Bank Securities. The claimant bank's claim against the defendants for sums due under financing agreements and a guarantee was allowed, along with its claim for a possession order in respect of two properties. Among other things, the Chancery Division held that, the first defendant's claim that the bank was estopped from enforcing its security before he had had the opportunity to conduct a sale of assets to reduce the debt to the bank, had failed at the first hurdle.
Practice Summary judgment. Summary judgment had to be granted to the defendant bank in respect of the claimants' negligence action against it, seeking damages arising out of the mis-selling of various interest rate hedging products in 2002 and 2004. The Mercantile Court held that the claimants had had the requisite knowledge of the material facts about the damage in respect of which damages were claimed before 29 June 2012, such that the claim was statute barred.
Co-Operative Bank plc v Hayes Freehold Ltd (in liquidation) and others; Deutsche Bank AG v Sentrum (Hayes) Ltd (in liquidation) and another
Bank Guarantee. Deutsche Bank AG brought a Pt 20 claim against Sentrum (Hayes) Ltd and Sentrum Holdings Ltd, concerning the purported surrender of leases granted in respect of a property. Deutsche Bank had been granted the headlease of the property. It later sub-let the property to Sentrum Hayes, by way of an underlease. Sentrum Holdings was the guarantor under the underlease. The parties entered into a deed to release them from their respective obligations under the leases. However, due to the existence of a charge in favour of another bank, and the absence of that bank's consent, the surrender of the headlease was not effective and Deutsche Bank was not released from its liability to pay the head-rent. The Chancery Division, in dismissing Deutsche Bank's claim, held that it had not been an implied condition precedent to the release of Sentrum Holdings' guarantee that the surrender of the headlease would be effective. It further held that the surrender of the underlease had been effective and that Deutsche Bank was not entitled to rescind the deed on the ground of implicit fraudulent misrepresentation, which had not been established on the facts. Further, the court held that the deed was not void on the alleged grounds of unilateral or common mistake.
Insolvency Administration. The Companies Court granted the administrators of 18 Nortel group companies orders giving directions to the administrators to inform potential claimants that any expense claims, which had not yet been made, had to be notified to the administratorson a demand form on, or before, a specified date. The court also granted an order authorising the administrators to distribute the assets of two of the companies in the group to their unsecured creditors directly, rather than by promoting a company voluntary arrangement for that purpose. The court held that it had jurisdiction to make the orders sought and that they properly balanced the need to protect the interests of persons who might have expense claims, which had yet to be asserted, against the need to minimise any further delay to the conclusion of the administrations, and to facilitate the distribution of the companies' assets to their unsecured creditors.
*The Joint Administrators of LB Holdings Intermediate 2 Ltd v The Joint Administrators of Lehman Brothers International (Europe) and others; The Joint Administrators of Lehman Brothers Ltd v Lehman Brothers International (Europe) (in administration) and others; Lehman Brothers Holdings Inc v The Joint Administrators of Lehman Brothers International (Europe) and others
Insolvency issues decided arising out of collapse of Lehman Brothers group of companies . The Supreme Court decided a number of points of insolvency law, which arose out of the collapse of the Lehman Brothers group of companies in 2008, including that, both statutory interest and non-provable liabilities ranked over subordinated debt in the distribution priorities of an insolvency.
*Gard Marine and Energy Ltd v China National Chartering Co Ltd and another; China National Chartering Co Ltd v Gard Marine and Energy Ltd and another; Daiichi Chuo Kisen Kaisha v Gard Marine and Energy Ltd and another
Shipping Charterparty. The appeal concerned the action by the claimant hull insurers against the charterers of a vessel for recovery of the value of the vessel which had been wrecked in a port during a severe storm. The Court of Appeal, Civil Division, allowed the charterer's appeal against the judge's decision that the casualty had been caused by the unsafety of the port in breach of a warranty in the demise charterparty. The Court of Appeal held that in the light of relevant caselaw, the casualty had been caused by an 'abnormal occurrence' with the result that no breach of the safe port warranty had occurred.The Supreme Court upheld the Court of Appeal's decision and dismissed the claimant's appeal.
Conflict of laws Jurisdiction. The Court of Appeal, Civil Division, dismissed the claimants' appeal against the judge's decision, dismissing their claims for unlawful means conspiracy against the fourth defendant Icelandic bank. There was no implied restriction in of the European Parliament and Council upon the application of the law of the home member state wherever it would have a jurisdictional effect and the effect of Icelandic bankruptcy law was that, when used with effect outside Iceland, no civil proceedings could be brought in any court, inside or outside Iceland, against a credit institution in liquidation.
Practice Striking out. The Commercial Court allowed the defendant bank's application to strike out a number of paragraphs in particulars of claim brought by the claimant company in liquidation. The paragraphs in issue did not have sufficient relevance to the allegations of negligent misstatement made in the claim.
Conflict of laws Jurisdiction. The Supreme Court dismissed the appellant company's appeal against a decision that the English courts did not have jurisdiction to hear its claim against the respondent company for damages and injunctive relief for the tort of inducing breach of contract of an exclusive jurisdiction and applicable law clauses. For the purposes of art5.3 of Council Regulation(EC) 44-2001, which gave jurisdiction in tort claims to the courts for the place in which the harmful event had occurred or might occur, the place where the harmful event had occurred had been Germany.
Shipping Bills of lading. The Mercantile Court, in allowing the appeal of the defendant carriers in part, considered the scope and operation of the Hague Rules (the Rules). The court held that, among other things, once the carrier had shown a prima facie case for the application of the exception of inherent vice in art IV r 2(m) of the Rules, the burden had then shifted to the cargo claimant to establish negligence on the part of the carrier, such as would negative the operation of the exception in the bill of lading for loss occasioned by perils of the sea.