Legal and Financial Risk Newsletter - January 2018

Legal and Financial Risk newsletter on legal developments impacting corporates and financial institutions. The January 2018 edition includes articles on recent court decisions and case reports.

Ghosh is gone


In the recent case of Ivey v Genting Casinos (UK) Ltd t/a Crockfords [2017] UKSC 67 the Supreme Court declared that the current test for dishonesty in criminal proceedings should no longer be used when directing juries on the law in criminal cases. The Ghosh test, which has represented established law for over thirty years, is gone. Click here to read more.


Rights of unnamed third parties - implication or process of construction?


In Chudley and others v Clydesdale Bank plc (2017) the Commercial Court provided some rare guidance on the application of the Contracts (Rights of Third Parties) Act 1999 in a banking context. In a move away from the Court of Appeal decision in Avraamides v Colwill (2006) the Judge drew a distinction between "implied identification" and "construction", and found that a class of unnamed beneficiaries could be expressly identified by a process of construction of the relevant terms of an agreement. Click here to read more.


Supreme Court considers the basic test for damages


In Tiuta International Limited (in liquidation) v De Villiers Surveyors Limited the Supreme Court recently considered the relationship between Tiuta International (Tiuta), a lender of short-term business finance, and its advisor De Villiers, a surveyor, and considered the basic comparison test for damages. Click here to read more.


Supreme Court takes debt order by the horns


In Taurus Petroleum Limited v State Oil Marketing Company of the Ministry of Oil, Republic of Iraq [2017] UKSC 64, the Supreme Court considered the situs of a debt under a letter of credit, and clarified the circumstances in which third party debt orders are available. Click here to read more.


Complying with SPA notice provisions: united we stand, divided we fall


A recent High Court decision (Zayo Group International Ltd v Ainger and others [2017] EWHC 2542 (Comm)) has delivered a pertinent reminder of the importance of complying with the strict terms of notice provisions in a sale and purchase agreement, both in terms of the contents of those notices and how they are served, and of giving careful consideration to the effects of limitations of liability in a sale and purchase agreement. Click here to read more.


No duty owed by a lender to advise on leading limits


In Deslauriers v Guardian Asset Management (2017) the Privy Council dismissed an appeal alleging that a lender was contractually obliged to provide extra funding to a borrower or owed that borrower a duty of care such that it was required to advise it on the lender's applicable lending limits. The Board of the Judicial Committee of the Privy Council (the "Board") considered that no statements or promises had been made that could lead to contractual liability or misrepresentation and suggested that in situations involving commercial parties dealing at arm's length, it would be extremely unusual for a duty of care to exist requiring a lender to disclose its internal lending policies. Click here to read more.


It's a matter of interpretation


In Kason Kek-Gardner Ltd v Process Components Ltd (2017), the Court of Appeal considered questions of contractual interpretation and implied terms, demonstrating the difficulties parties can face when seeking to rely on arguments of commercial common sense or business efficacy in support of their preferred interpretation. Click here to read more.

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