Rely on the most comprehensive, up-to-date legal content designed and curated by lawyers for lawyers
Work faster and smarter to improve your drafting productivity without increasing risk
Accelerate the creation and use of high quality and trusted legal documents and forms
Streamline how you manage your legal business with proven tools and processes
Manage risk and compliance in your organisation to reduce your risk profile
Stay up to date and informed with insights from our trusted experts, news and information sources
Access the best content in the industry, effortlessly — confident that your news is trustworthy and up to date.
Find up-to-date guidance on points of law and then easily pull up sources to support your advice with Lexis PSL
Check out our straightforward definitions of common legal terms.
Our trusted tax intelligence solutions, highly-regarded exam training and education materials help guide and tutor Tax professionals
Access our unrivalled global news content, business information and analytics solutions
Insurance, risk and compliance intelligence using big data, proprietary linking and advanced analytics.
A leading provider of software platforms for professional services firms
In-depth analysis, commentary and practical information to help you protect your business
LexisNexis Blogs shed light on topics affecting the legal profession and the issues you're facing
Legal professionals trust us to help navigate change. Find out how we help ensure they exceed expectations
Lex Chat is a LexisNexis current affairs podcast sharing insights on topics for the legal profession
Discuss the latest legal developments, ask questions, and share best practice with other LexisPSL subscribers
What were the key issues raised in Hockin and others v Royal Bank of Scotland and another, in which the Chancery Division heard an application to strike-out key parts of a claim relating to allegations of LIBOR manipulation and the mis-selling of swaps made against the Royal Bank of Scotland?
Hockin and others v Royal Bank of Scotland and another  EWHC 925 (Ch)
The claimants in this case were Mr and Mrs Hockin, who are in the process of bringing substantial claims alleging mis-selling of interest rate products and interest rate fixing against the Royal Bank of Scotland and National Westminster Bank (the Banks). The claimants were the ultimate owners of a company called London & West Country Estates (LWE), which is now in administration, and LWE's claims against the Banks were assigned to the claimants in March 2014 pursuant to a deed of assignment. LWE owned and managed a number of commercial business parks in Somerset and Devon. In 2008, it borrowed a £55m loan facility from the Banks, which it was required to repay over three years with interest referable to LIBOR (the 2008 Facility). It was a precondition of the 2008 Facility that the borrower hedge its interest exposure and as a result the parties also agreed a ten-year bank callable interest rate swap (the Swap). In or around October 2009, LWE was placed into the Bank’s global restructuring group (GRG). After a period, the 2008 Facility was assigned to a company referred to as Isobel, a joint venture owned by the Banks and the Blackstone private equity group, at a significant discount, despite what were alleged to have been substantial offers made by LWE to refinance the 2008 Facility. This was as part of the high-profile 'Project Isobel', a £1.36bn property loan portfolio sale which was completed in 2011. Isobel subsequently placed LWE into administration.
The case at hand consists of an attempt by the Banks to strike out key parts of the claimants' particulars of claim, along with an application from the claimants to amend the particulars it has submitted. We discuss these applications and the court's judgments on them below. However, the facts of the larger claim, to be heard in January 2017, are of interest to banking and finance lawyers as they concern allegations of LIBOR-fixing and the mis-selling of financial instruments and relate to a large portfolio disposal by the Banks following the 2008 financial crisis.
The main claim was transferred to the Financial List in February 2016. The claimants have advanced the following four heads of claim:
In this case, the Banks' application to strike out the GRG Claim was based on the following arguments:
However, the claimants' application to amend the particulars of claim were largely successful. The claimants sought to add, among other things, a claim of unlawful means conspiracy and further allegations of deceit or negligent misrepresentation on the part of the Banks, in defence of which the Banks submitted that the proposed amendments rendered the pleading 'prolix, unclear and lacking in particularity'. In particular, an alleged breach of the implied term of good faith, the conspiracy claim and the further particulars of alleged falsity of the LIBOR representations made unacceptably vague and un-particularised allegations of bad faith, dishonesty and fraud. Further, they submitted that the proposed amendments violated the principle in Tchenguiz and others v Grant Thornton LLP and others  EWHC 1864 (Comm),  All ER (D) 36 (Jul) that statements of case should be concise and should contain only material facts necessary for the purposes of formulating a cause of action and not background facts or evidence, and certainly not argument reasons or rhetoric.
The court concluded there were no reasonable grounds for it to intervene—on the evidence presented, the LIBOR claims were arguable, and there was no question of the pleading containing rhetoric or other irrelevant and unhelpful information. The court did however amend the particulars of the claim (as requested by the Banks) so that the conspiracy claim should refer only to the named individuals at the Banks who had been employed by it at the time and for whom it could be held vicariously liable.
This initial hearing does not contain any significant legal developments for banking and finance lawyers as it was largely decided on its facts. However, the case as a whole is of interest because of its facts and the parties involved—it involves allegations of mis-selling of interest rate swaps and LIBOR manipulation on the part of the Banks, as well as being relevant to the high-profile 'Project Isobel', a £1.36bn property loan portfolio sale. A number of UK retail banks have sought to dispose of non-performing loans on a portfolio basis in the aftermath of the financial crisis and this case illustrates some of the types of claims that can result from disgruntled borrowers and investors.
The main claim also has a potentially significant value and has garnered some press attention, with the claimants' lawyers alleging that this claim represents the tip of 'an iceberg' of similar cases relating to LIBOR manipulation, and estimating the value of the claim at £33m. Banking and finance lawyers will watch the further developments in this case, and in particular the full trial in January 2017, with interest.
Kate Edwards, solicitor in the LexisPSL Banking & Finance team.
First published on LexisPSL Banking & Finance. Click here for a free trial.
Free trials are only available to individuals based in the UK
* denotes a required field
0330 161 1234