The following Banking & Finance guidance note Produced in partnership with Chris Webber of Squire Patton Boggs provides comprehensive and up to date legal information covering:
The nature, main types and main uses of financial derivatives are summarised in Practice Notes: The nature of financial derivatives and Types of derivatives. Derivative contracts frequently give rise to disputes between the parties that enter into them. This Practice Note discusses:
the common categories of disputes that arise from derivative contracts
relevant case law relating to those categories
tips for practitioners when drafting derivative contracts on avoiding future disputes, and
modes of dispute resolution available for resolving derivatives contract disputes
Derivatives can give rise to a range of disputes. In common with any scenario in which parties negotiate, enter into and perform (or fail to perform) a contract, claims may arise, for example:
for negligent misstatement, deceit or breach of section 2 of the Misrepresentation Act 1967 (MA 1967) in relation to false or misleading statements made prior to entry into the contract (for more information, see: Misrepresentation, misstatement and other claims in banking and finance—overview)
for breach of contract in relation to any failure by either party to comply with its obligations under the derivative contract (for more information, see Dispute Resolution Overview: Terminating contracts—how and when a contract ends—overview.
other contract law-based claims alleging frustration, mistake, duress, undue influence, incapacity, non est factum, absence of offer and acceptance, absence of consideration, illegality
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