The High Court has dismissed two IRHP mis-selling claims by claimant investors against various defendant banks for losses alleged to have been suffered as a result of fraudulent misrepresentation or a unlawful means conspiracy: Boyse (International) Limited v Natwest Markets Plc and The Royal Bank of Scotland Plc [2020] EWHC 1264 (Ch); and Elite Properties and Ors v BDO LLP [2020] EWHC 1937 (Comm).

These decisions will be of broader interest to financial institutions as they show that the courts are willing (in appropriate cases) to deal with opportunistic claims alleging fraud on a strike out or summary judgment basis. Traditionally, such cases have been less amenable to a strike out or summary determination.

The decisions confirm that cases involving fraud: (a) need to meet a high bar in order for their pleadings to be satisfactory; (b) may be struck out on the basis of limitation if there is a clear and compelling case that the claimants had the requisite knowledge to bring such claims prior to the expiry of the relevant limitation period; and (c) which attempt to run a collateral attack on previous court findings will be struck out for abuse of process.

Boyse (International) Limited v Natwest Markets Plc and The Royal Bank of Scotland Plc [2020] EWHC 1264 (Ch)


The claimant trust company entered into two interest rate hedging products (IRHPs) in August 2007 and November 2008 with the defendant banks (together, the Banks). In 2012, the IRHPs were deemed by the Financial Services Authority (as it was then) (FSA) to have been mis-sold. In 2014, the claimant was offered a redress payment by the Banks as part of its past business review compensation scheme (PBR), which it accepted. In 2015, the Banks rejected the claimant’s claim for consequential loss in their PBR.

The claimant subsequently brought a damages claim in 2019 against the Banks for: (a) fraudulent misrepresentation/breach of contract (for LIBOR manipulation) (the LIBOR Claim); and (b) negligent and fraudulent misrepresentation made in relation to the suitability of the IRHPs (the IRHP Misrepresentation Claim).

The Banks applied to strike out and/or obtain summary judgment on the claim, and the claimant cross-applied to amend its Particulars of Claim (POC).


The court granted the Banks summary judgment and struck out the claim in its entirety, and dismissed the claimant’s application for permission to amend its POC.

In reaching its decision, the court considered two issues:

  • whether to strike out or grant summary judgment on the claimant’s LIBOR Claim on the ground that it was time-barred; and
  • whether the undeveloped fraud part of the IRHP Misrepresentation Claim met the minimum pleading requirements for such a claim.

Issue 1: Was the LIBOR Claim time-barred?

The Claim Form was issued on 19 February 2019, which (the Banks argued) was more than six years after the claimant could with reasonable diligence have discovered the alleged fraud relating to LIBOR manipulation referred to in the FSA’s Final Notice (published on 6 February 2013), and related publicity.

The claimant argued that the LIBOR Claim was not time barred on the basis that:

  • The knowledge of Mr and Mrs Sharma (the two principals of the claimant) should not be attributed to the claimant for the purpose of s.32(1) of the Limitation Act 1980 (the Act), as they were not directors and the focus should be on the claimant’s knowledge. It was also suggested that the directors of the claimant could not reasonably have been expected to read, or read about, the Final Notice or to have known about the LIBOR scandal from reports in the press.
  • The 13 day gap between the date of the Final Notice and the date on which, six years later, the claimant’s Claim Form was issued, could be bridged by the need for the claimant to get expert advice on the published information to transform that information to relevant knowledge for the purpose of starting the clock under s.32 of the Act.

The court rejected both arguments and held that the claimant’s LIBOR Claim was time barred. It gave two key reasons for its decision:

  • It was impossible for the purposes of s.32(1) of the Act to treat Mr and Mrs Sharma as mere agents of the claimant and not attribute their knowledge to it. The claimant’s relationship with the Banks was formed and developed on the basis of Mr and Mrs Sharma’s dealings with them. Through those dealings, Mr and Mrs Sharma had been made aware of LIBOR and its purpose, they had dealt with the Banks in relation to the IRHPs and the alleged express LIBOR representation was made to Mrs Sharma. In the court’s view, there was no distinction between the knowledge of the directors of the claimant and Mr and Mrs Sharma.
  • Whilst accepting that for the purpose of time running that there had to be some appreciation of what the knowledge meant, the court stated that a person who has the relevant knowledge does not need to know how to plead express and implied representations which are later said to have been made dishonestly. The language in the Final Notice which addressed the FSA’s findings in relation to LIBOR was not technical and could have been understood by any person of reasonable sophistication. The claimant did not need to have developed its case or obtained advice before time started to run. The claimant’s LIBOR fraud case would have been apparent from the Final Notice and other findings. The claimant was aware that the IRHPs used LIBOR and that something had gone wrong from the widespread publicity given to the findings of the manipulation of LIBOR. In the court’s view, a “reasonably diligent person” in the claimant’s shoes would have been alert to the widespread publicity about LIBOR before 6 February 2013. The Final Notice was a trigger that started time running.

Issue 2: Was deceit in relation to the IRHP Misrepresentation Claim adequately pleaded?

In its draft POC, the claimant had included some limited references that hinted towards development of the deceit aspect of the IRHP Misrepresentation Claim. The Banks’ position was that this part of the claim was inadequately pleaded and did not meet the minimum requirements for a case on fraud.

The court agreed with the Banks: adequate particulars had not been given that the Banks knew the alleged IRHP suitability representation was false (and the claimant did not adequately identify the individuals at the Banks who it was alleged had such knowledge). The court noted the requirements of pleading a deceit case as set out in JSC Bank Moscow v Kekhman and others [2015] EWHC 3073 (Comm) and commented that in this case there was no distinct pleading of primary facts from which fraud could be inferred, nothing which “tilts the balance in the direction of fraud”, and no reason to believe that the claimant (given a further opportunity) could cure these defects.


The claimant has filed an appeal against the court’s findings.

Elite Properties and Ors v BDO LLP [2020] EWHC 1937 (Comm)


Two of the claimant companies entered into a number of IRHPs with a bank between 2006 and 2010. Subsequently, it was deemed that the bank had mis-sold those IRHPs and the relevant claimant companies became entitled to redress under a PBR agreed between the bank and the FSA in 2012. As part of the PBR, the bank agreed with the FSA an undertaking, that, absent exceptional circumstances, it would not foreclose on existing lending facilities without giving prior notice and issuing a final redress determination (the Undertaking). The bank also agreed with the FSA to appoint KPMG to the role of the “skilled person”, i.e. to act as an independent reviewer and oversee the PBR. Part of this role involved KPMG overseeing the bank’s compliance with the Undertaking; in practice, this entailed KPMG reviewing escalation requests from the bank and confirming whether “exceptional circumstances” existed which permitted the bank to foreclose on lending facilities, notwithstanding the mis-sale of the IRHPs.

In mid-2013, the bank wrote to two of the claimant companies stating that it had determined that both were unsophisticated customers for the purpose of the sale of the IRHPs and that under the PBR they were entitled to a redress payment (but the amount had yet to be determined and was not paid until late 2014). In late 2013, the bank submitted an escalation request seeking KPMG’s approval that “exceptional circumstances” existed that would permit the bank to appoint receivers over two of the claimant companies’ assets. KPMG allowed the bank to foreclose on the loan of one of the claimant companies, appointing BDO as receivers over various assets in September 2013.

The claimant companies subsequently brought a claim against BDO, alleging that they had sustained loss and damage due to an unlawful means conspiracy in which the bank and BDO conspired to mislead KPMG into allowing the bank to foreclose when in fact there were no exceptional circumstances justifying that course of action (the New Claim).

BDO applied to strike out or obtain summary judgment on the New Claim on the basis that:

  • it was an abuse of process in that it re-ran allegations which had been made by two of the claimant companies in a previous claim against the bank (see our previous blog post for further details on the background to this claim and the Court of Appeal’s decision) (the Original Claim);
  • it constituted a “collateral attack” on findings made by HHJ Waksman and the Court of Appeal in the Original Claim against the bank, which was an abuse of process; and
  • there were no reasonable grounds for bringing the claim or it had no reasonable prospect of success.


The court struck out the New Claim, holding that it was “quite clearly” (and indeed a “paradigm” case of) a collateral attack on the Court of Appeal’s findings and an abuse of process. It alleged the same conspiracy as in the Original Claim, where findings had been made that there was no reasonable prospect of the Original Claimants establishing that conspiracy.

The court highlighted that Hunter v Chief Constable of the West Midlands Police [1982] A.C. 529 underlined that it was an abuse of process to initiate:

proceedings in a court of justice for the purpose of mounting a collateral attack upon a final decision against the intending (claimant) which had been made by another court of competent jurisdiction in previous proceedings in which the intending (claimant) had full opportunity of contesting the decision in the court in which it was made.

Additionally, the court noted that  Panton & Anor v Vale of White Horse District Counsel & Anor [2020] EWHC 167 (Ch) emphasised that the fact a previous claim had been struck out, rather than having the issues decided at trial, was no bar to a second trial being struck out as an abuse of process.

Finally, the court found that the alleged new evidence, and further particulars on further unlawful acts relied upon in the New Claim did not establish the existence of a conspiracy between BDO and the bank to mislead KPMG into permitting the bank to foreclose.

Interestingly, the court also commented obiter that it would have granted reverse summary judgment on the New Claim, had it not struck it out, on the basis that the claim had no reasonable prospect of success.

John Corrie
John Corrie
+44 20 7466 2763
Nihar Lovell
Nihar Lovell
Senior Associate
+44 20 7466 2529
Nic Patmore
Nic Patmore
Senior Associate
+44 20 7466 2298