Banque Keyser Ullmann SA v Skandia (UK) Insurance Company Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE O'CONNOR,LORD JUSTICE PARKER,SIR GEORGE WALLER |
| Judgment Date | 27 January 1986 |
| Judgment citation (vLex) | [1986] EWCA Civ J0127-11 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 86/0072 |
| Date | 27 January 1986 |
and
and
(Sued on Their Own Behalf and on Behalf of Other Company Underwriters Interested In a Contingency Guarantee Policy No. 205440)
and
(Suing on Their Own Behalf and on Behalf of Other Company Underwriters Interested In a Contingency Guarantee Policy No. 204627)
and
and
and
and
and
and
and
and
(Sued on Their Own Behalf and on Behalf of Other Company Underwriters Interested In Policy No. 400471)
and
(Sued on Their Own Behalf and on Behalf of Other Company Underwriters Interested In Policy No. 400531)
and
and
and
and
(Formerly Hodge General & Mercantile Insurance Company Limited)
[1986] EWCA Civ J0127-11
Lord Justice O'connor
Lord Justice Parker
Sir George Waller
86/0072
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
MR C. D. LINDSAY and MR C. A. CORY-WRIGHT, instructed by Messrs Herbert Smith & Co., appeared for Skandia (UK) Insurance Company Limited, Ennia Insurance Company (UK) Limited, The Prudential Assurance Company Limited and Westgate Insurance Company Limited.
MR J. C. GRIFFITHS, Q.C., and MR HODGE MALIK, instructed by Messrs Hopkins & Wood, appeared for Banque Keyser Ullman S.A., Slavenburgs' Banque (Suisse) S.A., Chemical Bank, American Fletcher Bank (Suisse) S.A., Banque Arabe Et Internationale D'Investissements and Arbuthnot Latham & Company Limited.
I will ask Lord Justice Parker to give the first judgment.
There are before the court four appeals from a judgment of Mr Justice Staughton given on 2nd July 1985. There are four appeals because there are four actions, but each appeal raises the same points. The appeal in each case is from only one part of the judgment. Although the pleadings in the action fully occupy no less than five large files, although we have been provided with a further five files for the purposes of this appeal, and although Mr Justice Staughton was provided with a further eighteen such files, the facts which it is necessary to state for present purposes fall within a very narrow compass.
In 1981 and early 1982 four companies wished to borrow large sums of money from banks. The total desired to be borrowed was some eighty million Swiss francs. Agreements for such loans were made with a number of banks. The loan agreements provided for the borrowers to lodge with the banks gemstones accompanied by professional valuations showing, in each case, that the value of the stones lodged was more than twice the amount of the loan. The agreements also provided for insurance policies to be taken out to cover the banks against failure of the borrowers to repay.
The loans were duly made, gemstones accompanied by valuations purporting to show the required values were deposited, and the insurance policies were obtained. In the case of three of the borrowers, the policies were issued to them and assigned by them to the banks. In the fourth case, the policy was issued directly to the bank. The loans were not repaid. The failure has led to the four actions being launched in the High Court in this country. In two of them the banks seek to recover against the insurers under the policies for their losses. In the other two, the insurers have taken the initiative and seek to establish that they are not liable under the policies.
In essence, the basis upon which the insurers contend that they are not liable is that the policies in each case were obtained by the fraud of the borrowers or their associates or both. In particular, it is alleged that to the knowledge of the borrowers, the valuations which were lodged were grossly excessive. No allegation of fraud is however made against the banks, and it is accepted for the purposes of these appeals that the banks were innocent of any fraud, and were indeed victims of the fraud. Discovery has taken place, and although it is not complete, the banks have already claimed legal professional privilege in the usual terms, namely for correspondence and other documents passing between the banks and their lawyers, both for the purposes of obtaining legal advice and in contemplation of proceedings.
Prima facie, that is a good claim to privilege, but the insurers have sought unsuccessfully before Mr Justice Staughton and now seek before us to establish that it is not available to the banks by reason of the fraud of the borrowers. The attack on the privilege is of course not directed to documents coming into existence in contemplation of the present proceedings or coming into existence in the course of...
To continue reading
Request your trial
-
Karam Salah Al Din Awni Al Sadeq v Dechert LLP
...the lawyer or on the lawyer's having knowledge of the iniquity. In Banque Keyser Ullman SA v Skandia (UK) Insurance Company Limited [1986] 1 Lloyd's Rep 336, at 337 Parker LJ said: “… legal professional privilege does not arise in respect of documents which are in themselves part of a crim......
-
Sweeney v Duggan
... ... C.F. Green and Company Ltd. [1975] Q.B. 582; [1975] 2 W.L.R. 773; ... 492. Banque Keyser Ullman S.A. v. Skandia (U.K.) Insurance ... recent English cases, Banque Keyser Ullmann S.A. v. Skandia (U.K.) Insurance Co. Ltd. [1989] ... ...
- Nyckeln Finance Company Ltd v Stumpbrook Continuation Ltd
-
The Owners and/or Demise Charterers of the Dredger “Kamal XXVI” and the Barge “Kamal XXIV” v The Owners of the Ship “Ariela”
...regard. 29 Mr MacDonald Eggers bolts on to this submission reliance upon an earlier Court of Appeal decision in Banque Keyser Ullmannn SA v Skandia (UK) Insurance Co Ltd [1986] 1 Lloyd's Rep 336. This was a case where a fraudulent borrower defrauded a number of banks. The banks, who were th......
-
Consequential Responsibility for Client Wrongs: Lehman Brothers and the Regulation of the Legal Profession
...Halbsury’s Laws of England, Ch 14 para 569.147 See, for example, RvCox & Railton (1884) 14 QBD 153.148 Banque Keyser Ullman vSkandia [1986] 1 Lloyds Rep 336.David Kershaw and Richard Moorhead© 2013 TheAuthors. The Modern Law Review © 2013The Modern Law Review Limited. 53(2013) 76(1) MLR sup......