Barings Plc and Another v Coopers & Lybrand (A Firm) and Others
| Jurisdiction | England & Wales |
| Judgment Date | 22 November 1996 |
| Date | 22 November 1996 |
| Court | Court of Appeal (Civil Division) |
Court of Appeal
Before Lord Justice Leggatt, Lord Justice Swinton Thomas and Lord Justice Mummery
Company - auditors of subsidiary - duty of care to parent company
Where a parent holding company claimed a direct relationship between it and the auditors of one of its overseas subsidiary companies, and specific facts were pleaded that a duty of care was owed by those auditors to the parent company, separate from any duty owed to the subsidiary as statutory auditors, that was a serious issue to be tried between the parties.
The circumstances showed the present was a proper case for service of proceedings out of the jurisdiction on the auditors.
The Court of Appeal so held in a reserved judgment dismissing the appeal of the fourth and fifth defendants, Khoo Kum Wing and S J Tan, against the dismissal by Mr Justice Chadwick (The Times August 13) of their applications to set aside service on them outside the jurisdiction of a writ issued by the plaintiffs, Barings plc, in administration, and Bishopscourt Ltd, in administration and provisional liquidation, formerly Barings Securities Ltd, and also issued against Coopers & Lybrand, Chaly Chee Kheong Mah and Po'ad Bin Shaik Abu Bakar Mattar, the first, second and third defendants. Leave to serve the writ out of the jurisdiction was granted by Master Barratt on January 23.
Mr Sydney Kentridge, QC and Mr Philip Sales for the fourth and fifth defendants; Mr Stanley Burnton, QC, Mr Rhodri Davies and Mr Richard Gillis for the plaintiffs; Mr Christopher Butcher for the second and third defendants; the first defendant was not represented.
LORD JUSTICE LEGGATT said that Barings, the English holding company of a group, was based in London and did not trade on its own account. The second plaintiff ("BSL"), an indirect subsidiary of Barings, although incorporated in the Cayman Islands, had its business based in London.
BSL and its subsidiaries conducted securities and futures trading. The plaintiffs had brought proceedings against their accountants, Coopers & Lybrand ("C&L"). The second and third defendants were Singaporean partners in Deloitte & Touche, the fourth and fifth defendants partners in Coopers & Lybrand Singapore ("C&LS"), a Singaporean firm associated with C&L.
Barings Futures Singapore Pte Ltd ("BFS"), an indirect subsidiary of BSL, and so of Barings, was incorporated in Singapore and traded...
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