Investors Compensation Scheme Ltd v West Bromwich Building Society
| Pages | 373-375 |
| DOI | https://doi.org/10.1108/eb024950 |
| Published date | 01 April 1997 |
| Date | 01 April 1997 |
| Author | Goff, Lloyd, Hoffman, Hope, Clyde,Joanna Gray |
| Subject Matter | Accounting & finance |
Journal of Financial Regulation and Compliance Volume 5 Number 4
Investors compensation scheme wins appeal
to House
of
Lords
on
validity
of
claim
assignment form
Investors Compensation Scheme Ltd
v
West
Bromwich Building Society
House
of
Lords: Lord Goff, Lord Lloyd, Lord Hoffman, Lord Hope, Lord
Clyde
Date
of
Judgment: 19th June, 1997
Reported
at:
Times
Law
Reports, 24th June, 1997
FACTS
These are
set out in the
earlier comment
on
this case when
it
arose
at
first instance
and
was considered
in
Vol.
5, No.
1, Journal
of
Financial Regulation
and
Compliance,
p. 78.
The investors concerned
in
this appeal
had
suffered losses through investment
in
Home Income Plans arranged
by an
inde-
pendent financial adviser
(IFA) and the
West Bromwich Building Society
(WBBS).
The IFA was in
default
and so
the Investors Compensation Scheme
(ICS)
had paid
the
investors compensation
as a
result
thereof.
Lord Lloyd explained the situation thus:
'The particular background
to the
present appeals
are
proceedings brought
by
two
groups
of
investors against
WBBS
for
damages
for
negligence
at
common
law and
under
s.2(l)
of the
Misrepresentation
Act 1967.
They also
claim rescission
of
their mortgages
on
the ground
of
misrepresentation
and
undue influence, equitable compensation,
damages
in
lieu
of
rescission under s.2(2)
of
the Act of
1967,
and a
variety
of
other remedies. Some
of
these remedies
overlap.
The
ICS
have also commenced
proceedings against WBBS
in
which
they claim
as
assignees
of the
investors'
rights against WBBS. They assert that
all
the
investors' claims against WBBS
have been validly assigned
to ICS,
with
the
exception
of the
investors'
claim
for
rescission.
It
follows that
there
are
competing claims against
WBBS
for the
same damages,
by the
investors
on the one
hand
and ICS on
the other.
The
resolution
of the
issue
which thus arises indirectly between
ICS
and the
investors depends
on the
true construction
of the
claim form,
and
in
particular
on the
scope
of the
provisions relating
to the
assignment
of
the investors' rights against third
parties'.
So,
the
appeal concerned
the
true construc-
tion
of
the ICS claim form which purport-
edly assigned individual investors' claims
against regulated investment businesses
and
third party claims
to the
ICS.
Journal
of
Financial Regulation
and Compliance, Vol.
5,
No.
4,
1997,
pp. 373-375
© Henry Stewart Publications,
1358-1988
Page 373
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