Promontoria (henrico) Limited Against James Friel
| Jurisdiction | Scotland |
| Judge | Lord Ericht |
| Neutral Citation | [2019] CSOH 2 |
| Date | 08 January 2019 |
| Docket Number | CA105/16 |
| Court | Court of Session |
| Published date | 08 January 2019 |
OUTER HOUSE, COURT OF SESSION
[2019] CSOH 2
CA105/16
OPINION OF LORD ERICHT
In the cause
PROMONTORIA (HENRICO) LTD
Pursuer
against
JAMES FRIEL
Defender
Pursuer: Dunlop QC, Welsh; Addleshaw Goddard
Defender: Ferguson QC; Pinsent Masons LLP
8 January 2019
Introduction
[1] The defender was a director and shareholder of Glen TV Rentals Ltd (the
“Company”). The Company’s bankers were Clydesdale Bank Plc (the “Bank”). The Bank
subsequently sought to transfer part of their loan book, including the lending to the
Company, to the pursuer. The pursuer now seeks payment under a personal guarantee
which the pursuer says was granted by the defender in favour of the Bank on 28 November
2008. The pursuer sought to prove the tenor of the guarantee and sought the sum
of £800,000 under the guarantee.
2
[2] The defender opposed the proving of the tenor and also defended the action on a
number of technical grounds, submitting:
(a) The copy of the assignation produced to the court purporting to transfer the
loan book by the Bank to the pursuer had not been proved in accordance with
the laws of evidence and accordingly the pursuer had failed to prove its title
to sue;
(b) On a proper construction of the terms of the assignation, the lending to the
Company had not been assigned by the Bank to the pursuer and so the
pursuer had no title to sue;
(c) The pursuer had failed to rebut the presumption against delegation;
(d) Esto the defender was liable under the guarantee, the pursuer had not proved
that £800,000 was due.
The pursuer’s response was that the defender’s position was a highly technical one, resting
on putting the pursuer to strict proof of its claim, but that the pursuer had proved its case on
the balance of probabilities.
Background
[3] The background to the dispute was largely agreed in the joint minute and was
otherwise uncontroversial.
[4] As at November 2008, the defender and his daughter Miss June Friel were directors
and shareholders of the Company. The defender is now the sole director and shareholder of
the Company.
[5] The Bank entered into facility agreements with the Company in and after 2007.
3
[6] The first such facility agreement was for a Tailored Business Loan and was dated 23
March 2007 (‘the 2007 Facility Agreement’).
[7] Clause 14.2 of the Terms and Conditions of the Tailored Business Loan provides:
“14.2 Our rights and obligations
(a) We may assign or otherwise transfer any of our rights and/or
obligations under the Finance Documents to any person.”
[8] Clause 17.4 of the Terms and Conditions of the Tailored Business Loan provides:
“Certificates
Any certificate or determination by us of a rate or amount under a Loan Document
is, in the absence of manifest error, conclusive of the matters to which it relates.”
[9] The second such facility agreement the Bank entered into with the Company was for
overdraft facilities and was dated 29 July 2011 (‘the 2011 Facility Agreement’), and renewed
on 30 March 2012.
[10] Clause 4.2 of the Schedule to the 2011 Facility Agreement provided:
“All notifications, determinations and calculations given or made by the Bank under
this letter will be conclusive and binding except in any case of manifest error.”
[11] Clause 6 of the Schedule to the 2011 Facility Agreement provided:
“6 Transfer and Disclosure
6.1 The Borrower may not assign, transfer or otherwise deal with any of its rights
or obligations in respect of this letter or the Loan or any other Relevant Document.
6.2 The Bank may (l ) assign any of its rights or benefits and/or (2) transfer by
novation any of its obligations, under this letter or any other Relevant Document to
another bank or financial institution or to a trust, fund or other entity which is
regularly engaged in or established for the purpose of making, purchasing or
investing ln loans, securities and other financial assets or to any other person or
persons and/or (3) otherwise deal with its rights, benefits and/or obligations under
this letter or any other Relevant Document, in whole or in part.”
To continue reading
Request your trial