Standard Bank London Ltd v Apostolakis [QBD (Comm)]
| Jurisdiction | England & Wales |
| Judge | Longmore J |
| Judgment Date | 19 January 2000 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 19 January 2000 |
Queen's Bench Division (Commercial Court).
Longmore J.
Mark Hapgood QC (instructed by Gouldens) for the claimant.
Roger Bartlett (instructed by Langshaw Kyriacou) for the defendants.
The following cases were referred to in the judgment:
Continental Bank NA v Aeakos Compania Naviera SAWLR [1994] 1 WLR 588.
Benincasa v Dentalkit Srl (Case C–269/95) [1997] ECR I–3767.
Contract — Banking — Financial services — Consumer protection — Conflict of laws — Anti-suit injunction — Greek defendants entered foreign exchange margin trading agreement with bank and bank made currency trades thereunder — Bank closed out defendants” positions at a loss — Proceedings in Greece and England — Whether agreement and bank”s terms of business contained exclusive English jurisdiction clause — Whether defendants acted as consumers — Unfair Terms in Consumer Contracts Regulations 1994, 1999 — Civil Jurisdiction and Judgments Act 1982, Sch. 1 (Brussels Convention), art. 13.
These were preliminary issues in an application by a bank for summary judgment in relation to the closing out at a loss of certain forward foreign exchange transactions.
In 1997 the defendants, who were married and resident in Greece, entered into a foreign exchange agreement with the claimant bank, “SBL”, whereby they agreed that SBL would make forward purchases of ECUs on their behalf in exchange for drachmas. The defendants were respectively a civil engineer and a lawyer. The defendants signed SBL's “Terms and conditions for foreign exchange and precious metals margin trading” which contained a clause by which the customer submitted to the non-exclusive jurisdiction of the English courts and of any country where the customer had assets. The agreement incorporated SBL's “Terms of business”, which the defendants also signed, and which contained an exclusive English jurisdiction clause. The defendants made margin deposits amounting to $1.1m. In March 1998 the drachma was devalued and the bank unilaterally closed out the defendants' open positions and forfeited their margin deposits. The defendants issued Greek proceedings asserting that SBL's conduct was unlawful. SBL started English proceedings for an injunction to restrain the Greek proceedings. After Langley J directed the trial of preliminary issues, Longmore J had to decide whether there was an exclusive English jurisdiction clause and whether the defendants acted as consumers for the purposes of art. 13 of the Brussels Convention and the Unfair Terms in Consumer Contract Regulations 1994 and/or 1999.
Held, ruling accordingly:
1. The terms of the two documents signed by the defendants required them to be read together. There was no conflict between them. The general conditions provided for any claim or dispute to be tried in England. The foreign exchange agreement had a particular right for the bank to sue where the customer had assets and that was an extension of the bank's rights not a contradiction of them. There was therefore an exclusive English jurisdiction clause. Considering the clause in the foreign exchange agreement on its own, even if it was to be interpreted as an agreement by the customer to submit disputes not only where it was the defendant but also where it was the claimant, the submission was to a non-exclusive jurisdiction.
2. The contracts were consumer contracts within art. 13 of the convention and the 1994 and 1999 regulations. The definition of a consumer was substantially the same in the convention and regulations and was someone acting outside his trade, business or profession. In this case the foreign exchange agreement and the individual trading agreements made under it were entered into by the defendants outside their trade, business or profession. They were not engaged in the trade of foreign exchange contracts as such despite the size of the contracts. They were wealthy people disposing of income which they had available in the hope of making a profit.
Longmore J:
Mr and Mrs Apostolakis are a married couple living in Athens. He is a civil engineer. She is a lawyer. They are obviously a wealthy couple.
In August 1997 they entered into a foreign exchange agreement with Standard Bank London Ltd, the claimant in this action, whereby they agreed that the bank would make forward purchases of ECUs on their behalf in exchange for drachmas. On 15 September 1997 they were required to, and did, make a margin deposit of US$500,000. On 31 October 1997 they were required to, and did, make a further margin deposit of US$600,000.
By Friday, 13 March 1998 Mr and Mrs Apostolakis had entered into 28 transactions with the bank of which 16 had been closed by reverse transactions but 12 remained open. On that day the drachma was devalued and the next working day (Monday, 16 March) the bank, it is said...
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