Khatri v Co-Operative Centrale Raiffeisen-Boerenleenbank BA

Summary judgment is appropriate only where the defendant has no realistic prospect of successfully defending the claim and there is no other compelling reason for a trial. A realistic prospect is more than merely arguable, but the court must avoid conducting a mini-trial. It may analyse factual assertions, particularly where contemporaneous documents contradict them, and must consider evidence reasonably expected to be available at trial. Contractual construction may justify refusing summary judgment where the defendant’s interpretation has considerable force. Contractual variation and acceptance issues are generally unsuitable for summary determination where acceptance depends materially on disputed conduct and surrounding facts.

The claimant, a derivatives trader employed by the defendant bank, claimed approximately €1.6 million under a performance-related bonus provision relating to 2008. He sought summary judgment, contending that the contractual formula bonus was payable and had not been validly removed.

The defendant argued that the contract permitted removal of the formula-linked arrangement at any time and that the claimant had accepted a varied contract by continuing to work in a redeployed role. The central issues were the construction of the bonus provision and whether any contractual variation had been accepted.

1. Application dismissed. The defendant had a real prospect of successfully defending the claim, and the court declined to determine the dispute summarily.
2. Under Civil Procedure Rules 1998, Part 24, summary judgment requires both that the defendant has no real prospect of successfully defending the claim and that there is no other compelling reason for a trial.
3. The court adopted the established principles summarised in Nigeria v Santolina Investment Corporation [2007] EWHC 437. The prospect must be realistic rather than fanciful and carry some degree of conviction. The court must not conduct a mini-trial, although it need not accept unsupported factual assertions without analysis. It must consider evidence available on the application and evidence reasonably expected at trial.
4. The defendant’s construction that the contractual right to review or remove the performance-related bonus “at any time” included 2008 had considerable force. That interpretation gave the defendant a realistic prospect of defeating the claim. The construction issue alone therefore required refusal of summary judgment.
5. The court also considered the variation issue. Whether the claimant accepted the proposed variation by continuing to work, receive salary and benefits, and operate in the redeployed role depended heavily on the parties’ conduct between July and October 2008. It was a fact-sensitive issue unsuitable for final determination on a summary judgment application.
6. The procedure is essentially directed to cases unfit for trial at all, as explained in Three Rivers District Council v Governor and Company of the Bank of England (No 3) [2003] 2 AC 1 at 261.