Camerata Property Inc v Credit Suisse Securities (Europe) Ltd

Summary judgment is appropriate where a claim has no realistic prospect of success, but the court must avoid conducting a mini-trial. A claim may proceed where success is unlikely but a properly arguable factual distinction could affect the result. Findings in earlier proceedings may create an issue estoppel where the finding was an essential step in the earlier decision. The estoppel may determine the factual framework for a later claim without necessarily disposing of that claim. Where suitability depends on comparing the risk of different investments, a prior decision concerning one investment does not automatically determine claims concerning others if their risk levels may materially differ.

Camerata brought claims against Credit Suisse concerning three structured notes purchased in 2007 and 2008. It alleged mis-selling, negligent misstatement, lack of authority for part of the Multi-Index Note purchase, and negligent management of its investment portfolio.

The defendant applied for summary judgment under CPR Part 24. It relied on findings made in earlier proceedings between the parties concerning a Lehman note, including findings about Mr Ventouris’s attitude to risk. The central issues were whether those findings created an issue estoppel and whether the pleaded claims nevertheless had a realistic prospect of success.

1. Application dismissed. Credit Suisse failed to establish that the claims had no realistic prospect of success.
2. The court adopted the established Part 24 approach. A realistic claim carries some degree of conviction and is more than merely arguable. The court must not conduct a mini-trial, but it may analyse factual assertions and decide a short point of law or construction where the necessary material is available. It must also consider evidence reasonably expected to be available at trial.
3. The finding in the earlier proceedings that Mr Ventouris’s attitude to risk extended to 2007 was an essential step in the reasoning of Flaux J. It therefore created an issue estoppel binding Camerata. Camerata could not contend that the earlier findings were confined to 2008. The court did not need to decide the alternative abuse-of-process argument.
4. The estoppel did not automatically dispose of the mis-selling claims. The relevant question was whether the risk of each of the three notes exceeded the risk which Mr Ventouris was prepared to accept. The risk associated with the three notes had not previously been investigated. Evidence that Credit Suisse regarded them as riskier than the Lehman note could, if accepted, support the pleaded case. The claim was unlikely to succeed but had a realistic prospect.
5. The negligent-misstatement, lack-of-authority and negligent-management claims also survived summary judgment. Each was weak or faced evidential difficulties, but the existing material did not show that it had no realistic prospect of success.

The summary judgment application was dismissed in its entirety.