Suremime Ltd v Barclays Bank Plc

On an application to amend, a proposed new claim should proceed only if it has a real prospect of success, unless there is a compelling reason for the issue to be tried. A contractual claim cannot ordinarily be founded on participation in a review where the defendant was already obliged to conduct that review, because the necessary consideration is absent. A proposed duty of care may nevertheless be sufficiently arguable where the factual and legal matrix is incomplete, public-law remedies remain uncertain, and the review may otherwise leave customers without an effective remedy. The existence of alternative public-law or mis-selling remedies does not automatically bar a private-law claim.

Suremime had entered into an interest-rate swap with Barclays. Following the FCA Review of interest-rate hedging products, Barclays invited Suremime to participate in a fact-finding process and later made an offer of redress. Suremime challenged the basis on which the offer had been calculated.

Suremime sought permission to delete its claim under section 1 of the Contracts (Rights of Third Parties) Act 1999 and to add claims based on an implied contract, a tortious duty of care, and principles derived from White v Jones. Barclays argued that the proposed claims had no real prospect of success. The central issue was whether the amendments crossed the applicable arguability threshold.

1. Disposition. Permission to amend was refused in relation to the proposed contractual claim but granted in relation to the proposed tort claims.
2. The applicable threshold was whether the new claim had a real prospect of success, as on strike-out or summary judgment. The court should hesitate before finally disposing of an issue without a trial where fuller factual investigation might alter the evidence or outcome. The fact that the proposed issues involved matters of public importance supplied a further compelling reason for trial.
3. The contractual claim was unsustainable. Barclays had undertaken to include Suremime’s swap in the review whether or not Suremime participated in the fact find. Suremime’s participation therefore provided no consideration for a promise to conduct the review in accordance with the agreements between Barclays and the FSA. The exchanges established, at most, that information supplied by Suremime would be taken into account.
4. The tort claims were different. Whether a duty of care should arise depended on a broader factual and legal matrix which had not yet been fully investigated. The possible availability of public-law remedies was not necessarily a bar, particularly while the availability of judicial review remained undecided. Nor was the existing mis-selling claim a complete answer, since the review was intended to provide fair and reasonable compensation without requiring customers to litigate the original sale.
5. The court considered that the reasoning in White v Jones might have potential application. The FCA might suffer no loss from defective implementation of the review, while the customer could bear the loss. The possible statutory remedy for individuals under section 138D of the Financial Services and Markets Act 2000 also supported argument that corporate customers should not necessarily be left without any private-law remedy where the review applied the same standards to both groups. No final duty was determined; the tort claims were permitted to proceed to trial.