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England and Wales Court of Appeal (Civil Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Bank Leumi (UK) Plc v Akrill [2014] EWCA Civ 907 (17 July 2014) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2014/907.html Cite as: [2014] EWCA Civ 907 |
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ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
His Honour Judge Jarman QC
HC13CO1238
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE McFARLANE
and
LORD JUSTICE KITCHIN
____________________
Bank Leumi (UK) plc |
Claimant/ Respondent |
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- and - |
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Philip Robert Akrill |
Defendant/Appellant |
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Paul Casey (instructed by Addleshaw Goddard LLP) for the Respondent
Hearing date: 10 June 2014
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Crown Copyright ©
Lord Justice Kitchin:
Introduction
The background
"The Bank Leumi representatives made me aware that the Bank had guarantees in place to support the borrowing. They also made me aware that their policy was to recover outstanding sums from the borrower and by realising the security over the property. They were reluctant to call upon the personal guarantees and their expressed strategy was to recover from the security on property and from the borrower before calling upon the personal guarantor."
Mr Akrill understood from this that the Bank was looking to find a buyer for the Salford site so as to recover the monies which it was owed.
"Steve Cooper stated that on the basis that the loan was only up to 60% of the value of the site I was in no danger as regards the proposed personal guarantee as Bank Leumi was an old fashioned bank that looked after its customers, and that if I provided the personal guarantee requested then any redress would be sought in the first instance from the borrower and by enforcing the security over the property and not under the guarantee (ie. in the first instance), that Bank Leumi would have more than adequate security with a charge over Manor Mill and as a result there would not be a shortfall and they would not (ie. in the absence of a shortfall) look to enforce the personal guarantee. He said they would work any problems out with Manor, just as they were doing with the existing customer in relation to the Salford site and had instead enforced their security over the property by the appointment of an LPA Receiver."
"Obviously, I understood this in the context of the discussions that had previously taken place and the reassurance and warranty that Bank Leumi would not look to me as guarantor before first pursuing the borrower and enforcing the security over the property, ie that I would only be called upon if there was a shortfall. By this stage I felt that the Manor Property Group was developing a relationship of trust and good working relationship with Bank Leumi. I trusted Steve Cooper and believed that Bank Leumi would be as good as Steve Cooper's word. On that basis, and on reliance on what Steve Cooper said, I duly entered into the personal guarantee dated 28 January 2011. Again, … I am entirely confident that Bank Leumi understood that I was providing the guarantee subject to these assurances and the warranty."
"The Guarantor [Mr Akrill] hereby acknowledges that it has not relied on any warranties or representations made by or on behalf of the Bank in entering into this Guarantee. The Guarantor further acknowledges that the Bank has no duty or obligation either now or at any time to provide the Guarantor with any information relating to the financial condition or other affairs of the Debtor."
"By giving the Guarantee you might become liable instead of or as well as the Debtor.
You should seek independent legal advice before entering into the Guarantee."
The claim and summary judgment
The appeal
The representations
"However, in my judgment the fraud now alleged by Mr Akrill is of such a stark and clear nature that it is highly surprising that it was not mentioned in the letters from [Mr Akrill's solicitors] at the outset in 2013 and indeed up to now."
"As you are aware, our client intends to defend this matter and contest your client's application for summary judgment. The focus of our client's defence will be upon the activities and representations of your client prior to and during the period of the loans to Manor Asset Ltd and Manor Property Ltd …"
"2. Your client persuaded our client to provide personal guarantees in relation to some of that borrowing. Your client induced our client to provide that security by representing to him that he would not be called upon in respect of that security. By that inducement, your client persuaded our client to provide security which it now has documented rather than the £250,000 guarantee which our client originally offered. He relied upon that inducement in doing so."
These matters were then substantially elaborated by Mr Akrill in his first witness statement in the manner I have described.
The implied agreement
Estoppel by convention
Conclusion
Lord Justice McFarlane:
Lord Justice Maurice Kay: