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"No easy claims for interest rate swaps"

United Kingdom
14/10/2013
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On 9 October 2013, the Court of Appeal sided with The Royal Bank of Scotland plc in upholding last December's High Court decision relating to a claim against the bank that it had mis-sold an interest rate swap.

A hotelier and property developer (Mr Rowley), together with his business partner (a residential lettings agent, Mr Green), failed with their appeal, which related to an interest rate swap sold to them in May 2005.

A Court of Appeal comprising Lords Justice Richards, Hallett and Tomlison heard the appeal at the end of July, and gave its judgment this week. Green and Rowley had asserted that the bank had given negligent advice, but Tomlinson LJ said that the bank had not owed Green and Rowley a duty of care to take reasonable care to ensure that they understood the nature of the risks involved in entering into the transaction.

This decision comes as no surprise, but it will be a great encouragement to banks who have been under fire on cases of this kind for some time.

Green & Anor v The Royal Bank of Scotland Plc [2013] EWCA Civ 1197

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