Citicorp Trustee Company Ltd v Barclays Bank Plc & Ors

Citicorp Trustee Company Ltd v Barclays Bank Plc & Ors

The disenfranchisement provisions in the Trust Deed apply only to Notes held by a Seller in its capacity as Seller, as defined in the Master Definitions Schedule. Barclays does not hold the Disputed Barclays Notes in its capacity as Seller, nor does Rabobank hold the Disputed Rabobank Notes as Seller or Issuer. Contractual or economic control does not amount to beneficial ownership for the purposes of disenfranchisement. Therefore, neither the Disputed Barclays Notes nor the Disputed Rabobank Notes are disenfranchised.

Parties
Claimant: Citicorp Trustee Company Ltd; Defendants: Barclays Bank Plc & Ors; Second Defendant: Theatre (Hospitals) No 1 Plc; Third Defendant: Theatre (Hospitals) No 2 Plc; Fourth Defendant: Cooperative Centrale Raiffeisen-Boerenleenbank B. A. (Rabobank International); Fifth Defendant: Capita Asset Services (London) Ltd; Sixth Defendant: Ambac Assurance UK Ltd; Seventh Defendant: Ambac Credit Products LLC; Eighth Defendant (representative of Junior Noteholders): XY
Jurisdiction
England and Wales
Judgment Date
23 August 2013
Procedural Posture
Part 8 Proceedings / Judgment After Expedited Trial
Outcome
Declaratory judgment for the Defendants (Barclays and Rabobank); Notes not disenfranchised.
Legal Topics
Construction of Trust Deeds, Disenfranchisement of Noteholders, Beneficial Ownership, Voting Rights of Noteholders, Interpretation of Financial Instruments
Commercial Law Trusts Law Banking and Finance Construction of Trust Deeds Disenfranchisement of Noteholders Beneficial Ownership Voting Rights of Noteholders Interpretation of Financial Instruments

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Parties

Citicorp Trustee Company Ltd

Claimant

Barclays Bank Plc & Ors

Defendants

Theatre (Hospitals) No 1 Plc

Second Defendant

Theatre (Hospitals) No 2 Plc

Third Defendant

Cooperative Centrale Raiffeisen-Boerenleenbank B. A. (Rabobank International)

Fourth Defendant

Capita Asset Services (London) Ltd

Fifth Defendant

Ambac Assurance UK Ltd

Sixth Defendant

Ambac Credit Products LLC

Seventh Defendant

XY

Eighth Defendant (representative of Junior Noteholders)

Procedural Posture

Part 8 Proceedings / Judgment After Expedited Trial

Legal Issues

  1. 1 Whether the Disputed Barclays Notes and Disputed Rabobank Notes are disenfranchised under the Trust Deed for voting purposes
  2. 2 Interpretation of 'Seller' and 'beneficial owner' in the context of the Trust Deed
  3. 3 Whether contractual or economic control amounts to beneficial ownership for disenfranchisement

Ratio Decidendi

The disenfranchisement provisions in the Trust Deed apply only to Notes held by a Seller in its capacity as Seller, as defined in the Master Definitions Schedule. Barclays does not hold the Disputed Barclays Notes in its capacity as Seller, nor does Rabobank hold the Disputed Rabobank Notes as Seller or Issuer. Contractual or economic control does not amount to beneficial ownership for the purposes of disenfranchisement. Therefore, neither the Disputed Barclays Notes nor the Disputed Rabobank Notes are disenfranchised.

Court Disposition

Declaratory judgment for the Defendants (Barclays and Rabobank); Notes not disenfranchised.

Orders

  • It is declared that neither the Disputed Barclays Notes nor the Disputed Rabobank Notes are disenfranchised under the Trust Deed.