Linklaters (a firm) v HSBC Bank Plc & Anor [2003] EWHC 1113 (Comm) (22 May 2003)

Linklaters (a firm) v HSBC Bank Plc & Anor [2003] EWHC 1113 (Comm) (22 May 2003)

HSBC is entitled to a complete indemnity from BPE for its liability to Linklaters, following the reasoning in Middle Temple v Lloyds Bank. The fact that HSBC was both paying bank and agent for collection does not distinguish the case. The implied indemnity and implied warranty principles apply, and there was no express disclaimer negating them. Accordingly, BPE must indemnify HSBC for the settlement paid to Linklaters.

Citation
[2003] EWHC 1113 (Comm)
Parties
Claimant: Linklaters (a firm); 1st Defendant/part 20 Claimant: HSBC Bank plc; 2nd Defendant/part 20 Defendant: Banco Popular Espanol
Jurisdiction
England and Wales
Judgment Date
22 May 2003
Procedural Posture
Commercial Court Claim and Part 20 Proceedings / Judgment After Trial
Outcome
HSBC succeeds in its claim for a complete indemnity from BPE in respect of its liability to Linklaters.
Legal Topics
Conversion of Cheques, Bankers' Indemnity, Implied Warranty, Contribution Between Tortfeasors, Cheque Collection, Negligence, Bills of Exchange
Banking Law Tort Law Agency Law Conversion of Cheques Bankers' Indemnity Implied Warranty Contribution Between Tortfeasors Cheque Collection +2 more

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Parties

Linklaters (a firm)

Claimant

HSBC Bank plc

1st Defendant/part 20 Claimant

Banco Popular Espanol

2nd Defendant/part 20 Defendant

Procedural Posture

Commercial Court Claim and Part 20 Proceedings / Judgment After Trial

Legal Issues

  1. 1 Whether HSBC is entitled to an indemnity or damages for breach of warranty from BPE for liability to Linklaters arising from conversion of a cheque.
  2. 2 Whether Middle Temple v Lloyds Bank is correct and applicable.
  3. 3 Whether the roles of HSBC as both paying bank and agent for collection affect entitlement to indemnity or warranty.

Ratio Decidendi

HSBC is entitled to a complete indemnity from BPE for its liability to Linklaters, following the reasoning in Middle Temple v Lloyds Bank. The fact that HSBC was both paying bank and agent for collection does not distinguish the case. The implied indemnity and implied warranty principles apply, and there was no express disclaimer negating them. Accordingly, BPE must indemnify HSBC for the settlement paid to Linklaters.

Court Disposition

HSBC succeeds in its claim for a complete indemnity from BPE in respect of its liability to Linklaters.

Orders

  • BPE to indemnify HSBC for the amount paid to Linklaters in settlement of the conversion claim.