Highbury Pension Fund Management Company & Anor v Zirfin Investments Management Ltd & Ors

Highbury Pension Fund Management Company & Anor v Zirfin Investments Management Ltd & Ors

Clause 8 of Zirfin's guarantee does not restrict Highbury's right to invoke the principle of marshalling against Barclays, as the equity arises between the two creditors, not between the surety and the principal debtor. Highbury is entitled to require Barclays to marshall its securities, and clause 8 does not impact this right.

Parties
Applicant/appellant: Highbury Pension Fund Management Company and another; Defendant/respondent: Zirfin Investments Management Ltd and others
Jurisdiction
England and Wales
Judgment Date
03 October 2013
Procedural Posture
Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal
Outcome
Appeal allowed
Legal Topics
Marshalling of Securities, Subrogation, Suretyship, Contractual Modification of Equitable Rights
Equity Banking and Finance Marshalling of Securities Subrogation Suretyship Contractual Modification of Equitable Rights

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Parties

Highbury Pension Fund Management Company and another

Applicant/appellant

Zirfin Investments Management Ltd and others

Defendant/respondent

Procedural Posture

Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal

Legal Issues

  1. 1 Whether clause 8 of Zirfin's guarantee restricts Highbury's right to require Barclays to marshall its securities
  2. 2 Whether Highbury can invoke the equitable principle of marshalling against Barclays despite contractual limitations between Zirfin and Barclays

Ratio Decidendi

Clause 8 of Zirfin's guarantee does not restrict Highbury's right to invoke the principle of marshalling against Barclays, as the equity arises between the two creditors, not between the surety and the principal debtor. Highbury is entitled to require Barclays to marshall its securities, and clause 8 does not impact this right.

Court Disposition

Appeal allowed

Orders

  • Highbury's right to invoke the principle of marshalling is not circumscribed by clause 8 of the guarantee.
  • Highbury may require Barclays to marshall its securities over the Affiliates' properties.