Francis v Barclays Bank Plc & Ors [2004] EWHC 2787 (Ch) (07 December 2004)

Francis v Barclays Bank Plc & Ors [2004] EWHC 2787 (Ch) (07 December 2004)

Mr. Diamond of Kirkby & Diamond was negligent in failing to make proper enquiries of the Local Plan Department regarding the prospects of residential development of the Nursery Site, which would have revealed a real prospect of planning permission and led the Bank not to agree to the variation of the clawback provisions. The Bank, relying on negligent advice, breached its equitable duty to Mrs. Francis. The Bank is liable for its agent's negligence. Damages are assessed on the basis that the Bank lost a two-to-one chance of recovering the full seller's share under the original clawback provisions.

Citation
[2004] EWHC 2787 (Ch)
Parties
Claimant: Grace Francis; Defendant and Part 20 Claimant: Barclays Bank PLC; Part 20 Defendants: Kirkby & Diamond; Part 20 Defendants: Duncan Anthony Kirkby; Part 20 Defendants: Henry Alexander Diamond
Jurisdiction
England and Wales
Judgment Date
07 December 2004
Procedural Posture
Chancery Division Civil Claim With Part 20 Proceedings / Judgment After Trial
Outcome
Judgment for the claimant (Mrs. Francis) and for the Bank against Kirkby & Diamond for damages in negligence.
Legal Topics
Mortgagee's Duties, Equity of Redemption, Negligence of Agents, Clawback Provisions, Damages Assessment
Equity Banking and Finance Professional Negligence Property Law Mortgagee's Duties Equity of Redemption Negligence of Agents Clawback Provisions +1 more

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Parties

Grace Francis

Claimant

Barclays Bank PLC

Defendant and Part 20 Claimant

Kirkby & Diamond

Part 20 Defendants

Duncan Anthony Kirkby

Part 20 Defendants

Henry Alexander Diamond

Part 20 Defendants

Procedural Posture

Chancery Division Civil Claim With Part 20 Proceedings / Judgment After Trial

Legal Issues

  1. 1 Whether Barclays Bank breached its equitable duty as mortgagee to the claimant by agreeing to vary clawback provisions on undervalue terms
  2. 2 Whether Kirkby & Diamond (and Mr. Diamond) were negligent in advising the Bank regarding the variation of clawback provisions
  3. 3 Whether the Bank is liable for the negligence of its agents in this context

Ratio Decidendi

Mr. Diamond of Kirkby & Diamond was negligent in failing to make proper enquiries of the Local Plan Department regarding the prospects of residential development of the Nursery Site, which would have revealed a real prospect of planning permission and led the Bank not to agree to the variation of the clawback provisions. The Bank, relying on negligent advice, breached its equitable duty to Mrs. Francis. The Bank is liable for its agent's negligence. Damages are assessed on the basis that the Bank lost a two-to-one chance of recovering the full seller's share under the original clawback provisions.

Court Disposition

Judgment for the claimant (Mrs. Francis) and for the Bank against Kirkby & Diamond for damages in negligence.

Orders

  • Declaration that 26 Station Road is free from the Bank's charge
  • Damages awarded to the Bank against Kirkby & Diamond assessed at two-thirds of £1,065,750, less the £115,000 actually received, plus interest