Concord Trust v The Law Debenture Trust Corporation Plc [2004] EWHC 1216 (Ch) (28 May 2004)

Concord Trust v The Law Debenture Trust Corporation Plc [2004] EWHC 1216 (Ch) (28 May 2004)

The Trustee's conclusion that the indemnities offered by Concord were unsatisfactory was not Wednesbury unreasonable. The Trustee was entitled to consider the worst case scenario for potential liability, and the indemnity clauses did not provide a clear and unambiguous defence to possible claims by Elektrim. The Trustee was not obliged to accept the indemnity offered or to accelerate the bonds.

Citation
[2004] EWHC 1216 (Ch)
Parties
Part 8 Claimant: Concord Trust; Part 8 Defendant: The Law Debenture Trust Corporation PLC
Jurisdiction
England and Wales
Judgment Date
28 May 2004
Procedural Posture
Part 8 Claim / Judgment After Hearing on Declaratory Relief
Outcome
Application dismissed
Legal Topics
Trustee Indemnity, Bond Acceleration, Wednesbury Unreasonableness, Contractual Discretion, Third Party Indemnity, Breach of Trust Deed
Trusts and Equity Banking and Finance Trustee Indemnity Bond Acceleration Wednesbury Unreasonableness Contractual Discretion Third Party Indemnity Breach of Trust Deed

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 12 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

Concord Trust

Part 8 Claimant

The Law Debenture Trust Corporation PLC

Part 8 Defendant

Procedural Posture

Part 8 Claim / Judgment After Hearing on Declaratory Relief

Legal Issues

  1. 1 Whether the Trustee's refusal to accept the indemnity offered by Concord was Wednesbury unreasonable
  2. 2 Whether the Trustee is obliged to accelerate the bonds under the Trust Deed upon request by bondholders holding at least 30% in principal amount, given the indemnity offered
  3. 3 Whether the indemnity clauses in the Trust Deed preclude claims by Elektrim against the Trustee for wrongful acceleration

Ratio Decidendi

The Trustee's conclusion that the indemnities offered by Concord were unsatisfactory was not Wednesbury unreasonable. The Trustee was entitled to consider the worst case scenario for potential liability, and the indemnity clauses did not provide a clear and unambiguous defence to possible claims by Elektrim. The Trustee was not obliged to accept the indemnity offered or to accelerate the bonds.

Court Disposition

Application dismissed

Orders

  • The application for a declaration that the Trustee is obliged forthwith to give notice to the Issuer and Elektrim that the Bonds are accelerated is dismissed.