The Royal Bank of Scotland Plc v Highland Financial Partners LP & Ors

The Royal Bank of Scotland Plc v Highland Financial Partners LP & Ors

The application to set aside the liability judgment for fraud is refused because, although there was deliberate suppression of material facts by RBS's witness after the summary judgment stage, this did not affect the outcome or validity of the liability judgment, as the same result would have been reached on the evidence now available. The application for a permanent anti-suit injunction is refused because RBS, through its principal witness, engaged in serious misconduct with an immediate and necessary relation to the equitable relief sought, amounting to unclean hands and strong reasons not to grant injunctive relief, notwithstanding the existence of an exclusive jurisdiction clause.

Parties
Claimant: The Royal Bank of Scotland PLC; Defendant: Highland Financial Partners LP; Defendant: HFP CDO Construction Corp; Defendant: Highland CDO Opportunity Master Fund LP; Defendant: Highland Capital Management Europe Ltd; Defendant: Scott Law LLC; Defendant: Highlander Euro CDO V B. V.
Jurisdiction
England and Wales
Judgment Date
25 May 2012
Procedural Posture
Commercial Court Civil Proceedings (summary Judgment, Anti Suit Injunction, Application to Set Aside Judgment) / Post Judgment Applications: Anti Suit Injunction, Application to Set Aside Liability Judgment for Fraud, and Related Orders
Outcome
Applications dismissed; no order setting aside liability judgment; no permanent anti-suit injunction granted.
Legal Topics
Summary Judgment, Anti Suit Injunctions, Exclusive Jurisdiction Clauses, Fraud on the Court, Res Judicata, Equitable Relief, Unclean Hands Doctrine, Collateralised Debt Obligations (cdos), Mortgagee Duties, Contractual Interpretation
Commercial Law Banking and Finance Civil Procedure Conflict of Laws Summary Judgment Anti Suit Injunctions Exclusive Jurisdiction Clauses Fraud on the Court +6 more

Case Brief

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Parties

The Royal Bank of Scotland PLC

Claimant

Highland Financial Partners LP

Defendant

HFP CDO Construction Corp

Defendant

Highland CDO Opportunity Master Fund LP

Defendant

Highland Capital Management Europe Ltd

Defendant

Scott Law LLC

Defendant

Highlander Euro CDO V B. V.

Defendant

Procedural Posture

Commercial Court Civil Proceedings (summary Judgment, Anti Suit Injunction, Application to Set Aside Judgment) / Post Judgment Applications: Anti Suit Injunction, Application to Set Aside Liability Judgment for Fraud, and Related Orders

Legal Issues

  1. 1 Whether the liability judgment should be set aside for fraud due to alleged suppression of material facts by the claimant's witness
  2. 2 Whether the claimant is entitled to a permanent anti-suit injunction restraining Texas proceedings in light of exclusive English jurisdiction clauses
  3. 3 Whether the doctrine of unclean hands or strong reasons precludes equitable relief (injunction) for the claimant

Ratio Decidendi

The application to set aside the liability judgment for fraud is refused because, although there was deliberate suppression of material facts by RBS's witness after the summary judgment stage, this did not affect the outcome or validity of the liability judgment, as the same result would have been reached on the evidence now available. The application for a permanent anti-suit injunction is refused because RBS, through its principal witness, engaged in serious misconduct with an immediate and necessary relation to the equitable relief sought, amounting to unclean hands and strong reasons not to grant injunctive relief, notwithstanding the existence of an exclusive jurisdiction clause.

Court Disposition

Applications dismissed; no order setting aside liability judgment; no permanent anti-suit injunction granted.

Orders

  • Highland's application to set aside the liability judgment is refused.
  • Scott Law's defence on the same ground is dismissed.