SEKERS FABRICS LTD AGAINST CLYDESDALE BANK PLC [2021] ScotCS CSOH_89 (26 August 2021)

SEKERS FABRICS LTD AGAINST CLYDESDALE BANK PLC [2021] ScotCS CSOH_89 (26 August 2021)

The Quincecare duty is limited to internal fraud and does not extend to external fraud or APP fraud. However, the bank's general duty to exercise reasonable skill and care may apply to pre-authorisation communications. Only the alleged breach relating to advice tendered by the bank's employees on the day in question is relevant and warrants inquiry; the other alleged breaches lack specification or legal basis.

Citation
[2021] ScotCS CSOH_89
Parties
Pursuer: Sekers Fabrics Limited; Defender: Clydesdale Bank PLC
Jurisdiction
Scotland
Judgment Date
26 August 2021
Procedural Posture
Commercial Action / Debate on Relevancy and Specification
Outcome
Defender's plea-in-law sustained in part; case put out by-order for further specification on averments to be excluded from probation.
Legal Topics
Implied Duty of Care, Quincecare Duty, Authorised Push Payment Fraud, Bank's Obligations in Pre Authorisation Communications
Banking Law Contract Law Implied Duty of Care Quincecare Duty Authorised Push Payment Fraud Bank's Obligations in Pre Authorisation Communications

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Parties

Sekers Fabrics Limited

Pursuer

Clydesdale Bank PLC

Defender

Procedural Posture

Commercial Action / Debate on Relevancy and Specification

Legal Issues

  1. 1 Scope of bank's implied duty to exercise reasonable skill and care
  2. 2 Application of Quincecare duty to external fraud
  3. 3 Relevancy and specification of alleged breaches of duty

Ratio Decidendi

The Quincecare duty is limited to internal fraud and does not extend to external fraud or APP fraud. However, the bank's general duty to exercise reasonable skill and care may apply to pre-authorisation communications. Only the alleged breach relating to advice tendered by the bank's employees on the day in question is relevant and warrants inquiry; the other alleged breaches lack specification or legal basis.

Court Disposition

Defender's plea-in-law sustained in part; case put out by-order for further specification on averments to be excluded from probation.

Orders

  • First three grounds of alleged breach excluded from probation; only fourth ground (advice tendered by bank employees) proceeds to inquiry.
  • All questions of expenses reserved.