Duty Owed To Investor When Entering Into Redress Scheme?: Suremime Ltd v Barclays Bank Plc (2015)

The case of Suremime v Barclays Bank is one to watch, as it raises the prospect that claimants may be able to bring claims for compensation against FCA regulated bodies for failure to properly award redress in the context of a past business review into the sale of interest rate hedging products ("IHRPs"). This would be a significant development if it transpires.

In this case, Suremime, which had been sold an IHRP in 2008, sought permission to amend an existing mis-selling claim against Barclays to also plead breach of contract and/or breach of duty of care by Barclays in conducting its IHRP Review and in preparing the offer of redress made to Suremime. Barclays argued that the claims had no merit, as it only owed a duty to the FCA in respect of the execution of the review and redress scheme, and sought summary judgment.

The Court granted Suremime permission to amend its Particulars of Claim to plead the allegations in tort, but not in contract. In doing so, the Court found that the contractual claim was bound to fail, as no consideration passed between Suremime and Barclays in respect of the IHRP Review - Barclays was bound by its agreement with the FCA to conduct the Review, irrespective of any act or omission by Suremime. In relation to the tortious claims, however, it was arguable that there was a lacuna in the law which a tortious right to sue for negligent implementation of the IHRP Review would fill. In particular, if it was found that the IHRP Review had been negligently conducted, those claimants who, in reliance on the review/redress scheme, did not issue proceedings for mis-selling, and whose claims were consequently time-barred...