Sophisticated buyers rebuffed, in landmark LIBOR mis-selling claim

Though the Royal Bank of Scotland secured a resounding victory against a high-profile interest rate swap ‘mis-selling’ lawsuit, there are remaining areas of risk and uncertainty for financial services firms. With a different claimant and set of circumstances, the next case could go the other way, warn James Le Gallais and Noah Benjamin Stewart-Ornstein.

James Le Gallais (jlegallais@petersandpeters.com) is of counsel and Noah Benjamin Stewart-Ornstein (nstewart@petersandpeters.com) an associate, at business crime and commercial litigation specialists Peters & Peters in London.

On 21 December 2016, Mrs Justice Aplin handed down the hotly-anticipated decision in Property Alliance Group Ltd v Royal Bank of Scotland plc [2016] EWHC 3342 (Ch). This case represents one of the most significant tests to date of the Chancery Division’s new financial list and was the first decision in England and Wales to consider whether rescission or damages were available in a swaps mis-selling claim arising from the manipulation of LIBOR.