Representatives of a lender on a board will not automatically impose directors' duties on the lender, but they may apply where a director's specific instructions have led directly to a breach of fiduciary duty. The High Court recently explored this issue in an appeal in the case of Standish v Royal Bank of Scotland.
The Court of Appeal recently set out the relevant circumstances in which a Quistclose trust can arise in the context of bank transfers. The decision reinforces the understandable reluctance on the part of the courts to erode the basic principle that a banker-customer relationship is no more than a contractual one of debtor and creditor.
In a high-profile acquisition claim, the High Court held that the implied undertaking against collateral use of documents received in the course of litigation prevented disclosure of those documents to the Federal Bureau of Investigation. The court's comments show clearly the level of scrutiny which will be given to requests or demands made by third parties for the disclosure of documents obtained through ongoing proceedings, no matter the standing of the person or authority that makes it.
With privilege remaining a hot topic, and with the recent SFO v ENRC decision still fresh in many legal professionals' minds, another judgment on legal advice privilege has been handed down – this time with a lesson for solicitors drafting supporting witness statements. It is of crucial importance to ensure that the utmost care is taken when making a claim to privilege, not least because the opposing party will usually have no choice other than to rely on what it is told.