Barclays Bank PLC v Nylon Capital LLP

Posted on 18/07/2011 · Posted in Expert Witness

Jurisdiction and mandate of an expert, court can hand down judgment even where the dispute has been settled

Mr Burnell set up hedge funds and the Defendant Nylon Capital LLP was appointed as investment manager. There was a manager fee of 2% and a performance fee of 20%. The Claimant was Barclays Bank who invested substantially in the hedge funds. The Claimant later withdrew all its investment and Mr Burnell sought to establish what monies were payable to whom. At this point dispute arose over interpretation of the agreement. The Claimant commenced proceedings, but the other parties sought a stay on proceedings on the ground that the issue in dispute fell within the agreement’s expert determination clause.

The Court of Appeal first considered an expert’s jurisdiction. It held that it is for the court to determine the jurisdiction of an expert and this is the case even where it has been expressly agreed that the expert can decide his own jurisdiction. The Court of Appeal also considered the extent of an expert’s mandate. It was stipulated that the court would not intervene with matters within the expert’s jurisdiction as a matter of course, but could do so where an issue of law arises (the question was left somewhat open).

On the facts the Court of Appeal held that the expert had no jurisdiction as a condition precedent for referral to an expert had not been fulfilled. This meant that the Claimant’s proceedings would not be stayed.

The Court of Appeal also clarified that the court can hand down judgment where parties have already setled their dispute and asked that judgment not be given (though still perhaps not where a draft judgment has not already been circulated).

Link: Barclays Bank PLC v Nylon Capital LLP [2011] EWCA Civ 826

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