We recently succeeded in full in a claim for damages for conversion on behalf of a financier which raised the apparently novel point of whether a large Excavator fell within the definition of “motor vehicle”.
In De Lage Landen Leasing Limited t/a Hyundai Construction Equipment Europe Finance v Dring (Manchester Circuit Commercial Court 13 July 2022) both parties were the victim of a fraudulent disposition of the Claimant’s Excavator by the Hirer and/or an associated company.
Financiers have been, together with almost all other litigants, subject to what seems to be an ever-increasing spiral of expense in navigating the various fees and charges payable under the court system, a trend which is been in place now for almost 2 decades.
We thought it is worth highlighting two points which can bring some relief to this situation.
As we are moving towards the second anniversary of the pandemic it is worth pausing to reflect that, after some initial reluctance, technology has been quite successfully embraced both by lawyers and also by the courts to keep the system running.
Obviously meetings between lawyers and clients have largely been replaced by virtual contact through Microsoft Teams and Zoom, but virtual contact has now taken a firm foothold in relation to the litigation process.
Readers may recall our lengthy article on the somewhat contentious schools leasing issue in a recent Briefing following the High Court judgment in the Schools Facilities Management case which can be found here.
In our last Briefing we reported on the Court of Appeal decision on broker commissions in Wood v Commercial First Business Ltd and the rather surprising decision of the NACFB in recommending that “both regulated and unregulated firms, working in all sectors, should be transparent about their commissions and fully disclose the amount of commission received”.
With the industry still reeling from revelations emerging from the demise of a certain Lessee, and taking into account the sensitivities of referring to any of the specific current or forthcoming matters in which we are instructed, we thought it might be worthwhile making some general remarks on steps which Funders may wish to consider to prevent being the victims of serious fraud going forward.
Aleena joined Bermans in 2019 and is a Litigation Assistant in the Asset Based Lending team. Aleena predominantly deals with prelegal correspondence and process driven claims and enforcement.
One of the effects of the pandemic has been to slow down (some might say even further!) the litigation process in the UK courts, and despite one or two high-profile decisions relating primarily to business interruption insurance there have been few reported cases dealing with the effects of the pandemic relevant to asset financiers.
One likely vehicle of attack by customers arises from the doctrine of frustration of contracts, which may discharge the parties from performance of a contract that has become legally or physically impossible through no fault of the parties. In general terms this doctrine is very difficult to establish, and for example the European Medicine Agency failed in its attempt to use frustration to extract itself from a long lease on its central London premises as a result of the fact that it had to move to Amsterdam following Brexit.
The Court of Appeal has recently handed down judgment in Wood v Commercial First Business Ltdand Others and Business Mortgage Finance 4 plc v Pengelly [2021] EWCA Civ 471, on the issue of broker “secret commissions”.
These decisions have caused something of a storm in the industry, and somewhat surprisingly in our view the NACFB is recommending “both regulated and unregulated firms, working in all sectors, should be transparent about their commissions and fully disclose the amount of commission received”.
We came across an interesting argument concerning the right to sue after securitisation of assets in a recent reported case we ran for an asset finance company, Haydock Finance Limited v Starcruiser Bussing Limited [2021] EWHC 622 (Comm).
The case involved commercial vehicles and acting for the funder we brought a claim against the hirer for return of the vehicles and the guarantor for a substantial sum. There appeared to be no merit whatsoever in the Defence as served, but by the time of the hearing the Defendants turned up with a so-called “Securitisation Analysis Report” prepared by an academic in California who describes himself as an “Expert Analysis on Auto Agreement Backed Securities Data.”
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Aleena joined Bermans in 2019 and is a Litigation Assistant in the Asset Based Lending team. Aleena predominantly deals with prelegal correspondence and process driven claims and enforcement.