Ruhi Sethi summarises the new financial list and financial markets test case scheme.
New Specialist List for Complex and High Value Financial Cases and Financial Market Test Case Pilot Scheme.
On 1 October 2015, new amendments to the CPR relating to the resolution of complex and high value financial disputes came into force. The amendments have created a new specialist list known as the financial list.
The scope of the financial list is fairly broad and covers claims which satisfy any of the following three criteria:
- Claims for a value of over £50 million or the equivalent amount in another currency and which are predominantly associated with loans, project finance, banking transactions, derivatives and complex financial products, financial benchmark, capital or currency controls, bank guarantees, bonds, debt securities, private equity deals, hedge fund disputes, sovereign debt, or clearing and settlement; or
- Claims which require specific expertise in the financial markets in order to be resolved; or
- Claims which raise issues of general importance to the financial markets.
The purpose of the new financial list is that cases to which it applies will be moved from the general court list and will be allocated to judges who have significant experience in resolving such disputes. The allocated judge will hear the case from beginning to end. The judges nominated to hear cases on the financial list are from the Chancery Division and the Commercial Court.
Financial list claims will still be issued either in the Chancery or Commercial Registry but claimants will need to use a new Financial List claim form. Following issue of the claim, the ensuring procedural steps will be the same as in mainstream cases.
It is unclear from the new amendments what would happen in the event that a claim falls within the scope of the financial list but the parties choose not to have their claims heard in that list. Financial list judges have the power to order cases to be transferred both to and from the financial list on their own initiative so it would seem that judges could make case allocation decisions against the wishes of the parties.
The above changes, if implemented effectively, should result in robust judgments from specialist judges well versed in the relevant financial markets, products and applicable case law. In addition, the case management of financial list cases should see a greater efficiency given that each claim will be assigned one judge.
Recent amendments to the CPR also provide for a new Financial Markets Test Case Scheme will be piloted from 1 October 2015 until 30 September 2017 and will apply to claims which raise points of general importance to the financial markets. It allows parties who are in agreement to issue proceedings intended to clarify a point of law which requires authoritative judicial guidance. It will no longer be necessary for there to be a dispute between the parties, there simply needs to be opposing interests as to the outcome. In the absence of a dispute, judges will need to be satisfied that the arguments of all persons with opposing interests will be put properly before the Court. Therefore, it will be vital for test cases of this nature to be extensively publicised in the relevant markets.