News Release
BCCI
04 December 1998
The Court of Appeal today dismissed the appeal made by the Liquidators of BCCI in their proceedings against the Bank of England. The Liquidators' claim against the Bank had first been struck out by Mr (now Lord) Justice Clarke in October 1997 and the Court of Appeal today confirmed his ruling. Two Courts have therefore now decided that the Liquidators' claim is incapable of being proved and, accordingly, should be struck out as frivolous and vexatious.
The question for the Court of Appeal was not whether the Liquidators' claim against the Bank for misfeasance in public office should succeed but whether that claim was arguable at all. The Court held, by a majority of 2-1, that it was not.
The majority said:
"The Judge reached the firm conclusion that, on the material then available, the Plaintiffs had no arguable case that the Bank dishonestly licensed BCCI SA or dishonestly failed to revoke the licence or authorisation in circumstances when it knew, believed or suspected that the company would probably collapse without being rescued. We agree with that conclusion."
In coming to this conclusion, the majority were well aware of what they described as the grievous losses suffered by the depositors. They also commented that the Liquidators had put their case "in great detail and no doubt as clearly and convincingly as they can".
Nevertheless, having carried out a thorough review of the history of the Bank's supervision of BCCI, they were in full agreement with Mr Justice Clarke that the Liquidators case was not arguable. They added:
"We also agree that in all the circumstances of this extraordinary case, it is now for practical purposes inconceivable that new material would emerge of such significance as to alter that conclusion."
The majority also dismissed as unarguable a claim based on a European law which the Liquidators had added to the proceedings some 2 ½ years after they had begun.
The Bank of England said:
"We are pleased that the Judgment of Mr (now Lord) Justice Clarke striking out the BCCI Liquidators' claim against the Bank of England has been upheld by the Court of Appeal."
