Finch and another company v Lloyds TSB Bank plc; Promontoria Holding 87 BV v Finch and others

Bank – Duty of care. The Mercantile Court dismissed a claim against Lloyds Bank plc which alleged that the bank was in breach of its duty in failing properly to provide advice to the company prior to it entering into a loan agreement with the bank, and which alleged misrepresentation. The court held, among other things, that a bank was not under a legal obligation to provide advice to a customer, but if it did, it had to do so using reasonable care and skill. The relationship was generally a banker and customer relationship not an advisor and client relationship. Further, it held that, on the facts, misrepresentation had not been established. The court allowed a second claim by an assignee of the bank to enforce guarantees originally granted to the bank as security for the loan.

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