Judgment handed down in PCP v Barclays

On 26 February 2021, Mr Justice Waksman handed down judgment in PCP Capital Partners LLP and PCP International Finance Limited v Barclays Bank plc, dismissing PCP’s claim, which originally stood at £1.6 billion, against Barclays in its entirety.

David Quest QC and Charlotte Eborall successfully represented Barclays during the three-month hybrid Commercial Court trial on issues of expert evidence, causation and loss, together with a Counsel team at One Essex Court who addressed issues of liability, instructed by Colin Passmore and Adam Brown at Simmons & Simmons.

The dispute arose out of Barclays’ fundraising efforts to raise the additional Tier 1 Capital required by the UK government and FSA, during the global financial crisis in the second half of 2008. PCP’s Ms Amanda Staveley alleged that Barclays had made fraudulent misrepresentations that PCP would receive the “same deal” as the state of Qatar, the other proposed investor in Barclays, for its investment as a result of an undisclosed £280m payment made under two “Advisory Services Agreements”; a further £66m payment to Qatar; and a $3bn unsecured loan offered to Qatar when the capital raising was being undertaken.

PCP’s case was that, had Ms Staveley learned of the misrepresentations, she would have been in a better negotiating position with Barclays, negotiating additional value from the deal. Armed with that, she would have negotiated from Sheikh Mansour of Abu Dhabi and/or IPIC (a government-owned investment organisation), remuneration for PCP far in excess of the £30 million payment that she in fact received.

Although PCP proved its case in relation to the misrepresentations and the additional value that would have been negotiated with Barclays, Mr Justice Waksman held that PCP had no real chance of obtaining the debt finance necessary to satisfy PCP’s remuneration agreement with Sheikh Mansour (the Abu Dhabi equity investor) and no real chance of any alternative funding either.

PCP would therefore always have lost control of the investments, as it did in the real world, and was not entitled to any of the damages it sought under either its primary or secondary claim.

Mr Justice Waksman concluded: “This meant that PCP’s claim as a whole must fail.”

In addition to this case being of general interest and importance to the banking industry, Mr Justice Waksman’s decision also contains a useful précis of the law in relation to causation and loss, particularly when the Court is concerned with the actions of third parties, and the loss of a chance assessment. See paragraphs 533 to 573 of the judgment.

The summary of the judgment is available here.

The judgment is available here.

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