Although there is no formally agreed definition of alternative dispute resolution (ADR), it is generally accepted as including all methods of resolving disputes other than through formal litigation. The use of ADR has developed significantly over the past few decades and despite the use of the word ‘alternative’ it is now very much part of mainstream thinking in modern-day dispute resolution. The importance of ADR to civil actions was reinforced by the Civil Procedure Rules in 1998, which emphasized it as part of the overriding objective, encouraged at all stages of the dispute process, from pre-action to after litigation has commenced. This is reinforced by sanctions that a court can impose on a party which fails properly to embrace the process. The Review of Civil Litigation Costs carried out by Jackson LJ further promoted the importance and use of ADR. There are many different forms of ADR, both adjudicative and non-adjudicative. This chapter will focus on the use of mediation as a non-adjudicative form of ADR and the steps the courts take to require (rather than compel) the parties to attempt to resolve their disputes.
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Additional Chapter Aspects of Commercial ADR
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Additional Chapter Principles of Insurance Law
Put broadly, insurance is a contractual process whereby risk is transferred from a person who might incur a loss to an insurer. Whilst insurance law is at root merely an example of applied contract, in fact it has some unique characteristics and practices and a terminology all of its own. In this chapter we will consider the key characteristics of insurance law. After examining the meaning of insurance, including the concepts of indemnity and insurable interest in liability and property insurance, we move to the structure of insurance policies. The ways the courts have interpreted insurance wordings and insurance warranties, conditions precedent, and basis of the contract clauses are dealt with before the extensive reforms wrought by the Insurance Act 2015 are introduced. Insurance policies, even so-called all risks policies, do not cover all causes of loss which an insured might suffer, so the concept of causation in insurance is particularly important and this is dealt with next. The chapter closes by reviewing insurance claims, including the effect of fraudulent claims, how the level of disclosure expected of an insured is far higher than in a non-insurance context, and how these issues have been the subject of substantial reform under the newInsurance Act.
Chapter
Additional Chapter: The UN Convention on the International Sale of Goods
This chapter is intended to introduce the reader to the UN Convention on the International Sale of Goods otherwise known as the ‘Vienna’ Convention or the ‘Convention of the International Sale of Goods (CISG). This chapter is intended to introduce the reader to the UN Convention on the International Sale of Goods otherwise known as the ‘Vienna’ Convention or the ‘Convention on the International Sale of Goods (CISG). The chapter begins with a discussion of the scope and application of the convention along with the difficulties with its interpretation and the problem of ensuring consistency across all jurisdictions. It then deals with the substantive provisions of the convention covering offer and acceptance, resolving the battle of the forms and variation of contract. It then details the rights, duties and remedies of the parties especially where these differ from English law, for example in relation to the seller’s right to cure, and the right to reduce the price in the event of breach and particularly the limitations on the right of either party to terminate the contract. It ends with a table comparing in summary form. the provisions of the CISG with the position in English law,
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10. Advisory and Transactional Liability
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
The chapter first discusses the general principles governing a bank's liability. One way to approach the topic involves a consideration of the relevant doctrines whereby banks can incur liability. Section I selects just a few such doctrines. Another approach considers the various factual matters which feed into legal decisions about bank liability. The same factors recur across different legal doctrines: indeed, they arise for consideration in other systems of law. This is the focus of Section II. Section III considers advisory liability, which can arise in two ways: a failure to advise where the law imposes a duty to do so, and a failure to advise adequately when a bank assumes the task of advising a customer or third party. Section IV turns to the English law doctrines which have a particular application to transactions involving those the law regards as vulnerable. The final section deals with ‘lender liability’.
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4. Agency
This chapter focuses on the nature of agency before considering the role of agents. It highlights the vital role agents play in commercial activity as they become the middleman in everyday life. The primary role of agents in commerce revolves around the negotiation and conclusion of contracts. The chapter acknowledges that most developed legal systems recognise the concept of agency and that there is a marked similarity between the rules of different legal systems. It looks into the relationships created by agencies by considering the relationships and interplay between an agency, a third party, and a principal in different circumstances.
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22. Assignment of choses in action
D Fox, RJC Munday, B Soyer, AM Tettenborn, and PG Turner
This chapter deals with the general law of assignment of choses in action. Beginning with the historically based difference between equitable and statutory assignment, it then explains what ‘chose in action’ and ‘assignment’ are before discussing the requirement that there be an existing and assignable chose in action or right as well as the requirement that a person who holds an existing assignable chose in action intends to assign it. It also examines whether and when a rule of legal formality requires writing to be made; whether and when notice of the assignment is required; and obstacles to the enforcement of an assigned chose in action.
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5. The authority of an agent
This chapter places the authority of an agent as a central concept of the law of agency, identifying two principal types of authority, namely actual authority (both express and implied, and the various forms of implied authority, such as customary authority and incidental authority) and apparent authority. There is a third form, known as usual authority, but, as will be seen, the reasoning behind the cases that established this form of authority is highly suspect. All three forms of authority are discussed. Determining the existence and type of authority is vital as the legal consequences of an agent breaching their authority can be severe. The principal may not be bound by the agent’s actions and the agent may instead be personally liable. In addition, the agent may lose the commission/remuneration to which they were entitled, and may be found liable for breach of contract and/or breach of warranty of authority.
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5. The authority of the agent
This chapter explores the authority of the agent. It tackles the interplay of authority between an agent, a principal, and third parties, and the distinction between actual and apparent authorities. In most cases of apparent authority, the ‘principal’ makes a representation that the ‘agent’ has authority which the third party relies upon by entering into a contract. In certain circumstances, a person who acts in an emergency to preserve the property or interests of another may be treated as an agent of necessity regardless of the principal's absent consent. The chapter then overviews the impact of ratification on the rights and liabilities of third parties.
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8. Background To The Sale Of Goods Act 1979
This chapter outlines the Sale of Goods Act 1979 (SGA), which is the set of legal rules primarily concerned with the sale of goods. It presents the history of sales law, acknowledging that the modern law of sale is largely found in the SGA. The SGA primarily aims to remove the need to consult prior case law. Thus, decisions of courts in cases prior to the Act should only be examined for guidance in cases where the language of the Act is unclear or ambiguous. The chapter then reflects on the future of sales law, which is considered to be the heart of commercial activity.
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3. Bailment
D Fox, RJC Munday, B Soyer, AM Tettenborn, and PG Turner
This chapter deals with bailment, defined as a transaction under which a bailee lawfully receives possession of goods from a bailor for some purpose. Examples of bailment from commercial law include warehousing, carriage, the deposit of property to have work done on it, leasing, and pledge. A buyer under a sale or return transaction is, pending acceptance or rejection, a bailee of the goods. After explaining what a bailment is, the chapter considers types of bailment and three requirements for a bailment: transfer of possession; ownership remaining in the bailor, or at least not passing to the bailee; and consent by the bailee. It then examines the bailee’s liability and the burden of proof with respect to bailment before concluding with an analysis of bailment involving third parties, focusing in particular on sub-bailment.
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6. Bank Insolvency and Resolution
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
Banks can become distressed for a range of reasons, just like other firms. These reasons may be internal to the distressed bank (e.g. risky lending practices) or external to it (both at industry level and at the macroeconomic level), or both. Distressed banks, however, are not always subject to the same regulatory regime that governs the treatment of distress in other kinds of firms. Banks have special characteristics and this has led to the special treatment, which is explored in this chapter. The discussions cover the justification for special treatment, special resolution regimes, bank resolution regimes at domestic level, and cross-border complexities.
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8. Bank Networks
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
This chapter considers the relationship which banks have with other banks. The discussion revolves around legal impact and legal consequences, in this case of the various types of inter-bank relationships. It shows that in some cases, banks become the customers of other banks. Some of the issues discussed in the chapter lay the foundation for some of the later chapters, notably that on payment and lending. These relationships between banks are primarily contractual in nature; the concept of the network usefully encapsulates the scope of the discussion. The chapter covers correspondent banking, inter-bank markets and contracts, exchange markets and payment systems, and bank syndicates.
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5. Bank Supervision in Practice: The Case of the UK and of the European Banking Union
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
This chapter discusses banking supervision in practice. It focuses on two jurisdictions: the UK and the European Banking Union (EBU), and considers in particular the type of powers enjoyed by the UK and EBU regulators, and the way they exercise them in their supervisory approaches. In the process the chapter highlights loopholes in the respective regimes and to some extent evaluates their effectiveness. On 1 April 2013 the Financial Services Act 2012 came into force, removing the Financial Services Authority and delivering a new regulatory structure for the UK, which comprises the Prudential Regulation Authority responsible for microprudential regulation and supervision of banks, building societies, and investment firms; and the Financial Conduct Authority, in addition to a financial stability (macroprudential) body within the Bank of England, the Financial Policy Committee. The EBU brought about the centralization of bank supervision and resolution within the Eurozone. The trigger for the establishment of the EBU was the Eurozone debt crisis.
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7. The Bank–Customer Relationship
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
This chapter focuses on the customer and the services which banks offer to customers. It begins by filling in some of the details about the customers of banks and modern banking services. In this context it gives attention to how the relationship between banks and their customers may be characterized as a matter of law. Contract emerges from this as the overarching feature of the relationship; thus, the second and third sections of the chapter discuss banking contracts and their regulation. The final section turns to a specific banking service, the taking of deposits. Historically this has been the core banking service, and deposit-taking has been central to any definition of banking.
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2. The banker–customer relationship
Iris Chiu and Joanna Wilson
This chapter discusses the relationship between a bank and its customer. The Bills of Exchange Act 1882 defines a banker to include ‘a body of persons whether incorporated or not who carry on the business of banking’. Meanwhile, upon the opening of an account, a person will be deemed to have become a customer of the bank and there is no requirement for a habitual course of dealings. Although the relationship between a bank and its customer is primarily governed by contract law, there may be circumstances in which the bank undertakes additional obligations, thereby taking the relationship beyond the remit of contract law such that the bank becomes subject to fiduciary duties of trust and loyalty. The chapter then considers the fiduciary nature of the banker–customer relationship as well as undue influence.
Book
Iris H-Y Chiu and Joanna Wilson
Banking Law fully addresses the current landscape of banking law and regulation post the 2008 financial crisis. Coverage is balanced between transactional, regulatory, and private law topics across UK banking law, as well as European and international law. The text aims to cover everything needed for a full understanding. Topics covered include: the banker–customer relationship, payment, regulatory architecture in the UK and the European Union, macroprudential regulation, banking culture, governance, incentives, crisis management and resolution, and combatting financial crime.
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4. Banks and finance
Iris Chiu and Joanna Wilson
This chapter focuses on the other core function of the banking business alongside taking in deposits from customers: lending. The traditional forms of lending include overdrafts, fixed-term loans, and syndicated loans. An overdraft generally involves an extension of credit by a bank to its customer via the customer’s current account. A fixed-term loan, as the name suggests, is a loan made for a fixed period of time. Meanwhile, a syndicated loan involves two or more banks that each contributes towards making a single loan to a borrower. The chapter then considers lender liability and the different forms of security a bank can use to realise the repayment of a loan in the event of default by the borrower. It also looks at recent innovations in the lending market that offer a competitive alternative to traditional bank lending, including payday lending and peer-to-peer lending.
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15. Banks and the Capital Markets
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
This chapter considers banks' securities activities. Many banks have compensated for the decline in traditional finance by emphasizing their securities activities. These range from the traditional task of investment banks in advising, underwriting, and distributing new issues of securities, through to dealing on their own account on securities and derivatives markets — proprietary trading. In the decade leading up to the Global Financial Crisis, banks also played a significant role in introducing new products to these markets, including asset-backed securities and credit derivatives. The onset of the crisis provoked intense scrutiny and widespread criticism of many of these activities, and led to the introduction of significant controls on the ability of banks to engage in them. The chapter discusses types of securities, subordination, and custody; distributing securities issues; and securities regulation.
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1. Banks in the Financial System
Ross Cranston, Emilios Avgouleas, Kristin van Zweiten, Theodor van Sante, and Christoper Hare
This chapter explains the economic functions and organizational structure of contemporary banking. It first discusses the role of banks in the economy, offering a brief account of the role of the financial system in capital allocation and risk management as well as key bank functions in this respect. It then details the rise and fall of the multifunctional bank in the era of globalization, and the different aspects of the too-big-to-fail bank problem and its possible causes. It explains the international nature of bank regulation and the standard-setting and regulatory coordination provided by key transnational regulatory networks such as the Basel committee on Bank Supervision and the Financial Stability Board; discusses the legal definition of the term ‘bank’ in the US and of ‘credit institution’ under EU legislation; advances a new understanding of what the term ‘bank’ means in the post-2008 era.
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2. Basic concepts of personal property
D Fox, RJC Munday, B Soyer, AM Tettenborn, and PG Turner
This chapter explores some basic concepts of personal property and personal property law. It first explains the distinction between personal and real property before discussing the nature of personal property and analysing the characteristics and significance of property rights. There is then detailed consideration of ownership and possession of chattels, the acquisition and transfer of legal and equitable ownership, and attornment. This is followed by an account of the acquisition and transfer of legal and equitable ownership in choses in action and intangibles. The chapter concludes with an examination of the remedies for recovery of, and interference with, personal property and remedies available for protection of equitable property, including claims to trust assets and claims for breach of trust.
