Vol 18 (2021) - Issue 3

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Singularis Holdings Limited (in Official Liquidation) v Daiwa Capital Markets Europe Limited [2019] UKSC 50

Synopsis
When Singularis Holdings reached the Supreme Court, the defendant bank had accepted that it had breached its Quincecare duty of care, requiring care to be exercised in executing customer orders. The bank should have queried payment instructions given by a fraudulent director who was the 'controlling mind' of the company. Two groups of questions then fell to be considered. Could the wrongdoer's actions be attributed to the claimant company? If so, could the bank raise defences on the basis of the company's illegality, causation, and a cross-claim against the company in deceit? The Supreme Court answered all of these questions in the negative. The defences failed because the director's actions could not be attributed to the company in the first place. Principles of attribution were not altered in how they applied to 'one-man companies'. Even if the director's actions could be attributed to the company, the three defences would have failed in any event due to the nature of the Quincecare duty.