Developer Can’t Revive Lloyds Suit Over Misselling Review
Paige Long, 16 April 2021
An English appeals court ruled on Friday that a property investor cannot sue Lloyds Banking Group over its conduct during a review of interest rate hedging products bought in the mid-2000s because his complaint was invalid.
The Court of Appeal upheld a decision from July that threw out the lawsuit brought by Clive Davis against Lloyds Bank. The higher court ruled that the property investor’s grievances did not comply with the regulatory definition of “complaint” in the Financial Conduct Authority’s dispute resolution rules.
High Court Judge Sarah Worthington was right to find that Davis failed to meet the gateway requirements under the regime, the appeals court said. The regime says he would have to express dissatisfaction with a financial service or redress decision and allege that he had suffered a loss.
“The purpose of the interest rate swaps was to deal with the risk that interest rates might move,” Justice Kim Lewison wrote. “The fact that, with hindsight, they moved in the wrong direction, thus meaning that Mr. Davis was worse off in net worth terms than he would have been if he had not entered into the transaction, does not amount to a complaint about the fact that he was sold the product in the first place.”
