2nd November 2015
In what was no doubt a common occurrence post the 2007/08 financial crisis, the claimant in Marshall v Barclays  entered into a settlement arrangement with his bank, the defendant, when he ran into financial difficulties. The claimant had borrowed some £1 million from the defendant and, amongst other dealings, had entered into an interest rate swap agreement. Despite being aware that he had a potential mis-selling claim in respect of the swap , the claimant concluded a settlement and release with the defendant, which ended all banking arrangements between them. Following the Financial Services Authority’s (FSA) findings that there had been serious failings on the part of several banks, the claimant took part in a review exercise with the defendant, the outcome of which was that the claimant was not entitled to any redress. The claimant then looked to pursue a mis-selling claim after all, and the question for the court was whether this was precluded by the settlement agreement.
The settlement agreement included a widely drafted release. The claimant had agreed to “release and waive irrevocably any claims, complaints or rights of action against the Bank in relation to this matter and your banking relationship and arrangements with the Bank… whether direct or indirect, foreseen or unforeseen, contingent or actual, present or future, and which arise, or may arise, out of or are in any way connected with this matter.”
The High Court ordered that the claim be struck out. The judgment covers several issues which will be of interest to banks and these are summarised below.
Banks and other financial institutions should ensure that as wide-a release as possible is negotiated into any agreement that is entered into as part of the settlement of any ongoing disputes, or simply when customers wish to extricate themselves from ongoing commercial/banking arrangements. Prior to completing any such release, firms should take expert advice so that they get the balance right between not unnecessarily tipping off as to any potential claims against them, and not engaging in the sharp practice of obtaining a release by unacceptably failing to disclose material matters.
Whilst every case will turn on its own facts, this decision may well assist financial institutions when any party seeks to revisit and undo any prior settlement and release. Please contact any member of Walker Morris’ Banking Litigation team if you would like further advice or assistance.
 Gary Ronald Marshall v Barclays Bank plc  EWHC 2000 (QB)
 Evidence to this effect was adduced in the case.
 This is a reference to the sharp practice argument noted in Bank of Credit and Commerce International SA v Ali & Ors  1 AC 251. In that case Lord Nicholls stated that for a party to whom a release was given to proceed, knowing that the other party had or might have a claim, knowing that the other party was ignorant and yet failing to disclose the existence of the claim or possible claim, could be unacceptable “sharp practice”, for which the law should provide a remedy.
 Para. 46
 Again, para.46