Case Analysis of Saudi Arabian Monetary Agency V Dresdner Bank Ag [2004] Ewca Civ 1074
CASE ANALYSIS OF SAUDI ARABIAN MONETARY AGENCY V DRESDNER BANK AG [2004] EWCA Civ 1074
(A)
Basic Information
The claimant with regard to this case is the Saudi Arabian Monetary Agency (“SAMA”) and the defendant is Dresdner Bank AG (“Dresdner”). The legal representatives for the parties involved were; Mr Robin Potts QC and Mr Charles Marquand on behalf of the claimant and Miss Elizabeth Jones QC on behalf of the defendant. SAMA sought relief in the form of a declaration that the Bank had no right to block SAMA’s account held at its branch in London, and an order that required the Bank to transfer the sum of €49,147,576.71 and any interest thereon to the Deutsche Bank account as initially instructed. On the other hand, Dresdner wished to set off the debt it was owed by the Government of the Kingdom of Saudi Arabia, by the equivalent held in SAMA’s account as it viewed SAMA as an arm of the Ministry of Finance and National Economy of the Kingdom of Saudi Arabia (“MOF”).
Relevant Facts
On the 10 October 2002, SAMA instructed Dresdner to transfer a sum of roughly €292 million from its account to SAMA’s account held at Deutsche Bank, Frankfurt. Dresdner did not comply in full with this request and instead withheld a sum of approximately €49 million which was owed to Dresdner Bank Luxembourg (“DBL”) by the Ministry of Defence and Aircraft (“MODA”) and MOF of the Kingdom of Saudi Arabia. Dresdner insisted that it was clear that a right of set- off existed against the assets of SAMA, which was an arm of MOF. SAMA on the other hand, disputed this with regard to the principle applied in Bhogal v Punjab National Bank: Basna v Punjab National Bank that a banker is not entitled to refuse to honour a customer’s demands when there is money in the account to cover it, merely on the basis of a suspicion that the account was held by the customer as a nominee (‘The Bhogal principle’).
SAMA claimed summary judgement against Dresdner for payment of money in the account, which
(A)
Basic Information
The claimant with regard to this case is the Saudi Arabian Monetary Agency (“SAMA”) and the defendant is Dresdner Bank AG (“Dresdner”). The legal representatives for the parties involved were; Mr Robin Potts QC and Mr Charles Marquand on behalf of the claimant and Miss Elizabeth Jones QC on behalf of the defendant. SAMA sought relief in the form of a declaration that the Bank had no right to block SAMA’s account held at its branch in London, and an order that required the Bank to transfer the sum of €49,147,576.71 and any interest thereon to the Deutsche Bank account as initially instructed. On the other hand, Dresdner wished to set off the debt it was owed by the Government of the Kingdom of Saudi Arabia, by the equivalent held in SAMA’s account as it viewed SAMA as an arm of the Ministry of Finance and National Economy of the Kingdom of Saudi Arabia (“MOF”).
Relevant Facts
On the 10 October 2002, SAMA instructed Dresdner to transfer a sum of roughly €292 million from its account to SAMA’s account held at Deutsche Bank, Frankfurt. Dresdner did not comply in full with this request and instead withheld a sum of approximately €49 million which was owed to Dresdner Bank Luxembourg (“DBL”) by the Ministry of Defence and Aircraft (“MODA”) and MOF of the Kingdom of Saudi Arabia. Dresdner insisted that it was clear that a right of set- off existed against the assets of SAMA, which was an arm of MOF. SAMA on the other hand, disputed this with regard to the principle applied in Bhogal v Punjab National Bank: Basna v Punjab National Bank that a banker is not entitled to refuse to honour a customer’s demands when there is money in the account to cover it, merely on the basis of a suspicion that the account was held by the customer as a nominee (‘The Bhogal principle’).
SAMA claimed summary judgement against Dresdner for payment of money in the account, which
Bibliography: 3. Chaikin, D. 2011, Bank as Depository and Bank’s Duties, CLAW 2204 at The University of Sydney, Semester 1. 4. Ex parte Morier, re Willis Percival & Co.(1879) 12 Ch. D. 491. 5. Ho, L. C. (2004) Bankers Duties to Customers Reaffirmed- CHAPS Transfer and Equitable Set- off, Journal of International Banking Law and Regulation, (issue 11), pp 466-468. 8. Uttamchandami v Central bank of India, (C.A.) (1989) 139 N.L.J. 222. [ 6 ]. Uttamchandami v Central bank of India, (C.A.) (1989) 139 N.L.J. 222. [ 8 ]. Ex parte Morier, re Willis Percival & Co.(1879) 12 Ch. D. 491. [ 10 ]. Ho, L. C. (2004) Bankers Duties to Customers Reaffirmed- CHAPS Transfer and Equitable Set- off, Journal of International Banking Law and Regulation, (issue 11), p 468. [ 12 ]. Chaikin, D. 2011, Bank as Depository and Bank’s Duties, CLAW 2204 at The University of Sydney, Semester 1.