Jurisdiction(s):
United Kingdom

Naibu Global v Daniel Stewart: implied retainer arguable; reflective loss strike-out post-Marex; Arbitration Act 1996 s9 stay refused (High Court of England and Wales)

Published on: 19 October 2020

Published by a LexisNexis Dispute Resolution expert

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Article summary

Naibu Global International Company plc and another v Daniel Stewart & Company plc and another [2020] EWHC 2719 (Ch)

What are the practical implications of this case?

This decision presents several wide-ranging, practically significant points. In substance, it stands as another concrete illustration of a first‑instance court adopting the Supreme Court’s approach in Sevilleja v Marex Financial Ltd [2020] UKSC 31, and consequently striking out a claim characterised as reflective loss. That strike‑out occurred at an early juncture notwithstanding the claim’s substantial value. It therefore underlines how the Marex principle can be decisive at the threshold, irrespective of quantum, when a claim properly falls within the category of reflective loss as understood by the Supreme Court in that judgment itself. Different strategies will therefore be required when formulating losses liable to be treated as ‘reflective’ losses.

Procedurally, the court permitted Pinsent Mansons to amend its pleadings to add the reflective loss argument. The judge regarded this as sound case management, enabling every issue to be addressed together on the strike‑out application.
Practitioners are also reminded of the doctrine of implied retainers. Although no formal engagement letter existed between Pinsent Masons and Naibu Jersey, there was a real prospect that ultimately...

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