Landmark Mispresentation Act ruling- Court of Appeal

Taberna Europe CDO II plc v Selskabet (formerly Roskilde Bank A/S) (In Bankruptcy) [2016] EWCA Civ 1262)

In a landmark decision issued today, the Court of Appeal has unanimously overturned Eder J's conclusions, following an 8 day trial in 2014, in relation to s 2(1) of the Misrepresentation Act 1967 (negligent misrepresentation), and standard disclaimers in written publications issued by the bank.

The original conclusions in regard to Issuer liability to a secondary market investor were of significant potential consequences for the financial markets.  This successful appeal also upholds the availability of the protection offered by clear and unambiguous disclaimers in documents exchanged between commercial parties.

The Macfarlanes team advising Roskilde Bank was led by banking and finance dispute resolution head, Barry Donnelly, with litigation senior solicitor, Aalia Datoo, and litigation solicitor, Tim Ballingal. Charles Béar QC (Fountain Court) and Matthew Cook (One Essex Court) were instructed in both the first instance and Court of Appeal proceedings.


  • Roskilde was the largest retail bank in Denmark, and the first to collapse in the financial crisis.
  • Roskilde had issued subordinated notes which were purchased in the secondary market by Taberna (a European property fund) from Deutsche Bank in February 2008, for just over €26m.
  • Taberna alleged eight counts of misrepresentation by Roskilde, but only one was successful - a representation in respect of the level of Roskilde’s non-performing loans.
  • Eder J's conclusion that negligent misrepresentation under s 2(1) of the Misrepresentation Act 1967 extended to loss sustained as a result of contracting to purchase notes from a third party, but not arising under the subsequent contractual relationship with the issuer representor (Roskilde), was a novel interpretation of the wording of s 2(1) of the Act.
  • As a consequence of the decision at first instance, representations made in publications issued by financial institutions which are designed for the primary market on and before an issue of subordinated debt could have been actionable by secondary market purchasers long after the publications were first issued. On the facts, Eder J had found that the disclaimer wording included in some of the bank’s publications afforded it no protection.