BEAR STERNS BANK PLC V FORUM GLOBAL EQUITY LTD

[2007] EWHC 1576 (Comm), Queens Bench Division, Commercial Court, Mr Justice Andrew Smith, 5 July 2007

Whether contract concluded for sale of distressed debt notes – Intention to create legal relations – String contracts – Measure of damages

The claimants (BS) claimed to have concluded a contract in a telephone conversation on 14 July 2005 with the defendants (F) that BS would acquire from F some distressed debt by way of notes issued by companies in the Parmalat group. Held, that a contract for the sale of the notes had been concluded – there had not been mere agreement to agree, there was sufficient certainty and the parties did have the intention to make a legally binding contract. The judge found no convincing evidence of usage or custom in the relevant market prescribing trade on LMA terms, such as to impliedly incorporate them into an oral agreement.