Lloyd's Maritime and Commercial Law Quarterly
QUINCECARE AND BANKING DUTIES: BACKWARDS AND FORWARDS
Aaron Yoong *
This article examines the recent experiences on the Quincecare duties and the course of litigation surrounding the duty, from two perspectives. First, from a doctrinal-comparative view, the UK Supreme Court relied heavily upon a Singaporean case in coming to its decision in Philipp v Barclays Bank. However, when that case is properly situated in the Singaporean context, that reliance by the Supreme Court instead raises questions relating to the scope, standard and bases upon which banks can be said to owe duties of skill and care in executing customers’ orders. Secondly, seen through a socio-functional lens on judicial outcomes, the entire set of litigation neatly illustrates the way in which litigants can be said to respond to developments in the law. Drawing on the Singapore experience, it is seen that, far from being dissuaded by a narrow interpretation adopted in Philipp, fraud victims appear instead to be emboldened to attempt arguments on the very basis of the Quincecare duties that was rejected by the Supreme Court in Philipp.
I. INTRODUCTION
The Quincecare duty, from the eponymous decision in Barclays Bank Plc v Quincecare Ltd,1 refers to a bank’s duty to use reasonable skill and care when executing its customers’ orders. Under this duty, a banker must refrain from executing the order where there are reasonable grounds for believing that the order is an attempt to misappropriate its customer’s funds.2 In the thirty-odd-year history of the duty,3 resort to it was rare and its jurisprudential development stagnated as a result. That all changed in the past five years or so, with a spate of decisions examining the doctrine at all judicial levels.4
* Assistant Professor, Yong Pung How School of Law, Singapore Management University. “The author is grateful to Danny Ong for comments on an earlier draft, and Joel Soon for the research assistance. All errors remain mine.”
1. [1992] 4 All ER 363 (“Quincecare”).
2. Quincecare, 376; Singularis Holdings Ltd v Daiwa Capital Markets Europe Ltd [2019] UKSC 50; [2020] 1 Lloyd’s Rep 47; [2019] Bus LR 3086 (“Singularis SC”), [1]; JP Morgan Chase Bank NA v Federal Republic of Nigeria [2019] EWCA Civ 1641; [2019] 2 CLC 559 (“JP Morgan v Nigeria CA”); Philipp v Barclays Bank UK Plc [2021] EWHC 10 (Comm); [2021] Bus LR 451 (“Philipp HC”), [81]; Stanford International Bank Ltd v HSBC Bank Plc [2021] EWCA Civ 535; [2021] 1 WLR 3507 (“Stanford CA”).
3. Quincecare was decided in 1988 but reported only in 1992, as observed by the Court of Appeal in Philipp, [12].
4. Singularis Holdings Ltd v Daiwa Capital Markets Europe Ltd [2017] EWHC 257 (“Singularis HC”); Singularis Holdings Ltd (In Liquidation) v Daiwa Capital Markets Europe Ltd [2018] EWCA Civ 84; [2018] 1 Lloyd’s Rep 472; [2018] Bus LR 1115; [2018] 1 WLR 2777 (“Singularis CA”); Singularis SC; Federal Republic of Nigeria v JP Morgan Chase Bank NA [2019] EWHC 347 (“JP Morgan v Nigeria HC”); Philipp HC; Philipp v Barclays Bank UK Plc [2022] EWCA Civ 318; [2022] Lloyd’s Rep FC 276 (“Philipp CA”); Stanford CA; Royal Bank of Scotland International Ltd v JP SPC 4 [2022] UKPC 18; [2023] AC 461 (“JP SPC 4”).
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