Hatfield Philips and Rosling King Comment on English Court of Appeal's Judgment in the case of Titan Europe 2006-3 Plc v Colliers International UK plc
- Express disappointment with judgment; seeking permission to appeal -
- Pleased Titan recognized as proper claimant, upholding significant legal precedent -
LONDON, Nov. 3, 2015 /PRNewswire/ -- Hatfield Philips International ("HPI") and Rosling King LLP, HPI's legal counsel, today commented on the English Court of Appeal's judgment in the case of Titan Europe 2006-3 Plc ("Titan") v Colliers International UK plc.
In overturning an earlier High Court ruling, the Court of Appeal determined Titan was not entitled to 32 million euros in damages plus interests and costs. However, the Court of Appeal upheld the precedent set by the High Court, which ruled that Titan was the correct claimant with the right to pursue a claim against Colliers.
Colliers' original valuation of the 'Quelle Nurnberg' building in December 2005 was 135 million euros and the Court of Appeal has ruled that the 'true' valuation was 118.3 million euros, overruling the High Court's decision that the 'true' valuation was 103 million euros. However, this 16.7 million euro, or 14.1%, overvaluation was not sufficient to constitute negligence, as the Court of Appeal ruled that the permissible margin of error, or 'bracket', was 15%.
Richard Spooner, Deputy General Counsel at HPI, said, "We are obviously disappointed with the Court of Appeal's judgment in relation to the valuation and Colliers' negligence. The Court of Appeal has, however, underpinned a significant legal precedent in that although Titan (as the Issuer of the securitisation) did not hold any financial risk, as the owner of both the loans and the security for such loans it also held the right to sue Colliers for any negligence caused by it. This aspect of the ruling provides some further welcome certainty on the often debated topic of who is the correct party within these complex structures to pursue a claim against a valuer who acted negligently at the point of loan origination."
James Walton, partner at Rosling King, said, "We are liaising with our client in connection with an application for permission to appeal to the Supreme Court. Despite the Court of Appeal agreeing that it could not overturn the findings of fact in the Court below, that is exactly what it has done. It has decided on the actual valuation of the property in question without having had the benefit of hearing the valuation experts at trial and without fully considering the relevant comparables. In its judgment, the Court of Appeal comes up with its own opinion of value seemingly without carrying out any detailed valuation analysis, and by failing to take into account many of the key facts at play." Walton added, "The Court of Appeal's decision on the 'correct claimant' point is most welcome, not only for those claimants currently pursuing similar cases, but more importantly for new CMBS issuances; the documentation can now be structured in the knowledge that the Issuer is the right and proper person to pursue a claim of this nature, should one so arise."
About Hatfield Philips International Ltd.
Hatfield Philips International ("HPI"), together with LNR Europe, is a leading NPL and debt advisory firm with best-in-class loan servicing capabilities. From NPL underwriting to co-investing to helping lenders execute on debt strategies, HPI is uniquely positioned to deliver multiple layers of value to a wide range of debt market participants. HPI accomplishes this by leveraging a highly seasoned team of real estate finance, workout, debt servicing, and client service specialists. Founded in 1997 on the principles of trust, integrity and providing the highest levels of customer service, HPI has the experience and capabilities to partner with clients to achieve their business and investment objectives. HPI is a subsidiary of LNR Property, a United States-based real estate investment, finance, management and development firm, which was acquired by Starwood Property Trust in April 2013. For more information please visit us at http://www.hatfieldphilips.com/.
About Rosling King LLP
Rosling King is a leading City of London law firm, offering specialist legal expertise of the highest calibre to commercial clients, predominantly operating in the finance, real estate, construction and private equity sectors. For more information please visit us at www.rkllp.com
Contacts
Hatfield Philips:
Jason Chudoba
ICR, Inc.
Phone: +1-203-682-8200
Jason.Chudoba@icrinc.com
Rosling King:
Ramsay Smith
Media House International Limited
Phone: 07788 414 856
Ramsay@mediahouse.co.uk
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