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Jperryuk, hillarious.

Popcorn to you... munch... munch...

Quite amusing the flurry of bearish posts from people with no vested interest (other than shorting) in the issue. I think the ChatGPT summary nailed the perspective on one poster very well. The surfacing of "I have been involved in the law for years" on Friday, who also has no vested interest, curious, what is your motivation ? Expert tooling is an empasis of what the intent Wood was trying to make that the CoA got so wrong, I had forgot about that case, thank you.

Guardian article, old and lazy article, which did not even correct the stale reference to the CBAM sale, poor form.

Rollercoaster ahead get the popcorn ready... munch... munch...

"Regarding the pending appeal: Expert Tooling was granted permission to appeal to the Supreme Court on two specific issues—(i) whether courts should distinguish between fully secret and half-secret commissions at all (potentially aligning them under Wood's stricter bribe treatment), and (ii) if distinguished, whether the dishonesty test for accessory liability in half-secret cases is correct or overly narrow. "

The Expert tooling case was also, like Wood and Hurstanger pure fiduciary cases where the engagement of a fee bound and created the trust of the fiduciary. Expert tooling is tied up with the mess that has been left from a misinterpretation (CoA motor finance) in Wood where a perception that a fiduciary role is not required for disinterested advice to be a requirement.

Wood : "The ruling does clarify that, as fiduciaries, the brokers were required to provide advice, information, or recommendations on a disinterested basis, as this forms part of the core fiduciary duty of loyalty (which demands honesty, impartiality, and full disclosure, including of any commissions received)."

This is the core as to the motor finance error the Court of Appeal made whereby the judges discounted the requirement for a fiduciary role to exist in the first place, which is by a very clear engagement of both parties (i.e. buyer and broker explicitly agreed and acknowledged the fiduciary engagement). Without a fiduciary engagement the Court of Appeal mistakenly applied the principle that disinterested advice was required and to make it a fiduciary they reversed the principles of Keech by saying the buyer trusted the broker and therefore they made the broker into thier fiduciary, without agreement or engagement (fee).

This is what the Supremem Court is going to clarify and correct. A fiduciary is obligated to provide disinterested advice as part of the trust (Keech) entrusted to the fiduciary. They are going to clarify that without a fiduciary engagement there is no disinterested obligation and a fiduciary cannot be created without both parties agreeing and engaging.

Then figure how this impacts the motor finance rulings.

Why has nobody picked up on my earlier point that the Guardian article quoted the sale of CBAM from months ago ? Did this not scream the whole content was old and out of date information ? Nothing new ?

Quotes from Grok4, not legal advice, not trading advice, not an opinion, my guess mixed with my beliefs, mixed with whatever. Do your own research.

Popcorn ahead.... munch.... munch....

Meconopsis. Spot on, “if you followed the rules in place at the time - even if mortally repugnant - then you’ve not broken the law”. This is one of the main considerations in the way the judges have looked at the issue and why would we expect them to look at the motor finance ruling (CONC rules) differently ? CBG followed the rules and the law at the time. The Court of Appeal applied Wood (2021) concepts retrospectively and compeltely ignored CONC rules.

Look at the LIBOR wording in relation to judges interpretation of the wording of rules in non jury cases. What's your interpretation of that perspective ?

Nor repugnant popcorn... munch... munch...

Given that the government are in summer recess and are unable respond, the impact of the judgement will take time to implement, whatever the decision and therefore to create the most time for adaptation the weekend would seem logical.

Making a ruling half way through the business day, which becomes law at that point in time, was always impossible to implement at the drop of a hat, so it's not untoward that the ruling is out of business hours. Imagine having to unwind all the adaptations for the Court of Appeal ?

The curious part is the dual listing aspect because that would make the timing dislocated from market price volatility and more towards basic operational adaptations, although it could be argued that most companied don't stop trading at 4:35 on a Friday. This perspective could also apply to shorts being taken out on claims management companies, Hindenburg style, forcing an immediate liquidity crisis and some closing up very quickly. Chaos may be an expected part of any ruling.

Should it go extreme bribery and fiduciary the whole market will lock up on Saturday, which would then require the government to recall parliament. That is a scenario that I see as near zero because it would be maximal self inflicted damage to every aspect of the UK. Consumer, retailer, banks, etc. It would also undermine the rule of law because Parliament overruling the Supreme Court is never a good look internationally.

Whilst some posts of great unwashed chaotic incoherent nonsense, I'd rather stick to as many facts and realistic perspectives as possible with the mandatory disclaimer of not knowing anything because if I said anything otherwise I would have claims lodged against me for whatever. Do your own research and homework, it's your own risk. A guess vs an opinion vs a recommendation are very different things in a post, read the note at the bottom of the pages.

Comfy chair for the rollercoaster ahead and mind the popcorn.... munch... munch...

Bribery would require a definition contrary to the law that applied at the time (CONC rules, which explicitly allowed Hopcraft level commissions and the whole insurance market) - Overturned. Reason - LIBOR ruling interpretation and application of LIBOR and EURBOR rules.

The ruling in Wood will be clarified to resolve the conflict with Hurstanger and siding with Hurstanger. This drops the fiduciary, disinterested, half secret. Contract law is restated and confirmed.

Plevin may well mean that only the very excessive cases get refunds. The case may effectively rule in Barclays favour because of how Plevin is applied and no fiduciary.

My guess (and it is a guess) is that the bulk of the CoA is completely overturned because it is based on Wood. Claims companies are going to face big challenges because the banks will then start proceedings to recover costs against claims that were made without basis. This may well recover a lot of the overheads on processing all the claims.

Who knows, we could see a gap of around 300p and still be vulnerable to a takeover.

Watch out for old or misleading news in the next week and disinformation central posters.

Make your own popcorn... munch... munch...

Did nobody really notice the the Guardian article was 'slightly' dated "announced plans to sell its asset management business" - that would be the sale of CBAM that closed quite some time ago. Was there anything actually new in the article or was it a potentially bearish intent at a time when someone may have been closing a position out ? Some people fell for this hook line and sinker.

Parliament is also on summer recess, so any new retrospective applying legislation that may be required would need to wait until 1st Sep when parliament is back in and then it would be reliant upon the vote not being held to ransom by double dealing back benchers to get any legislation through.

Between next Friday and a month later when parliament could pass legislation, all of the markets involved will have to abide by the Supreme Court ruling - the law is the law when it is made. Do you think the UK economy is going to work with a new definition of bribery and a fiduciary created by any sort of 'disinterested' nature and held in check by a promise to get legislation passed by a government that has more U-Turns than a learner driver ?

The majority of the market does not think the current Court of Appeal ruling applies already - just check how many documents are still worded with 'we may be paid a comission'.

Then think how the whole market is going to operate if the court sides with Wood, whereby the case is made that the small print of any term within a contract is then deemed half secret (or more specifically for someone who is unsophisticated) and therefore any term can be challenged because as it was attempted by council, commercial law is different to consumer law, as if consumers don't have to read a contract, sign it and not be bound by the terms as a result. Unsophisticated, it is assumed they don't understand what they are signing, so why is that limited to monetary terms and not legally complex terms ?

Then move on to the slight problem around the FCA redress scheme, whereby the banks refund the consumer directly, which would count as a win by a claim's company, who may then charge an additional fee to recover thier costs (with a premium due to the unintended processing required, cuased by the FCA) and thier percentage cut of the court win. This will have to go direct to the consumer as a bill, who could end up with a claims bill larger than the win from the bank (consider the Hopcraft value and add a processing fee on top).

Then going back to the sale of Winterflood adding to the circa £380m pool of capital already raised, which then makes the contingent convertable bonds even less likely to be called. Based on todays market cap CBG has raised around 74% of that as a new funds (circa £480m).

The timing of the ruling for Friday after the close poses an interesting connundrum in relation to dual listings. Lending may stop from next Saturday or the claims companies are facing armageddon. Choice, choices.

Popped out of popcorn.. Munch... munch...

Pop, yawn....

Back to the popcorn... munch... munch...

With the Guardian article indicating Treasury intervention, this just looks like a secondary (from the first intervention) message to the Supreme Court that they will be overriden by Parliament if they make a judgement that is an extreme liberal stretch of the law. For me it looks far more like signalling and after the fact because this message I would argue was actually sent before the LIBOR ruling. The LIBOR ruling in my view is vastly misunderstood as to it's implications.

The LIBOR case has some of the judges involved in the Close Brothers car finance hearing and when considering the details and the application of the law in realtion to the LIBOR ruling it would be difficult for the case of bribery to be upheld because it would require a contradiction as to the intent made within the LIBOR judgement. How the definition and wording of the LIBOR submissions was treated and dealt with to me in is indicative that bribery will not stand, especially give CONC rules at the time. The treasury making statements now, may well be after the fact and pure political posturing because they know that the ruling is not going to be extreme far reaching bribery of every act of financing with a comission for the last two decades. Labour can then do flag waving and posture about the courts doing the right thing for the stability of the markets as a whole.

Todays offloading of Winterflood to help streamline operating costs (key reason which large shareholders have repeated) and focus on the core business is quite positive and it would appear that post an early morning team brief one of the shorts may have realised that the position is not going their way. Curious that some people are cashing in at this point, when CBG is still below half book value and now an even more appealing takeover target once the uncertainty is removed. I'm even more comfortable to continue to hold and ride the rollercoaster.

Make your own mind up, do your own research, abobe all else, think.

Wiating for more popcorn... munch... munch...

No change on the shorts. Barclays pulling the banks up from yesterdays LIBOR judgement, with the fade through the day as 420p seems more and more to be a defensive level at the moment with 24% of the days volume at 418p (1p) and then 38% in the 415-417p (2p) range. Token 147 shares above 420p. Roughly following the 3 other banks in general with Barclays pushing higher on it's own. Curiously the LIBOR judgement has not spilled out beyond Barclays yet, although it mainly rested on a judge making a wrong decision that the jury should have taken in the first part and then a flawed logic as to which rate could be 'chosen'. Otherwise rattling along in the 405-415 range with the off stray.

The SC judgement now seems to be in August, so all those long volatility for July, oh dear. Curiously the LIBOR case was finished 27th March compared to the CBG case starting on the 1st April and the judgement being pushed back by more than a week. I am thinking more and more (as per my earlier guess) the delay is possibly due to the Barclays vs FOS case that was postponed so the pending ruling may well remove a lot of uncertainty, if not all the major uncertainty. Maybe the FCA can deliver on the six week promise and not look as useless, who knows...

Still sat on the edge of the seat, popcorn in hand... munch... munch...

Millenium closed out around 60k yesterday, down to 0.66%. Small change, although an interesting day to trim back above 405p. Today 75% of the volume was in a 3p range between 409-412p and half of the 410p volume in one 25k trade. With the days volume 303k and 122k of that in the auction (1.4p above the last trade) so we are seeing big swings in the type of trading between days, with todays trend rattling around with the other banks.

Curiously todays LIBOR ruling does not seem to have been factored into the market yet as the full implications are yet to filter through. It's what is said in the judgement that matters way more. The 83 page ruling is not short and wanders around covering the reasoning for the ruling, which has items like section 105, which touches on contract law. That s105 would seem to imply that Wood was wrong and Hurstanger is right, which if applied to the court of appeal the ruling is unsound and based on flawed overstretched reasoning. Nobody seems to have joined the dots yet, so get that comfy chair ready.

Stocking up on popcorn... munch... munch...

Todays update is inline with the 10 days notice.

Curious that the shares have not responded to the LIBOR ruling, although given the last round of decorrelated and delayed reactions it's not really that surprising.

Popcorn munching moment ahead.... munch... munch...

Grok : "Applied to the pending motor finance appeals (Hopcraft v Close Brothers Ltd, Johnson v FirstRand Bank Ltd, and Wrench v FirstRand Bank Ltd, UKSC 2024/0157-0159), this could significantly favor the defendant banks (including Close Brothers). The Court of Appeal's 2024 judgment imposed an ad hoc fiduciary duty of loyalty and a "disinterested duty" on car dealers as credit brokers, requiring full disclosure of commissions and deeming non-disclosure a breach equivalent to bribery, based on implied obligations of impartiality absent explicit contractual terms.

However, Hayes/Palombo signals judicial reluctance to imply absolute bars on self-interested conduct (e.g., commission incentives) in routine financial transactions, particularly where pre-2021 industry practices were tolerated under FCA/OFT regulations and not expressly prohibited."

I would encourage people to read the LIBOR ruling and make your own minds up.

https://supremecourt.uk/uploads/uksc_2024_0087_0088_judgment_f9b6ff1bb1.pdf

Even more optimistic popcorn ahead.... munch...munch...

Today the SC ruled on the LIBOR case, which was a few days before the CBG hearing. I don't recall the page notifying the announcement last week..... Barclays postponement may have therefore pushed CBG back a week or more. Will be reading the LIBOR judgement.

Popcorn in a kettle.... munch.... munch...

No change on shorts. Days range 403-422, quite interesting with the morning spike that ended up as a slow slide on the day until bumping into the 406-407p support with 30% of the days volumes and then the post close auction cleared over 4p higher with 165k in volume. Down just under 1%, which was less than the losses on Lloyds and Barclays, mainly following the overall market trend asside from the early monrning stretch to 422p. Not a lot to say, nobody is likely to push a direction from here unless they are trying to flush people out of day trading limits. As per the pervious comment we waiting for the kettle boil.

Im waiting for popcorn to pop.... munch... munch...

An interesting day indeed. No change on the shorts. Volumes subdued, with the auction on a low 56k volume with a 2.2p premium to the last trade, possibly catching a few short day traders out. Closing at a price point that only 10% of the market traded at or above. Not really showing any stand out sticking points with 54% above 410p. Top 12 trades with near even split which looks like 41k at 407p and then 43k at 413p almost as it someone went long and then sold out.

Slow and steady on the popcorn.... munch... munch...

"it will be made by following the rules and law and past cases" - So you clearly agree that the Court of Appeal wandering off into the long grass and making up completely new rulings was entirely wrong. Not entirely sure why you then contradict yourself with various opinions.

Popcorn on the same page.... munch... munch...

The delay for the Barclays ruling may well have pushed the announcement into August because they may try heading off the Barclays case going to appeal and retuning to the Supreme Court later in 2025 or early 2026. The LIBOR case has an element that crosses with the Barclays case and ties back into Hopcraft et.al. So, the SC ruling may well be an interesting combinational ruling. LIBOR bringing elements of interest rate control, Hopcraft on bribery / fiduciary, Johnson on fairness of commission levels / Plevin.

The market may well have bought volatility for July, which with no result may just leave CBG drifting slowly and then in August ending up more volatile. The ruling may remove a lot more uncertainty than the market expected if the necessity for the Barclays case is effectively cancelled. Removing uncertainty is removing a discount. Who knows ? Do your own research.

Get the popcorn ready.... munch... munch...

Citadel trimmed yesterday 0.63% to 0.58% or around 75k volume that was 16% of yesterdays traded volumes.

The lack of liquidity in the morning today was a bit stunning with 35k upto 11:30 before someone who may have tried with 3 trades (50k in volume) to push down past 404, which did not happen and was trading up at 409 with 25k in volume later. The 410-411p (1p) range was 34% of the volume. Possibly look back at the last few days and see if anything may or may not be happening.

Interesting close for the day with very little difference to the last trades.

Old popcorn.... munch... munch...

No change with the shorts. Trading was interesting with the 1p range of 404-5p seeing 42% of the volume and possibly some chunky defensive volumes above 405p with the bulk of the volume in just six trades (maybe a couple of day trading cashouts as well ?)

With 82% above 402p compared to the previous close down at 396.4p it could be viewed that the elastic does not want to be stretched far below 400p anymore. Maybe it's now just a situation of steady volumes to slowly break away from 400p while the market awaits the SC ruling. Based on the other big bank movements over the last 5 days, it may also look like CBG is due for a continuation of the slow rise back above 410p.

Who knows ? Not me... do your own research.

Back to stretchy popcorn time... munch... munch...