Family wins right to sue RBS over their lost firm

 

A Plymouth family have won a landmark case giving them the green light to sue Royal Bank of Scotland for millions over the alleged mis-selling of interest rate swaps that ultimately left them with crippling borrowing costs on a £55m loan.

Michael and Diane Hockin saw the property empire they had built up over 30 years snatched out of their hands when the bank's Global Restructuring Group (GRG) put it into administration in 2012. Since then their London and Westcountry Estates – which converted redundant factories into premises for more than 300 small business clients – has been sold off bit by bit by the administrator, Ernst & Young.

Legal claims by companies in administration are often taken up by the administrators, but in this case EY opted not to push ahead and vigorously contested signing the rights to sue RBS to the Hockins, even though Mrs Hockin remains a creditor. But a court has now ruled she should be allowed to press ahead.

Mr Hockin told The Independent that the family's battle against the administrators and the bank had been a "horrendous" ordeal. "It's been two years and they've fought us every inch of the way. I'm pleased with the result but we're only halfway there.

"We are now lodging a claim against the swap and we'll be looking at the administration, which we believe was flawed."

He claimed the bank was "out of control" but added: "We have had the facilities and the tenacity to fight them."

While smaller business mis-sold swaps can sign up to a review under the auspices of the Financial Conduct Authority (FCA), those deemed to be too big have to fight on alone. Mr Hockin believes many businesses have been left hanging as a result. "How can you fight people like EY and RBS?"

The GRG's activities are currently under the scrutiny of the FCA after the government adviser Lawrence Tomlinson published a report alleging that it had tipped viable businesses into bankruptcy.

In his ruling, Nicholas le Poidevin, QC, said Mrs Hockin should be assigned the claim even though the largest beneficiary of an outcome against RBS would be a firm called Isobel, which is 75 per cent owned by RBS and 25 per cent by the private equity giant Blackstone. Isobel holds London and Westcountry's debt.

The judge wrote archly that the banks would "undoubtedly prefer the claims to be abandoned" but that it would be in Isobel's interests to proceed.

Alice Loveday, a managing partner at Berg, the law firm that represented the Hockins, said: "They have lost the business they took 30 years building up. It was making £1m when put into admin. We felt it was a very good claim."

EY said in a statement: "Further to the hearing held on 12 March 2014 and judgment handed down on 19 March 2014, the administrators respectfully acknowledge the order and will act in accordance with the court's judgment."

An RBS spokesperson said: "The Hockins have previously raised issues concerning their swap transactions, which the bank has investigated and responded to in full. We have not found any evidence of wrongdoing by the bank."

Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

Where the spooks get their coffee fix: The busiest Starbucks in the US is also the most secretive

The secret CIA Starbucks

The coffee shop is deep inside the agency's forested Virginia compound
Revealed: How the Establishment closed ranks over fallout from Loch Ness Monster 'sighting'

How the Establishment closed ranks over fallout from Nessie 'sighting'

The Natural History Museum's chief scientist was dismissed for declaring he had found the monster
One million Britons using food banks, according to Trussell Trust

One million Britons using food banks

Huge surge in number of families dependent on emergency food aid
Excavation at Italian cafe to fix rising damp unearths 2,500 years of history in 3,000 amazing objects

2,500 years of history in 3,000 amazing objects

Excavation at Italian cafe to fix rising damp unearths trove
The Hubble Space Telescope's amazing journey, 25 years on

The Hubble Space Telescope's amazing journey 25 years on

The space telescope was seen as a costly flop on its first release
Did Conservative peer Lord Ashcroft quit the House of Lords to become a non-dom?

Did Lord Ashcroft quit the House of Lords to become a non-dom?

A document seen by The Independent shows that a week after he resigned from the Lords he sold 350,000 shares in an American company - netting him $11.2m
Apple's ethnic emojis are being used to make racist comments on social media

Ethnic emojis used in racist comments

They were intended to promote harmony, but have achieved the opposite
Sir Kenneth Branagh interview: 'My bones are in the theatre'

Sir Kenneth Branagh: 'My bones are in the theatre'

The actor-turned-director’s new company will stage five plays from October – including works by Shakespeare and John Osborne
The sloth is now the face (and furry body) of three big advertising campaigns

The sloth is the face of three ad campaigns

Priya Elan discovers why slow and sleepy wins the race for brands in need of a new image
How to run a restaurant: As two newbies discovered, there's more to it than good food

How to run a restaurant

As two newbies discovered, there's more to it than good food
Record Store Day: Remembering an era when buying and selling discs were labours of love

Record Store Day: The vinyl countdown

For Lois Pryce, working in a record shop was a dream job - until the bean counters ruined it
Usher, Mary J Blige and Will.i.am to give free concert as part of the Global Poverty Project

Mary J Blige and Will.i.am to give free concert

The concert in Washington is part of the Global Citizen project, which aims to encourage young people to donate to charity
10 best tote bags

Accessorise with a stylish shopper this spring: 10 best tote bags

We find carriers with room for all your essentials (and a bit more)
Paul Scholes column: I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England

Paul Scholes column

I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England
Jessica Ennis-Hill: 'I just want to give it my best shot'

Jessica Ennis-Hill: 'I just want to give it my best shot'

The heptathlete has gone from the toast of the nation to being a sleep-deprived mum - but she’s ready to compete again. She just doesn't know how well she'll do...