A commercial property developer has lost a multimillion-pound High Court fight against Royal Bank of Scotland over a loan agreement made shortly before the banking crisis.
Oliver Morley borrowed £75 million from RBS in 2006 to refinance and expand his property portfolio and to provide a personal bonus to himself of about £15 to £20 million.
However, the value of his portfolio fell to about £58 million during the 2008 global banking crisis and he was unable to repay the loan by the date of its expiry in 2009.
In August 2010, he entered an agreement with RBS which allowed him to save half of his property empire – while the rest was transferred to one of the bank's subsidiaries – by paying £20.5 million to the bank.
Morley sued RBS for tens of millions of pounds in damages, claiming the bank had breached its duty to take reasonable skill and care when providing banking services.
He also alleged the bank had subjected him to "intimidation and economic duress".
But his case was rejected by Justice Kerr, who ruled in favour of the bank on Monday.
In his ruling, which followed a 14-day hearing in October and November last year, the judge concluded the bank's provision of services to Morley did not fall below the standard required of a lender.
He also found against Morley on the intimidation allegation, saying that "neither intimidation nor economic duress" were supported by the evidence.
The judge said Morley had spent his bonus on South African mining investments, property, cars, a yacht and a jet – assets he then struggled to sell during the global downturn.
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