Claim No: CL-2023-000687 - [2025] EWHC 1157 (Comm)

As a result, the Claimants have brought these proceedings against RSUK alleging breach of contract, duty of care and fiduciary duty in giving the original instruction to Barclays to freeze the sums in escrow and breach of contract in failing to pay the Claimants the Balance, either initially or at all. By way of a simplified summary, the Claimants advance two broad case narratives:

RSUK denies liability on a number of grounds. Again, with some over-simplification, its case narrative is as follows:

RSUK has also brought an additional claim against Barclays (“the Additional Claim”) alleging breach of contract by Barclays in not complying with RSUK’s instruction to pay the Balance to the Claimants and seeking specific performance and damages. To the extent Barclays relies on US sanctions as a reason for not complying with RSUK’s instruction to pay Virgo, RSUK pleads that this is contrary to Article 5 of the Retained Blocking Regulation and a criminal offence under The Extraterritorial US Legislation (Sanctions against Cuba, Iran and Libya) (Protection of Trading Interests) Order 1996. It claims damages for breach of contract and/or of the blocking statutes.

Amongst the relief sought by RSUK at paragraph 23 of the Additional Claim Particulars of Claim is as follows:

“If [RSUK] is successful in its Amended Defence and Counterclaim, [RSUK] is entitled to and hereby seeks an order requiring the deduction and payment from the Balance of: (a) [RSUK’s] loss, fees and expenses incurred as a result of its communications with Barclays and the Claimants’ representatives in relation to the transfer of the Balance. (b) [RSUK’s] reasonable costs in defending the claim brought against it by the Claimants, as may be ordered by the Court, including (a) costs incurred by [RSUK] in pursuing this Additional Claim, and (b) costs incurred by Barclays in defending the Additional Claim which the Court requires [RSUK] to pay.”

Barclays is defending that claim relying on express terms of the banking contract. Barclays relies on Clause 4.1 of the Core Terms, and also argues that on the proper construction of Clause 3.1.3 of the Core Terms and/or Clauses 7.2 and/or 13.12.1 of the Country Terms, Barclays is not obliged to process a payment instruction where the relevant customer has not provided information requested by Barclays which relates to the relevant payment, which it alleges is the position here. Barclays denies the application of the Retained Blocking Regulation and similar legislation saying that it is relying on its own contractual provisions as a reason for not processing the instruction rather than the legal effect of the foreign sanctions measures, and because the blocking legislation is only engaged when the relevant foreign sanctions legislation would otherwise have extra-territorial, rather than intra-territorial, effect.

Barclays’ response to the plea advanced at paragraph 23 of the Additional Claim Particulars of Claim is as follows:

“Barclays is neither able to admit nor deny whether [RSUK] is entitled to such relief, that being a matter for [RSUK] to establish as against the Claimants.”

The effect of that paragraph appears to be that Barclays will not be advancing any positive case at trial that if RSUK succeeds, it will not be entitled to an order permitting it to deduct the amount of its own costs and any costs it is obliged to pay Barclays from the Balance in the Escrow Account.

The case is now proceeding to a 12-day trial, with permission for two expert witnesses per party.