[2025] UKUT 00185 (TCC)

At the September 2018 board meeting, a new NED, Catherine Brown, was appointed with effect from 1 October 2018, see §154. On 5 October 2018, Mr Lane, Mr Sadler and Mr Cheyne came to the Bank’s offices to provide Ms Brown with a training session covering the Listing Rules Corporate Governance, the Bank’s Share Dealing Policy and its Disclosures Procedures Manual.

Mr Arden and Ms Roberts were aware that the training session was taking place, and decided to ask whether Mr Lane would be available for a meeting subsequently. In the course of, or shortly before, that training, Ms Roberts popped into the training room to say that she and Mr Arden would like to speak to Mr Lane afterwards.

That meeting took place in Mr Arden’s office. It had not been pre-arranged; no papers, written instructions or briefing was provided to Linklaters either in advance or at the meeting. No note of the meeting was taken, and Linklaters was not asked to confirm in writing the advice which was given.

After the meeting, at 14.22 the same day, Ms Roberts sent Mr Arden an email which was headed “For DisCo” and read as follows:

“David, please review and add to minutes below as needed:

David Arden and I met with Linklaters (John Lane, Jonty Sadler and Rupert Cheyne) at 11.45am today to discuss the ongoing work and dialogue with the PRA on the classification of our RWAs. We explained that we had identified a problem with the risk weight classification of some commercial assets; that current estimates based on sampling was c.£600m and the impact on core equity capital of c.£50m but further work was being undertaken (with the help of Deloitte) to finalise the amount; that the PRA had agreed that there were no immediate changes necessary for our CoReg [COREP] reporting; and the intention was to notify the market once finalised and resolved in line with our usual full year and Pilar 3 disclosures. Linklaters concurred with our view that it is neither specific or material information at this point and was in the ordinary course of ongoing dialogue with the regulator over a complex issue and no market announcement was necessary at this point.”

Mr Arden read the email, and responded around 30 minutes later saying “Perfect – thanks Jo”. He did not think anything needed to be added. He copied his reply to Ms James, Ms Roberts’ email was appended. Neither he nor Ms Roberts sent a copy of the email to Mr Lane, or to anyone else at Linklaters. However, Mr Arden discussed the meeting with Mr Donaldson the same day, and during October he also told Ms Gillan.

Mr Arden agreed in cross-examination that the following information in the email was incorrect:

Ms Roberts’s email is the only contemporaneous evidence of what happened at this meeting, which Mr Arden read at the time and agreed was “perfect”. However, from the witness box, he initially suggested that the email had incorrectly recorded what had been said in relation to the two points in the previous paragraph. However, in reliance on the contemporaneous evidence, and on Mr Arden’s subsequent responses in cross-examination, we find that the email is not wrong, and that Mr Arden told Mr Lane that the £600m was “based on sampling”; and had also told him that the PRA had agreed no immediate change was required to the COREP reporting.

In addition to the points recorded by Ms Roberts in the email, it is clear from Mr Arden’s own evidence that he also gave Mr Lane the following information, which he accepted was incorrect:

Mr Arden also agreed in cross-examination that the Q3 Update was not mentioned during the meeting, and in particular:

On 16 October 2018, the text of Ms Roberts’s email (other than the first two sentences) was replicated in the minutes of the Disclosure Committee meeting, as can be seen from the text set out at §163. That is consistent with the header on the email, which was “for Disco” and with the opening sentence “David please review and add to minutes below as needed”.

After the meeting on 5 October 2018, there was no further discussion or communication between Mr Lane and the Bank for the rest of that calendar year on any disclosure or market-related issue.