Brick Court win spells no compensation for Northern Rock shareholders

Mayer Brown and Brick Court Chambers have won a victory that supports the Government’s actions over the collapse of Northern Rock in 2008.

A three-strong panel of the tax and chancery Upper Tribunal has decided that Northern Rock’s independent valuer had been correct to assign no value to the stricken bank’s shares. The decision meant that Northern Rock shareholders won no compensation when it was taken into public ownership.

Brick Court barristers Mark Howard QC, Martin Chamberlain and Jonathan Dawid were instructed by Mayer Brown partners Clare Canning and Simon Willis on behalf of the valuer Andrew Caldwell.

The case is one of the last handled by Canning, who recently left Mayer Brown to become general counsel at Ernst & Young (20 September 2011).

In the judgment, tax and chancery chamber president Mr Justice Warren, sitting with Judge Andrew Bartlett QC and Sandi O’Neill, ruled that although two private bidders had sought to acquire Northern Rock this did not mean Caldwell was wrong in his valuation.

The tribunal’s decision falls in line with earlier decisions from the High Court (13 February 2009) and Court of Appeal (see judgment).

The shareholders, led by hedge fund Harbinger Capital Partners, were represented in court by 3-4 South Square’s Mark Phillips QC and Blackstone Chambers’ Monica Carss-Frisk QC, instructed by Louise Verrill of Brown Rudnick. 3-4 South Square juniors David Allison and William Willson also appeared.