Linklaters heads to CoA on Commerzbank bonus fight

Matrix Chambers’ Tom Linden QC will tomorrow (6 November) attempt to persuade the Court of Appeal (CoA) to give Germany’s Commerzbank permission to appeal the bankers’ bonus case it lost earlier this year.

Linklaters managing associate Jillian Naylor has instructed Linden for the CoA oral hearing after the bank was refused permission to appeal on paper in May.

In total 104 ex-bankers launched a High Court claim in September 2009, with Stewarts Law partner Clive Zietman instructed for 83 claimants while Mishcon de Reya acted for 21.

Nigel Tozzi QC of 4 Pump Court was instructed by Zietman to lead the battle for the 83 claimants, while Mishcon instructed Essex Court’s Andrew Hochhauser QC.

Mr Justice Owen upheld claims that the bank “was wrongful and in breach of express and implied terms” when it refused to pay bankers’ bonuses in 2008 as the banking market went into freefall.

The judgment (9 May 2012) revealed that at the height of the global banking crisis Dresdner Kleinwort, which has since been taken over by Commerzbank, claimed to financial regulators that a bonus pool had been set up to stop staff defections.

However, the bankers did not receive their Christmas 2008 reward after being told that any bonus would be subject to a so-called material adverse change clause, meaning it would be paid the following February pending the financial performance of Dresdner Kleinwort. Consequently payments to staff were reduced by 90 per cent.

Owen J refused the bank permission to appeal in June and ordered it to pay 50 per cent of the claimants’ costs of more than £10m (1 June 2012 ). Stewarts Law billed £5.6m for the work while Mishcon charged £5.08m.

The judge said that the bank’s behaviour was “highly reprehensible, and was unreasonable to the high degree that warrants an order for indemnity costs”.

It is understood that the court will decide tomorrow whether to allow the appeal.