Stockbrokers in the clear following High Court win for Memery Crystal

Memery Crystal has landed a High Court judgment that dismissed an investor’s allegations of unauthorised trading.

Mr Justice Blair held that claims that Crawley-based Ellis Stockbrokers executed transactions without authorisation should be dismissed.

The claimant, British Virgin Islands-based company Geniki Investments International, was unable to prove that trades were actioned without permission.

Geniki had opened an account with Ellis with an initial sum of £217,000, which by July 2001 had been mostly drained due to trading losses. Geniki claimed that 62 deals undertaken by Ellis were unauthorised. Of these, 35 formed the subject of the claim before the court.

Counsel for Geniki argued that the company had given permission for Ellis to act on an “execution-only” basis, although the agreement between the parties did not make this clear.

The court accepted the defence’s argument that Ellis was acting in an advisory and execution role, which meant the transactions were de facto authorised through the course of dealings between the parties.

Sharif Shivji of 4 Stone Buildings was instructed by Edwin Coe on behalf of the claimants, while Andrew Clutterbuck, also of 4 Stone Buildings, acted for Ellis under the instruction of Memery Crystal.