Following an eight day trial, the Chancery Division (Henry Carr J) handed down its judgment on 20 July 2017 in a dispute between Deutsche Bank and Sentrum Holdings (a subsidiary of Digital Realty, the US-based global leader in large-scale data centres).
The case involved a challenge by Deutsche Bank to the validity of a Deed executed in August 2015. The Deed purported to effect Deutsche Bank’s surrender of a headlease of a data centre in Hayes, the surrender to Deutsche Bank of a sublease over the same property and the release of an associated guarantee given by Sentrum Holdings The headlease surrender was subsequently found to be invalid (because the consent of the landlord’s secured lender, the Co-Op Bank, had not been obtained). Deutsche Bank argued that the release of the guarantee should also not take effect, notwithstanding the terms of the Deed. It sought to invalidate the release of the guarantee by means of a number of arguments, including implied term, implied fraudulent misrepresentation and mutual and unilateral mistake (the principle in Pitt v Holt).
In a wide-ranging and detailed decision, the Court rejected each of Deutsche Bank’s arguments and gave judgment for Sentrum Holdings.
Aside from its consideration of the legal arguments and evidence, the Court also gave a timely reminder, of general application to all involved in civil litigation, of the importance of ensuring that witness statements are accurate and reflect the contemporaneous documents, so as to spare honest witnesses the difficult experience, as occurred in this case, of hostile cross-examination on their witness statements at trial.
Sentrum Holdings represented by White & Case, instructed Ben Valentin QC at trial, leading Gary Cowen (of Falcon Chambers).
A link to the judgment can be found here.