Specialisation: Financial services law

Commercial banking law: bank customer relationship

Module A [LWM72A]

Banks and customers

What is a bank and who is a bank customer?

The contract: obligations of parties, significance of the mandate, termination of the contract, variation, proper law of the contract

Duty of confidentiality owed by a bank to its customers and the circumstances in which the duty can, or must, be breached

Module B [LWM72B]

Duty of care, fiduciary duty, constructive trust and undue influence

A bank’s duty of care: application and scope of duty

Fiduciary obligations: when does bank become a fiduciary and how can it limit or exclude its obligations?

Constructive trust: when does liability as a constructive trustee arise?

Undue influence: types of undue influence, how can a bank protect its transactions from challenge on the grounds of undue influence?

Constructive trust: when does liability as a constructive trustee arise?

Customer’s duty of care

Module C [LWM72C]

Accounts, money, payment and fund transfers

What is money, how is its transfer conceptualised legally? Chattel and bank money

What is payment and how is it made?

Credit and debit transfers

Clearing and settlement systems

Legal relationships

Accounts and dispute resolution
-Accounts: types of accounts and their implications
-Dealing with complaints: Banking Codes, Financial Services Ombudsman Service

Module D [LWM72D]

Cheques and payment cards

Cheques
  What is a cheque, the obligations of, and defences available to, paying and collecting banks

Payment cards and recovering mistaken payments
-Payment cards: debit cards, credit cards, charge cards, digital cash cards, etc.
-Contractual relationships
-Consumer Credit Act
-Recovering mistaken payments

Sequence:
Students are required to attempt the modules in order.

Textbooks:
E.P. Ellinger, Eva Lomnicker and Richard Hooley, Ellinger's Modern Banking Law 4th ed (Oxford: Oxford University Press, 2005), ISBN: 9780199281190

Commercial trusts law

Module A [LWM06A]

The nature of commercial trusts

Equity, trusts and commercial expectations

The contractarian account of trusts

Unit trusts and other financial uses of trusts

The constitution of express trusts in commercial transactions

Module B [LWM06B]

Equitable devices used to take security in commercial contracts

Taking security in loan contracts

Equitable charges

Establishing title at common law and in equity

Example: collateralisation in financial transactions

Module C [LWM06C]

The recovery of property in commercial litigation

Breach of trust in commercial and investment transactions

Recovery of property in relation to terminated transactions

Personal liability to account of commercial intermediaries

Case study: the local authority swaps cases

Module D [LWM06D]

Investment of trust funds

The duty to invest under statute

The duty to invest in the case law

Principles of the law of finance

Issues with portfolio investment strategies

Sequence:
Module A first.

Textbooks:
Alastair Hudson, Equity and Trusts 5th ed (London: Routledge-Cavendish Publishing, 2007), ISBN: 9780415418478

Alastair Hudson, Understanding Equity and Trusts 3rd ed (London: Cavendish Publishing, 2008), ISBN: 9781859418871

Corporate governance and compliance

Module A [ LWM80A ]

Governance – legal and regulatory framework

Introduction to corporate governance

-Corporate governance in the United Kingdom

-Corporate governance in the United States

Shareholders

Board of Directors

-Key principles and practicalities

-Composition and processes

Board committees

-International overview of board structures

Executives

Sarbanes-Oxley requirements

Listing requirements: how capital markets impose corporate governance requirements

Module B [ LWM80B ]

Compliance

Introduction to compliance

-Internal enforcement

-Whistleblowers

-Self-reporting

-Regulators

-Deferred prosecution agreements

Information systems: data privacy, data transfers, offshoring and the cloud

Corporate hospitality

Ethics, responsibility and social culture

Module C [ LWM80C ]

Bribery and corruption, money laundering and terror financing

Bribery and corruption

-US Foreign Corrupt Practices Act (FCPA)

-UK Bribery Act 2010

-Internationalisation of prohibitions on foreign bribery

Money laundering

-UK Proceeds of Crime Act 2002 offences

-UK Money Laundering Regulations 2007

Terror financing

-UK Terrorism Act 2000 offences

Module D [ LWM80D ]

Regulated industries – compliance and risk management in the financial sector

Introduction to risk management

Approaches to risk management

Governance in banks and how poor governance can cause systemic financial crises

Fraud within the banking sector

Sequence: Module A must be attempted before module B; module B must be attempted before module C; module B must be attempted before module D.

Textbooks:

Miller, G.P. The law of governance, risk management and compliance. (New York: Wolters Kluwer Law & Business, 2014) [ISBN 9781454845447].

Weinstein, S. and C. Wild Legal risk management, governance and compliance. (London: Globe Law & Business, 2013) [ISBN 9781905783946]

These will be despatched to registered students along with the hard copy of the Study Guides. Some readings are already available via the VLE, the Online Library or other internet sources.

Derivatives law

Module A [LWM75A]

Analysing and documenting derivatives transactions

The nature of financial derivatives

The International Swaps and Derivatives Association (ISDA) Master Agreement structure

The provisions of the ISDA master agreement

Issues in the creation of financial derivatives

Module B [LWM75B]

Terminating derivatives transactions

The ISDA termination scheme in outline

Events of default

Termination events

The ISDA termination procedure

Module C [LWM75C]

Legal issues in collateralisation and stock-lending

Taking security under English law

Collateralisation in general terms

Standard market documentation for collateral

Lessons from the local authority swaps cases

Module D [LWM75D]

Credit derivatives and securitisation

Credit derivatives

Securitisation

Stock-lending and repo transactions

Derivatives and the financial crisis

Sequence:
Module A, B and C must be attempted before module D.

Textbooks:
Hudson, A. The law of finance. (London: Sweet & Maxwell, 2009) first edition [ISBN 9780421947306]

Insurance law (excluding Marine insurance law)

Module A [LWM22A]

Elements of insurance

Definition: what is an insurance contract?

Regulation of insurers

Intermediaries: agents, brokers

Module B [LWM22B]

Insurance contract formation

Duty of disclosure and misrepresentation; remedies for breach

Formation of the contract including: offer, acceptance, premiums

Module C [LWM22C]

The insurance contract and its terms

Insurable interest in property insurance and life assurance

Terms of the contract

Construing the terms of the contract

Module D [LWM22D]

Claims process

Causation: determining the casue of the loss; losses caused by the insured

Claims: the claims process, the requirement of good faith

Subrogation: the insurer's, the insured's and the other parties' rights

Abandonment

Double insurance and contribution between insurers

Indemnity and reinstatement, mitigation of loss, reinstatement under contract and under statute

Alternative dispute resolution mechanisms: the ombudsman

Sequence:
Module A first, Module D last.

Textbooks:
John Lowry and Philip Rawlings, Insurance Law: Doctrines and Principles 2nd ed (Oxford: Hart Publishing, 2005), ISBN: 9781841135403

John Lowry and Philip Rawlings, Insurance Law: Cases and Materials (Oxford: Hart Publishing, 2004), ISBN: 9781841132747

International and comparative bank regulation

Module A [LWM64A]

Risk, banks and the principles of bank regulation

Banks and risk: what is a bank, why are banks important, what is risk?

Principles of regulation: what is regulation and what is its purpose(s)?

Module B [LWM64B]

Basel Committee and the regulation of international banks

Issues in international bank regulation: what are the problems?

Basel Committee on Banking Supervision: its structure, soft law

The Concordat 1975, Revised Concordat 1983, Core Principles

Capital Adequacy: Basel I and II

The impact of the banking crisis on Basel

Module C [LWM64C]

European Union regulation and who should regulate banks

EU banking regulation law

Who should regulate banks? Single financial regulator, multiple regulators?

Module D [LWM64D]

United Kingdom bank regulation law

Pre-1979: ‘unregulated’ period. Regulation 1979-1997

Financial Services Authority: structure, accountability, objectives and practice

Sequence:
Starting with A, modules must be attempted in order.

Textbook:
There is no supplied textbook for this course. Instead, students are directed to read an extensive selection of online resources.

International and comparative trust law

Students are not required to have studied the 'Law of trusts' at undergraduate level. However, it is advisable to have done so, for this course assumes that students are familiar with, and have an understanding of, the 'Law of trusts' and the standard works on the subject up to LLB level or its equivalent. Knowledge of the relevant principles of the 'Conflict of laws' is useful, though not essential.

Module A [LWM29A]

The nature of the English trust

Survey of the English law of trusts

Shams

The trust as property-holding vehicle and as obligation

The core content of a trust

The Beneficiary Principle: trusts for non-charitable purposes

Module B [LWM29B]

Offshore purpose trusts

Introduction to offshore non-charitable purpose trusts

The Bahamas

Belize

Bermuda

The British Virgin Islands

The Cook Islands

Cyprus

Guernsey

Isle of Man

Jersey

Labuan

The STAR trust of the Cayman Islands

The British Virgin Islands’ Vista Trusts

Module C [LWM29C]

Asset protection trusts

Asset protection trusts in a commercial and trading context

Introduction to offshore asset protection trusts

The pre-Insolvency Act 1986 and current position under English law

The Bahamas

The Cayman Islands

The Cook Islands

Cyprus

Gibraltar

The Isle of Man

Jersey

Avoidance of forced heirship

Module D [LWM29A]

Special issues in international and comparative trust law

Part one:

Choice of law; jurisdiction; recognition; enforcement

General principles of choice of law

The Hague Trusts Convention

The jurisdiction and remedies of the English courts over foreign trusts

Recognition and enforcement of foreign judgments in England

Part two:

The reception of the trust or trust-like devices in civil law jurisdictions

The trust and the civil law

The trust from a worldwide perspective: The trust’s future

Sequence:
Start with A, modules must be attempted in order.

Textbook:
John Glasson and Geraint Thomas (eds), The International Trust 2nd ed (Bristol: Jordan Publishing Ltd, 2006), ISBN: 9781846610394

International commercial insurance law

Module A [LWM70A]

The contract of reinsurance

The definition of reinsurance

Regulation of reinsurance business

Forms of reinsurance: facultative contracts; treaties

Relationship between assured, insurer and reinsurer

Formation and insurable interest

Utmost good faith

Express, implied and incorporated terms

Module B [LWM70B]

Reinsurance losses and claims

Back to back cover

Follow the settlements and follow the fortunes

Claims co-operation and claims control clauses

Aggregation of losses

Post-loss allocation

Inspection clauses

Module C [LWM70C]

Liability insurance

Forms of liability insurance: event, injury, claims made

Compulsory insurance regimes: motor; employers’ liability; maritime law

Professional indemnity insurance

Directors’ and Officers’ insurance

Product liability insurance

Defence costs

Third party rights

Module D [LWM70D]

Conflict of laws in insurance

Jurisdiction of the English courts: European cases

Jurisdiction of the English courts: non-European cases

Law applicable to insurance and reinsurance contracts: the different regimes

Law applicable to insurance and reinsurance contracts: express choice; absence of choice

Significance of the applicable law

Sequence:
Module A must be attempted before Module B.

Textbooks:
Textbook details TBC.

Law of financial crime

[Please note: this course replaces 'Fraud, corruption and money laundering']

Module A: [LWM17A]

Insider dealing and market abuse

The sources of the law on insider dealing

The EC context of market abuse: insider dealing and market abuse

The purpose of the law on insider dealing, and whether or not insider dealing ought to be
criminalised

Insider dealing offences under Part V of the Criminal Justice Act 1993

The power of regulators

Market abuse regulation

Module B: [LWM17B]

Fraud and market manipulation

The development of the criminal law of fraud

The economic and historical context of the law on abusive practices

Market manipulation offences

Fraud Act 2006 offences

Theft Act 1968 offences

Module C: [LWM17C]

Money laundering

The purpose of money laundering regulation

The international dimension

The context of money laundering regulation

Proceeds of Crime Act 2002 offences

Terrorism Act 2000 offences

Money Laundering Regulations 2007

The efficacy of money laundering regulation

Civil recovery

Module D: [LWM17D]

The nature of the law on financial crime

The sources of the law on financial crime

The objectives of the law on financial crime

The economic and historical context of the law on corruption

The role of information and transparency in financial criminal law

The EC Market Abuse Directive

The role of the regulators in prosecuting criminal offences

The role of criminal law in supporting financial regulation in the UK

Other criminal offences under Financial Services and Markets Act 2000

The underlying objectives of the criminal law in relation to finance

Civil recovery

Sequence:
Module A, B and C must be completed before Module D.

Textbooks:
Alastair Hudson Law of Finance. (London: Sweet & Maxwell, 2009) ISBN: 9780421947306

For Sections C and D of the course only:
Peter Alldridge, Money Laundering Law (Oxford: Hart Publishing, 2003), ISBN: 9781841132648

Law of international finance: syndicated loans

Module A: [LWM66A]

Capital markets, finance and the loan contract

Raising finance, the nature of international finance

The nature of the loan contract and its objectives

The different types of loan contract, the use of security and guarantees, conflict of laws and choice of forum

The loan contract: contractual capacity, formalities, term sheets, commitment letters and mandates, syndication of loans, the model contract, construing the terms of the contract

Module B: [LWM66B]

Terms of the contract Part I

Interest on the loan, adjusting the interest rate

Stipulating the purpose of the loan

Utilisation request

Conditions precedent

Representations and warranties

Module C: [LWM66C]

Terms of the contract Part II

Financial covenants

Asset disposals and change of business clauses

Negative pledge clause

Module D: [LWM66D]

Syndicate management and loan transfer

Syndicate management, the duties and rights of the arranger and agent banks

Transferring the rights and obligations under a loan contract

Sequence:
The modules must be attempted in order.

Law of international project finance

Module A: [LWM78A]

Loan facilities

Term sheets and commitment letters

The overall structure and contents of a loan facility agreement (based on the standard (Loan Market Association) form of loan agreement)

Financial and operative provisions; issues arising from the 2012 LIBOR scandal

Implications of a wrongful refusal to lend

Conditions precedent

Representations and warranties

Covenants and undertakings

Events of default and acceleration

Module B: [LWM78B]

An introduction to project finance

Approaching legal issues in a project finance structure

Outline of a typical project finance structure (parties and their objectives, contractual framework and typical project financing steps)

Sources of funding

Export credit agencies and multilateral development banks

The license and state aid issues

Module C: [LWM78C]

Risk identification, allocation and mitigation in project finance transactions

Cross-border risks

Commercial risks

Risk allocation in project documentation

Insurance issues

Module D: [LWM78D]

Project finance documentation

Negotiating finance documents

Sponsor support, security and related issues

Construction contracts

Operation and maintenance agreements

Offtake sales contracts

Direct agreements

Sequence:
Module A first

Textbook:
Scott L. Hoffman, The Law and Business of International Project Finance 3rd ed (Cambridge University Press, 2007), ISBN: 978-0521708784

Law on investment entities

Module A: [LWM77A]

The legal nature of investment entities

The meaning of "investment": speculative, social and collective investment

The concept of "risk" in investment law

Trusts as investment entities

The predication of all investment entities on concepts of contract and property

Principles of portfolio management and their legal aspects

Acquisitions investment

Module B: [LWM77B]

Collective investment schemes

The European Community Undertakings for Collective Investment in Transferable Securities (UCITS) Directive

The legal nature of a unit trust

The legal nature of an open-ended investment company

The regulation of collective investment schemes

Module C: [LWM77C]

Communal investment schemes

The history of communal investment models

Friendly societies

Cooperative investment models

The legal inter-action of members of communal investment schemes

The legal nature of investors' rights in such entities

The regulatory context of retail investment services provision

Public sector investment models

Module D: [LWM77D]

Investor protection

The fundamentals of financial regulation in the UK

The effect of the Markets in Financial Instruments Directive (MiFID)

The conduct of business regulation

The regulation of financial promotion

The interaction between regulation and substantive law on investor protection

Sequence:
The modules must be attempted in order.

Textbooks:
Textbook details TBC.

Marine insurance law

Module A: [LWM39A]

The contract of marine insurance

The nature of a marine insurance contract

The Marine Insurance Act 1906

The requirement of insurable interest

Wagering and gaming contracts

The formation of a marine insurance contract

The construction of a marine insurance contract

The policy

Types of marine insurance policies (time/voyage policies; floating policies/open covers; valued/unvalued policies; composite/joint policies)

The assignment of rights under a marine insurance policy

Module B: [LWM39B]

The doctrine of Uberrimae Fidei and insurance contracts

Nature of the duty of utmost good faith

The assured's pre-contractual duty of good faith: misrepresentation and non-disclosure

The assured's post-contractual duty of good faith and the duty in respect of claims

The insurer's duty

Remedies

The role of the broker

Module C: [LWM39C]

The terms of the contract; risks; and causation

Terms:
- Premium
- The assured and the subject matter of the insurance
- The attachment, duration, alteration and termination of the insured risk (including change of voyage, deviation and delay)
- Warranties (express and implied)
- Conditions and other terms
- The Institute Clauses

Risks:
- Marine risks
- War risks
- Excepted risks

Causation

Burden of proof

The sue and labour clause (mitigation of loss)

Module D: [LWM39D]

Indemnity, subrogation and contribution

The principle of indemnity

The measure of indemnity:
- Partial loss
- Actual total loss
- Constructive total loss

Insurers’ right of subrogation upon payment

Contribution between multiple underwriters

Third parties’ rights against insurers

Sequence:
The modules must be attempted in order.

Textbooks:
Susan Hodges, Law of Marine Insurance (London: Cavendish Publishing, 1996), ISBN: 9781859412275

Susan Hodges and Roy Carlile, Cases and Materials on Marine Insurance Law (London: Cavendish Publishing, 1999), ISBN: 9781859414385

Private law aspects of the law of finance

Module A [LWM69A]

Fiduciary liability in finance

The basis of financial regulation in the United Kingdom

The nature of fiduciary liability

The significance of fiduciary liability in financial transactions

Liability in relation to conflicts of interest and firm’s profits

Conduct of business regulation

Standards of “integrity” in regulation and fiduciary liabilities of “good conscience”

Module B [LWM69B]

Stranger liability in finance

The nature of stranger liability

Liability for dishonest assistance in a breach of fiduciary duty

Liability for knowing receipt of property resulting from a breach of fiduciary duty

Attribution of knowledge and dishonesty of traders to financial institutions

Taking objective notions of honesty, knowledge, etc., from regulation

Case law on reasonable commercial behaviour and stranger liability

Module C [LWM69C]

Issues in the creation of financial contracts

Case law on mistake in the creation of complex financial contracts

The use of master agreement structures in many financial markets

Conditions and warranties in standard market contracts

Exclusion of liability

Module D [LWM69D]

Suitable conduct and unconscionable conduct in financial transactions

Undue influence in financial transactions

Appropriate treatment of clients in forming contracts under conduct of business regulation

Misrepresentation in financial transactions

Unfair contract terms.

Sequence:
Module A must be attempted before module B,C or D.

Textbook:
Textbook details TBC.

Securities law

Module A [LWM71A]

The foundations of securities regulation

The Lamfalussy Process for creating European Union (EU) securities regulation

The EU securities directives

The general EU financial services directives as they apply to securities transactions

Implementation in the United Kingdom

Module B [LWM71B]

Prospectus and transparency regulation of securities

The core significance of information in securities regulation

The economic objectives of prospectus and transparency obligations

“Offers of securities to the public”

Prospectus regulation

Transparency obligations regulation

The duty of disclosure in prospectuses

Module C [LWM71C]

Liability for misstatements in a prospectus

The common law on obligations to make disclosure in prospectuses

The tort of negligence

Negligence and takeovers

Negligence and sales of securities in the after-market

Financial Services and Markets Act 2000, s.90

Fraudulent misrepresentation (the tort of deceit)

Module D [LWM71D]

The Listing Rules and the Model Code

The Listing Process

The six Listing Principles

Admission to listing

Maintenance of listing

Discontinuance of listing and censure

Sequence:
Module A must be attempted before section B; section A must be attempted before section
C; section A must be attempted before section D.

Textbooks:
Alastair Hudson, The law of finance (London: Sweet & Maxwell, 2009), ISBN 9780421947306

Extracts from Alastair Hudson, Securities law (London: Sweet & Maxwell, 2008), ISBN 9781847033291

View more Securities Law videos on the LLM YouTube channel