A Scottish property developer has won a landmark legal case against the Royal Bank of Scotland that could have far-reaching consequences for the banking sector over its treatment of businesses just prior to the financial crash.
The Supreme Court has found in favour of Derek Carlyle after a bitter seven-year battle, leaving the taxpayer-owned bank potentially facing a bill in excess of £3million.
Mr Carlyle originally won a Court of Session decision in 2010 from Lord Glennie, who found the bank had a contractual obligation to provide an additional £700,000 of development funding on top of a £1.4million loan for a site in the grounds of the Gleneagles Hotel.
That ruling was subsequently overturned on appeal, which has now been trumped by the Supreme court ruling.
RBS, whose legal bill on the case is estimated to have run to hundreds of thousands of pounds, is open to a £3million counter-claim for loss of profits and future income from Mr Carlyle.
Cat MacLean, Head of Dispute Resolution for MBM Commercial and Mr Carlyle’s solicitor, said: “This has been a long, hard battle for Derek, who has had his life put on hold for a number of years, but has stuck with the case with dogged determination in the face of numerous obstacles put in his way by RBS.
“It is a vindication of not only his position, but also gives hope to many individuals and businesses in the property and other sectors who have suffered at the hands of banks.
“It sends a message that banks are not beyond censure or free to do what they choose, regardless of the human consequences – they will face legal redress in the end.”