10 - The Future of the Financial Courts

Summary

One the basis of the decisions handed down over the last three decades, and in particular since 2008, this book has argued that the English ‘Financial Courts’ have taken a market-minded or ‘macro’ perspective when adjudicating derivatives disputes. This approach has evolved with the markets themselves, as the courts have sought to respond to the exigencies of global markets operating on standard terms containing the default choice of English law and the English courts. In this sense, the English courts coped well with the unprecedented demands of the last financial crisis, including the spike of cases relating to the collapse of Lehman Brothers and novel and complex challenges to the administration of valuation and close-out in volatile markets. This approach has, however, proved more problematic in those cases reflecting the sheer diversification of the modern derivatives markets, so that end-users now include individuals and other types of non-sophisticated customers, an issue which does not have to be factored in by cases on standardised commercial terms used in sectors such as shipping.