Primeo Fund (in Official Liquidation) (Appellant) v Bank of Bermuda (Cayman) Ltd and another (Respondents) (Cayman Islands)
Case ID: JCPC 2019/0089
Jurisdiction: Court of Appeal (Cayman Islands)
Case summary
Issue
This appeal concerns claims brought by the appellant, Primeo Fund (In Official Liquidation) (Primeo), against the respondents for breach of their contractual duties. The claims arise in the context of the fraud perpetrated by Bernard Madoff. The Judicial Committee of the Privy Council allowed Primeo's appeal in relation to the application of the reflective loss rule to the extent explained in its judgment dated 9 August 2021. The Board is now asked to decide the remaining issues on Primeo's appeal and also decide the respondents' cross-appeal/additional grounds for upholding the decision below.
Facts
Primeo operated as an open-ended investment fund incorporated in the Cayman Islands. It invested funds with Bernard L Madoff Investment Securities LLC (BLMIS), initially a small proportion of its overall investments, growing over time. From 2003, Primeo also placed a small proportion of investments with BLMIS indirectly through Alpha Prime, a Bermudan-domiciled investment fund. From 2004, Primeo also began investing indirectly via another Cayman-domiciled fund, Herald Fund SPC. On 1 May 2007, Primeo switched its remaining direct investments in BLMIS to an indirect investment through Herald Fund SPC. The respondents acted respectively as Primeo’s administrator and custodian at all relevant times.
On 11 December 2008, Bernard Madoff was charged with fraudulently operating a multi-billion-dollar Ponzi scheme. Primeo was subsequently placed into voluntary liquidation. On 20 February 2013, Primeo brought claims against the respondents for breach of their contractual duties. At first instance, the judge dismissed Primeo’s claims, principally on the basis that strict liability loss and causation had not been established and that the claims were barred by the reflective loss principle in any event. The Court of Appeal agreed that that Primeo's claims were barred by the reflective loss principle, and so dismissed Primeo's appeal on that basis. Primeo now appeals to the Judicial Committee of the Privy Council.
Parties
Appellant(s)
Primeo Fund (in Official Liquidation)
Respondent(s)
Bank of Bermuda (Cayman) Ltd and another
Appeal
Justices
Lord Reed, Lord Hodge, Lord Lloyd Jones, Lord Kitchin, Lord Sales
Hearing start date
20 April 2021
Hearing finish date
21 April 2021
| Watch hearing | ||
|---|---|---|
| 20 Apr 2021 | Morning session | Afternoon session |
| 21 Apr 2021 | Morning session | |
Judgment details
Judgment date
9 August 2021
Neutral citation
[2021] UKPC 22
Appeal
Justices
Lord Reed, Lord Hodge, Lord Lloyd Jones, Lord Kitchin, Lord Sales
Hearing start date
12 Oct 2021
Hearing finish date
15 Oct 2021
| Watch hearing | ||
|---|---|---|
| 12 Oct 2021 | Morning session | Afternoon session |
| 13 Oct 2021 | Morning session | Afternoon session |
| 14 Oct 2021 | Morning session | Afternoon session |
| 15 Oct 2021 | Morning session | Afternoon session |
Judgment details
Judgment date
15 November 2023
Neutral citation
[2023] UKPC 40
- Judgment (PDF)
- Press Summary (PDF)
- Judgment on The National Archives (HTML version)
- Press Summary on The National Archives (HTML version)
- Judgment on BAILII (HTML version)
This judgment was uploaded on 22 November 2023 to correct how the Astley judgment was described. The corrections can be found at paras 314, 315, 316, 317, 318, 319, 320, 321, and 337.
| Watch Judgment summary | |
|---|---|
| 15 November 2023 | Judgment summary |