Bank of Credit and Commerce International SA v Ali

Bank of Credit and Commerce International SA v Ali [2001] UKHL 8 is an English contract law case in the House of Lords on the limits of freedom of contract, and the contra proferentem principle.

BCCI v Ali
Court	UK House of Lords
Full case name	Bank of Credit and Commerce International SA v. Munawar Ali, Sultana Runi Khan and Others
Decided	1 March 2001
Citation	[2001] UKHL 8; [2001] 1 All ER 961; [2001] 2 WLR 735
Court membership
Judges sitting	Lord Bingham of Cornhill Lord Browne-Wilkinson Lord Nicholls of Birkenhead Lord Hoffmann Lord Clyde
Keywords
Contractual terms, contra proferentem

Facts

Mr Naaem, an employee of BCCI SA, claimed damages for economic loss after not having been able to find a job following his redundancy in 1990. BCCI, once the world's 7th largest bank, had gone insolvent after mass fraud because of the stigma. However, Naaem and other employees had signed a release form saying the redundancy pay was ‘in full and final settlement of any claims... of whatsoever nature that exist or may exist’. BCCI argued Naaem was bound.

Judgment

The House of Lords by a majority held that because the exposure of fraud would not have been contemplated when Mr Naeem signed, the release did not actually, despite the words, excluded a stigma damages claim.

See also

• English contract law

References

• Bank of Credit and Commerce International SA v. Munawar Ali, Sultana Runi Khan and Others [2001] UKHL 8 (1 March 2001)