Fiduciary duties in the financial sector
By the Hon Justice Ashley Black
I should start this presentation by recognising the continuing issues as to effective regulation of the financial services regulation; I will then note areas of overlap and complexity in the general law and statutory regulation of conflicts of interest; and then note more specific regimes which may or may not address the gaps in effective regulation; and finally address ongoing questions as to enforcement practice.
Equitable penalties and high-low interest rate clauses
By John Lidbetter and Jacob Lerner
Should the equitable penalties doctrine be enlivened by a set of contractual provisions which provide that: (i) interest is charged at a ‘higher rate’ if the sum owing is paid by date A+1; but (ii) interest is charged at a ‘lower rate’, by way of discount, where the sum owing is paid by date A? For instance, should the penalties doctrine be engaged by the following set of provisions: (a) if the debtor pays by 2 January 2025, interest applies at a compounding rate of 50% per day; and (b) if the debtor pays by 1 January 2025, interest applies at a simple rate of 1% annually? The current state of the law says ‘no’. In contrast to the current approach, we contend that the penalties doctrine should be — and, indeed, is — capable of restraining such high-low interest rate clauses. The question that we pose in this essay is important as many financial instruments and loans prescribe ‘lower’ and ‘higher’ rates of interest in this fashion.
Advocacy in mediation
By John McKenna KC
Sir Laurence Street (1926-2018), after his retirement as Chief Justice of New South Wales, became one of Australia’s most renowned mediators. In his opening remarks at mediations, he would commonly use a simple analogy to set the mood. Having seated the opposing parties on opposite sides of a boardroom table, he would place a 50-cent coin between them. The coin would be balanced on its edge, with each side facing only one of the opposing groups. This coin, he explained, represented the problem which the parties were facing. Whilst each party was looking at the same problem, their views were limited by their perspective. One party was apt to view the problem as if it were simply a ‘heads’, whilst their opponent may only be viewing it as a ‘tails’. Whilst as mediator, he had a glimpse of both sides of the coin, his viewpoint was also constrained. So, the purpose of the mediation, he said, was to give all parties an opportunity, metaphorically speaking, to pick up the coin and examine it from all angles. Having then obtained a similar understanding of the problem, the parties should be in a much better position to work out how it could fairly be resolved.
These remarks are instructive for two reasons.
Fiduciary duties in the financial sector
By Hon Justice Ashley Black
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Equitable penalties and high-low interest rate clauses
By John Lidbetter and Jacob Lerner
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Advocacy in mediation
By John McKenna KC
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29