A French bank claiming a magic circle firm was negligent in its handling of a dispute over gold bullion has argued that the English courts are not the correct jurisdiction to hear the claim.

Clifford Chance filed an application seeking declarations that Clifford Chance LLP and not Clifford Chance Europe was acting for Société Générale in litigation, in which the bank took a Turkish gold jewellery manufacturer to court over bullion worth around $483m at the time. 

The bank supplied 15.725 metric tonnes of gold on a consignment basis. It claimed that it later learned the gold was being used before the bank had been paid.

Société Générale is applying for an order staying or dismissing proceedings. It argues that the French court is the more appropriate forum to hear the claim and, according to court documents, the proceedings ‘have been commenced in contravention of an applicable exclusive jurisdiction clause in favour of the French court’.

In an application hearing before Mr Justice Henshaw in the Rolls Building this week, Clifford Chance argued that CC Europe owed no duty of care to the bank in respect of the conduct of the litigation. The firm claims that neither CC LLP nor CC Europe is liable. Société Générale is applying for an order staying or dismissing the London proceedings. 

According to court documents, the bank has begun proceedings against CC LLP and CC Europe in Paris. The first French court hearing is listed for March 2024.

The London application was brought by Clifford Chance following a 'Formal Demand' sent by Société Générale to CC Europe LLP and copying in CC LLP last year. The letter alleged that CC Europe had acted negligently and in breach of duty in its conduct of the litigation and that the bank had suffered loss as a result. The firm denies all allegations against it.

 

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