| 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(s) | [2001] UKHL 8; [2001] 1 All ER 961; [2001] 2 WLR 735 |
| Court membership | |
| Judge(s) sitting | Lord Bingham of Cornhill Lord Browne-Wilkinson Lord Nicholls of Birkenhead Lord Hoffmann Lord Clyde |
| Keywords | |
| Contractual terms, contra proferentem | |
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.
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.
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.
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The Bank of Credit and Commerce International (BCCI) was an international bank founded in 1972 by Agha Hasan Abedi, a Pakistani financier. The bank was registered in Luxembourg with head offices in Karachi and London. A decade after opening, BCCI had over 400 branches in 78 countries and assets in excess of US$20 billion, making it the seventh largest private bank in the world.
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