Bank of Tokyo Ltd v Karoon
Encyclopedia
Bank of Tokyo Ltd v Karoon [1987] AC 45n is a conflict of laws
case, which also relates to UK company law and piercing the corporate veil
.
and a wholly owned subsidiary the Bank of Tokyo Trust Co, a New York corporation. Mr Karoon, an Iranian employee of the Iranian Martime Co had personal accounts with both banks. He left Iran and transferred his money from the New York to the London bank. In February 1980 the London bank was notified that Mr Karoon was sentenced to prison by the Iranian government, and requested his assets be sent to the Iranian government. Mr Karoon asked the bank to transfer his accounts to another bank. The bank, unsure of what to do, applied for an interpleader summons and the money was eventually paid into court. Mr Karoon sued the New York bank claiming breach of the duty of confidentiality in disclosing information to the London bank, and the London bank sought to restrain him taking proceedings in the American courts.
, observing that it was a separate corporation from Bank of Tokyo. There were no reasons of public policy which required an injunction.
In the course of his judgment Robert Goff LJ observed,
Conflict of laws
Conflict of laws is a set of procedural rules that determines which legal system and which jurisdiction's applies to a given dispute...
case, which also relates to UK company law and piercing the corporate veil
Piercing the corporate veil
Piercing the corporate veil or lifting the corporate veil is a legal decision to treat the rights or duties of a corporation as the rights or liabilities of its shareholders or directors. Usually a corporation is treated as a separate legal person, which is solely responsible for the debts it...
.
Facts
The Bank of Tokyo was a Japanese Bank operating in LondonLondon
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
and a wholly owned subsidiary the Bank of Tokyo Trust Co, a New York corporation. Mr Karoon, an Iranian employee of the Iranian Martime Co had personal accounts with both banks. He left Iran and transferred his money from the New York to the London bank. In February 1980 the London bank was notified that Mr Karoon was sentenced to prison by the Iranian government, and requested his assets be sent to the Iranian government. Mr Karoon asked the bank to transfer his accounts to another bank. The bank, unsure of what to do, applied for an interpleader summons and the money was eventually paid into court. Mr Karoon sued the New York bank claiming breach of the duty of confidentiality in disclosing information to the London bank, and the London bank sought to restrain him taking proceedings in the American courts.
Judgment
Robert Goff LJ held that it was for American law, as the forum conveniens, to determine whether a Bank of Tokyo Trust Co had committed a breach of contractBreach of contract
Breach of contract is a legal cause of action in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party's performance....
, observing that it was a separate corporation from Bank of Tokyo. There were no reasons of public policy which required an injunction.
In the course of his judgment Robert Goff LJ observed,