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''Hazell v Hammersmith and Fulham LBC'' () 2 AC 1 is an English administrative law case, which declared that local authorities had no power to engage in interest rate swap agreements because they were beyond the Council's borrowing powers, and that all the contracts were void. Their actions were held to contravene the Local Government Act 1972. Prior to the judgment a large number of local authorities had entered into such swap transactions. Accordingly, the decision of the House of Lords declaring such practices to be unlawful set off a torrent of collateral litigation unwinding such swaps.〔In his judgment in ''(Re Interest Rate Swap Litigation )'' (unreported, 28 November 1991) Hirst J recorded that "As at 30th October, 1991 there were 203 extant swap actions, 18 had been settled after the issue of proceedings, 2 had been discontinued and 4 are in progress in the Chancery Division. Although in the vast majority of cases the banks are plaintiffs, there are 10 actions involving 8 local authorities in which a local authority is plaintiff because they are net losers under their swap transactions. The number of plaintiff banks in these actions totals in all 42 and the number of local authority defendants 62. These figures may need up-dating, but give a substantially accurate picture."〕 Although this clearly caused difficulties for the banks and local authorities engaged in such swap transactions, it has been noted that the "swap litigation" was instrumental in developing the modern law of restitution under English law. ==Facts== Up until the early 1990s a number of local authorities had been engaged in interest rate swap transactions as part of managing their debt portfolios. Under the Local Authorities Act 1972 the local authorities had power to borrow in order to amortise their costs of capital projects over a longer period of time. In connection with that borrowing, certain local authorities sought to enter into swap transactions to hedge their exposure to fluctuations in interest rates. There were some doubts as to the ability of local authorities to enter into such transactions, but the local authorities sought the opinion of Anthony Scrivener QC, a leading commercial silk, who had advised that if a "rate swap is undertaken as part of the proper management of the council's fund then ... the swap will be ''intra vires''." (within the powers of the council )〔McKendrick, at page 208.〕 Whilst most local authorities engaged in swap transactions on a prudent scale to manage their debt portfolios, the position of Hammersmith and Fulham LBC was different. Writing about the swaps litigation, Professor Ewan McKendrick described it thus: In his 2008 book, ''Follow The Money'', Duncan Campbell Smith paints a dramatic picture of the moments before the litigation commenced, with the slowly dawning realisation developing amongst the principals that somehow a very left-wing London Borough Council has managed to accumulate an extraordinarily large swaps exposure to the various banks simply to be able to collect and spend the premiums for entering into the trades: When Mr Scrivener QC was asked to give a further opinion in relation to the matter, having been made better aware of the scale of the activities of Hammersmith, he advised that if one looked at all of the transactions in their totality, one could not say "these transactions were part and parcel of debt management so as to be lawful".〔McKendrick, at page 209.〕 In his judgment, Lord Templeman noted that although the total borrowings of Hammersmith were in the order of ₤390 million, it had entered into swap transactions with a total aggregate notional principal of ₤6,052 million.〔() 2 AC 1, at 26F.〕 When the district auditor (Tony Hazell) became aware of the scale of Hammersmith and Fulham's activities in the swap market he brought proceedings to determine whether or not those activities were lawful. Although the case is reported as Hazel against Hammersmith and Fulham, in practice the various banks were joined as third parties, and Hammersmith and Fulham joined with Hazel in arguing that the swaps were unlawful and should not be binding upon them. The banks were understandably upset that Hammersmith and Fulham were selected to be the test case, given that its activities were at the extreme end of the spectrum.〔Despite the banks' ire, this was fairly understandably. Because Hammersmith and Fulham had entered into so many swaps for so many different purposes, it enabled the court to make rulings which would cover the broadest range of scenarios.〕 In addition to being upset at the choice of Hammersmith (rather than a Council which had made more responsible use of interest rate swaps), the various banks were also reported to have been upset by the decision for the case to be brought in the Divisional Court rather than in the Commercial Division of the Chancery Court, where a judge might have been expected to have greater familiarity with transactions of this nature. 抄文引用元・出典: フリー百科事典『 ウィキペディア（Wikipedia）』 ■ウィキペディアで「Hazell v Hammersmith and Fulham LBC」の詳細全文を読む スポンサード リンク
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