The Court of Appeal has held that a warranty that a company's accounts gave a “true and fair view” of its affairs (the standard required by the Companies Acts) was not breached where the accounts did not make provision for a liability of £2.4 million which was unknown at the time the accounts were prepared. The accounts had been prepared in accordance with relevant accounting standards and this was taken as strong evidence that the accounts did present a true and fair view.

The decision illustrates the importance for lenders to seek a comprehensive set of financial warranties and not merely rely on accounts warranties as a catch-all protection.

Macquarie Internationale Investment Ltd v Glencore UK Ltd [2010] EWCA Civ 697