There has been widespread press coverage this week of a Court of Appeal decision in the case in which 104 former Dresdner Kleinwort bankers are suing Commerzbank over its decision to lower their bonuses after buying the bank at the height of the financial crisis in 2007.

The Court of Appeal’s decision simply means that the claimants can proceed with all their claims relating to the €400m ‘guaranteed minimum bonus pool’. Commerzbank may now appeal to the Supreme Court, but in the meantime the claimants have succeeded in overturning the High Court’s decision which struck out one important part of their case. So this is by no means the end of the litigation: in fact we may be nearer the beginning, although the case has lasted for over a year already.

In many ways it is an exceptional case. But it raises some novel and important general issues. For example, can you have individual legal rights in relation to a guaranteed bonus pool, from which individual bonus allocations have not yet been made, and from which individual allocations will only be made on a discretionary performance related basis? If the ultimate answer to that question turns out to be yes, then many lawyers and industry observers will be surprised. Prior to the Court of Appeal’s decision, the bank successfully argued that the bankers had no realistic prospect of succeeding in their claims relating to the initial general announcement of the €400m guaranteed bonus pool, before the allocation of individual bonuses from it. If the claimant bankers now go on to show that they had enforceable legal rights at the bonus pool announcement stage, it will probably be on the basis that the bonus pool was announced in exceptional circumstances, to safeguard employee stability at a time when there was great uncertainty surrounding the business.

If it is possible for legal rights to be created at such an early stage of the bonus cycle, then this could concern all banks, but they would look again at their bonus policies and pay particular care over any future announcements about the size of a general pool, as opposed to communication of individual awards. They will also take comfort over the discretion they retain over individual bonus allocation, whilst the whole legal landscape of bankers bonuses has changed recently under the new FSA remuneration code. The Commerzbank issues pre-date this. One implication of the new code is that in some circumstances, for example “material financial downturn”, regulated firms are required to reduce deferred bonus awards before vesting.

At its heart, like all bonus claims this case concerns whether contractual promises were made and broken. With the stakes particularly high in this case, it is one that people in the industry should continue to watch.