Book contents
- Frontmatter
- Contents
- Preface
- List of acronyms
- Part I Evolution of capital markets regulation, FSA and the European single market
- Part II Licensing and rule application
- Part III The firm's infrastructure
- Part IV Conduct of business
- 8 Client classification and client documentation
- 9 Principles of conduct
- 10 Marketing investments
- 11 Advising clients
- 12 Improper behaviour in dealing and executing orders
- 13 Dealing and executing orders
- 14 Exchanges and MTFs
- Part V Application of rules to particular businesses
- Bibliography
- Index
11 - Advising clients
Published online by Cambridge University Press: 03 December 2009
- Frontmatter
- Contents
- Preface
- List of acronyms
- Part I Evolution of capital markets regulation, FSA and the European single market
- Part II Licensing and rule application
- Part III The firm's infrastructure
- Part IV Conduct of business
- 8 Client classification and client documentation
- 9 Principles of conduct
- 10 Marketing investments
- 11 Advising clients
- 12 Improper behaviour in dealing and executing orders
- 13 Dealing and executing orders
- 14 Exchanges and MTFs
- Part V Application of rules to particular businesses
- Bibliography
- Index
Summary
General Law
The supply of services, such as giving advice, whether on an ad hoc or discretionary or non-discretionary basis, is subject to a duty of reasonable care as a matter or contract, tort and statute:
it was … within the scope of the defendant bank's business to advise on all financial matters and … there is a duty to the plaintiff to advise him with reasonable care and skill.
the liability of stockbrokers … did not di.er from commodity brokers: … in contract … stockbrokers are liable for failing to use that skill and diligence which a reasonably competent and careful stockbroker would exercise … [T]he principle in Hedley Byrne & Co Limited v. Heller. … would apply were there no contract and were a stockbroker negligently to give advice … [A] broker cannot always be right in the advice that he gives in relation to so wayward and rapidly changing a market as the commodity futures market. An error of judgement … is not necessarily negligent … even if he advised … [on] the transaction which produced the loss.
In a contract for the supply of a service where the supplier is acting in the course of a business, there is an implied term that the supplier will carry out the service with reasonable care and skill.…
- Type
- Chapter
- Information
- Capital Markets Law and ComplianceThe Implications of MiFID, pp. 306 - 325Publisher: Cambridge University PressPrint publication year: 2008