Anna Roiser & Sophia Smout explore hybrid loans and economic abuse in LexisNexis Family Law Journal
Anna and Sophia’s article was published in LexisNexis Family Law Journal, 20 October 2025, and can be seen here.
Anna Roiser, Senior Knowledge Lawyer in our Family & Relationships department, and Sophia Smout, Associate in our Litigation & Dispute Resolution department, discuss the recent Supreme Court decision in Waller-Edwards v One Savings Bank Plc and its implications for protecting victims of economic abuse.
The judgment broadens the circumstances in which lender banks must take steps to safeguard individuals from undue influence, particularly in non-commercial loans between couples. It recognises that risk exists whenever someone assumes liability for their partner’s benefit, marking a significant development in financial remedies.
Anna and Sophia explain that historically, cases such as O’Brien and Etridge established that banks are “on inquiry” when one party guarantees another’s debts, requiring compliance with the Etridge protocol, independent legal advice and disclosure obligations. However, uncertainty remained around “hybrid” loans, where funds serve both joint and individual purposes. In Waller-Edwards, the Supreme Court ruled that even a non-trivial surety element in such loans triggers the protocol, overturning the Court of Appeal’s more nuanced “fact and degree” approach.
Lady Simler’s judgment emphasised a binary test: either the lender is on notice or it is not. By rejecting subjective assessments of risk, the Court prioritised clarity and consistency. This approach benefits lenders by reducing litigation risk and ensures vulnerable parties receive protection without imposing excessive burdens on banks. The decision reflects growing recognition of economic abuse and its subtle manifestations within intimate relationships.
For couples, the ruling may introduce additional due diligence in ordinary borrowing, but it offers vital safeguards for those at risk of coercion or financial exploitation. By extending the Etridge protocol to hybrid transactions, the Supreme Court ensures that individuals taking on liabilities for their partner’s benefit have a baseline level of protection. This judgment underscores the importance of addressing power imbalances in financial arrangements and signals a broader commitment to tackling economic abuse beyond the family court.
Read the full article on the LexisNexis Family Law Journal website [subscription required].