A CAYMAN Islands investment fund, in liquidation, has sued a Dublin-based company for damages of €380 million over alleged breach of an administration and accounting services agreement.

The proceedings by Weavering Macro Fixed Income Fund Ltd against PNC Global Investment Servicing (Europe) Ltd, registered at Sir John Rogerson’s Quay, Dublin, were transferred to the Commercial Court yesterday by Mr Justice Peter Kelly.

The case concerns alleged breaches of a June 2003 administration and accounting services agreement between Weavering and PNC’s predecessor in title, PFPC International Ltd. Weavering alleges gross negligence, breach of contract, misrepresentation and/ or negligent misstatement in that provision of services.

In seeking transfer of the case yesterday, Brian Murray SC, for PNC, argued “wrongdoing” by the plaintiff company was “at the root” of the case and security for costs issues and possible involvement of others would be involved. The case would benefit from the Commercial Court procedures, he said.

An investment company incorporated and registered in the Cayman Islands, Weavering was placed in official liquidation by a court there in April 2009.

Much of its claim relates to interest rate swap transactions it entered between 2005 and 2009 with Weavering Capital Fund Ltd (WCF), a company incorporated in the British Virgin Islands. The swaps value rose from $1.48 million in April 2005 to $633 million in January 2009 but it now appears they are worthless, Weavering claims.

It claims that when existing swaps profitable to Weavering were closed out, no payments were made by WCF to Weavering, which was not disclosed to its auditors by PNC. It is also claimed there was failure to investigate or disclose to Weavering that payments were made to WCF when swaps unprofitable to Weavering were closed out.

At the date of the resolution to appoint liquidators to Weavering, there were four outstanding swaps, it is claimed. The effect of that involved WCF having a net liability of £442.7 million to Weavering when, it is claimed, WCF’s assets at all material times were worth less than £78 million and it did not have sufficient assets to meet its liabilities under the swaps.

It is claimed that by the time of Weavering’s liquidation, more than 20 per cent of its gross assets were exposed to the solvency of WCF contrary to the listing rules of the Irish Stock Exchange.

About March 2009, the ISE issued a notice of non-compliance by Weavering with its listing rules.