The verdict in this case is not always easy to follow. Moreover, the conclusions should not be broader than what the market has already adopted. But the fact is that this is the first official decision on this matter. In this regard, this case is a welcome and important reference for the issue of closure under the 2002 ISDA Steering Contract, as it confirms the existence of a coherence of importance between the closing provisions of the 1992 and 2002 edition of the ISDA management contract. A comparison between the 1992 ISDA and the 2002 ISDA is available on the ISDA comparison page. The Tribunal found that this meant that the restriction in the 2002 ISDA differed significantly from that of the 1992 ISDA, in which the calculation was to be of an amount that the party concerned “reasonably considers in good faith as its total losses and costs”, which a number of authorities considered a test of rationality. The court found that this tightening was consistent with the commentary of the 2002 ISDA User Manual. In a recent case before the Commercial Court, it became clear that the change in the wording between the 1992 and 2002 ISDA master contracts was important in calculating the amount payable in the event of early termination. Under the 2002 agreement, the calculation of the final amount must be objectively reasonable and not merely rational. LBSF stated that NPC had violated the 2002 IDSA, both in the context of the publication of a revised statement a few years later (on the grounds that there was no provision under the 2002 ISDA to withdraw and replace a final statement) and by the NPC`s inability to follow an economically appropriate procedure for calculating the final amount in this statement. Overall, the advance payment of termination under the 1992 ISDA Master Contract is the “loss” suffered by the determining party when the loss is defined as “an amount reasonably in good faith as its loss and total cost.” This wording is justifiable.
The position was summarized in Fondazione Enasarco against Lehman Brothers Finance S.A. and Anthracite Rated Investments (Cayman) Limited  EWHC 1307 (Ch). In that case, the High Court held that a party wishing to challenge a calculation of the injury must show that the non-failing party`s decision was irrational in the sense of Wednesbury (i.e., it was so inappropriate that no reasonable person could have achieved it. In point a), it was said that the accumulated amount should have been taken into account. For the Tribunal, the question arose as to whether the non-inclusion of the accumulated amount was a clear error encouraging NPC to make a new finding or whether it was the type of error that simply had to be corrected by agreement or by the court. This issue is discussed below. The next section examines whether the requirement in point (b) has been met and what the consequences are if this requirement is not met. The ISDA lehman was then modified by an alternative letter (the letter of page) of July 24, 2006. Side Letter documented an agreement between LBIE and LBF that, in the event of termination of a customer transaction, the “back-to-back-Intercompany” transaction would be automatically terminated and that the amount of compensation payable under Lehman ISDA in or by LBIE is the amount payable to LBIE or LBIE as part of the relevant customer transaction transaction. As noted above, LBSF attempted to rely on its own market valuations, which showed that the LBSF transaction had a significant value in its favour at its end.