Jurisdiction(s):
United Kingdom

4VVV v Spence: deceit, unlawful means conspiracy and FSMA UCIS—EWHC guidance on reliance, rescission, sections 19 and 26 remedies, and disclosure failings

Published on: 06 November 2024

Published by a LexisNexis Dispute Resolution expert

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Article summary

4VVV Ltd and others v Spence and others [2024] EWHC 2434 (Comm)

What are the practical implications of this case?

The claim revolved around three principal causes of action, including deceit. The claimants contended that statements made to them, which persuaded them to commit funds to the schemes, were fraudulent.

A successful deceit claimant may recover every loss directly arising from the fraud, whether or not it was reasonably foreseeable. That extends to consequential losses and profits forgone on an alternative transaction they would have pursued but for the deceit. The claimant must, however, give credit for any gains made as a result of the relevant transactions. Rescission, as an equitable remedy, may likewise be sought, and was pursued here for the relevant contracts.

The burden of proving the tort of deceit rests with the claimants. In 4VVV, each lead claimant had to establish that:

the Representations were received and relied upon when investing
the Representations were false
the defendants believed the Representations were false; and
the defendants intended the Representations to induce investment

Where a representation is made dishonestly, there is an evidential presumption...

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