CL-2018-000297, CL-2018-000404, CL-2018-000590, - [2025] EWHC 2364 (Comm)

One consequence of that approach is that where a defendant is alleged to be liable in deceit, as a primary liability, in respect of a misstatement made to the claimant by another that induced the claimant to act, or refrain from acting, so as to suffer loss, it may be impossible or unrealistic to consider separately the relevant state of mind of the defendant and the question whether responsibility for the misstatement is to be attributed. Another consequence is to simplify the analysis. That can be illustrated from the case put against Sanjay Shah in closing. SKAT contended in its written closing submissions that he was “primarily liable”, i.e. liable in deceit as a primary tortfeasor:

That presents the matter as if there are different doctrines of attribution, for each of which SKAT advanced a case that Sanjay Shah was caught. The better view (as SKAT itself submitted in Mr Rabinowitz KC’s oral closing argument) is that a single question arises, namely whether Mr Shah deliberately arranged matters so that one or more of the representations alleged by SKAT would be made to SKAT by the Tax Agents, the representation or representations in question being false and Mr Shah knowing that (or having no honest belief in the truth of the relevant representation or representations) and intending SKAT to be induced thereby into paying out on the tax refund claims submitted to it. At all events, that is so given that (a) any representations made to SKAT were made by the Tax Agents, and (b) there was no agency agreement between the Tax Agents, or their principals, the named clients, and Sanjay Shah, under which the Tax Agents were appointed his agent and agreed that they would be acting on his behalf in respect of tax refund claims they submitted to SKAT.

The nature and content of the representations alleged by SKAT meant that the issue of whether a given defendant understood that representations essentially to the effect of those representations, or any of them, would be or were made to SKAT was a significant question explored at trial for at least those defendants said by SKAT to have a primary liability for deceit. That led to a question arising in oral closing argument, on which submissions were made for SKAT and for some of the defendants, as to whether there would be liability for deceit where, speaking objectively, a pleaded representation was made, and, subjectively:

As part of SKAT’s submissions, Mr Graham KC posed as an example a fee obtained to speak at a civic conference where the representation was, and was understood by the representee to be, that the representor was the Mayor of Boston, Lincs., but the representor, who was not a Mayor at all, intended what they said to convey that they were the Mayor of Boston, MA. That to my mind did not capture the possible point, because (subject to detailed consideration of the facts if it were a real case) it would be likely to be fair to say the representor intended the representee to understand, cumulatively, (i) that the representor was a Mayor, and (ii) that their Mayoralty was in Boston, MA, and that the representee was induced by the misrepresentation as to (i) even if their error in thinking that the representor was referring to Boston, Lincs., was also material to their decision (and perhaps even essential to it). There was no possible analogy there to the case SKAT had pursued at trial here.

Varying Mr Graham KC’s example, suppose an attendance fee in respect of the conference, paid by the local council to the defendant, upon application, and then: