Mr Justice Hamblen has handed down judgment following the 18 week trial in the Innovator Litigation, dismissing the Claimants’ claims against Collyer-Bristow, Mr Bailey and others.
John Powell QC, Graham Chapman, Shail Patel and Can Yeginsu appeared for the Claimants. Justin Fenwick QC, Ben Hubble QC and Brendan McGurk appeared for Collyer-Bristow. Sue Carr QC and Tim Chelmick appeared for Mr Bailey.
In the Innovator Litigation some 555 Claimants brought claims said to amount to £64m arising out of 19 tax advantaged investment Schemes. The Defendants included: (1) Innovator, the promoter of most of the Schemes, (2) Collyer-Bristow, the firm of solicitors who acted for Innovator in relation to the Schemes, and (3) Mr Bailey, who was a partner at Collyer-Bristow at the material time. The Claimants alleged conspiracy, breach of trust, dishonest assistance, breach of the Financial Services and Markets Act 2000 (“FSMA”), breach of contract, misrepresentation and negligence.
The Litigation proceeded by way of a trial of the issues in 6 selected Schemes, together with evidence from 44 Lead Claimants.
In the course of his 263 page judgment, Mr Justice Hamblen reviewed, in the context of tax advantaged investment schemes involving Information Memoranda: (1) contract issues (offer and acceptance, implication of terms, affirmation); (2) agency issues (actual and ostensible authority, ratification); (3) trust issues including constructive and Quistclose trusts in relation to monies held on a solicitor’s client account; (4) accessory liability issues in relation to solicitors and others (dishonest assistance, knowing receipt and conspiracy); (4) FSMA issues, including whether the Schemes were Collective Investment Schemes and when a solicitor does, or does not, arrange deals in investments or act as operator of such Schemes; (5) misrepresentation, including reliance and disclaimer issues; and (6) tort issues, including the circumstances in which a duty of care will, or will not, be owed by a solicitor to a non-client.
The judgment will be important reading for any practitioner involved in tax, investment or financial services based claims against professionals whether arising out of tax advantaged investment schemes or generally.