Daniel Saoul KC acts for successful claimants in deceit and unlawful means conspiracy group action
On 27 September 2024, the High Court (Foxton J) handed down judgment in a complex, long running fraud group action claim arising out of a multi-million pound property investment scheme (4VVV Ltd and Others v Spence & Others [2024] EWHC 2434 (Comm)). The lead claimants were successful in their claims for deceit and unlawful means conspiracy, and in seeking determinations that the investment schemes in question amounted to unregulated collective investment schemes and were therefore subject to the Financial Services and Markets Act 2000, and related regulations (“FSMA”). Daniel Saoul KC acted for the successful claimants, instructed by Trowers & Hamlins and leading Matthieu Gregoire (Essex Court Chambers) at trial. In addition, Neil Hext KC, Will Harman, Melody Hadfield, Carola Binney and Will Cook (all of 4 New Square) also assisted with this matter at various stages prior to and following the trial.
The case concerned investments made by 435 investors in student accommodation and holiday properties around the United Kingdom. The Claimants bought their investment properties between 2012 – 2019. They were sold to them by companies owned or controlled by the First and Second Defendants, Mr Nicholas Spence and Mr Derek Kewley. The Claimants alleged that the investment schemes pursuant to which the properties were sold, which promised fixed returns over set periods of time and which did not materialise, were fraudulent. With a number of the seller companies involved now insolvent, the claimants sued Mr Spence and Mr Kewley as well as a number of companies within their control for fraud, advancing claims in deceit and in unlawful means conspiracy. In addition, it was alleged that the property investment schemes were unregulated collective investment schemes, such that further relief was available under FSMA. The estimated damages were calculated at circa £45 million.
The litigation has been extremely hard fought. The claim was issued in February 2021, with the Claimants obtaining Worldwide Freezing Orders on an ex parte basis at that time. There have since been applications to discharge the WFOs (which were unsuccessful), contested applications for fortification of the cross-undertaking in damages (including an appeal to the Court of Appeal, in which the Claimants succeeded – judgment here) and many other pre-trial applications and hearings. Following the trial, but prior to Judgment, the Court also heard an application for contempt of Court against Mr Kewley, at which Mr Kewley was sentenced to a suspended sentence of imprisonment for various breaches of the WFO (Judgment [HERE]).
Mr Justice Foxton heard the trial of ten lead cases over a period of 10 weeks from April to June 2024. The trial Judgment addresses the underlying facts and legal arguments extensively, concluding that the lead Claimants had made out their claims in deceit, unlawful means conspiracy and under FSMA.
The full judgment can be found here
