On 30 April 2020, the Court of Appeal handed down a judgment confirming that the test for dishonesty in criminal law is that set out by the Supreme Court in Ivey v Genting Casinos, as opposed to the much criticised Ghosh test.
In practical terms, this decision means that it should prove easier to prove offences requiring dishonesty, for example offences under the Fraud Act or conspiracy to defraud offences.
The judgment in R v David Barton and Rosemary Booth  EWCA Crim 575, held that the Supreme Court’s obiter commentary in Ivey should be followed by the Court of Appeal, and that the “the Magistrates or jury in such cases would first establish the facts and then apply an objective standard of dishonesty to those facts, with those facts being judged by reference to the usual burden and standard of proof”.
Since 1982, the Ghosh test for dishonesty has applied, requiring:
- an objective test (whether, according to the ordinary standards of reasonable and honest people, what was done was dishonest); and
- a subjective test (if it was dishonest by those standards, whether the defendant himself must have realised that what he was doing was by those standards dishonest).
In Ivey v Genting Casinos (UK) Ltd  UKSC 67, a professional gambler argued that his use of a technique called ‘edge sorting’, (which significantly improved his chances of winning), was not ‘cheating’, but merely made him an ‘advantage player’. On the basis of the Ghosh test, the second ‘subjective’ limb was therefore not satisfied.
The Supreme Court noted, obiter, that ‘the second leg of the test propounded in Ghosh does not correctly represent the law and that directions based upon it ought no longer to be given…The reasonableness or otherwise of his belief is a matter of evidence (often in practice determinative) going to whether he held the belief, but it is not an additional requirement that his belief must be reasonable’. Rather, the test for dishonesty should be:
- What was the defendant’s actual state of knowledge or belief as to the facts?
- Was his conduct dishonest by the standards of ordinary decent people?
Civil proceedings have, since 1995, advocated this exclusively objective test (Royal Brunei Airlines Sdn Bhd v Tan  2 AC 164, confirmed by Barlow Clowes International Ltd v Eurotrust International Ltd  UKPC 37).
The decision in R v Barton confirmed that “where the Supreme Court itself directs that an otherwise binding decision of the Court of Appeal should no longer be followed and proposes an alternative test that it says must be adopted, the Court of Appeal is bound to follow what amounts to a direction from the Supreme Court even though it is strictly obiter” avoiding the need for a further appeal in this case to the Supreme Court to ensure that the decision in Ivey was binding