The United Kingdom Supreme Court is to revisit vicarious liability issues, with a bench of seven. The hearing is set down for 13 & 14 February 2018: Frederick and others (Appellants) v Positive Solutions (Financial Services) Ltd (Respondent).
The Appellants appeal against a decision granting summary judgment to the Respondent, a company providing financial advice, in their claim alleging that the company was liable in negligence following a fraud perpetrated by its agent, Luke Warren. The question for the court therefore is whether the respondent is vicariously liable for the fraudulent and dishonest actions of its agent:
The Appellants had been introduced to a property development scheme run by Warren and his business partner, Qureshi. Warren was an agent of the Respondent. Warren explained that the monies for the investment could be raised by way of remortgage of the Appellants’ properties, which Warren could arrange. Because he was an agent of the company, Warren had access to an online portal operated by a bank. He used the portal to arrange the remortgages. He put forward false income and employment information, thus obtaining borrowing which could not otherwise have been advanced. Some of the monies were used to pay off the Appellants’ existing mortgages; the balance was advanced to the Warren, who misappropriated, and lost it in the development scheme. The Appellants argued that the Respondent company was legally responsible for the actions of Warren. A Master granted the Respondent summary judgment on most bases but refused it in respect of its alleged vicarious liability for the Warren’s wrongdoing. The Respondent successfully appealed that decision in the High Court. This decision was upheld by the Court of Appeal which the Appellants now appeal.
The judgment appealed from is that of Frederick & Ors v Positive Solutions (Financial Services) Ltd [2018] EWCA Civ 431.