Pattinson v Flack

On an appeal against findings of fact, the Court of Appeal reviews the evidence but will interfere only where the decision is plainly outside the range of conclusions reasonably open to the trial judge. In a deceit claim, a claimant may rely on a false representation even though the truth was discoverable or ought to have been discovered. A material representation made to induce a contract gives rise to a rebuttable inference that it induced the contract. The inference may be confirmed by the claimant’s evidence and the surrounding circumstances, even where the claimant previously received a warning which made little impression and failed to investigate it.

The claimant purchased a historic Lotus racing car from the appellant for £180,000. The trial judge found that the appellant had falsely represented the car as Innes Ireland’s 2.5 litre Grand Prix car, implying that it was an historic Formula 1 car. The claimant had previously been warned that the car had a Formula 2 history, but the judge found that he nevertheless relied on the appellant’s later representation.

The High Court entered judgment for the claimant in deceit and awarded £76,747.50 damages. The appellant challenged the finding of reliance and sought to adduce further evidence. The central issue was whether the claimant had relied on the misrepresentation notwithstanding his prior warning and access to information revealing the car’s history.

1. Appeal dismissed. The refusal to admit fresh evidence was upheld. The proposed evidence could with reasonable diligence have been obtained for trial and would not probably have affected the result.
2. The appeal principally challenged findings of fact. Under CPR 52.11(3), the appellate court reviews the evidence to decide whether the lower court’s decision was wrong. It should interfere only where the finding falls outside the generous ambit within which reasonable disagreement is possible, applying the approach in G v G (Minors: Custody Appeal) [1985] 1 W.L.R. 642.
3. The trial judge was entitled to find that the warning given by Mr Harper made little impression because of the claimant’s enthusiasm for the purchase and his belief that Mr Harper was pursuing rival salesmanship. There was evidence supporting those findings, and the judge’s acceptance of the claimant as honest was not inconsistent with accepting Mr Harper’s evidence.
4. The representation was material because the claimant wanted a Formula 1 car. Under Smith v Chadwick (1884) 9 App. Cas. 187, proof of a material statement made to induce a contract, followed by entry into the contract, supports an inference of inducement. The inference was rebuttable, but the evidence did not rebut it.
5. As explained by Redgrave v Hurd (1881) 20 ChD 1, and by Lord Hoffmann in Standard Chartered Bank v Pakistan National Shipping Corporation [2002] UKHL 43, the claimant’s means of discovering the truth did not defeat reliance on a fraudulent representation. The finding that the misrepresentation finally persuaded the claimant to buy the car was open to the judge and entitled the claimant to damages.

• Court of Appeal (Civil Division): dismissed the appeal from the judgment of Mr Geoffrey Vos Q.C., sitting as a Deputy High Court Judge, which had awarded the claimant £76,747.50 damages for deceit.