Ticketus LLP & Anor v Whyte & Ors

On summary judgment, the court must decide whether the defence has a realistic prospect of success, without conducting a mini-trial. It must consider evidence reasonably expected to be available at trial, but speculation that further evidence may emerge is insufficient. A material fraudulent misrepresentation gives rise to a strong inference of inducement, although the inference remains one of fact and may be rebutted. The burden lies on the defendant seeking to resist judgment. The Civil Procedure Rules’ overriding objective informs the discretion whether there is another compelling reason for a trial, but does not displace the summary judgment test. Publicity, complexity, financial value and unsupported assertions of further evidence will rarely constitute such a reason.

This was an appeal by the first defendant from Master Marsh’s decision granting the claimants summary judgment for more than £18 million in damages and interest for fraudulent misrepresentation. The claimants alleged that the defendant had falsely answered questions about previous misconduct and director disqualification in a questionnaire used during due diligence for a ticket-financing arrangement involving Rangers Football Club. The appeal challenged whether the claimants were within the class of representees, whether the representations induced the funding arrangement, whether missing committee documents justified a trial, and whether there was another compelling reason for trial.

1. Appeal dismissed. The Master was entitled to grant summary judgment. The defendant accepted, for the purposes of the appeal, that the questionnaire answers constituted fraudulent misrepresentations.
2. The court adopted the summary of the law on CPR Part 24 in F G Wilson (Engineering) Ltd v John Holt & Co (Liverpool) Ltd [2013] 1 All ER (Comm) 223. The defence must be realistic rather than fanciful and carry some degree of conviction. The court must avoid a mini-trial, while considering the evidence before it and evidence reasonably expected at trial. Summary judgment remains appropriate where the legal or evidential position is sufficiently clear.
3. Both claimants fell within the class to whom the representations were directed. The commercial reality was that the defendant sought funding from Octopus, trading as Ticketus, and the representation was intended for reliance by whichever Ticketus entity advanced the funds.
4. The misrepresentation was material. The fact that the claimants conducted their own due diligence did not prevent reliance, because a misrepresentation need not be the sole inducement. The seven-year director disqualification was prima facie material. Once materiality and entry into the transaction were shown, there was a strong inference of inducement. The burden was on the defendant to show a real prospect of rebutting it.
5. The absence of committee minutes did not justify a trial. The defendant could have sought inspection or disclosure under CPR rule 31.14. Statements from all four committee members supported the relevant account, and the defendant produced no evidence giving a realistic prospect of proving it false.
6. The overriding objective applied to the question whether there was another compelling reason for trial. It informed the court’s discretion but did not override it. Hope that further evidence might emerge, publicity, complexity, financial value and unsupported allegations did not meet that threshold.

The appeal was dismissed. Costs and consequential matters were reserved for further argument.

• High Court (Chancery Division): Master Marsh granted summary judgment for the claimants on the fraudulent misrepresentation claim.
• High Court (Chancery Division): On appeal with permission from Newey J, the appeal was dismissed and the Master’s decision upheld.