Webster & Ors v Mark Liddington & Ors

Whether a person who passes on information supplied by another has adopted it as a representation is determined objectively. The court asks what a reasonable recipient would understand from the words and infer from the conduct and all the circumstances. A qualified clinician who gives a cosmetic-treatment brochure to a consumer without a disclaimer adopts its description of the treatment and injected substance. A statement that an injectate contains only the patient’s own cells may be materially false even where bovine material is present only in trace amounts. The discrepancy may be material if it could affect a reasonable person’s decision, including because of possible allergic reaction or aversion to extraneous material.

A group of patients brought claims against clinicians who administered Isolagen cosmetic treatment. Isolagen was developed and marketed by Isolagen Europe Ltd, which was later placed into administration. The patients alleged that brochures given to them stated, in substance, that the injectate contained only their own cells, although it could contain traces of foetal calf serum.

The Manchester County Court ordered trial of preliminary issues concerning whether the brochure statements were representations, whether they were statements of fact or opinion, and whether they were accurate. His Honour Judge Platts found for the claimants on those issues, subject to specified exceptions. The surviving defendants appealed. The central issues were whether the clinicians were responsible for the brochure contents and whether the trace amounts made the statements materially inaccurate.

The appeal was dismissed unanimously. The challenge concerning whether foetal calf serum became internalised in the cells was academic. That finding played no part in the decision on the preliminary issues, and it was common ground that traces could be present in the injectate.

1. Responsibility for information. The court adopted the objective test stated by Toulson J in IFE Fund SA v Goldman Sachs International [2006] EWHC 2887 (Comm). The court must determine what a reasonable recipient would understand from the words used, or infer from the representor’s conduct and all the circumstances. Passing on another’s information may involve a warranty, adoption of the information, a representation that it is believed on reasonable grounds, or mere transmission with responsibility limited to honesty and good faith. The test includes the context and any disclaimer.
2. Application to the clinicians. The claimants were consumers and the appellants were qualified clinicians offering both a treatment and the substance to be injected. There was a marked imbalance of knowledge, and no disclaimer or reservation was given. A reasonable patient would therefore understand that the clinician adopted the brochure’s description. This applied both to the IEL brochures and to the WACC brochure. The clinicians did not need to give an express warranty for responsibility to arise.
3. Material inaccuracy. The foetal calf serum represented between 0 and 0.02% of the injectate, but the evidence established that 3% to 10% of the population might suffer an allergic reaction to bovine products. Even a small trace could therefore be material. A reasonable person might also be deterred by the injection of extraneous material. The substantial-truth approach discussed in Avon Insurance Plc v Swire Fraser Ltd [2000] EWHC 230 (Comm) was distinguishable, and De Beers Abrasive Products Ltd v International General Electric Co of New York Ltd [1975] 1 WLR 972 provided no assistance.

The first and third grounds of appeal consequently failed, and the judge’s conclusions on the preliminary issues stood.

• Court of Appeal (Civil Division) — [2014] EWCA Civ 560, 7 May 2014: unanimously dismissed the defendants’ appeal.
• Manchester County Court — His Honour Judge Platts, judgment handed down on 26 February 2013: decided the three preliminary issues in favour of the claimants, holding that the defendants were responsible for the brochures and that the identified statements were misrepresentations subject to specified exceptions.