The Estate of Euan McIntyre Lindsay & Anor v Outlook Finance Limited & Anor

A judgment procured by fraud may be set aside against a party who was not himself fraudulent where the equitable jurisdiction makes that course just. This is not a form of vicarious liability. The court must examine the scope of the equitable jurisdiction and whether it is equitable to grant relief against the non-fraudulent beneficiary of the judgment.

Where a judgment is set aside, sums paid under its costs orders may be ordered to be repaid to restore the status quo ante. The court may defer determination of costs connected with the original proceedings where a retrial may affect the appropriate order.

This was a consequential-matters judgment following the court’s main judgment, Lindsay v Outlook Finance Ltd [2025] EWHC 3100 (KB), which had set aside a 2014 Manchester judgment obtained by fraud and ordered a retrial. The judgment was set aside against Outlook Finance Limited and Roderick Graham Butcher, although Mr Butcher was not found to have participated in the fraud.

The court determined costs of the present action, whether costs paid under the Manchester judgment should be returned, the treatment of costs of the original proceedings, payment on account, permission to appeal, and whether the retrial should be stayed pending appeal.

1. Disposition. The Manchester judgment was set aside against Outlook and Mr Butcher, and a retrial was ordered. The judgment was not set aside as against Beattie, and costs orders affecting him were left undisturbed.
2. Costs of the present action. The claimants succeeded on the central issue. A non-fraudulent party may have a judgment in his favour set aside where another party’s fraud procured it, if it is equitable to set aside the judgment against both parties. That proposition was not a form of vicarious liability. Mr Butcher had unsuccessfully resisted that jurisdiction and had maintained that Mr Fradgley had not deceived the court. The claimants’ original allegations that Mr Butcher was consciously and deliberately dishonest were unjustified, however. His conduct justified reducing the claimants’ costs by 25 per cent. The claimants were awarded their costs on the standard basis, subject to that reduction.
3. Costs paid under the Manchester judgment. The court ordered Outlook to repay £31,000 and Mr Butcher to repay £24,000 within 28 days. Repayment restored the status quo ante and did not depend on joint and several liability. The assessment of Outlook’s costs in the sum of £162,919.82 was set aside. Interest on the repaid sums was left to agreement or application to a Master of the King’s Bench Division.
4. Costs of the original proceedings and payment on account. The costs of the Manchester proceedings were made costs in the retrial. No Bullock order was made in Mr Butcher’s favour. Mr Butcher was ordered to pay £150,764.85 on account of the claimants’ costs of the present action.
5. Permission and stay. Permission to appeal was granted on the scope of the equitable jurisdiction to set aside a fraudulently procured judgment against a non-fraudulent party. Permission was refused on the proposed challenge concerning Mr Butcher’s culpability and the legal advice. The retrial was not stayed pending appeal.

First-instance consequential judgment following the court’s main judgment, Lindsay v Outlook Finance Ltd [2025] EWHC 3100 (KB). Permission to appeal was granted on one ground, but no appellate decision is stated.