Anderson & Ors v Sense Network Ltd [2019] EWCA Civ 1395 (31 July 2019)

Anderson & Ors v Sense Network Ltd [2019] EWCA Civ 1395 (31 July 2019)

Sense Network Limited is not liable under section 39(3) FSMA because its written acceptance of responsibility for Midas's activities was contractually limited to business using a Company Agency, which did not include the fraudulent scheme; vicarious liability does not arise as Midas was carrying on its own independent business and not acting as an integral part of Sense's business.

Citation
[2019] EWCA Civ 1395
Parties
Appellants/claimants: Adam Anderson & Others; Respondent/defendant: Sense Network Limited
Jurisdiction
England and Wales
Judgment Date
31 July 2019
Procedural Posture
Appeal (civil) / Court of Appeal Judgment
Outcome
Appeal dismissed
Legal Topics
Appointed Representatives, Vicarious Liability, Collective Investment Schemes, Statutory Interpretation, Ponzi Schemes
Financial Services Law Contract Law Tort Law Appointed Representatives Vicarious Liability Collective Investment Schemes Statutory Interpretation Ponzi Schemes

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Parties

Adam Anderson & Others

Appellants/claimants

Sense Network Limited

Respondent/defendant

Procedural Posture

Appeal (civil) / Court of Appeal Judgment

Legal Issues

  1. 1 Whether Sense Network Limited is liable under section 39(3) of the Financial Services and Markets Act 2000 for the acts of Midas Financial Services (Scotland) Limited as its Appointed Representative
  2. 2 Whether Sense Network Limited is vicariously liable at common law for the tortious acts of Midas and its advisors
  3. 3 Whether the scheme operated by Midas constituted a collective investment scheme under section 235 of FSMA

Ratio Decidendi

Sense Network Limited is not liable under section 39(3) FSMA because its written acceptance of responsibility for Midas's activities was contractually limited to business using a Company Agency, which did not include the fraudulent scheme; vicarious liability does not arise as Midas was carrying on its own independent business and not acting as an integral part of Sense's business.

Court Disposition

Appeal dismissed