Parabola Investments Ltd & Ors v Browallia Cal Ltd & Ors [2010] EWCA Civ 486 (05 May 2010)

Parabola Investments Ltd & Ors v Browallia Cal Ltd & Ors [2010] EWCA Civ 486 (05 May 2010)

Damages for loss of profits after discovery of fraud are recoverable in deceit where the fraud has a continuing effect on the claimant's ability to generate profits, and the assessment of such damages is not precluded by the discovery of the fraud; the trial judge's approach to quantifying lost profits was rational...

Source-derived case information.

Citation
[2010] EWCA Civ 486
Parties
Claimant/respondent: Parabola Investments Limited; Claimant/respondent: Aria Investments Limited (formerly Tangent Investments Limited); Defendant/appellant: Browallia Cal Limited (formerly Union Cal Limited); Defendant/appellant: MF Global UK Limited (formerly Man Financial Limited); Defendant/appellant: Matthew Bomford
Jurisdiction
England and Wales
Judgment Date
05 May 2010
Procedural Posture
Appeal (civil) / Court of Appeal Judgment on Appeal From Commercial Court
Outcome
Appeal dismissed
Legal Topics
Damages for Deceit, Fraud, Loss of Profits, Assessment of Damages, Remoteness of Damage
Tort Law Commercial Law Damages for Deceit Fraud Loss of Profits Assessment of Damages Remoteness of Damage

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Parties

Parabola Investments Limited

Claimant/respondent

Aria Investments Limited (formerly Tangent Investments Limited)

Claimant/respondent

Browallia Cal Limited (formerly Union Cal Limited)

Defendant/appellant

MF Global UK Limited (formerly Man Financial Limited)

Defendant/appellant

Matthew Bomford

Defendant/appellant

Procedural Posture

Appeal (civil) / Court of Appeal Judgment on Appeal From Commercial Court

Legal Issues

  1. 1 Whether damages for loss of profits after discovery of fraud are recoverable in deceit
  2. 2 Whether the assessment of lost profits was too speculative to be recoverable
  3. 3 Whether the discovery of fraud is a legal cut-off for recoverable damages

Ratio Decidendi

Damages for loss of profits after discovery of fraud are recoverable in deceit where the fraud has a continuing effect on the claimant's ability to generate profits, and the assessment of such damages is not precluded by the discovery of the fraud; the trial judge's approach to quantifying lost profits was rational and supported by evidence, and the compensatory principle requires restoration of the claimant to the position they would have been in but for the fraud.

Court Disposition

Appeal dismissed

Orders

  • Permission to appeal on quantification refused
  • Judgment of Flaux J affirmed