Glossop Cartons and Print Ltd & Ors v Contact (Print & Packaging) Ltd & Ors

Glossop Cartons and Print Ltd & Ors v Contact (Print & Packaging) Ltd & Ors

The correct measure of damages for fraudulent misrepresentation is the difference between the price paid and the objective market value of the assets at the relevant date, regardless of the claimant's subjective calculations or commercial misjudgments. Claimants can recover for a bad bargain even if defects were known or ought to have been known. The judge erred in adopting a deduction method based on what the claimants had factored into the price. Contractual provisions do not override the right to damages for deceit unless expressly stated.

Parties
Claimant/appellant: Glossop Cartons and Print Limited; Claimant/appellant: Brian Sidebottom, Jacqueline Cameron Sidebottom-Every, and Jillian Cameron Woodacre (suing as individuals and as the Raymond Joseph Partnership); Defendant/respondent: Contact (Print & Packaging) Limited; Defendant/respondent: Philip Smith; Defendant/respondent: Embark Pensions Trustees Limited
Jurisdiction
England and Wales
Judgment Date
07 May 2021
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal allowed; cross-appeal dismissed
Legal Topics
Fraudulent Misrepresentation, Damages Assessment, Remedies for Deceit, Contractual Indemnity, Breach of Warranty
Contract Law Tort Law Commercial Law Fraudulent Misrepresentation Damages Assessment Remedies for Deceit Contractual Indemnity Breach of Warranty

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Parties

Glossop Cartons and Print Limited

Claimant/appellant

Brian Sidebottom, Jacqueline Cameron Sidebottom-Every, and Jillian Cameron Woodacre (suing as individuals and as the Raymond Joseph Partnership)

Claimant/appellant

Contact (Print & Packaging) Limited

Defendant/respondent

Philip Smith

Defendant/respondent

Embark Pensions Trustees Limited

Defendant/respondent

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 What is the correct approach to assessing damages for fraudulent misrepresentation in a business asset sale?
  2. 2 Can a claimant recover for a bad bargain made as a result of fraudulent misrepresentation, even if the defects were known or ought to have been known?
  3. 3 Should damages be calculated by reference to the claimant's subjective assessment or by objective market value?

Ratio Decidendi

The correct measure of damages for fraudulent misrepresentation is the difference between the price paid and the objective market value of the assets at the relevant date, regardless of the claimant's subjective calculations or commercial misjudgments. Claimants can recover for a bad bargain even if defects were known or ought to have been known. The judge erred in adopting a deduction method based on what the claimants had factored into the price. Contractual provisions do not override the right to damages for deceit unless expressly stated.

Court Disposition

Appeal allowed; cross-appeal dismissed

Orders

  • Glossop awarded £300,000 in damages for direct loss due to fraudulent misrepresentation, in addition to other financial awards made by the judge.
  • Costs orders to be reconsidered; parties to agree or court to determine on paper if not agreed.