Civil Fraud Quarterly Round-Up: Q4 2025

This quarterly civil fraud update provides a summary of reported decisions handed down in the courts of England and Wales in the period of October - December 2025.

Abuse of process

The claimant’s application for summary judgment in Salinas Pliego v Astor Management 3 Ltd & Otrs (previously mentioned in my Civil Fraud Case Update Q3 2025) was dismissed as it was based on evidence which had been obtained by a private investigator using what the court described as unethical conduct. The private investigator had targeted the solicitor representing the first and fourth to sixth defendants who had divulged information about the strengths and weaknesses of his clients’ case and litigation strategy. The defendants’ application to strike out the claim was based on the accusation that such unethical conduct constituted abusive litigation conduct. The Deputy Judge balanced the need to expose and remedy wrongdoing such as fraud, with abusive behaviour and determined that dismissing both applications was the appropriate and proportionate response. The Deputy Judge indicated that this deserved appellate attention, granting permission to appeal and cross-appeal and also listed an Information Review Hearing at which issues of privilege and iniquity are to be considered.

Arbitration

The Court in K1, K2 and D v B confirmed that the “serious irregularity” referred to in Section 68 of the Arbitration Act 1996 refers to irregularities in the arbitration process: the conduct of the parties and the way in which an award is obtained.  It did not apply to a complaint about the award itself.

Breach of fiduciary duty/trust

The Supreme Court considered how loss and equitable compensation should be calculated in Mitchell v Al Jaber, finding that a single act, such as signing share transfer forms could both create and be a breach of a fiduciary duty. The date of calculation of loss would depend on what was just and equitable. Where property had been misappropriated and that property had value at the date of misappropriation, there was an immediate loss of value at that date.  If the fiduciary wanted to plead that there had been a break in the chain of causation, the burden was on the fiduciary to prove that was the case.

Breach of Mandate

The claimants in Arena Television Limited (in liquidation) & Otrs v Bank of Scotland Plc and Lloyds Bank Plc resisted a strike out of significant parts of their claims. The claimants alleged that payments had been made in breach of mandate and that the defendant banks had notice of certain facts which should have led them to carry out inquiries. The defendants sought to strike out parts of the claims relating to the reconstitution of the accounts and breach of duty. The claimants cross-applied to strike out parts of the defences and counterclaims. The Court granted the defendants’ application in so far as it related to a scope of duty which went beyond a duty to avoid the making of unauthorised payments, but dismissed the balance of the defendants’ application, indicating that issues of authority should be resolved where there has been a full investigation at trial into the circumstances of such authority.  The Court granted one part of the claimants’ cross application, namely striking out part of the defendants’ case that directors of the claimants had actual authority by virtue of the terms of the mandates.

Contempt

The defendant in Commercial Bank of Dubai PSC v Al Sari (discussed previously in my Civil Fraud Case Update Q2 2024) was sentenced (in his absence) to two years imprisonment for contempt of court. The sentence followed a pattern of obstruction, non-engagement and failure to comply with the asset disclosure provisions of a freezing order.

The defendant in Khan v David was found to be in contempt of court for non-compliance with the asset disclosure provisions of a freezing order.

In Rajabieslami v Tariverdi the Court refused to discharge a worldwide freezing order, an application for contempt of court and an order allowing alternative service of the contempt application. Service had been effective, there had been no material disclosure and the claimant had succeeded in the claim, so it could not be said to have lacked merit.

Deceit

The Privy Council in Credit Suisse Life (Bermuda) Ltd v Ivanishvili held that it is not a necessary requirement in a claim for deceit that a claimant was consciously aware of representations made by the defendant. A claim in deceit based on the claimant’s unconscious assumption could succeed if the assumption was reasonable and causally linked to the defendant’s words and actions. An example provided from prior case law was where a defendant deliberately concealed the true position such that the claimant’s ignorance of not only the true position but the defendant’s conduct in concealing it was essential to the deceit.

Dishonest Assistance

A solicitors’ firm was found to have dishonestly assisted in breaches of duty in Grosvenor Property Developers Ltd (in liquidation) v Portner Law Ltd. The partner involved in the transaction had shown a disregard for his obligations in terms of anti-money laundering and source of funds checks and repeatedly turned a blind eye to matters which should have given him cause for concern. There were no circumstances which could enable the court to find that this disregard was anything but dishonest. An ordinary honest solicitor with the same degree of skill and experience would not have behaved in the same way.  The defendant firm was held vicariously liable for those actions.

Dishonesty

In Transworld Payment Solutions UK Limited (in liquidation) & Another v First Curaçao International Bank NV & Another the Court dismissed claims that the defendants had dishonestly assisted in VAT fraud by providing banking facilities. The claim required the claimants to prove dishonesty on the part of an individual who had been the former UBO of the claimant company and CEO of the first defendant bank. The Court found that the evidence the claimant relied on to demonstrate dishonesty was equally consistent with an honest approach and therefore on the balance of probabilities it was not available to the Court to find dishonesty. The Court also found that parts of the claim were statute-barred.

Fraudulent Misrepresentation

The Court of Appeal in Mather v Rattan dismissed an appeal against a decision that a claim in fraudulent misrepresentation was made out and not statute-barred. Whilst the representations complained of had been made in 2012 and the claim was not issued until 2021, the Court of Appeal found that there had been no misunderstanding or misapplication of the test under s.32 Limitation Act and that the judge at first instance was right to find that the evidence afforded a complete answer to the plea that the claim was statute-barred.

Freezing Injunctions

The Court in Manolete Partners Plc v El Hady continued a freezing injunction. There was a good arguable case that funds had been paid in breach of fiduciary duty, the respondents had assets and there was a risk of dissipation of assets as explanations about movement of funds were not easy to follow and matters remained obscure. Where proprietary relief was sought, there was a serious issue to be tried, and damages would not be an appropriate remedy.

Applications for proprietary and freezing injunctions brought by joint administrators were granted in 79^th Grp Ltd v Webster. The court accepted a cross undertaking in damages limited to the net value of the assets under the control of the joint administrators. There was no evidence of any business or commercial activities of the respondents which would be damaged by the injunctions.  A passport order was also granted, to remain in place until the respondents had complied with their disclosure obligations.

After considering concerns raised including about the validity of service, costs and the value of assets, the Court in Fund Ourselves Ltd v Siam granted an application to vary three freezing injunctions to allow an aircraft to be sold. 

In Titanium Capital Investments Ltd v Hughes the Court considered the interaction of a stay pending appeal on an application for asset disclosure, finding that the stay did not catch an application for asset disclosure following the first instance judgment. However, the Court dismissed the application: CPR Rule 25.1(1)(g) only gives jurisdiction to make an order relating to assets which were or might be subject to a freezing injunction. There, therefore had to be credible grounds on which an application for a freezing injunction could be based. The Court found that there were no such grounds: there was no risk of dissipation of assets and the delay in making an application militated against it.

The Court set aside a freezing injunction made in aid of a foreign arbitration in AAA v BBB on the basis that the arbitration claim form had expired after one month pursuant to CPR Rule 62.4(2) and the requirements for an extension of time had not been met. The applicant had not made his application to extend time under the right provision of the CPR, had not acted promptly and had made material non-disclosures in both the application for the freezing injunction and the application to extend time.

Jurisdiction

The Court of Appeal in Public Institute for Social Security v Al Rajan upheld the first instance decision to join the four children of the deceased defendant into the proceedings, and to serve them out of the jurisdiction, in Switzerland. Under Swiss law enforcement of a judgment against an estate asset would only be possible if all owners of the asset were bound by the judgment. Further, under Swiss law if jurisdiction had been established against a defendant who then died, the court seised would continue to have jurisdiction over the deceased’s heirs.

Unjust Enrichment

In Lunak Heavy Industries (UK) Ltd and Lucasfilm Ltd LLC v Tyburn Film Productions Ltd, the Court of Appeal upheld an appeal against the first instance Court’s decision to refuse to strike out an unjust enrichment claim. The Court of Appeal determined that the claim was unsustainable: there was no loss suffered by the respondent through the provision of the relevant benefit to the appellants. There had also been no series of coordinated transactions: the agreements in question were entered into 23 years apart and did not serve to transfer interests from the respondent to the appellants.

About the author

Mary Young is a Partner in the Dispute Resolution team. Her practice covers a wide range of areas but Mary’s particular interests and expertise lie in civil fraud and asset tracing as well as claims against professionals in negligence, breach of fiduciary duty and breach of trust.