Summary

In the context of fraudulent misrepresentation it was possible for a claimant to plead an alternative case based on the defendant's version of events while continuing to deny that version. The requirement for a statement of truth did not prevent such a scenario as long as there was a proper evidential foundation for the alternative allegation.

Facts

The applicants (B and C), the claimants in proceedings alleging fraudulent misrepresentation, applied for permission to amend their particulars of claim.

Their primary case was that they had been fraudulently induced by the respondent (F) to invest in her company after she allegedly made untrue representations that she had secured a high-value contract. By their instant application, B and C sought to plead an alternative case based on F's own evidence about the representations she had made concerning the contract. They denied her version of events, but wanted to protect their position in case it was accepted by the trial judge. A key issue was whether it was possible, in law or in logic, for a claimant complaining of fraudulent misrepresentation to adopt an apparently self-contradictory stance. F opposed the application on both substantive and procedural grounds; she questioned whether the representations were a fair reflection of her evidence and challenged the lateness of the application.

Held

Where amendment was close to a trial date, the claimants had to be held to the terms in which the amendments were pleaded and F had to know the precise nature of the new case she had to meet, Worldwide Corp Ltd vGPT Ltd applied and Swain-Mason v Mills & Reeve [2011] EWCA Civ 14, [2011] 1 W.L.R. 2735 followed. Superficially it was easy to think that a claimant could not properly advance a claim in misrepresentation where his primary case was that the representation in question had not been made to him. However, a claimant was free to advance alternative claims and it was possible to plead an alternative case based on the defendant's version of what happened while continuing to deny that version. The requirement for a statement of truth did not prevent that scenario as long as there was a proper evidential foundation for the allegation, Binks vSecuricor Omega Express Ltd [2003] EWCA Civ 993, [2003] 1 W.L.R. 2557followed. That evidential foundation would, in the context of inducement, enable the claimants to rely on the rebuttable presumption of inducement that arose once it had been proved that a false statement had been made (see paras 24-27 of judgment). In the instant case, however, there was no apparent evidential basis for the proposed amendment because the information that F said she gave to B would have been sufficient to make it clear that the contract was no longer viable. B's investment in F's company could not therefore have been induced by a representation that the contract was proceding. On the evidence as it stood, it was not properly arguable that the representation at the heart of the proposed amendment had ever been made and permission to plead an alternative case was therefore refused (paras 19-21, 23). A renewed application to amend could be made at trial once the evidence was complete, since, on the facts, delay was not a ground for refusing permission. On the contrary it had been sensible of the claimants to wait until the determination of F's summary judgment application before seeking permission to amend (paras 29-30). (2) The application relating to other proposed amendments was adjourned for seven days to give B and C an opportunity to provide particulars.

Judgment accordingly