Bringing or defending conspiracy claims
What is a conspiracy claim?
Conspiracy claims, fall within the umbrella of ‘economic torts’. There are two types of conspiracy claims:
- Unlawful means conspiracy requires the use of unlawful means in furtherance of the agreement, and an intention to cause injury to the target; and
- Lawful means conspiracy does not require any unlawful acts to be done by the parties to the agreement, however it does require the parties' sole or predominant purpose to have been to cause injury to the target.
The elements common to both types of conspiracy are agreement, concerted action and damage.
When considering a conspiracy claim it is also important to think about whether there is any causal link between the allegations made and the extent of the monetary relief sought in the claim and any time limitation defence.
How long do I have to bring a conspiracy claim?
Generally, a claimant has six years from the date on which a cause of action accrues to bring a claim. However, section 32 of the Limitations Act 1980 provides an exception to this general rule and covers claims based on fraud, concealment or mistake. In these circumstances, time does not begin to run until the claimant has discovered the fraud, concealment or mistake, or could with reasonable diligence have discovered it. This in itself may present an important and potentially determinative preliminary issue.
It is also important to consider any defences that may as arise.
Have the common elements of a conspiracy claim been satisfied by the claimant?
Threading together a conspiracy claim in practice involve various allegations to be satisfied. Whether the allegations pleaded in a claim are strong, will be very much dependent upon accompanying disclosure and witness evidence which support the substance of the allegation.
Was there an agreement?
The first shared element is an agreement between two or more persons to injure another. It is not necessary for there to be an agreement in the contractual sense: a tacit agreement or understanding will be sufficient. So long as each individual conspirator knows the central facts and entertains the same object, it is not necessary that all conspirators join the agreement at the same time.
Has any concerted action been established?
Unlike a criminal conspiracy, an agreement to injure by itself is not enough to establish civil liability. A claimant must also show that concerted action has been taken pursuant to that agreement. Concerted action can be direct or indirect, but it must be more than mere facilitation.
Concerted action does not necessarily require much. By way of example, a director may be using their company to carry out a complicated money laundering operation for third party fraudsters. If a co-director discovers the illegitimate reason for the payment and chooses to do nothing (impliedly authorising it), they will likely be liable for conspiracy.
On the other hand, if the co-director innocently transfers funds to an offshore bank accounts at another director’s request (with a wholly plausible and legitimate explanation), they are more likely to be considered a mere facilitator.
This distinction between concerted action and facilitation was considered relatively recently by the Court of Appeal in Lakatamia Shipping Co. Ltd–v- Su & ors  EWCA
Has loss and damage resulted from the concerned action?
Unless the concerted act of the defendants has caused loss or damage to the claimant there can be no claim for conspiracy.
How can a conspiracy claim be defended?
In respect of either type of conspiracy the following defences could be raised, however its dependent upon the facts of each case:
- There was simply no agreement of any sort between the defendants or any of them.
- Even if there was an agreement of some sort, no concerted action was taken pursuant to that agreement. For example, it may be argued that a defendant was merely a 'facilitator' rather than an 'actor' as per the example made above.
- No damage was caused to the claimant. The scope of this defence is limited as once a claimant establishes that it has suffered some pecuniary loss, damages are considered at large. However, it is important that the claimant has established a clear causal link between the act of fraud or conspiracy to the relief sough in their claim.
In respect of lawful means conspiracy, it could be raised in defence that the alleged damage was not the predominant purpose of the conspiracy, even if some damage was an inevitable result.
As for unlawful means conspiracy, it could potentially be raised as a defence (subject to the facts of the case) that, the conspiracy was not aimed at another person and therefore could not reasonably be foreseen that the conspiracy might injure that person.
Some practical points to remember
Many conspiracy claims (civil fraud claims more generally) will involve the movement of funds and assets across the world. This can raise both legal and practical obstacles. Whilst the UK courts have the power to grant worldwide freezing injunctions (which are common at the outset of such claims), it is necessary to establish that the court has jurisdiction in the first instance.
The claimant will have the heavy burden of proving a conspiracy claim against a defendant. At the stage of bringing the claim, the claimant may not direct evidence of a conspiracy, and they will therefore be basing the claim on inferences until such time as disclosure and witness evidence has taken place. As a result of these risks, claimants will often try to bring claims against more than one defendant as it increases the chances of a recovery. This can however have adverse cost consequences if a claim against one or more defendant fails or is abandoned.
Why should I instruct Brett Wilson LLP?
In short, to ensure that you have the best team fighting for you and to maximise your prospects of success. Expert representation in this field is vital in order to formulate the appropriate strategy and achieving the most favourable outcome.
Our work and client care is of the highest standard. Every matter has partner involvement. We work with a range of top barristers.
How do I instruct Brett Wilson LLP?
Get in touch with one of our civil fraud solicitors by sending us an email, completing our online enquiry form or calling us on 020 3925 1318. If emailing or using the online form, please provide a short outline of your situation.
Where possible, we recommend that you contact us before responding to any claim.
Costs information will provided following your enquiry.
Please note that we do not undertake civil fraud work on a contingency basis and no public funding is available. We generally only act in high value disputes (where the value of the claim exceeds £100,000). We regret that we are unable to assist individuals who are not in a position to fund litigation.
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