Dear Listers,

A recent decision of the Irish High Court in Loonam v Kenny [2015]
IEHC 545 in which contributory negligence was held to be a partial
defence to successful claims for (what seems to have been actual)
undue influence and fraudulant misrepresentation may be of some
interest.

To quote from the judgment (paragraph 3) "3. ... On 1st July, 2001,
the plaintiff was involved in a very serious road traffic accident in
which he sustained serious personal injuries including a significant
head injury, multiple fractures and very serious bilateral brachial
plexus lesions which left him with a significant level of disability
involving loss of useful function of his right hand and a severely
impaired level of function of the left hand. Prior to the accident,
the plaintiff’s health had not been good and he had been an insulin
dependent diabetic for many years. ..."

The Court went on to hold that while on first meeting the Plaintiff
one might not appreciate his vulnerability, this would become
apparent. It held that the Defendant had become aware of the
Plaintiff's vulnerability, when some of the transactions in issue were
entered into.

The transactions in issue were investments by the Plaintiff in
companies owned by the First Defendant (which were themselves
ddefendants to the action) and the purchase of equipment from the
First Defendant by the Plaintiff.

The Court concluded that those investments and purchases had been made
while the Plaintiff was under the undue influence of the First
Defendant and had that the Plaintiff had been induced to invest, at
least in part, by fraudulant misrepresentations.

What is surprising notable (and in my view concerning) about the
decision however, is the Court's ruling that the Plaintiff should have
his damages reduced by 10% to reflect a finding of contributory
negligence - the Plaintiff had consulted his solicitor about the
investments which he made, had been advised (very properly) not to
proceed but had gone on to invest despite that advice.

To the present writer, that holding seems contrary to principle, given
the nature of the tort (fraudulant misrepresentation) and equitable
wrong (actual undue influence) held to have been proved.

While the Irish Civil Liability Act 1961 provides that contributory
negligence may be relied on as a defence to all wrongs (defined to
include equitable wrongs as well as torts and intentional wrongs) it
does not follow that conduct which would amount to contributory fault,
were the claim brought in negligence should amount to contributory
negligence where as here the claim is one of fraud.

In short, it seems to me that the Plaintiff is entitled to say - I was
gullable but at least you who tricked me ought not to be allowed to
rely on that foolishness.

As a footnote, I note that no order was made against the Second
Defendant (wife of the First Defendant) despite the fact that some of
the money paid over by the Plaintiff found its way to her account. The
Court was satisfied that she was not involved in the misstatements or
undue influence. However, there is no discussion of whether she was a
bona fide purchaser for value. Perhaps the amount in question was
small but the omission is a disappointing one in my view.

Please see a link to the judgment below. I'd welcome any comments.

http://www.courts.ie/Judgments.nsf/09859e7a3f34669680256ef3004a27de/d48296928f790f5280257ea50038e2fc?OpenDocument

Kind regards

Ger