Beeny v Ghersie & MG Associates Limited

Charlie, instructed by Richard Gore at Gregg Latchams Limited, has successfully defended Mr David Beeny, a former accountant, against a misrepresentation claim worth c. £1m in the case of Beeny v Ghersie & MG Associates Limited.

The claim was brought by Michael Ghersie and MG Associates Limited (‘the defendants’). The defendants had purchased Mr Beeny’s accountancy business in Dartmouth, Devon in 2010. In a first trial on liability, David Blunt QC sitting as Recorder in the High Court found that the defendants owed Mr Beeny over £220,000 arising from the sale and purchase agreement (‘the SPA’) entered into by the parties. However, the defendants had counterclaimed that Mr Beeny had misrepresented certain matters to them and that as a consequence they had suffered losses of £1m. The Judge also found that Mr Beeny had made a misrepresentation to the defendants.

In the second trial on misrepresentation in dispute were issues of causation and loss. The question of causation focused on whether the alleged losses included losses which could not be attributed to the misrepresentation even if the misrepresentation was causative of the defendant’s acquisition of the business. As regards loss, the parties disputed the date at which losses should be calculated and whether the defendants would have entered into an agreement to purchase the business on the same terms as contained in the SPA even if there had been no misrepresentation.

Mr Beeny prevailed at trial on the issues of causation and loss. Mr Recorder Blunt QC held that Mr Beeny was not liable to pay the defendants anything in relation to the misrepresentation claim. The Judge found that the defendants’ quantum claims had no merit or were entirely too speculative. Mr Recorder Blunt QC also held that the losses claimed were not a result of Mr Beeny’s representations, so causation was not made out. In any event, the Judge found that the date from which the defendants alleged the losses should be calculated could not be substantiated. Mr Recorder Blunt QC therefore found that the defendants were not entitled to recover any damages.