The appellants had entered into discretionary investment management agreements wth the respondent. The investments made a substantial losss which the appellants sought to recover, saying that the agreements were void under the 1958 Act.
Held: The absence of a licence did not avoid an agreement needing a licence.
The claimants had put money with the defendants to invest. The markets fell, and they lost substantially. They now sought recovery saying that the asset management agreement was invalid and void under section 1 in that the person who signed the agreement for the defendants was not himself authorised at the time.
Held: The claimants appeal failed. The Act did not have the effect that non-compliance would render the contract void.
Judges:
Nourse, Hirst, Saville LJJ
Citations:
Ind Summary 13-Jun-1994, [1994] EWCA Civ 14, [1995] 3 All ER 669, [1994] CLC 556
Links:
Statutes:
Prevention of Frauds (Investment) Act 1958 1
Jurisdiction:
England and Wales
Citing:
Cited – Cornelius v Phillips HL 1918
A transaction which had been entered into in contravention of statutory restrictions was unlawful, and any contract which formed part of it conferred no rights on the moneylender. . .
Cited – St John Shipping Corporation v Joseph Rank Limited 1956
The defendants held a bill of lading for part of the cargo carried on the plaintiffs’ vessel from Mobile, Alabama, to Birkenhead. The vessel was over laden and the plaintiffs were guilty of an offence under the 1932 Act. The defendants relied on the . .
Cited – Re Cavalier Insurance Co Ltd 1989
The court considered the effect on a transaction of rules which prohibited the actions of both parties, in this case a prohibition on effecting and carrying out contracts of insurance. . .
Cited – Cope v Rowlands 1836
The court considered te situation of entry into a contract by a person under a statutory prohibition. Parke B said: ‘It is perfectly settled that where the contract which the plaintiff seeks to enforce, be it express or implied, is expressly or by . .
Cited – Halvanon Insurance Co Ltd v Central Reinsurance Corporation CA 1988
The fact that a contract was made by an unauthorised insurer contrary to the 1974 Act, which was silent as to the effect of a breach of this statute, did not render the contracts made by the unauthorised insurer void. Rendering transactions void . .
Cited by:
Cited – Patel v Mirza SC 20-Jul-2016
The claimant advanced funds to the respondent for him to invest in a bank of which the claimant had insider knowledge. In fact the defendant did not invest the funds, the knowledge was incorrect. The defendant however did not return the sums . .
Lists of cited by and citing cases may be incomplete.
Financial Services, Financial Services, Contract
Updated: 29 April 2022; Ref: scu.81519