On Wednesday 14 April the Court of Appeal handed down its judgment in The Commissioners for Her Majesty’s Revenue and Customs v IGE USA Investments Ltd [2021] EWCA Civ 534.
The appeal concerned a Settlement Agreement which the defendants entered into with HMRC in 2005. Having subsequently discovered allegedly new information, HMRC purported to rescind the Settlement Agreement for material misstatements of fact and issued their claim against the defendants in 2018.
At first instance, Zacaroli J held that no limitation period applied to claims for equitable rescission. Following a three-day expedited hearing, the Court of Appeal allowed the defendant’s appeal, and decided that claims for equitable rescission of a contract for fraudulent misrepresentation are subject to a six-year limitation period by analogy with claims founded on the tort of deceit under section 2 of the Limitation Act 1980. Although rescission and damages for the tort of deceit are not identical, they are sufficiently similar for section 2 to apply by analogy under section 36 of the Limitation Act 1980.
Professor Paul Davies acted for GE (with Laurence Rabinowitz QC, John Gardiner QC, John Brinsmead-Stockham, Thomas Bell and Nicholas Sloboda) instructed by PricewaterhouseCoopers LLP.
