No duty of care owed to investors

The claimants were members of limited liability partnerships (LLPs) that were formed to participate in the distribution of films. Investors took part on the basis that they would be entitled to tax relief against their income or capital gains for trading losses that the partnerships were expected to make. HMRC refused the reliefs and made a settlement offer to the investors which was accepted.

The defendant (T) had been engaged by the scheme promoter to provide advice on the tax consequences of the arrangements. The claimants said T owed them a duty of care in respect of the advice he gave to the promoter. The High Court concluded that no duty of care was owed by T to the claimants for the advice in relation to the schemes. He was ‘in no sense retained as adviser’ to the claimants rather he was ‘expressly’ engaged by the promoter....