Mather v Rattan: Reasonable Diligence, Reliance and Causation in Deceit

1. Introduction

The Court of Appeal’s decision in Mather v Rattan [2025] EWCA Civ 1596 refines and consolidates several important principles in the law of deceit (fraudulent misrepresentation), particularly:

the operation of section 32 of the Limitation Act 1980 in fraud cases and the scope of “reasonable diligence”;
what amounts to actionable reliance where the misrepresentation concerns a person’s status as a de jure director as opposed to a de facto or shadow director;
the correct approach to causation and damages in deceit, including the (limited) role of “what if the representation had been different?” counterfactuals.

The claim arose out of a £1 million investment by Mr and Mrs Mather (the Mathers) in Yagna Limited, a biotech company controlled by the defendant, Mr Rattan. The investment was made between December 2012 and November 2014 and was subsequently lost when Yagna entered administration in April 2016. The central allegation was that the Mathers had been induced to invest by fraudulent misrepresentations about the appointment of their trusted associate, Mr Lak Basran MBE, as a director of Yagna.

After a four‑day trial, HHJ Hodge KC (sitting as a High Court Judge in the Chancery Division) found for the Mathers on liability, causation, and limitation, awarding them their full £1 million loss plus interest and costs: Mather v Rattan [2025] EWHC 438 (Ch). On appeal, Lord Justice Snowden (with whom Males and Lewison LJJ agreed) dismissed the defendant’s appeal on all three grounds.

The judgment is noteworthy for its clear application of earlier Court of Appeal authority on section 32 (notably Paragon Finance, Gresport Finance and OT Computers) and for its firm stance that a fraudster cannot shift blame onto an investor for failing to verify Companies House records in the absence of “red flags”. It also reinforces the orthodox approach to reliance and damages in deceit laid down in Smith New Court Securities v Citibank.

2. Factual Background

2.1 The investment in Yagna

Between December 2012 and November 2014, the Mathers invested a total of £1 million in Yagna Limited, a biotech company whose majority shareholder and director was the defendant, Mr Rattan [3]. The investment was structured as subscriptions for shares. Ultimately, Yagna entered administration on 26 April 2016, and the investment proved worthless.

Unbeknown to the Mathers, company filings later recorded their shares as having been transferred away from them in 2015 and then ultimately to Mr Basran in 2016 [Note 1]. The trial judge treated the investment as completely lost.

2.2 The alleged misrepresentation

The crucial communication was an email dated 5 December 2012 from Mr Rattan responding to queries raised by the Mathers’ lawyers on a draft shareholders’ agreement [5]. One provision in the draft agreement contemplated that Mr Lak Basran MBE, a person trusted by the Mathers and known to both parties, would be appointed as a director of Yagna on 1 December 2012.

Two of the questions and answers are central:

Reserved matters (Q4) – Whether there could be a list of reserved matters subject to the Mathers’ consent (e.g. issuing more shares, changing the nature of business, selling assets, licensing IP, loans, and capital expenditure limits).
Answer (in substance): These were matters normally for the directors and restricting them could be disruptive. “For this reason I have allowed Lak Basran MBE to become a company director as the shareholders he has introduced as investors are close associates of his.” Any material change in policy would be notified and shareholders consulted where appropriate.
Right to appoint a director (Q6) – Could the Mathers have the right to appoint a director?
Answer (in substance): The same question had been raised by Mr Basran, and “I allowed him to become a company director as mentioned in point 4 reply”, adding that he had relevant industry experience.

The judge at first instance found, and the Court of Appeal accepted, that:

These statements were intended to induce the Mathers to invest in Yagna [7].
They were untrue and known to be untrue: when the email was sent, Mr Basran had not in fact been appointed a director of Yagna [7]. He was only formally appointed (and replaced Rattan on the board) on 12 September 2015.

2.3 The reliance alleged

The Mathers’ case was that they were only willing to invest because they believed their trusted friend, Mr Basran, had been appointed to the board to protect their investment. The trial judge accepted Mr Mather’s evidence that:

“Had it not been for Mr Rattan’s assurance that Mr Basran, who I trusted and had confidence in, had been appointed as a director to protect my investment, I would not have felt comfortable investing in Yagna. Indeed, my wife and I would not have handed over our money had Mr Rattan not represented that Mr Basran had been made a director of the company.” [9]

Further oral evidence, summarised by the judge at [63], was to similar effect: the director status was important because:

“We knew him as a personal friend. We trusted him – that he would have control of the company’s money and would be able to look after our investment.”
“He would still be on the board. He would have an influence and a say in the company. How it would move forward.”
Had they not been told he was to be a director: “We would probably not have invested.” [10]

2.4 When the fraud came to light

The limitation issue turned on section 32 of the Limitation Act 1980. The key factual points were:

After the final tranche in November 2014, there were “no material events” and no further investor meetings. This was not inherently concerning because biotech investments were expected to take time to show returns [14], [15(6)].
The first “serious misgivings” arose around September 2015, prompted by concerns first raised by another investor, Mr Samuel Mikail, whose advisers had questioned the validity of his share certificate [14], [15(7)].
On 14 September 2015, Mr Mather received a call from Mr Basran saying that Mr Rattan had “been a naughty boy” and that all their investment funds had been taken [14]–[15].
Mr Mather’s second witness statement also recorded that this September 2015 call was the first indication that “the investment [was] not transpiring as I was informed it would” [13].

The claim form was issued on 20 August 2021 [4] – more than six years after the first investment in December 2012, but less than six years after the September 2015 “naughty boy” call.

3. Summary of the Judgment

3.1 The three grounds of appeal

The Court of Appeal was asked to consider three issues [17]–[20]:

Limitation: Whether the judge misdirected himself on section 32 by (a) mis-allocating the burden of proof and (b) applying the “reasonable diligence” test wrongly—specifically, by accepting that the Mathers were not obliged to check Companies House in the absence of any reason to doubt what they had been told.
Reliance: Whether the judge erred in finding that the Mathers relied on the misrepresentation that Basran was a de jure director, given the alleged common ground that he was in fact a de facto director whose practical influence would have been similar.
Causation: Whether the judge failed to address whether the misrepresentation caused the Mathers’ loss, and should have considered a counterfactual where the email did not misrepresent de jure director status but the Mathers invested and lost money anyway due to the failure of the business.

Snowden LJ dismissed the appeal on all grounds [21], with Males and Lewison LJJ concurring [45]–[46].

3.2 Ground 1: Limitation under section 32

On limitation:

The Court accepted that the language of the first sentence of [120] of the trial judgment (“I am satisfied that Mr Rattan cannot raise any valid limitation defence …”) was imperfect but held that, read as a whole, the judge had correctly understood and applied section 32 and the burden of proof [25]–[26].
The judge was entitled to find that there was “nothing to put [the claimants] on inquiry” before September 2015 and that they “could not, with reasonable diligence, have discovered that the representations … had been made fraudulently until less than six years before the commencement of this action” [12], [28]–[30].
Although the claimants could theoretically have discovered the lie earlier by searching Companies House, they were under no duty to do so in the absence of any reason to suspect dishonesty. The law of fraudulent misrepresentation is clear: “it does not lie in the mouth of a liar to argue that the claimant was foolish to take him at his word” [12].

Accordingly, section 32 postponed the running of time until (at the earliest) September 2015, and the claim issued in August 2021 was in time.

3.3 Ground 2: Reliance on the de jure director representation

On reliance:

The Court rejected the argument that the Mathers would have regarded Basran’s de facto role as sufficient. Mr Mather’s evidence about wanting him to have “an influence and a say” must be read in the context that he would be “on the board” as a formal director [32].
A de jure director possesses formal legal powers and rights (including access to information and participation in management) not necessarily enjoyed by a de facto director [32].
In any event, it was not common ground that Basran was in fact a de facto director at the time of the investments. The pleadings did not admit this, and the trial judge made no such finding [33]–[37].
The Court emphasised the appellate restraint in overturning primary findings of fact, citing Volpi v Volpi [2022] 4 WLR 48; there was no basis for disturbing the judge’s clear finding that the Mathers relied on the representation that Basran had been appointed a director and that this induced all three tranches of the £1 million investment [38].

3.4 Ground 3: Causation and damages in deceit

On causation:

The Court reaffirmed the orthodox principle that a claimant in deceit is entitled to recover “financial loss flowing directly from changing his position under such inducement” (Smith New Court), without any foreseeability requirement [40].
Although in theory a defendant may try to prove that the claimant would have entered into an alternative transaction and suffered the same loss anyway (MDW Holdings v Norvill [2023] 4 WLR 33 at [75]), this was impossible on the facts. The judge had accepted Mr Mather’s evidence that they would not have invested at all without the representation about Basran being a director [41].
Rattan had neither explored this issue in cross‑examination nor invited factual findings about hypothetical alternative investments or different terms [41]. It was not for the judge to adopt an inquisitorial role to make such a case for an unrepresented party [41].
Applying Smith New Court, the Mathers were entitled to recover the full price paid for the shares, with no deduction for value because there was no evidence that the shares ever had a realisable value, and the misrepresentation both continued to operate and effectively “locked” them into their investment until it became clear their shares were worthless [42]–[43].

The award of £1 million as the total loss directly flowing from the deceit was therefore upheld [16], [43].

4. Precedents Cited and Their Influence

4.1 Section 32 and fraud: Paragon Finance v Thakerar

The Court re‑stated the “classic” formulation by Millett LJ in Paragon Finance plc v DB Thakerar [1999] 1 All ER 400 at 418, cited at [23]:

The question is not whether the claimant should have discovered the fraud earlier, but whether they could with reasonable diligence have done so.
The burden of proof is on the claimant to show that they could not have discovered the fraud without exceptional measures which they could not reasonably have been expected to take.

This baseline principle frames the entire limitation debate in Mather v Rattan. The Court accepts that the Mathers bear the burden, but finds that on the evidence they met it: searching Companies House in the absence of any trigger would be an “exceptional measure” they could not reasonably be expected to take.

4.2 “Reasonable diligence” and the “trigger”: Gresport Finance and OT Computers

The Court also relies heavily on recent appellate elaborations of section 32:

Henderson LJ’s observation in Gresport Finance v Battaglia [2018] EWCA Civ 450 at [49] that the concept of reasonable diligence “only makes sense if there is something to put the claimant on notice of the need to investigate whether there has been a fraud” [24].
Males LJ’s analysis in OT Computers Ltd v Infineon Technologies [2021] QB 1183 at [47]–[48], explaining that:
- There are two factual stages: (1) being put on notice that something might be wrong, and (2) what a reasonably diligent investigation, once triggered, would reveal.
- Nevertheless, there is only a single statutory issue: whether the claimant “could with reasonable diligence” have discovered the fraud or concealment [24].
- The test is objective but applied to the actual claimant, in their real circumstances, not to a hypothetical investor [24].

Snowden LJ’s reasoning at [28]–[30] is directly shaped by these authorities. He treats:

the absence of any concerns about the investment before September 2015 (no returns yet being normal for a growing biotech business), and
the fact that the appointment of Basran was understood as a protective device rather than an end in itself,

as decisive in concluding that there was nothing to “trigger” the need to check Companies House.

4.3 Damages in deceit: Smith New Court and MDW Holdings

The causation and damages analysis rests on:

Smith New Court Securities Ltd v Citibank NA [1997] AC 254:
- Lord Steyn is cited at [40] for the proposition that a claimant in deceit is entitled to recover the financial loss “flowing directly” from acting under a fraudulent inducement, without the need for foreseeability.
- Lord Browne‑Wilkinson’s classic seven‑point summary at 266–267 is quoted in full at [42]. The key elements applied in this case are:
  - The defendant must make reparation for all damage directly flowing from the transaction (point 1).
  - The general rule of assessing loss by reference to value at the date of acquisition is not inflexible, particularly where the misrepresentation continues to operate or the claimant is “locked in” (points 4–5).
  - Consequential losses may also be recovered (point 6), and the claimant must mitigate once the fraud is discovered (point 7).
MDW Holdings Ltd v Norvill [2023] 4 WLR 33:
- Used at [40] to recognise that in theory a defendant can argue that the claimant would have entered into an alternative transaction and lost the money anyway.
- But Snowden LJ emphasises that such a case must be factually pleaded and explored; it cannot be conjured up on appeal.

The net effect is to reinforce a strong version of the “out‑of‑pocket” measure in deceit: where a misrepresentation induces a transaction in worthless assets, the starting and often ending point is full recovery of the price paid, particularly where the claimant was locked in by the fraud.

4.4 Appellate restraint: Volpi v Volpi

In addressing reliance, the Court cites Volpi v Volpi [2022] 4 WLR 48 at [2]–[5] as authority for the principle that the Court of Appeal will not interfere with a trial judge’s findings of primary fact unless they are plainly wrong [38]. The warning against “island‑hopping” on selective pieces of evidence reinforces why Rattan’s attempt to recast the factual matrix around de facto directorship could not succeed.

4.5 The role of the judge with litigants in person: Rea v Rea

In rejecting the suggestion that the trial judge should have engaged in an inquisitorial inquiry into hypothetical alternative transactions, Snowden LJ refers to Rea v Rea [2022] EWCA Civ 195 at [75]–[83] [41]. That case discusses the proper limits of judicial intervention on behalf of litigants in person under CPR 3.1A. Here, it is used to emphasise:

The judge is not obliged to construct and explore speculative defences that the party has not advanced.
Even for an unrepresented party, adversarial limits remain.

5. The Court’s Legal Reasoning

5.1 Limitation and reasonable diligence

5.1.1 Burden of proof under section 32

Section 32(1)(a) provides that where an action is based on fraud, “the period of limitation shall not begin to run until the plaintiff has discovered the fraud … or could with reasonable diligence have discovered it” [22].

Rattan argued that the judge had wrongly placed the burden on the defendant, pointing to the phrase “I am satisfied that Mr Rattan cannot raise any valid limitation defence” [25]. Snowden LJ accepted that this was poorly expressed but held that, reading [120] as a whole, the judge:

understood that there was a primary limitation defence under section 2 (six years from accrual of cause of action);
understood that it was for the Mathers to “afford a complete answer” to the plea that their claim was statute‑barred [26]; and
in fact applied the Paragon/OT Computers tests correctly.

This confirms that occasional infelicities of language do not amount to misdirection if the substance is right.

5.1.2 The “trigger” and Companies House searches

The substantive question was whether the Mathers could with reasonable diligence have discovered the fraud earlier by searching Companies House for Yagna’s filings and seeing that Basran was not a director as at December 2012.

The Court’s reasoning proceeds as follows:

Reasonable diligence requires a trigger.
Drawing on Gresport Finance and OT Computers, Snowden LJ affirms that reasonable diligence only becomes practically operative once there is something to put the claimant on notice of a potential problem [24]. Until then, the claimant need only be a “reasonably attentive” investor, not an actively suspicious one.
No red flags before September 2015.
The judge accepted evidence that:
- In a biotech start‑up, delayed returns were expected [15(6)].
- The Mathers had “no concerns about the security of their money” and “no reason whatsoever to feel any concern about their investments” until the September 2015 call from Basran saying the money had “gone” [15(7)].
There was therefore no “trigger” before September 2015.
The status of Basran as protection, not an end in itself.
Snowden LJ makes a subtle but important point at [28]–[30]: the appointment of Basran was not a freestanding objective the Mathers were independently verifying; it was a device offered by Rattan, and relied on by them, as a way of protecting their investment. The focus of their concern was not corporate formality but protection of their capital.
No duty to verify with Companies House.
Against that backdrop, expecting the Mathers to check the public register to verify that Rattan had told the truth about Basran’s appointment would be to require “exceptional measures” in Millett LJ’s sense in Paragon [23]. Snowden LJ endorses the trial judge’s robust statement that “there was no duty on any of the claimants to check the true position by making a search against the entries for Yagna at Companies House. The claimants were entitled to take Mr Rattan at his word. There was nothing to put any of the claimants on inquiry” [11], [28]–[30].

In short, section 32 is satisfied: the Mathers could not with reasonable diligence have discovered the fraud before the September 2015 trigger, and they sued within six years thereafter.

5.2 Reliance and the distinction between de jure and de facto directors

5.2.1 Misrepresentations about formal status

Rattan’s case on reliance was ingeniously narrow: since (he said) everyone knew that Basran was in practice acting as a director, the formal distinction between de jure and de facto status was immaterial to the Mathers’ decision to invest. Therefore, the deception as to legal appointment could not be causative of their decision.

The Court rejected this, emphasising:

The misrepresentation the judge found was precisely about formal appointment to the board (“I have allowed Lak Basran MBE to become a company director”).
Mr Mather’s evidence on which the judge relied explicitly tied the importance of Basran’s influence to his being “on the board” [32].

Snowden LJ adds the practical observation that a de jure director has “greater powers to call for information about his company, and greater rights to be involved in the management of a company than a de facto director, who is simply permitted by the de jure directors to act as if he were a director” [32]. That difference is crucial:

A de facto director’s influence exists at the sufferance of those legally in control.
A de jure director’s rights and duties are grounded in law and articles of association.

The misrepresentation thus went to a substantive, not merely formal, protection.

5.2.2 No factual basis for a “de facto” common ground

The Court also dismantles the premise that it was common ground that Basran was de facto a director at the relevant times:

Rattan’s pleading alleged that there was an agreement he would be appointed and that he was “acting as though he was already a director”, but this was not admitted [34].
The trial judge made no factual finding that Basran was a de facto director at the time of investment [33].
The only supporting evidence was a general statement in another claimant’s witness statement and an email where Basran later described himself as “Chairman” in January 2014—months after the first two investment tranches and before the final tranche [36]–[37]. None of this was explored with Mr Mather in cross‑examination, and no findings were made.

Given this evidential landscape, the Court had no basis to disturb the trial judge’s finding that the Mathers relied on the de jure appointment representation in making all the investments.

5.3 Causation and damages in deceit

5.3.1 Direct loss flowing from the fraud

On causation, Snowden LJ adopts a straightforward application of Smith New Court. The key points:

Once it is shown that the claimant was induced by a fraudulent misrepresentation to enter into a transaction, the defendant is liable for “all the damage directly flowing from the transaction” [42].
Foreseeability is irrelevant in deceit: losses directly flowing from the fraud may be recovered even if they would have been unforeseeable in negligence [40], [42].
Where the subject matter proves worthless, the default position is that the claimant is entitled to the full price paid, less any benefits, subject to flexibility where the fraud “locks in” the claimant or the misrepresentation continues to operate [42]–[43].

Here:

The misrepresentation induced the Mathers to part with £1 million they would otherwise not have invested at all [41].
There was no evidence that the shares had any realisable value at acquisition or subsequently [43].
The fraud plainly continued to operate to keep them locked into their investment until the September 2015 revelation [43].

The complete loss of the £1 million was therefore the direct loss caused by the deceit.

5.3.2 The limited role of “alternative transaction” counterfactuals

Rattan sought to deploy a nuanced causation argument drawing on MDW Holdings: even if the misrepresentation induced the investment, the court should ask whether, in a world where the email was truthful (e.g. explicitly describing Basran’s role as de facto only), the Mathers would still have invested and lost their money due to the collapse of the business, making the business failure the true cause of loss.

Snowden LJ accepts that in principle deceit damages can be reduced if the defendant proves that the claimant would have taken some other path leading to the same loss [40], but holds that:

On the facts found, this was unavailable: the judge had accepted unequivocal evidence that “they would not have invested in Yagna” without the director representation [41].
Rattan took no steps at trial to challenge that evidence or develop an alternative‑transaction case [41].
It would have been inappropriate for the judge to fill that evidential vacuum by adopting an inquisitorial approach for an unrepresented defendant [41].

The judgment therefore implicitly confines the MDW Holdings line of argument to cases where:

the alternative transaction case is properly pleaded and explored at trial; and
there is a credible evidential basis that the claimant would have made a similar loss in any event.

In Mather v Rattan, neither condition was met.

6. Complex Concepts Simplified

6.1 Fraudulent misrepresentation (deceit)

Fraudulent misrepresentation—or the tort of deceit—requires the claimant to prove that:

The defendant made a representation of fact.
The representation was false.
The defendant knew it was false, or was reckless as to its truth.
The defendant intended the claimant to rely on it.
The claimant did rely on it.
The claimant suffered loss as a result.

In this case, the key representation was that Rattan had “allowed Lak Basran MBE to become a company director” [6]–[7], which was untrue and known by him to be untrue at the time [7]. The trial judge found—and the Court of Appeal accepted—that the Mathers relied on this in deciding to invest and that it was made with the intention of inducing them to do so [7], [9]–[11].

6.2 De jure, de facto and shadow directors

De jure director: A person formally appointed as a director under the Companies Act 2006 and the company’s constitution, whose name appears on the register at Companies House.
De facto director: A person who acts as a director in practice, participating in management and holding themselves out as a director, even though not formally appointed.
Shadow director: A person in accordance with whose directions or instructions the company’s de jure directors are accustomed to act.

The case turns on the difference between de jure and de facto status. Snowden LJ stresses that a de jure director has stronger legal entitlements—especially to information and participation in management—than someone merely allowed to “act as though he were a director” [32]. That difference was material to the Mathers’ desire for assurance.

6.3 Limitation and section 32 of the Limitation Act 1980

Normally, a claimant has six years from the date a tort (such as deceit) occurs to sue (section 2). However, section 32 postpones the start of that six‑year period in fraud cases until:

the claimant discovers the fraud; or
the claimant could with reasonable diligence have discovered it.

“Reasonable diligence” is an objective test but applied to the actual claimant in their situation [24]. It does not require:

paranoid suspicion; or
taking exceptional steps such as proactively verifying every representation made, absent any reason to suspect a problem [23]–[24].

In Mather v Rattan, the court held that an investor in a start‑up company, with no reason to suspect dishonesty and who is told that a trusted associate has been appointed as director, is not obliged to search Companies House purely to check that the representation is true [28]–[30]. Time only started running when events in September 2015 indicated something was seriously wrong [12]–[15].

6.4 Causation and damages in deceit

Causation in deceit is more generous to claimants than in negligence:

Once reliance is established, the defendant is responsible for all loss that directly flows from entering the transaction.
The loss need not be foreseeable.
The usual measure is the difference between the position the claimant is in after the transaction and the position they would have been in had they not entered it at all (the “out‑of‑pocket” measure).

Where the asset acquired is worthless and the claimant was locked in by the fraud, that usually means full recovery of the price paid (Smith New Court), as occurred here [42]–[43].

7. Impact and Significance

7.1 Section 32 and investor vigilance

The decision reinforces an important practical message: in fraud cases, honest investors are not expected to operate on the assumption that they are being deceived. In particular:

An investor who has no reason to question what they have been told, and who is dealing with someone in a position of apparent trust and responsibility, is entitled to rely on those statements without immediately cross‑checking public registers.
The suggestion that claimants should routinely verify directorship appointments at Companies House, on pain of time‑bar, is firmly rejected.

This will be of real significance in future disputes where defendants allege that investors “could have discovered” the truth earlier by simple public searches. Mather v Rattan underlines that the combination of Paragon, Gresport and OT Computers protects victims of fraud from such hindsight‑based arguments unless there were concrete warning signs.

7.2 Misrepresentations about governance protections

The case illustrates that misrepresentations about corporate governance arrangements—such as board composition and the appointment of protective directors—are just as capable of founding a deceit claim as misrepresentations about business prospects or financial performance.

It also clarifies that the formal legal status of a protective figure (de jure vs de facto director) can be critical to reliance:

Investors who bargain for a trusted individual to be legally appointed to the board are entitled to insist on that condition.
A defendant cannot later argue that the misrepresentation was immaterial because the individual was “effectively” involved in management.

7.3 Causation defences in deceit post‑MDW Holdings

After MDW Holdings, there was scope for defendants to argue that, even if they lied, the claimant would have suffered the same loss in some other way. Mather v Rattan does not close that door, but it sharply limits its use:

The alternative‑transaction narrative must be properly run at trial, backed by evidence and tested in cross‑examination.
Courts will not indulge in speculative “what if” scenarios invented for the first time on appeal, especially where the claimant’s unchallenged evidence is that they would not have entered the transaction at all absent the misrepresentation.

This provides valuable guidance for litigators: if a “same loss anyway” defence is to be advanced in deceit, it must be clearly pleaded and evidentially supported from the outset.

7.4 Appellate deference to trial findings

The judgment also exemplifies the modern approach to appellate review of factual findings. The Court explicitly warns against “island‑hopping” and faithfully applies Volpi. This reinforces that:

Reliance and causation in deceit are intensely fact‑sensitive.
First‑instance credibility assessments—particularly concerning what a claimant would or would not have done—will rarely be disturbed absent clear error.

8. Conclusion

Mather v Rattan is a significant and tightly reasoned Court of Appeal authority on fraudulent misrepresentation in an investment context. Its key contributions can be summarised as follows:

Limitation: It affirms that section 32 protects claimants in fraud cases unless they could with reasonable diligence have discovered the fraud earlier, which in turn requires a genuine “trigger” for suspicion. Routine failure to verify statements against public records like Companies House does not defeat section 32 where there were no red flags.
Reliance: It confirms that misrepresentations about de jure director appointments are materially different from mere de facto involvement and can be central to an investor’s decision. Courts will respect clear first‑instance findings that such representations induced investment.
Causation and damages: It re‑states the Smith New Court principles: a claimant in deceit is entitled to recover all loss directly flowing from the transaction induced by fraud, typically including the full price paid for worthless property, without any foreseeability requirement. “Alternative transaction” arguments derived from MDW Holdings will be tightly controlled and require a robust evidential foundation.
Fairness to fraud victims: The case encapsulates the policy that “it does not lie in the mouth of a liar to argue that the claimant was foolish to take him at his word” [12]. Investors who have reasonably trusted express assurances about board composition and protective governance structures will find strong support in this judgment.

In combination with earlier authorities, Mather v Rattan provides a clear and practical framework for future deceit claims in the corporate and investment sphere, especially those involving assurances about who will sit on the board to “look after” investors’ money and when time starts to run for limitation purposes in fraud.