Landmark victory in High Court property fraud case

Law firm Trowers & Hamlins is celebrating victory in a fraudulent property investment case, acting for people who invested in holiday schemes at Westward Ho! and Ilfracombe in Devon.
The firm acted for the lead claimants, 4VVV Ltd and Others v Spence & Others, in a complex fraud group action before the High Court in a case that centres on a multi-million-pound property investment scheme.
The High Court ruled in favour of the lead claimants marking a critical first step towards obtaining redress for the claimants who invested in the schemes.
The ruling concerned investments in student accommodation and holiday properties across the South West and other areas of the UK sold between 2012 and 2019. The claimants alleged that the investments were fraudulent schemes and the promised returns on these investments did not materialise, leading to the 435 claimants taking action after incurring substantial financial losses. With numerous companies involved now insolvent, the claimants pursued personal claims against the defendants, with estimated damages around £45m.
Trowers’ Exeter based partner Alex Sharples said: “The case was groundbreaking for numerous reasons and there are significant lessons to be learned in terms of big scale investment in property that may not be legitimate. Critically, this decision is a substantial finding of fraud in relation to holiday property investment in the South West of England and it concerns a claim of fraud and conspiracy which has impacted hundreds of individual investors who invested in holiday schemes at Westward Ho! and Ilfracombe in Devon. It is likely the largest fraud claim in terms of scale in respect of investment properties in the South West to ever come before the Courts. The significance of this result across an area with a high volume of property investment in holiday homes is paramount and a real story of victory which hopefully investors can use to be more aware of risk.
“This is a fantastic result for the lead claimants and a demonstration of the strength and depth of our litigation team working in the South West and beyond, that we were able to fight for this complex litigation over four years and we are so pleased that we have been able to bring about justice for investors.”
Trowers & Hamlins, working alongside a Counsel team led by Dan Saoul KC (4 New Square) and Matt Gregoire (Essex Court), successfully secured declarations that these investments constituted unregulated collective investment schemes (UCIS). This ruling supports the claimants’ right to recovery and affirms the legal safeguards protecting investors in the UK.
The lead claimants succeeded in their claims for deceit, unlawful means conspiracy, rescission of leases induced by fraudulent misrepresentation, and recovery of all monies paid, underscoring the significant impact of this judgment for property investors.
The trial of the ten test cases took place over a ten-week period in the Commercial Court, heard by Mr. Justice Foxton, who held that the defendants knowingly conspired to deceive investors over many years.
The judge’s decision highlighted the considerable distress and financial harm the defendants’ deceptive practices caused.
The judgment has major implications for fraud cases involving investment misrepresentation. It also reaffirms the importance of Financial Services and Markets Act (FSMA) regulation, following FCA v Forster [2023], in protecting investors from risks tied to unauthorised investment schemes.
The Trowers & Hamlins team included partner Alex Sharples, partner Helen Briant, associate Meera Solanki, and other members from Trowers & Hamlins’ Dispute Resolution teams.