Royscot Trust Ltd v Rogerson [1991] EWCA Civ 12 is an English contract law case on misrepresentation.

The reasoning of the decision has been much criticised by academic lawyers such as Treitel and Hooley,[1] partly for its overly literal interpretation of the statute, and for its dubious finding of fact that a deliberately false document was made negligently, rather than fraudulently.

Royscot approved the loan; but, had accurate figures been stated, they would have refused finance since its policy was not to lend money if the deposit was less than 20%.

[a] A year later, he informed the finance company of the sale, and stopped paying instalments in September 1988, leaving the balance unpaid.

The dealer alleged Rogerson's unlawful sale broke the chain of causation between any misrepresentation and Royscot's loss.

See also the decision of Sir Douglas Frank Q.C., sitting as a High Court judge, in McNally v. Welltrade International Ltd. [1978] I.R.L.R.

In each of these cases the judge held that the basis for the assessment of damages under section 2(1) of the Act of 1967 is that established in Doyle v Olby (Ironmongers) Ltd This is also the effect of the judgment of Eveleigh L.J.

In an article, "The Misrepresentation Act 1967" (1967) 30 Modern Law Review 369 by P. S. Atiyah and G. H. Treitel, the authors say, at pp.

(1987), p. 278, he says: "Where the action is brought under section 2(1) of the Misrepresentation Act , one possible view is that the deceit rule will be applied by virtue of the fiction of fraud.

But the preferable view is that the severity of the deceit rule can only be justified in cases of actual fraud and that remoteness under section 2(1) should depend, as in actions based on negligence, on the test of foreseeability."

It seems to me that that case, far from supporting Treitel's view, is authority for the proposition that we must follow the literal wording of section 2(1), even though that has the effect of treating, so far as the measure of damages is concerned, an innocent person as if he were fraudulent.

(1986), p. 286, says: "It has been suggested" - and the reference is to the passage in Atiyah and Treitel's article cited above - "that damages under section 2(1) should be calculated on the same principles as govern the tort of deceit.

With all respect to the various learned authors whose works I have cited above, it seems to me that to suggest that a different measure of damage applies to an action for innocent misrepresentation under the section than that which applies to an action for fraudulent misrepresentation (deceit) at common law is to ignore the plain words of the subsection and is inconsistent with the cases to which I have referred.

He went on to submit that, in the particular circumstances of this case, where the customer was apparently reputable, being a young married man in employment, it was even less likely that the dealer could have foreseen what might happen.

Nevertheless neither of these facts is conclusive in determining whether the sale of the car was a novus actus sufficient to break the chain of causation: see generally Clerk & Lindsell on Torts, 16th ed.

480, 492: "In my opinion, wherever any intervening factor was itself foreseen or reasonably foreseeable by the actor, the person responsible for the act which initiated the chain of causes leading to the final result, that intervening cause is not itself, in the legal sense, a novus actus interveniens breaking the chain of causation and isolating the initial act from the final result."

Mr. Kennedy's final submission was that the normal rule is that the plaintiff's loss must be assessed as at the date of his reliance upon the misrepresentation; since the finance company paid £6,400 to the dealer and in return acquired title to a car which was worth at least that sum, its loss assessed at that date was nil.

This submission again falls into the error of treating the transaction according to its technicalities - that the finance company was interested in purchasing the car.

Once the transaction is looked at in this way the authorities on which Mr. Kennedy relied to support this submission, being all concerned with misrepresentations leading to the acquisition of chattels, can be seen to be of little assistance.

[citation needed] Arguably, this case should have been considered "fraudulent" as it complied with the 3-part guidelines of Derry v Peek.