Tag: Appointed Representative

On 9 April 2020, the High Court handed down judgment in Silvercloud Finance Solutions Limited t/a Broadscope Finance v High Street Solicitors Limited [2020] EWHC 878 (Comm).

Financial services practitioners will be pleased to see His Honour Judge Pearce did not accept the Defendant’s argument that “the Financial Services and Markets Act 2000 renders every “appointed representative” in the position of the Claimant as an agent for the purpose of the law of contract when contracting with potential clients“.

This was because:

– the “word “agent” is not used in that Act, nor is any such unqualified modification of contractual status asserted in Section 1 of the Act“; and

– of the Court’s earlier decisions in R (TenetConnect Services Limited) v Financial Ombudsman [2018] EWHC 459 and Ovcharneko v Investuk Limited [2017] EWHC 2114 (both of which decided the statutory scheme in Section 1 is to create an additional liability on the part of the ‘principal’ “without more generally affecting the rights and obligations of third parties“).

On 31 July 2019, the Court of Appeal handed down judgment in Anderson & Others v Sense Network Limited [2019] EWCA Civ 1395 on an important issue: whether a principal is responsible for things done by an appointed representative outside of the scope of the things the principal accepted responsibility for.

After hearing submissions, Lord Justice David Richards decided that the appointed representative agreement restricted the appointed representative “to business using a Company Agency”. Because the advice given to clients did not involve the use of a Company Agency, it fell outside of the business the principal accepted responsibility for.

The principal was therefore not responsible for the advice given by the appointed representative. The appeal, and the claim, was therefore dismissed.