Unlawful means conspiracy clarified

Conspiracy theories are banded around frequently in the age of social media, however the law of conspiracy is a separate, and often underused, beast and one that can often provide recovery to the claimant where there is no relationship between them and the defendant who has caused the loss complained of and, hence, no claim for breach of contract can be made.

Overview

The economic tort of unlawful means conspiracy exists where two or more people agree to act together unlawfully, intending to damage another person or their trade (although there is no need for the intention to damage to be the predominant purpose – the mere intention to inflict harm suffices), and do, in fact, cause damage.

The Racing Partnership Ltd and others v Sports Information Services Ltd [2020] EWCA Civ 1300 

In May 2022, the Supreme Court granted permission to appeal in Racing Partnership v Sports Information Services (SIS). This case involved an alleged breach of confidence and conspiracy by SIS, high street bookmakers, who were alleged to have unlawfully collected horse race betting information from betting websites – instead of from Racing Partnership. Racing Partnership had an exclusive contractual right to collect pre-race betting odds from on-course bookmakers and to sell those odds, for a fee, to off-course high street betting shops.

In the first instance judgment of the case, Zacaroli J dismissed the conspiracy claim and held that the claimant in an action for unlawful means conspiracy must establish that the defendant had actual knowledge of unlawful conduct. On appeal, however, the Court of Appeal held that SIS was indeed liable for unlawful means conspiracy, but not for breach of confidence. The Court established that for unlawful means conspiracy, the unlawful means can be a breach of contract – even if the contract is with a third party and not the claimant – and does not require that the unlawful act be directed at the claimant.

Clarifying previous conflicting case-law on the requirement for knowledge in this context, the Court disagreed with Zacaroli J, confirming that while conspirators should have knowledge of the facts which make the act unlawful, they do not need to have knowledge of the law too. By (i) not requiring knowledge of unlawfulness and (ii) not requiring an unlawful act to be directed at the claimant, this decision seems to have significantly broadened the application of the tort of unlawful means conspiracy.

Comment

Tom Barnard, Commercial Litigation & Dispute Resolution partner and Head of Irwin Mitchell's Sports sector team, comments:

“This case presents us with a clarity that did not exist previously in respect of the element of requisite knowledge of the law in order for claims of unlawful means conspiracy to succeed. The judgment widens the scope for potential claimants who suffer loss as a result of a deliberate act of two or more perpetrators given it narrows the defence for potential defendants”.