Tax silk owed no duty of care to investors

The appellants were members of limited liability partnerships (LLPs) that were formed to participate in the distribution of films. Investors took part on the basis that they would be entitled to tax relief against their income or capital gains for trading losses that the partnerships were expected to make. HMRC refused the reliefs and made a settlement offer to the investors which was accepted.

The respondent Andrew Thornhill KC had been engaged by the scheme promoter to provide advice on the tax consequences of the arrangements. The appellants said Mr Thornhill owed them a duty of care in respect of the advice he gave to the promoter for example by approving statements about the implications and tax benefits of the scheme in the information memorandum by which each scheme was promoted and by agreeing to be named in the memorandum as having provided advice and for...