Series
Blogs
12 January 2026
In a major decision for cases involving fraud, the Judicial Committee of the Privy Council has concluded in Credit Suisse Life (Bermuda) Ltd v Ivanishvili and 6 others [2025] UKPC 53 that there is no requirement for ‘conscious awareness’ of the misleading representation for a claim in deceit or fraudulent misrepresentation to succeed. This represents a significant departure from recent first instance authorities and potentially opens new avenues for claims for deceit or fraudulent misrepresentation.
This case comes out of the fallout from a fraud committed by the relationship manager at Credit Suisse AG (“Credit Suisse”) for Mr Bidzina Ivanishvili, the former Prime Minister of Georgia. This relationship manager, Mr Lescaudron, had misappropriated and fraudulently dealt with assets which Mr Ivanishvili had transferred to a Credit Suisse entity, Credit Suisse Life (Bermuda) Ltd (“CS Life”) to be invested under two life insurance policies, investments which Mr Lescaudron had earlier recommended to Mr Ivanishvili. Mr Lescaudron was subsequently convicted of fraud, forgery, and other offences by the Swiss courts.
Mr Ivanishvili, along with his family and associated companies, began proceedings in the Bermuda courts in 2017 against CS Life for breaches of contractual and fiduciary duties. In 2020, they added a claim for fraudulent misrepresentation to their case, alleging that, when recommending he invest in the life insurance policies, Mr Lescaudron had impliedly represented that Mr Ivanishvili’s accounts were not being, and would not be, managed fraudulently.
At the trial in Bermuda Mr Ivanishvili and the other plaintiffs succeeded on all material points. However, the Bermuda Court of Appeal – while agreeing with the trial court’s findings on breach of contractual and fiduciary duties – disagreed that the plaintiffs had established fraudulent misrepresentation, since the plaintiffs had not shown (or sought to argue) that Mr Ivanishvili had any conscious, contemporaneous, awareness or understanding of the implied (mis)representations that correlated with the meaning they were alleged to have carried. In line with a number of recent English first instance decisions the Bermuda Court of Appeal thought that this was an essential ingredient for a claim for damages for fraudulent misrepresentation or the tort of deceit.
Both parties appealed to the Privy Council – Mr Ivanishvili and the other plaintiffs against the Court of Appeal’s dismissal of their fraudulent misrepresentation claim, and CS Life against its upholding of the contractual and fiduciary claims against it.
The Privy Council endorsed the Court of Appeal’s (and trial court’s) findings of contractual breach, with their only modification to the lower courts’ conclusions being to adjust the dates used to calculate damages. The Privy Council did not, therefore, need to consider the appeal on the fiduciary claim, since this would have made no difference to the sum of damages Mr Ivanishvili was entitled to.
However, the Privy Council embarked on an interesting – and detailed – examination of the fraudulent misrepresentation claim (also referred to by the Privy Council as a deceit claim – the elements being identical). This was an important point as, if it succeeded, Mr Ivanishvili and the other plaintiffs would have been entitled to a greater sum in damages.
The trial court and Court of Appeal had considered that Mr Lescaudron, by recommending investment in the life insurance policies, had impliedly represented that Credit Suisse was not managing the plaintiffs’ accounts fraudulently, nor did it intend to manage the policy assets fraudulently. Those representations turned out to be false – as was known to Mr Lescaudron – and were intended to (and did) induce the plaintiffs to invest in the policies. None of these findings were challenged before the Privy Council.
The key point in issue, then, at least as regards Bermuda law, was whether Mr Ivanishvili needed to show that he had actually had a conscious awareness or understanding of the representations made to him by Mr Lescaudron’s conduct.
The Privy Council’s unanimous view was that there was no reason why a claim for deceit should be impacted by the presence, or lack thereof, of conscious awareness of the representation on the part of the claimant. The Privy Council identified a number of misconceptions underlying the previous cases, in summary that:
Despite the Privy Council’s endorsement of their position on conscious awareness (and therefore that they had a claim under Bermuda law), the plaintiffs were not entitled to damages for misrepresentation because their claim was time-barred under Georgian law (matters of limitation generally, under Bermudan statute, being referred to the lex causae). This was then relevant under the so-called ‘double-actionability’ rule of conflict of laws, whereby a tort committed a foreign country is only actionable if it gives rise to liability under both the law of the forum (Bermuda) and the law of the country where it took place (in this instance, Georgia, where the meetings with Mr Lescaudron occurred).
This rule has long been superseded as a matter of the conflict of laws rules applicable in England, but the parties did not challenge its existence in Bermuda. Against this background, the Privy Council rejected a number of arguments advanced by the plaintiffs as to why, in the present circumstances, Georgian law should not apply. The conclusion, therefore, was that the claim would fail since it was brought outside the three-year limitation period prescribed by Georgian law.
So far as English law is concerned, whilst decisions of the Privy Council are generally not, without a specific direction to that effect, directly binding authorities, they remain highly influential; particularly on any point where there is an absence of domestic appellate court rulings to the contrary.
For claimants seeking to bring fraud claims (whether under Bermudan or English law), then, this decision is likely to be regarded as smoothing their path – with particular significance for claims involving implied representations or representations by conduct, where claimants might have previously found it especially difficult to prove that they consciously thought about the representation at the relevant time.