High Court sides with claimants in shocking moth infestation fraud case

19 February 2025

3 min read

On 10 February 2025, the High Court ruled in favour of Iya Patarkatsishvili and Yevhen Hunyak in their case against William Woodward-Fisher. The judgment, delivered by Mr Justice Fancourt, centres on claims of fraudulent misrepresentation in the sale of a high-value property.

False representation alleged by Claimants over severe moth infestation

The case revolves around the sale of a Victorian house in West London, purchased by the Claimants for £32.5m in May 2019. The Claimants alleged that they were induced to buy the property based on false representations made by the Defendant. These misrepresentations specifically concerned a severe moth infestation.

Key findings

Misrepresentations identified: The Court found that the Defendant's replies to pre-contract enquiries were indeed misrepresentations. These replies falsely stated that there were no issues with vermin infestation, no relevant reports concerning the fabric of the property and no latent defects. The definition of vermin was clarified in this case as “animals or insects that are capable of infesting a residential house and causing a problem to the occupier or the house”. It was made clear that moths were classed as vermin. The Defendant was aware of a significant moth infestation but failed to disclose this information.
Reliance and inducement: The Claimants relied on the Defendant's false replies in deciding to purchase the property. The Claimants' agents, including their solicitors and wealth management advisors, reviewed the replies and advised the Claimants based on the false information provided by the Defendant. The Court concluded that the Claimants would not have proceeded with the purchase had the true facts been disclosed.
Defendant's knowledge: It was established that the Defendant knew or suspected that his replies were untrue. He had received reports from pest control companies identifying the moth infestation but chose not to disclose these reports to the Claimants.

£32.5m rescission plus damages

The Court allowed the Claimants to return the house and receive repayment of the purchase price with interest. The Court also awarded substantial damages for various costs incurred due to the misrepresentation.

The importance of honest disclosures in property transactions

When selling a property, the principle of "caveat emptor" (buyer beware) generally applies, meaning sellers are not obliged to disclose information unless withholding it would render other provided information misleading or incomplete. However, this judgment highlights the importance of honest disclosure in property transactions. Sellers must provide honest answers to pre-contract enquiries if they choose to respond or if uncertain, to not answer incorrectly. For instance, if asked about the presence of clothes moths or moth damage, sellers must either decline to answer or respond truthfully. This ensures transparency and trust in the property transaction process.

Reassurances were given that this was an extreme case and would not impact general conveyancing practices. It’s understood that the Defendant intends to appeal.