The Supreme Court’s 2025 decision in Hopcraft [2025] UKSC 33 turned on the conclusion that, on the facts, car dealers did not owe a fiduciary duty to their customers. It was therefore unnecessary for the Court to decide whether the disclosures made in the individual transactions were sufficient to establish informed consent, which is relevant if a fiduciary is to avoid the equitable liabilities which flow from his breach of the no conflict and no profit rules. The Court nevertheless reviewed the principles applicable to this point in detail, holding that a fiduciary must establish that they have provided full disclosure of all material facts, although what is material will depend on the circumstances. The Court of Appeal has now had cause to consider the issue of disclosure by fiduciaries in GI Globinvestment Ltd & Anor v XY ERS UK Ltd [2026] EWCA Civ 1248. In this judgment, the Court of Appeal considered the question of whether a fiduciary has a positive duty of disclosure, as well as what level of disclosure is required for a principal to give informed consent.
Summary
The Claimants are a high net worth individual and a company through which his family made and held various investments. The Defendant is part of a group that was founded and is owned by Mr Migani, providing data technology and strategy consultancy services to those managing high-end wealth. The Claimants invested in various funds and products on the recommendation of the Defendant, including the Skew Base Fund (“the Fund”). The general partner of the Fund, which was responsible for its management and which was paid fees out of the assets of the Fund, was owned by a company which was in turn owned by Mr Migani. Following market disruption caused by the COVID-19 pandemic, various compartments of the Fund were liquidated, producing substantial capital losses. In contrast, one compartment was successful and another suffered no loss.
The Claimants alleged that the Defendant had presented itself as an independent, unbiased and conflict-free adviser and the Claimants had engaged it on that basis. However, in breach of its fiduciary duty to the Claimants, the Defendant had recommended that the Claimants invest in the Fund without disclosing Mr Migani’s interest in it.
After a 28-day trial, the Judge agreed that the Defendant was in a fiduciary relationship with the Claimants. However, he also found that it was more likely than not that Mr Migani disclosed that he was the entrepreneur who was behind the Fund and had set it up, and that he was the owner of the general partner. Having regard to this, the Judge found that the Defendant was not under a positive duty to disclose to the Claimants all information relevant to their affairs, there was informed consent and therefore there was no breach of fiduciary duty.
No freestanding positive duty to disclose
Newey LJ, with whom Popplewell and Asplin LJJ agreed, reiterated the accepted no-profit and no-conflict duties applicable to fiduciaries. He rejected, however, the existence of a discrete positive duty of disclosure arising simply from a person’s fiduciary status (albeit that he did not
decide that fiduciary duties can never be prescriptive). Rather, disclosure is the means by which a fiduciary could negative what would otherwise be a breach of duty.
Viewing the issue practically, Newey LJ noted that, were the position otherwise, a fiduciary with a conflicting interest or duty could incur liability even though the principal had chosen to proceed with full knowledge of all material facts. Likewise, a principal could still make a claim if the fiduciary had not himself disclosed a fact which a Court later held to be material. It would make no difference that the fiduciary had striven to make full disclosure, that the fiduciary had believed the fact in question to be immaterial or that the principal had known the fact anyway. Newey LJ did not regard such an outcome as equitable.
Materiality and knowledge are context specific
Although Newey LJ accepted that the Claimants were not necessarily told, in so many words, all material facts necessary to understand the nature and extent of any conflict of interest, to the extent they were not, he found that their background knowledge and intelligence led them so to conclude. In Newey LJ’s view, it was plainly legitimate to take such conclusions into account when deciding whether there was informed consent: where an addressee’s sophistication means that he is aware of something, it is right to have regard to it.
Newey LJ also found little reason to impugn the Judge’s conclusion that there was informed consent. For instance, while the Claimants did not know the extent to which the sums paid to the Fund’s general partner accrued for the benefit of Mr Migani or particular companies he owned or controlled, they were aware that Mr Migani had a significant financial interest in the Fund, that he was the (ultimate) owner of the general partner, that it was receiving substantial fees and that he had a significant financial interest in the Fund’s success.
The Court of Appeal dismissed the appeal, holding that the Defendant owed no freestanding positive fiduciary duty of disclosure and the Judge had been entitled, and was correct, to find informed consent on the facts.
Practical matters
The common-sense approach of this judgment in respect of the law of informed consent is to be welcomed, acknowledging as it does that the relevant question is not simply what information the fiduciary expressly communicated, but what the principal actually knew and understood about the nature and extent of the fiduciary’s interest. Whilst the principal’s experience and sophistication may be relevant, they do not permit the fiduciary merely to place the principal on inquiry.
Fiduciaries should not, however, treat the decision as reducing the importance of clear disclosure. The burden remains on the fiduciary to establish informed consent to what might otherwise be a breach of the no-conflict or no-profit rule. As a matter of good practice, the agreement governing the relationship between the parties should identify the nature of any conflict, the existence and basis of any payment or benefit and, where it is material, its amount. Express written consent should then be obtained.
Disclaimer: This article is provided for general information only and is accurate as of 4 October 2026. It may not be updated to reflect subsequent legal or other developments. It does not constitute legal advice and should not be relied on as such. Specific legal advice should be obtained in relation to particular circumstances.
