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Conspiracy as a Torts

Written by: Kartikey Mahajan
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There are two sorts of conspiracy:

the Quinn v. Leathem type which employs only lawful means but aims at an unlawful end, and the type which employs unlawful means. Thus the tort can take the form of unlawful conspiracy, where the combination uses unlawful means and the form of simple conspiracy, where the magic of plurality renders a combination to injure tortuous, despite the lack of unlawful means. Though these two torts obviously have common factors- an agreement or combination involving two or more persons intentionally to harm the claimant- their focal point is different. For this reason they must be analyzed separately. In so doing their relationship to the other economic torts will be revealed.

(A) Unlawful Conspiracy

Its ingredients are: -
# Intention
# Agreement / Common Design
# Concerted Action
# Damage
# Unlawful Means
# Justification

The issue of INTENTION is controversial in the economic torts. Though they require intentional harm, it has not been established whether that concept of intention is the same for them all. So dicta can be found requiring only that the act at the heart of the unlawful conspiracy be deliberate and have the effect of injuring the claimant . The parties to a conspiracy must have a COMMON DESIGN , though they need not all join at the same time. It is clear that for the conspiracy liability, it is sufficient that the parties combine to secure the doing of acts, which in the event prove to be a tort. The lack of common design in CBS Songs Ltd. v. Amstrad meant there could be no complicity liability. The requirement of a common design- means that ¡¥mere facilitation¡¦ is not sufficient for liability. Agreement alone is not sufficient for liability: there must be CONCERTED ACTION, consequent on that agreement.

Thus, Stuart-Smith LJ commented in Credit Lyonnais v. ECGD: it is not enough that [the defendant] merely facilitates the commission of the tort unless his assistance is given in pursuance and furtherance of the common design. Glidewell LJ in Unilever plc v. Chefaro noted that in order to show liability emanating from a common design ¡¥it is necessary to show some act in furtherance of the common design, not merely an agreement. Pumfrey J in Sandman v. Panasonic UK Ltd. , having found no decision to support a doctrine of responsibility in tort from mere association with a group acting in concert, concluded there must be some evidence that the defendant was actually involved in furthering the common design, that he took part in the unlawful act. There must be concerted action to a common end. DAMAGE is an essential element of liability in the tort of conspiracy for the tort, unlike the crime, consists not of agreement but of concert action taken pursuant to agreement. Pecuniary loss must be shown.

There was a detailed consideration of this point in Lonrho v. Fayed (no. 5) . So, damages are at large, i.e. not limited to a precise calculation of the amount of the actual pecuniary loss actually proved. Loss of profit and the expense of investigating the conspiracy are clearly recoverable. In the light of recent dicta , it would seem that the UNLAWFUL MEANS relied on for the tort of unlawful conspiracy must, as Stuart-Smith LJ in Credit Lyonnais v. ECGD asserted, be actionable in themselves and at the suit of the plaintiff. This was accepted as correct by Toulson J in Yukong Line Ltd. v. Rendsburg Investments Corp. (no. 2) . Such a view equates this tort with the torts of inducing breach of contract and inducing breach of statutory duty, where there is a need to show that an actionable wrong (i.e. actionable by the claimant) has been induced. It is clearly arguable that where unlawful means are deliberately used to harm, a defence of JUSTIFICATION should rarely if ever apply. Indeed, it is hard to see why this special defence would apply in unlawful conspiracy if the unlawful means need to be independently actionable- unless something like the defence of justification applies to the primary tort.

(B) Simple Conspiracy:

Here there is liability for an agreement to do acts, lawful in themselves, for the sole or predominant purpose of causing injury to the claimant and which causes injury to him. Simple conspiracy is an exception to Allen v. Flood . Lord Denning MR found simple conspiracy to be a modern intervention altogether. Simple conspiracy was established in a modern form in Mogul Steamship Co. v. Mc. Gregor and nurtured in Quinn v. Leathem.

As an anomalous economic tort, simple conspiracy in fact only applies in the most extreme cases of oppressive combination This is because of the need to prove that the combination is motivated by an illegitimate purpose. Given this tort can render a defendant liable, even though no unlawful means have been employed, this proviso to liability is an attempt: to hold the balance between the defendants right to exercise his lawful rights and the plaintiffs right not to be injured an injurious conspiracy.

The tort provides interlocutory relief to the plaintiff in Gulf Oil (GB) Ltd. v. Page. However, there is an obvious need to be wary of applying the tort of simple conspiracy to cases where the combinations to injure uses words, rather than acts. The tort could place the courts in a dilemma if it allowed claimants too easily to circumvent the requirements of a defamation action and gain damages for injury to reputation where the basis of the action was that the defendants had conspired to tell the truth.

Simple conspiracy exists but is of little practical value. It presents the opportunity for protection only in the most extreme cases of hostility and vendetta. It will rarely be useful for victims of others use of market power. A tort based on reviewing the interests and motivation of only the parties before the court would appear of little value in the process of market regulation.

The author can be reached at: kartikeymahajan@legalserviceindia.com / Print This Article

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