Impersonation of purchaser — Purchaser providing funds — Impersonator mortgaging property and receiving benefit of loans — Impersonator signing documents — Solicitors believing impersonator their purchaser/client — Impersonator disappearing with funds — Claim against solicitors — Whether negligent — Whether solicitors should have been on notice by two genuine signatures — Whether contributory negligence by purchaser — Claim against solicitors succeeds
The plaintiff is a Nigerian who makes occasional visits to London. In 1985 the plaintiff expressed interest in a flat at 6 Rodney Court, Maida Vale, London, and requested a Mr Abuchi to act for him. When a lease of the flat was offered for sale, Mr Abuchi instructed the defendant firm of solicitors to act on behalf of the plaintiff. But Mr Abuchi, without any power of attorney from the plaintiff, opened a bank account in the plaintiff’s name, conducted correspondence with the defendants and signed the contract for sale using the plaintiff’s name. The defendants assumed Mr Abuchi was the plaintiff. The plaintiff provided the defendants with funds for the purchase. Mr Abuchi entered into a mortgage with the Britannia Building Society to secure a loan of £30,000 and, on the completion of the purchase and mortgage, retained that sum of money.
In January 1986 Mr Abuchi impersonated the plaintiff again, mortgaged the lease and borrowed a sum of £95,000, which he requested the defendants to transfer to his personal account. The defendants believed they were acting in this further transaction for the plaintiff. When the plaintiff returned to London in April 1986 to collect the lease of the flat from the defendants and discovered Mr Abuchi’s fraud, he commenced proceedings against the defendants alleging negligence; the defendants counterclaimed for contributory negligence on the part of the plaintiff.
Held The claim was allowed.
On a balance of probabilities the evidence of the plaintiff had to be accepted. The defendants were negligent in dealing with the original assignment of the lease because, although they corresponded with Mr Abuchi, they overlooked two genuine letters from the plaintiff written from Nigeria which bore a totally different signature; that should have put them on notice. They were also negligent in dealing with the purchase moneys on the basis of a telephone message from Mr Abuchi, and in respect of the second mortgage, without meeting their client to establish his identity. The defendants should also have enquired as to whether Mr Abuchi held a power of attorney.
There was no contributory negligence by the plaintiff, who had paid the full price for the lease with vacant possession, had no knowledge of the mortgage, and had no reason to believe that the defendants would not be registering his title in the normal way.
Malcolm Knott (instructed by Bernard Oberman & Co) appeared for the plaintiff; and Dirik Jackson (instructed by Ince & Co) appeared for the defendants
