The Wine Enterprise Investment Scheme Limited (In Liquidation) v Crowe UK LLP

Facts

The claimant, The Wine Enterprise Investment Scheme Limited ("TWEISL"), in liquidation and acting by its joint liquidators, sued its former auditors, Crowe U.K. LLP (formerly Clark Whitehill LLP), alleging that competent auditing would have exposed the so-called Lilliput fraud perpetrated by its directors, and that the fraud would then have been stopped and the company's wine stock preserved. The substantive trial was determined by Richard Spearman KC, sitting as a Deputy Judge of the Chancery Division, whose judgment was handed down on 27 March 2026 ([2026] EWHC 692 (Ch)). At trial the judge held that the company required permission to re-amend its Particulars of Claim in order to advance a case that Crowe should have reported the discovery of fraud directly to shareholders, or that shareholders would have learned of it through a statement of reasons for resignation under sections 519 to 522 of the Companies Act 2006, and refused that permission. Damages of a modest sum were awarded, with a reduction for contributory negligence, and interest was ordered to run from 1 December 2019 rather than November 2018. A consequentials hearing took place on 2 June 2026, followed by a further judgment on 3 July 2026 ([2026] EWHC 1662 (Ch)) dealing with costs and some proposed grounds of appeal. The remaining consequential matters, including both sides' applications for permission to appeal, fell to be determined in this judgment.