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22 January 2018
In October 2017 the Supreme Court handed down a significant judgment in the civil case Ivey v Genting Casinos (UK) Ltd trading as Crockfords. Although this case was decided on principles of civil law, it arguably has further reaching implications on the criminal law of dishonesty.
Phil Ivey, a well-known professional gambler, won £7.7 million playing Punto Banco (Baccarat) at the Crockfords Club in Mayfair in 2012. The club refused to pay out on the basis that Ivey had used an unfair technique called 'edge-sorting'. Ivey challenged the club all the way to the Supreme Court, losing at every turn.
From a criminal law perspective, the most significant part of the judgment relates to the test for dishonesty: the Supreme Court stated that the test for dishonesty in fraud and other acquisitive offences – known as the 'Ghosh test', which has been used in criminal cases since 1982 – did not correctly represent the law. The Ghosh test is based on:
The Supreme Court stated that the second limb of the test did not represent the law. The key passages of the judgment are set out below:
"In civil actions the law has settled on an objective test of dishonesty. There can be no logical or principled basis for the meaning of dishonesty to differ according to whether it arises in a civil action or a criminal prosecution. The second leg of the test propounded in Ghosh does not correctly represent the law and directions based upon it ought no longer to be given. The test of dishonesty is that used in civil actions. The fact-finding tribunal must ascertain (subjectively) the actual state of the individual's knowledge or belief as to the facts and then determine whether his conduct was honest or dishonest by the (objective) standards of ordinary decent people. There is no requirement that the defendant must appreciate that what he has done is, by those standards, dishonest."
This judgment represents a fundamental change to a basic tenet of criminal law and means that judges in future criminal trials will be required to give a different jury direction when summing up cases involving dishonesty.
For further information on this topic please contact Kathleen Harris, Sean Curran, Oliver Cooke or Melissa Dames at Arnold & Porter Kaye Scholer LLP by telephone (+44 20 7786 6100) or email (email@example.com, firstname.lastname@example.org, email@example.com or firstname.lastname@example.org). The Arnold & Porter Kaye Scholer LLP website can be accessed at www.apks.com.
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