Ivey (Appellant) v Genting Casinos (UK) Ltd t/a Crockfords (Respondent) [2017] UKSC 67  On appeal from [2016] EWCA Civ 1093

Following a unanimous Supreme Court ruling on 25th October 2017, the 35-year test for dishonesty is no longer applicable with the correct approach to these claims to be standardised across both civil and criminal jurisdictions.

The ruling will have far reaching repercussions for those accused of dishonesty offences and make it far easier to convict people of dishonesty as previously the court had to prove that the defendant was aware that their actions would be viewed as dishonest.

The facts of the case centered around a poker player, Phil Ivey, who sued Genting Casinos UK, which owns more than 40 casinos in the UK including Crockfords, over a game of Punto Banco in 2012. The casino stated that he had won using a technique known as 'edge-sorting' which was not a legitimate strategy. The case was worth £7.7 million.

The original test for dishonesty (known as the 'Ghosh' test after R v Ghosh [1982] EWCA Crim 2) was as follows and a jury had to answer yes to both of these questions in order to return a guilty verdict:

  • whether the conduct complained of was dishonest by the lay objective standards of ordinary reasonable and honest people; and, if yes
  • whether the defendant must have realised that ordinary honest people would so regard his behaviour

However in the Supreme Court ruling, which now stands as the correct law, Lord Neuberger, Lady Hale, Lord Keer, Lord Thomas and Lord Hughes said that the new law should be the same across both civil and criminal actions and follow the decision in Royal Brunei Airlines Sdn Bhd v Tan [1995] 2 AC 378 and Barlow Clowes International Ltd v Eurotrust International Ltd [2006] 1 WLR 1476. This says that it is irrelevant that the defendant may judge his dishonesty by different standards- thereby negating the 2nd stage of the test.

Lord Hughes said: “Although a dishonest state of mind is a subjective mental state, the standard by which the law determines whether it is dishonest is objective. If by ordinary standards a defendant’s mental state would be characterised as dishonest, it is irrelevant that the defendant judges by different standards."

Addleshaw Goddard's head of corporate crime, Nichola Peters, commenting on the ruling said: "This case has significant implications for criminal dishonesty cases going forward, especially the more serious cases of fraud and dishonesty. I can predict a real uptick in cases coming to trial as the benchmark for dishonesty is now much clearer."

Previously the Ghosh test had meant that "the unintended effect that the more warped the defendant’s standards of honesty are, the less likely it is that he will be convicted of dishonest behaviour”, given the necessity that a jury conclude that the defendants would have so realised that his behaviour would be been seen as dishonest by ordinary and honest people. This was difficult to prove.