Dr Stefan Lo Cited by UK Supreme Court

Congratulations to Dr Stefan Lo whose articles (“Liabilities of Directors as Joint Tortfeasors” [2009] Journal of Business Law 109 and “Dis-attribution Fallacy and Directors’ Tort Liabilities” (2016) 30 Australian Journal of Corporate Law 215) were cited with approval by the UK Supreme Court in Lifestyle Equities CV v Ahmed [2025] AC 1, [2024] UKSC 17. The case concerned the issue of the circumstances in which a director of a company may be liable as an accessory in tort where the company is the main tortfeasor. A main thesis of the above articles from Dr Lo is that directors do not hold any special position by reason of being a director and that they, similar to employees or agents of a company, may be a joint tortfeasor with the company pursuant to the general principles of accessory liability and joint tortfeasors in tort law. Lord Leggatt SC agreed with this view in handing down his judgment (with which the other members of the Supreme Court agreed). Lord Leggatt SC (at para 35) adopted the terminology of “dis-attribution fallacy” as coined by Dr Lo (also referred to as a “dis-attribution heresy” by Campbell and Armour) – namely that it is a fallacy to suppose that attribution of acts of a director to a company necessarily results in dis-attribution of those acts from the director for all legal purposes. A number of Australian decisions have, in Dr Lo’s views, committed this fallacy. Lord Leggatt cited Dr Lo’s research on the Australian position (at para 71) and agreed with the view asserted by Dr Lo that to limit directors’ personal liabilities due to their acts being regarded as the company’s is incorrect. Earlier English cases had been moving towards this position as favoured by Dr Lo but there was also a suggestion by the English Court of Appeal that there remains a “constitutional exception” under which directors cannot be liable as joint tortfeasor with the company merely where their authorisation of the tortious act is done via their constitutional role in voting at a board meeting (MCA Records Inc v Charly Records Ltd (No.5) [2002] BCC 650, [2001] EWCA Civ 1441). Dr Lo argued that any such exception that effectively provides a ”safe harbour” for directors is inappropriate as a matter of both principle and policy. Lord Legatt SC agreed (at para 81).