To deceive is, I apprehend, to induce a man to believe that a thing is > " true which is false, and which the person practising the deceit knows " or believes it to be false. To defraud is to deprive by deceit: Click here.

>
>
>  
>  
>  
>  
> Parliamentary Archives,
> HL/PO/JU/4/3/1256
> HOUSE OF LORDS
> SCOTT
> v.
> COMMISSIONER OF POLICE FOR THE METROPOLIS
> (On Appeal from the Court of Appeal (Criminal Division))
> Lord Reid
> Viscount Dilhorne
> Lord Diplock
> Lord Simon of Glaisdale
> Lord Kilbrandon
> Lord Reid
> my lords,
> For the reasons given by my noble and learned friend, Viscount Dilhorne,
> I would dismiss this appeal.
> .
> Viscount Dilhorne
> MY LORDS,
> In October, 1973, the Appellant was arraigned with nine others at the
> Central Criminal Court on an indictment which contained 36 counts. He
> was charged in 15, of which six charged him with conspiracy.
> The first count was as follows:
> " Statement of Offence " 1st Count Conspiracy to Defraud
> " Particulars of Offence
> " Terence John Avery, *******  Reginald James Thomas Corrigan, Robin
> " Graham Osborne, Donald Issatt, Raymond Frederick Watson,
> " Anthony Peter James Scott, Arthur Cyril Whiting, Thomas Herbert
> " Chatwin, Arthur Henry Turner and Donald Edward Falaise-Hodson
> " on diverse days between the 1st day of January 1971 and the 30th day
> " of December 1972 conspired together and with other persons to
> " defraud such companies and persons as might be caused loss by the
> " unlawful copying and distribution of films the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp0]copyright[#disp2] in which
> " and the distribution rights of which belonged to companies and
> " persons other than the said persons so conspiring and by divers other
> " subtle crafty fraudulent means and devices."
> The 7th count charged him with conspiracy to contravene the provisions
> of section 21 (1)(a) of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp1]Copyright[#disp3] Act, 1956.
> During the course of the opening of the case for the prosecution Mr.
> Blom-Cooper, who represented the Appellant, said that the Appellant was
> prepared to admit, and the Appellant did admit, the following facts, namely,
> that he
> " Agreed with employees of cinema owners temporarily to abstract,
> " without permission of such cinema owners, and in return for payments
> " to such employees, cinematograph films, without the knowledge or
> " consent of the owners of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp2]copyright[#disp4] and/or of distribution rights
> " in such films, for the purpose of making infringing copies and
> " distributing the same on a commercial basis ".
> On these admitted facts Mr. Blom-Cooper submitted the Appellant could
> not be convicted on the first count. His contention that there could not
> be a conspiracy to defraud unless there was deceit was rejected by Judge
> Hines and the Appellant then pleaded guilty to the first and seventh counts
> and was sentenced to two years imprisonment on count one and one year's
> imprisonment on count two.
> The Appellant appealed against his conviction on count one and the
> sentences imposed on him. Mr. Blom-Cooper's submission that, in the
> absence of deceit, the conviction for conspiracy to defraud could not stand
>  
>  
> 2
> was rejected by the Court of Appeal but the sentence passed on count one
> was reduced to one year's imprisonment.
> The Court of Appeal certified that a point of law of general public
> importance was involved in the decision to dismiss the appeal against con-
> viction on count one, namely,
> " Whether, on a charge of conspiracy to defraud, the Crown must
> " establish an agreement to deprive the owners of their property by
> " deception; or whether it is sufficient to prove an agreement to
> " prejudice the rights of another or others without lawful justification
> " and in circumstances of dishonesty ".
> Before the House Mr. Blom-Cooper put forward three contentions, his
> main one being that which he had advanced unsuccessfully before the Court
> of Appeal and Judge Hines that there could not be a conspiracy to defraud
> without deceit. He further contended that the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp3]Theft[#disp5] Act, 1968, had
> abolished with effect from the 1st January, 1969, when the Act came into
> operation, the offence of conspiracy to defraud. He also contended that a
> charge of the common law offence of conspiracy to defraud would not lie
> in respect of a conspiracy to commit a summary offence created by statute.
> The man who had conspired to contravene the provisions of section 21(l)(a)
> of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp4]Copyright[#disp6] Act, 1956, could not, he submitted, be convicted of
> conspiracy to defraud.
> The answer to this last submission is to be found in section 33 of the
> Interpretation Act, 1889, which enacts:
> " Where an act or an omission constitutes an offence under two or more
> " Acts, or both under an Act and at common law, whether any such
> " Act was passed before or after the commencement of this Act, the
> " offender shall, unless the contrary intention appears, be liable to be
> " prosecuted and punished under either or any of those Acts or at
> " common law, but shall not be liable to be punished twice for the same
> " offence."
> Mr. Blom-Cooper's main submission was based on the well known dicta
> of Buckley J. in In re London and Globe Finance Corporation, Limited [1903]
> 1 Ch. 728 at p. 732.
> " To deceive is, I apprehend, to induce a man to believe that a thing is
> " true which is false, and which the person practising the deceit knows
> " or believes it to be false. To defraud is to deprive by deceit: it is by
> " deceit to induce a man to act to his injury. More tersely it may be
> " put, that to deceive is by falsehood to induce a state of mind ; to defraud
> " is by deceit to induce a course of action ".
> Mr. Blom-Cooper, while not submitting that an intent to defraud neces-
> sarily includes an intent to deceive, nevertheless submitted that a man could
> not be defrauded unless he was deceived. Buckley J's. definition was, he
> said, exhaustive and as the conspiracy charged in count one did not involve
> any deceit of the companies and persons who owned the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp5]copyright[#disp7] and the
> distribution rights of the films which had been copied, the conviction on that
> count could not, he submitted, stand.
> In a great many and it may be the vast majority of fraud cases the fraud
> has been perpetrated by deceit and in many cases Buckley J's. dicta have
> been quoted in charges to juries. It does not, however, follow that it is an
> exhaustive definition of what is meant by " defraud ". Buckley J. had to
> decide when a prima facie case had been shown " of doing some or one of the
> "acts" mentioned in sections 83 and 84 of the Larceny Act, 1861, "with
> intent to deceive or defraud ". He did not have to make or to have to attempt
> to make an exhaustive definition of what was meant by " defraud ".
> Stephens' History of the Criminal Law of England (1883) vol. II at p. 121
> contains the following passage:
> " FRAUD—There has always been a great reluctance amongst lawyers
> " to attempt to define fraud and this is not unnatural when we consider
>  
> 3
> " the number of different kinds of conduct to which the word is applied
> " in connection with different branches of law and especially in connec-
> " tion with the equitable branch of it, I shall not attempt to construct
> " a definition which will meet every case which might be suggested but
> " there is little danger in saying that whenever the words ' fraud' or
> " ' intent to defraud' or ' fraudulently' occur in the definition of a crime
> " two elements at least are essential to the commission of 'the crime :
> " namely, first, deceit or an intention to deceive or in some cases mere
> " secrecy: and, secondly, either actual injury or possible injury or an
> " intent to expose some person either to actual injury or to a risk of
> " possible injury by means of that deceit or secrecy ".
> Stephens thus recognises that a fraud may be perpetrated without deceit
> by secrecy and that an intent to defraud need not necessarily involve an intent
> to deceive. In vol. Ill of his History at page 121 he says that:
> " Offences relating to property fall into two principal classes namely
> " fraudulent offences which consist in its misappropriation and mis-
> " chievous offences which consist in its destruction or injury. [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp6]Theft[#disp8] is
> " a typical fraudulent offence ".
> The definition of the common law offence of simple larceny had as one of
> its elements the fraudulent taking and carrying away (see Hawkins' Pleas of
> the Crown 6th ed. (1777) Book I, 134: East's Pleas of the Crown, vol. II
> (1803) 553). " Fraudulently " is used in the definition of larceny by a bailee
> in section 3 of the Larceny Act, 1861 (24 and 25 Vict. C.96) and in the
> definition of larceny in section 1 of the Larceny Act, 1916. [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp7]Theft[#disp9] always
> involves dishonesty. Deceit is not an ingredient of [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp8]theft.[#disp10] These citations
> suffice to show that conduct to be fraudulent need not be deceitful.
> The Criminal Law Revision Committee in their Eighth Report on " [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp9]Theft
> "[#disp11] and Related Offences (Cmnd. 2977) in paragraph 33 expressed the view
> that the important element of larceny, embezzlement and fraudulent con-
> version was " undoubtedly the dishonest appropriation of another person's
> " property " ; in paragraph 35 that the words " dishonestly appropriates "
> meant the same as " fraudulently converts to his own use or benefit or the
> " use or benefit of another person " and in paragraph 39 that " dishonestly "
> seemed to them a better word than " fraudulently ".
> Parliament endorsed these views in the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp10]Theft[#disp12] Act, 1968, which by section
> 1(1) defined [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp11]theft[#disp13] as the dishonest appropriation of property belonging to
> another with the intention of permanently depriving the other of it. Section
> 17 of that Act replaces sections 82 and 83 of the Larceny Act, 1861, and
> the Falsification of Accounts Act, 1875. The offences created by those
> sections and by that Act made it necessary to prove that there had been an
> " intent to defraud ". Section 17 of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp12]Theft[#disp14] Act substitutes the words
> " dishonestly with a view to gain for himself or another or with intent to
> " cause loss to another " for the words " intent to defraud ".
> If " fraudently " in relation to larceny meant " dishonestly " and " intent
> " to defraud " in relation to falsification of accounts is equivalent to the
> words now contained in section 17 of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp13]Theft[#disp15] Act which I have quoted,
> it would indeed be odd if " defraud " in the phrase, " conspiracy to defraud "
> has a different meaning and means only a conspiracy which is to be carried
> out by deceit.
> In the course of the argument many cases were cited. It is not necessary
> to refer to all of them. Many were cases in which the conspiracy alleged was
> to defraud by deceit. Those cases do not establish that there can only be a
> conspiracy to defraud if deceit is involved and there are a number of cases
> where that was not the case.
> In R. v. Orbell (1703) 6 Mod 42, 87 E.R. 804 the indictment stated that the
> defendants had fraudulently and per conspirationern, to cheat J.S. of his
> money, got him to lay a certain sum of money upon a foot race and
> prevailed with the party to run " booty ". No false representation was made
> to J.S. and he was not led to believe something to be true which was in fact
> false.
> 4
> In R. v. Button (1848) 3 Cox C.C. 229 the defendants were charged with
> conspiracy to use their employers' vats and dyes to dye articles which they
> were not entitled to dye, to secure profits for themselves and so to defraud
> their employer of profit. There was no false pretence and no deceit of their
> employer by inducing him to believe something to be true which was false.
> In R. v. Yates (1853) 6 Cox C.C. 441 the defendant was charged with
> conspiracy by false pretences and subtle means and devices to extort from T.E.
> a sovereign and to cheat and defraud him thereof. There was no evidence
> of any false pretence but Crompton J. held that the words " false pretences "
> might be rejected as surplusage and held that the defendant might be
> convicted of conspiracy to extort and defraud. Again, in this case, there was
> no deceit of T.E. inducing him to believe something to be true which was
> false.
> In R. v. De Kromme [1892] 17 Cox C.C. 492 the defendant was indicted for
> soliciting a servant to conspire to cheat and defraud his master by selling his
> master's goods at less than their proper price. Lord Coleridge C.J. said that
> if the servant had sold the goods at less than their proper price, his employer
> would have been defrauded. The conviction was upheld. The conspiracy
> which the defendant was charged with inciting did not involve any deceit
> of the employer.
> In R. v. Quinn [1898] 19 Cox C.C. 78 the defendants were convicted of
> conspiring to cheat and defraud the Great Northern Railway of Ireland of
> fares by abstracting return half tickets and selling them to members of the
> public. Again, there was no deceit of their employers.
> In R. v. Radley [1973] (unreported) the defendants were convicted of
> conspiring to defraud a company inter alia by stealing the property of that
> company. The Court of Appeal upheld their conviction and it was never
> suggested that the conviction was bad on the ground that no deceit of
> the company was involved.
> Indeed, in none of these cases was it suggested that the conviction was
> bad on the ground that the conspiracy to defraud did not involve deceit of
> the person intended to be defrauded. If that had been a valid ground for
> quashing the conviction it is, I think, inconceivable that the point would
> not have been taken, if not by counsel, by the court.
> In Welham v. Director of Public Prosecutions [1961] A.C. 103, this House
> had to consider the meaning of " intent to defraud " in relation to forgery,
> in the course of his speech Lord Radcliffe said (at page 123):
> " Now, I think that there are one or two things that can be said
> " with confidence about the meaning of this word ' defraud '. It
> " requires a person as its object: that is, defrauding involves doing
> " something to someone. Although in the nature of things it is almost
> " invariably associated with the obtaining of an advantage for the
> " person who commits the fraud, it is the effect upon the person who
> " is the object of the fraud that ultimately determines its meaning . . .
> " Secondly popular speech does not give, and I do not think ever has
> " given, any sure guide as to the limits of what is meant by ' to defraud '.
> " It may mean to cheat someone. It may mean to practise a fraud
> " upon someone. It may mean to deprive someone by deceit of some-
> " thing which is regarded as belonging to him or, though not belonging
> " to him, as due to him or his right ".
> Later Lord Radcliffe said that he was unable to accept Buckley J's
> observations in In re London Globe Finance Corporation (supra), which he
> said were obiter, as an authoritative exposition of words employed in a
> subsequent Statute.
> While the meaning to be given to words may be affected by their context
> and Lord Radcliffe was only considering the meaning of intent to defraud
> in section 4 of the Forgery Act, 1913, the passages which I have cited from
> his speech are, I think, of general application ; and certainly those passages
> and his speech lend no support to the contention that there cannot be a
> conspiracy to defraud which does not involve deceit.
> 5
> In the course of delivering the judgment of the Court of Appeal in R.
> v. Sinclair [1968] 1 W.L.R. 1246, where the defendants had been convicted
> of conspiracy to cheat and defraud a company, its shareholders and creditors
> by fraudulently using its assets for purposes other than those of the company
> and by fraudulently concealing such use, James J. said :
> " To cheat and defraud is to act with deliberate dishonesty to the
> " prejudice of another person's proprietary right".
> Again, one finds in this case no support for the view that in order to
> defraud a person, that person must be deceived.
> One must not confuse the object of a conspiracy with the means by which
> it is intended to be carried out. In the light of the cases to which I have
> referred, I have come to the conclusion that Mr. Blom-Cooper's main
> contention must be rejected. I have not the temerity to attempt an exhaustive
> definition of the meaning of " defraud ". As I have said, words take colour
> from the context in which they are used, but the words " fraudulently "
> and " defraud " must ordinarily have a very similar meaning. If, as I think,
> and as the Criminal Law Revision Committee appears to have thought,
> " fraudulently " means " dishonestly " then " to defraud " ordinarily means
> in my opinion to deprive dishonestly a person of something which is his
> or of something to which he is or would or might but for the perpetration
> of the fraud, be entitled.
> In Welham v. Director of Public Prosecutions (supra) Lord Radcliffe
> at page 124 referred to a special line of cases where the person deceived is
> a person holding public office or a public authority and where the person
> deceived was not caused any pecuniary or economic loss. Forgery whereby
> the deceit has been accomplished had, he pointed out, been in a number
> of cases treated as having been done with intent to defraud despite the
> absence of pecuniary or economic loss.
> In this case it is not necessary to decide that a conspiracy to defraud may
> exist even though its object was not to secure a financial advantage by
> inflicting an economic loss on the person at whom the conspiracy was
> directed. But for myself I see no reason why what was said by Lord
> Radcliffe in relation to forgery should not equally apply in relation to
> conspiracy to defraud.
> In this case the accused bribed servants of the cinema owners to secure
> possession of films in order to copy them and in order to enable them to
> let the copies out on hire. By so doing Mr. Blom-Cooper conceded they
> inflicted more than nominal damage to the goodwill of the owners of the
> [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp14]copyright[#disp16] and distribution rights of the films. By so doing they secured for
> themselves profits which but for their actions might have been secured
> by those owners just as in R. v. Button (supra) the defendants obtained
> profits which might have been secured by their employer. In the circum-
> stances it is, I think, clear that they inflicted pecuniary loss on those owners.
> I now turn to Mr. Blom-Cooper's second contention that the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp15]Theft[#disp17] Act,
> 1968, impliedly abolished the offence of conspiracy to defraud.
> Section 31(1) of that Act so far as material is in the following terms:
> " The following offences are hereby abolished for all purposes not
> " relating to offences committed before the commencement of this Act,
> " that is to say (a) any offence at common law of ... and, except
> " as regards offences relating to the public revenue, cheating . . . ."
> This section does not refer to fraud or conspiracy to defraud. In the
> Theatres Act, 1968. passed in the same year as the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp16]Theft[#disp18] Act, section 2
> subsection (3) expressly provides that no person shall be proceeded against
> for an offence at common law of conspiring to corrupt public morals. If
> it had been Parliament's intention to abolish conspiracy to defraud I would
> have expected a similar provision in the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp17]Theft[#disp19] Act.
> 6
> In East's Pleas of the Crown, vol. II, at page 818 the author stated that
> in his view the common law offence of cheating consisted in:
> " The fraudulent obtaining of the property of another by any deceitful
> " and illegal practice or token (short of felony) which affects or may
> " affect the public ".
> " It is not, however, every species of fraud or dishonesty in trans-
> " actions between individuals which is the subject matter of a criminal
> " charge at common law but in order to constitute it such ... it must
> " be such as affects the public, such as is public in its nature, calculated
> " to defraud numbers, to deceive the people in general ".
> In R. v. Wheatly (1761) 2 Burr 1127 97 E.R. 746, Lord Mansfield said:
> " The offence that is indictable must be such a one as affects the
> " public. As if a man uses false weights and measures and sells by
> " them ... in the general course of his dealing: so if a man defrauds
> " another under false tokens "
> The common law offence of cheating is, it appears, far narrower in
> ambit than the offence of conspiracy to defraud and while Parliament may
> by inadvertence do that which it does not intend to do, in my opinion it
> would be wrong to construe section 31(1) of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp18]Theft[#disp20] Act, 1968, in the way
> Mr. Blom-Cooper submits. I therefore reject his second contention.
> Reverting to the questions certified by the Court of Appeal, the answer
> to the first question is in my opinion in the negative. I am not very happy
> about the way in which the second question is phrased although the word
> " prejudice" has been not infrequently used in this connection. If by
> " prejudice " is meant " injure ", then I think the answer to that question is
> yes, for in my opinion it is clearly the law that an agreement by two or
> more by dishonesty to deprive a person of something which is his or to which
> he is or would be or might be entitled and an agreement by two or more
> by dishonesty to injure some proprietary right of his, suffices to constitute
> the offence of conspiracy to defraud.
> In my opinion this appeal should be dismissed.
> Lord Diplock
> MY LORDS,
> I have had the advantage of reading the speech of my noble and learned
> friend Viscount Dilhorne. I agree with it. The authorities that he cites
> and others cited in the speeches in this House in the contemporaneous appeal
> in R. v. Withers, in my view, established the following propositions.
> 7
> (3) Where the intended victim of a "conspiracy to defraud" is a
> person performing public duties as distinct from a private individual it is
> sufficient if the purpose is to cause him to act contrary to his public duty,
> and the intended means of achieving this purpose are dishonest. The
> purpose need not involve causing economic loss to anyone.
> In the instant case the intended victims of the conspiracy to defraud were
> private individuals. The facts bring it squarely within proposition 2 above.
> The dishonest means to be employed were clandestine bribery.
> I would dismiss the appeal.
> Lord Simon of Glaisdale
> MY LORDS,
> I have had the advantage of reading in draft the speech prepared by my
> noble and learned friend, Viscount Dilhorne. I agree with it; and I would
> therefore dismiss this appeal.
> Lord Kilbrandon
> MY LORDS,
> I have had the advantage of reading the speech prepared by my noble
> and learned friend, Lord Dilhorne. I agree with it, and would dismiss this
> appeal.
>
> Although at common law no clear distinction was originally drawn
> between conspiracies to " cheat" and conspiracies to " defraud ", these
> terms being frequently used in combination, by the early years of the
> nineteenth century " conspiracy to defraud" had become a distinct
> species of criminal agreement independent of the old common law sub-
> stantive offence of " cheating ". The abolition of this substantive common
> law offence by section 31(l)(a) of the [https://www.bailii.org/cgi-bin/format.cgi?doc=/uk/cases/UKHL/1974/4.html&query=(theft)+AND+(of)+AND+(copyright)#disp19]Theft Act, 1968, except as regards
> offences relating to the public revenue, thus leaves surviving and intact
> the common law offence of conspiracy to defraud.
> Where the intended victim of a " conspiracy to defraud" is a
> private individual the purpose of the conspirators must be to cause the
> victim economic loss by depriving him of some property or right, cor-
> poreal or incorporeal, to which he is or would or might become entitled.
> The intended means by which the purpose is to be achieved must be dis-
> honest. They need not involve fraudulent misrepresentation such as is
> needed to constitute the civil tort of deceit. Dishonesty of any kind is
> enough.
>  
>  
>  
>