In the controversial decision of Royscot Trust v Rogerson,5 the English Court of Appeal held that the measure of damages under a s.2(1) claim is the same as that in a claim for fraudulent misrepresentation in the tort of deceit. Despite acknowledging fierce opinion to the contrary by leading contract academics, both Ralph Gibson and Balcombe LJJ held that the “plain words” of s.2(1) compelled this conclusion, even though it had the objectionable “effect of treating . . . an innocent person as if he were fraudulent”.6 Royscot’s reading of s.2(1) is now commonly referred to as the “fiction of fraud”, a phrase first coined by Treitel and Atiyah in their seminal article on the Act.7 Subsequent judicial reception to Royscot has been cold, but the English courts have stopped short of overruling it.8 Instead, the prevalent strategy has been to admit that Royscot still remains good law, while chipping away at it piecemeal by artfully navigating around the full force of its implications in each instant case.9 The resulting situation is highly complex.10 Atiyah has even described it as an “embarrassment for English law”.11

Considering how much attention has been focused on criticising the fiction of fraud and trying to confine its impact,12 contract lawyers will be keen to know that the