The Court of Appeal has dismissed an appeal concerning whether a financial adviser breached fiduciary duties by failing to disclose further information about its connections to an investment fund and the financial interests associated with it.
What was the appeal about?
In G.I. Globinvestment Limited & Anor v XY ERS UK Limited [2026] EWCA Civ 1248, handed down on 2 October 2026, the Court of Appeal considered whether XY ERS UK Limited (“XY”) had breached fiduciary duties owed to G.I. Globinvestment Limited (“GIG”) and Matteo Cordero di Montezemolo (“MDM”).
The appeal arose from a decision of Mr Justice Jacobs in the Commercial Court, reported as [2025] EWHC 740 (Comm). The Court of Appeal was asked to consider, principally, whether XY’s fiduciary obligations included a positive duty to disclose information concerning its interests and connections with investments recommended to the appellants.
The appeal was heard by Lord Justice Newey, Lady Justice Asplin and Lord Justice Popplewell following hearings on 21 and 22 July 2026.
What was the background to the dispute?
GIG was used by the di Montezemolo family to make and hold investments. MDM and his father were high-net-worth members of the family, while MDM had significant experience in financial and investment matters and had been involved in establishing private equity investment funds.
XY formed part of a group providing data technology and strategy consultancy services to high-end wealth managers. GIG first entered into an agreement with XY in 2016 for financial asset analysis and later entered into further arrangements for investment strategy consultancy and asset monitoring.
From 2017 onwards, MDM, SRL and GIG invested in a range of financial products proposed by XY. These included Market Insurance Notes (“MINs”) and High Frequency Price Opportunity (“HFPO”) products. The investments were initially profitable.
The appellants also invested in the Skew Base Fund, a Luxembourg Reserved Alternative Investment Fund. The fund had a number of compartments, including HFPO, MIN, Tangible Credit and Real Estate.
The fund’s structure involved a general partner, Skew Base SARL (“SB GP”), ultimately owned by Mr Daniele Migani. Mr Migani was also the founder and owner of the XY Group and a director of XY. Various entities within the structure received fees for management, investment management, investment advisory and related services.
When financial markets were severely affected by the Covid-19 pandemic in March 2020, the fund’s MIN compartments were liquidated. GIG and MDM suffered substantial losses on certain investments, while other investments were not affected.
The appellants subsequently brought proceedings alleging, among other matters, fraud, conspiracy, breach of fiduciary duty, dishonest assistance and breaches of contractual, tortious and regulatory duties.
What did the High Court decide?
The trial before Mr Justice Jacobs lasted approximately 28 days in late 2024. In judgment handed down on 28 March 2025, the Judge rejected the claims and found in favour of XY on its counterclaim for outstanding fees.
In relation to the fiduciary duty claim, the Judge accepted that a fiduciary relationship existed between XY and the appellants. There was no real dispute that XY owed duties not to place itself in a position of conflict and not to profit from its fiduciary position without informed consent.
The central dispute concerned whether that fiduciary relationship also imposed a positive obligation on XY to disclose all information relevant to the appellants’ affairs.
The Judge concluded that it did not. He treated fiduciary obligations as fundamentally proscriptive and held that the relevant duties did not include a general positive obligation to disclose all information relevant to the appellants’ affairs.
The Judge also concluded that the appellants had given informed consent. He found that MDM and Mr Nuzzo understood Mr Migani’s significant connection to the Skew Base Fund, including his role as the entrepreneur behind the fund and his ownership of the general partner.
Did XY have a positive duty of disclosure?
The Court of Appeal rejected the appellants’ argument that fiduciary loyalty created a separate and independent duty requiring XY to disclose all information relevant to their affairs.
Lord Justice Newey reviewed the established principles governing fiduciary obligations, including the no-profit and no-conflict rules. The court noted that the core obligation of a fiduciary is one of single-minded loyalty and that a fiduciary must not place itself in a position where its interests may conflict with those of its principal, subject to informed consent.
The court distinguished between disclosure as a mechanism for obtaining informed consent and a freestanding fiduciary obligation to disclose. Disclosure can enable a principal to give informed consent where the no-conflict or no-profit rules might otherwise apply, but that does not create a separate claim based solely on non-disclosure.
“Disclosure can facilitate informed consent where the ‘no conflict’ and/or ‘no profit’ rules might otherwise bite but … there is no discrete fiduciary duty of disclosure.”
The Court of Appeal also considered authorities including Item Software (UK) Ltd v Fassihi and Australian decisions relied upon by the appellants. It concluded that those authorities did not establish the existence of a general positive fiduciary duty of disclosure.
Ground 1 of the appeal was therefore rejected.
Why did informed consent matter?
The second principal ground concerned whether the appellants had given informed consent to conduct that would otherwise have engaged the no-conflict and no-profit rules.
The appellants argued that XY should have disclosed further information, including the amount or proportion of fees that companies owned or controlled by Mr Migani would receive, the role of Twinkle as an investment adviser and the fact that Twinkle was owned and controlled by Mr Migani.
The Court of Appeal confirmed that informed consent must be fully informed and that the person relying upon consent bears the burden of establishing that sufficient disclosure was made.
However, what amounts to all material facts depends on the circumstances of the particular case. The sophistication and experience of the person receiving the disclosure can also affect what that person understands from the information provided.
In this case, the trial judge had found that MDM and Mr Nuzzo were financially sophisticated and experienced. They understood the important role played by a general partner and knew that Mr Migani was closely connected with the fund.
The Court of Appeal considered that they knew, among other things, that Mr Migani was the entrepreneur behind the fund, that he owned the general partner, that the general partner played an important role in managing the fund and that substantial sums were paid to the general partner.
The fact that they did not know the precise amounts ultimately accruing to Mr Migani or the precise role played by Twinkle did not prevent the disclosure from being sufficient in the circumstances.
What did the Court of Appeal decide?
The Court of Appeal concluded that there was no proper basis for interfering with the trial judge’s conclusion that the appellants had given informed consent.
The court emphasised that appellate courts will generally not interfere with factual findings or evaluative assessments unless there is an identifiable error, such as a material error of law, a critical finding unsupported by evidence, a misunderstanding of relevant evidence or a decision that cannot reasonably be explained or justified.
Applying those principles, the Court of Appeal held that the trial judge’s conclusion was rationally open to him and was not undermined by any such error.
Lord Justice Newey concluded that GIG and MDM had adequate information to understand the nature and extent of the financial interest held by Mr Migani and entities associated with him.
The court therefore rejected Ground 2. As Grounds 4 and 5 concerned remedies and only arose if the appellants succeeded on Grounds 1 or 2, those grounds did not arise.
The appeal was dismissed. Lady Justice Asplin and Lord Justice Popplewell agreed with Lord Justice Newey.
- GIG entered into arrangements with XY concerning financial asset analysis, investment strategy consultancy and asset monitoring.
- The appellants invested in various MIN, HFPO and Skew Base Fund products following proposals from XY.
- Market volatility caused substantial losses to the appellants’ investments in certain fund compartments.
- The High Court dismissed the claims and found in favour of XY on its counterclaim.
- The Court of Appeal heard the appeal.
- The Court of Appeal dismissed the appeal in [2026] EWCA Civ 1248.
Frequently asked questions
Did the Court of Appeal find that XY owed fiduciary duties?
Yes. The Court accepted that a fiduciary relationship existed between XY and the appellants. The dispute concerned the scope of those duties and, in particular, whether they included a separate positive duty of disclosure.
Did XY have a general duty to disclose all relevant information?
No. The Court of Appeal held that there was no discrete fiduciary duty requiring XY to disclose all information relevant to the appellants’ affairs.
Why was disclosure still important?
Disclosure can be important because it allows a principal to give informed consent to a fiduciary’s conflict of interest or receipt of a benefit. The absence of a freestanding duty of disclosure does not remove the importance of disclosure when informed consent is relied upon.
Why did the Court accept that there was informed consent?
The Court relied heavily on the findings concerning MDM and Mr Nuzzo’s financial sophistication and their understanding of Mr Migani’s significant connection with the fund, his ownership of the general partner and the substantial fees paid to it.
What happened to the appeal?
The appeal was dismissed. Lady Justice Asplin and Lord Justice Popplewell agreed with Lord Justice Newey’s judgment.