Conspiracy

Legal provision

• No Indian Act defines civil conspiracy. The tort comes from English common law and is applied in India as justice, equity and good conscience.
• Bharatiya Nyaya Sanhita, 2023: criminal conspiracy is an offence. It is complete on the agreement alone.
• Competition Act, 2002: deals with anti-competitive agreements. It is a separate statutory regime.
• Trade Unions Act, 1926: section 18 protects a registered trade union and its officers from a civil suit for an act done in contemplation or furtherance of a trade dispute. The protection applies where the suit is based only on the act inducing a breach of a contract of employment or interfering with another person's trade, business or employment.

Meaning and definition

The tort of conspiracy is committed when two or more persons combine to do an unlawful act, or a lawful act by unlawful means, and actual damage is caused to the claimant. A combination has a power to harm that one person lacks, so the law looks at the combination as a whole.

Detailed explanation

Step 1: The essentials

1. A combination of two or more persons. A person cannot conspire alone.
2. An agreement or common design to injure the claimant, or to use unlawful means.
3. An act done in carrying out the agreement.
4. Actual damage to the claimant. The tort is not actionable per se.

Step 2: Two forms

• Conspiracy to injure, using lawful means. Each act is lawful in itself. Liability depends on the predominant purpose of the combination. If it was to injure the claimant, there is liability. If it was to advance the defendants' own legitimate interests, there is none, even if the claimant suffers.
• Conspiracy by unlawful means. The means used are independently unlawful, such as a crime, a tort or a breach of contract. The claimant need not prove that the predominant purpose was to injure him. Damage and unlawful means are enough.

Step 3: Quinn v. Leathem: purpose to injure

In Quinn v. Leathem, union officers pressed a Lisburn butcher, Leathem, to dismiss non-union men. They threatened his regular customer, circulated black lists and drew away his employees. A jury found a conspiracy that caused him loss. The House of Lords held that he could sue, and it read Allen v. Flood narrowly. A combination to injure a person in his trade, with threats and no justification, is actionable.

Step 4: Mogul Steamship: lawful competition

In Mogul Steamship Co. Ltd. v. McGregor, Gow & Co., a group of shipowners formed a conference to control the Hankow tea trade. They gave a rebate to exclusive shippers, sent extra ships and cut freights. The claimants got cargo only at very low rates. The House of Lords held that there was no actionable conspiracy. The object was lawful, and no unlawful means were used. Loss caused by lawful competition is damnum sine injuria.

Step 5: Motive and lawful acts

In Bradford Corporation v. Pickles, the House of Lords held that a landowner's malicious motive did not make unlawful his lawful use of his own land. It is different for a combination. After Quinn v. Leathem, a combination with the predominant purpose of injuring the claimant is liable even if each act is lawful.

Step 6: Defences

• Legitimate interest. The predominant purpose was to protect or advance the defendants' own trade or other interests.
• Lawful means and lawful object. No agreement to use unlawful means.
• Statutory immunity for trade disputes, within limits.
• No damage.

Step 7: Remedies

• Damages for the actual loss.
• An injunction to restrain the continuing combination.
• Criminal liability for conspiracy can follow separately.

Don't confuse: civil conspiracy and criminal conspiracy

Common mistakes

• Saying that one person can conspire. Two or more persons are needed.
• Saying that conspiracy is actionable without damage. Actual damage is essential.
• Treating all joint trade competition as conspiracy.
• Mixing civil conspiracy with the crime of conspiracy.
• Forgetting that unlawful means need no proof of predominant purpose.

Apply it

Leading case laws

• Quinn v. Leathem (1901)

  Facts. Union officers used threats, black lists and inducements against a butcher, Leathem, to force him to dismiss non-union men. A jury found a malicious conspiracy that injured him.

  Principle. A combination to injure a person, with threats and no justification, is actionable.

  Significance. Leading case on conspiracy to injure.

• Mogul Steamship Co. Ltd. v. McGregor, Gow & Co. (1891)

  Facts. Shipowners formed a conference, gave rebates and cut freights to control the Hankow tea trade.

  Principle. The object was lawful, and no unlawful means were used, so there was no conspiracy.

  Significance. Lawful competition is not conspiracy.

• Bradford Corporation v. Pickles (1895)

  Facts. A landowner dug on his own land and threatened a town's water supply.

  Principle. Malice does not make a lawful act unlawful.

  Significance. Motive and lawful acts by one person.

How to write this answer in the exam

Key points to remember

• Two or more persons, a common design, an act, actual damage.
• Lawful means: predominant purpose to injure decides liability.
• Unlawful means: no predominant purpose needed.
• Quinn v. Leathem: liable. Mogul Steamship: not liable.
• Civil conspiracy needs damage. Criminal conspiracy does not.

Quick self-test

Related topics

• Torts against Business Relations
• Passing off
• Wrongful intent