The Court of Appeal has dismissed a test case against Andrew Thornhill KC, a well-known specialist in tax, who was head of Pump Court Tax Chambers in the early 2000s, and was hired by Scotts, promoter of the film schemes, to advise on the tax consequences of the schemes.

The appeal involved 10 investors from a group of 100 who had lost up to £40m in a failed film schemes. The case related to a dispute over whether Thornhill’s tax advice misled investors in a number of failed film finance tax schemes, the Second Scotts Atlantic Distributors LLP (SAD2) and the Third Scotts Atlantic Distributors LLP (SAD3) promoted by Scotts Atlantic Management Limited.

The average investor put £1m into the scheme and expected a gain of £108,000 after four years if the option was exercised.