Accessories

Question 1

Test for Dishonest Assistance

Answer 1

1. Breach of trust or fiduciary duty
2. Defendant factually assisted in the breach
3. The defendant acted dishonestly by the standards of ordinary people [objective] (Tan)
4. No need for realisation

Question 2

Tan v Twinsectra

Answer 2

Tan created fault-based liability [objective]

Twinsectra decided the defendant must have realised his act was dishonest [subjective]

Question 3

Test for Knowing Receipt

Answer 3

El-Ajou

1. breach of fiduciary duty
2. beneficial receipt by D can be traced back to C
3. D’s knowledge that receipt (property) is traceable to breach of FD

Agip
received for own benefit

Question 4

Baden Delvaux: Shades of Knowledge

Answer 4

Actual Knowledge: DA + KN
1. Actual knowledge
2. shutting one’s eyes to the obvious
3. Wilfully and recklessly failing to make inquiries as an honest and reasonable person would
Constructive Knowledge: Notice
4. knowledge of circumstances which indicate facts to reasonable and honest person
5. knowledge…on inquiry

Question 5

BCCI v Akindele

Answer 5

“unconscionable to retain benefit”

should this be a single test for knowledge like dishonesty?

Question 6

Constructive Trusts
Herbert Smith (No2)

Answer 6

English law provides no clear and all-embracing definition of a constructive trust

Question 7

Constructive Trust

Classification

Answer 7

1. A person acting in accordance with the trust or fiduciary engagement
2. A person acting against the trust or fiduciary arrangement from the start

Question 8

Paragon Finance (Millet LJ)

Answer 8

distinction between a trust and a catch-phrase

Question 9

Starglade v Nash

Answer 9

dishonesty is not a pre-requisite for liability (knowing receipt)

Question 10

Dishonest Assistance

Remedies

Answer 10

Ultraframe (UK)

Joint and several liability compensate for loss

Question 11

Constructive Trust

Salaam (No3)

Answer 11

‘equitable relief’
‘fully subject to fiduciary obligation’
‘strict liability’

Question 12

Notice

Arthur v Attorney General

Answer 12

notice is of equitable interest (competing)
Thus a proprietary claim
KR is unconscionable = equitable fraud
Thus personal liability = personal claim

Question 13

Notice

Eagle Trust plc

Answer 13

D can have actual notice and not know it
Ought to have known
lower standard

Question 14

Notice

Re Montagu’s Settlements

Answer 14

constructed and imputed notice is not appropriate to decide man’s conscience

Should we consider conscience?

Question 15

Unjust Enrichment

Answer 15

1. D has been enriched
2. Enrichment gained at C’s expense
3. D’s enrichment was unjust

• Changed bona fide position = not liable

Question 16

Insolvency

Answer 16

Holder goes bankrupt

C has priority over creditors (proprietary claim)

Question 17

Recipients

Answer 17

1. donees who do not purchase the property

2. those with notice of breach of trust or fiduciary duty

Question 18

Abu-Saleh

Answer 18

factual assistance as well as dishonesty

Question 19

Labelling

Answer 19

Dishonesty and knowledge
Third Rivers DC (Hirst)
‘gradually darkening spectrum’

Question 20

Weavering Capital

Answer 20

“incompetent best”

Question 21

A.B.Douglas - Group Seven

Answer 21

Sham Loan

Rescission from C lead to constructive trust

Question 22

Manifest Shipping

Answer 22

“Blind eye knowledge”

Question 23

Simon Gardner

Answer 23

Notice and knowledge overlap (especially in commercial contexts)

Question 24

Knowing Assistance and Receipt

Lord Nicholls

Answer 24

D = mostly persons/entities
e.g. banks who voluntarily enter agreements with trustees thus should owe a duty of care.
Knowing Assistance should not be required as there is a fiduciary duty

When D is not under a fiducial duty of care cases should be claimed in negligence

Question 25

Barnes v Addy

Answer 25

Strangers are not to be made constructive trustees...agents of trustees in transactions...unless agents receive ...property or assist with knowledge in a dishonest and fraudulent design.

Question 26

Speight v Gannit

Answer 26

"prudent businessman" | - steps to protect themselves

Question 27

Simon Gardner | Broad liability

Answer 27

Is this advantageous? | Solicitors and banks are essential in both committing and consent to fraudulent activity

Question 28

Bink

Answer 28

Shadowy liability of commercial life

Question 29

Mitchell and Waterson

Answer 29

The law regards D committing DA as constructive trustees even when they are not because the the trustee's liability is duplicated. (attached to DA). Seen as secondary liability to the breach of trust. Same for KR as they are attached to the receipt.

Question 30

Accessory Liability and Commercial Transactions

Answer 30

Akindele Actual knowledge not constructive knowledge is required. Suggestion there should be a single test. Basis of the Claim: 1. dishonestly assisted in the breach of fiduciary duty 2. knowingly received funds traceable to C

Question 31

Thomas | Unconscionability

Answer 31

Unconscionability is subjective which is dangerous for the law

Question 32

Agip and Dishonesty

Answer 32

The line between honest and dishonest is blurred by Baden-Delvaux

Question 33

Novoship

Answer 33

secondary profits

Question 34

Trustee de son tort

Answer 34

Mara v Brown | trustee by his own wrong

Question 35

Twinsectra and Strict liability

Answer 35

KR is receipt based

Question 36

Types of dishonesty

Answer 36

Twinsectra (Millet LJ): 1. defendants point of view of morality (Robin Hood) 2. dishonest by ordinary decent people [objective - Tan] 3. combined - realisation of dishonesty (Ghosh)