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equity > FD- new > Flashcards

FD- new Flashcards

1
Q

which 2 cases highlighted what a FD is

A
  • Canson Enterprises: acting in the best interests of others
  • Bristol and West Building society: relationship of trust and loyalty, you can only breach a FD if you are a F
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2
Q

3 remedies for breach of FD

A
  • account of profits
  • recission
  • compensation
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3
Q

2 cases for breach of no-conflict rule

A
  • Wright v Morgan; self-dealing

- Moody v Cox; conflicting duties owed to 2 principles

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4
Q

breach of no-profit rule case

A

Keech v Sandford

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5
Q

breach of no-conflict and no-profit rule case

A

FHR v Cedar

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6
Q

what case defined acting in bad faith and how

A

Re Second East Dulwich- as turning a blind eye to bad behaviour

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7
Q

what was highlighted in Armitage v Nurse

A

distinguished between dishonesty and recklessness

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8
Q

3 cases of category based fiduciaries

A
  • Boardman v Phipps: T-B relationship
  • Guinness Plc: Director-company
  • Bristol and West Building Society: solicitor-Client
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9
Q

what was highlighted in Eze v Conway (3)

A
  • that there was no category based F relationship even though he took a secret commission
  • no claim
  • This case shows that there was a shift in the law now and that courts will consider people who are not in a fiduciary-based category, as fiduciaries or not
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10
Q

outcome in Re Goldcorp (2)

A
  • High expectations was not enough

- There was vulnerability but not high enough for there to be a FD

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11
Q

outcome in Hospital Products (3)

A
  • Argued there was a FD so wanted an account of profits
  • Courts said no- it was more like a breach of contract
  • We need more than a little bit of vulnerability
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12
Q

which 2 cases show that this area of law is so strict that it can lead to harshness

A
  • Re Goldcorp

- Hospital products

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13
Q

which case shows that the courts are reluctant to find fiduciary relations, there have to be very good reasons for imposing them

A

Murad v Al-Saraj

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14
Q

what was held in SEC v Chenery Corporation (Frankfurter J)

A
  • When someone says they are a F it begins analysis- giving direction to further enquiry
  • He argues that a fiduciary duty might not apply to everything
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15
Q

what was held in Re Coomber

A

-There are different types of F relations but it doesn’t mean that there will always be a breach of FD

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16
Q

what was held in Henderson v Merrett (per lord BW).

2

A
  • The phrase ‘FD’ can give rise to a mistaken assumption that all fiduciaries owe the same duties
  • This is not the case
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17
Q

what was held in Benham about partnerships (2)

A
  • in partnerships, profiting from activates outside the scope of the partnership has been permitted
  • You have to find the scope of the F duty
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18
Q

what was held in English v Dedham about F based relations

A

that the categories are not closed and that the court can infer a F relationship by compared it to similar cases

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19
Q

what did Finn argue about f relations (2)

A
  • Argued that the concept of F relationship has always been hard to define
  • And hard to work out an easy set to rules to determine who is a F
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20
Q

what 3 things will the court do when someone is not part of the categories of a F relationship

A
  1. Check if someone is an established categories
  2. What the scope of their F duties are
  3. And if they are not in a recognised category- they will decide if they are a F or not
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21
Q

what did Boardman v Phipps say about self-appointed agents

A

that they are Fs because their work is so close to that of an actual agent

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22
Q

what did United Dominos Corporation say about joint ventures

A

that is so close to a partnership that it will be held that a FD was owed

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23
Q

what was held in Global Container Lines

A

there was a F relationship

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24
Q

what type of approach will the courts go through when determining if someone is a F or not when they are not in the F based categories

A

multi-factorial approach considering 5 common factors

25
Q

what are the 5 common facts courts consider when determine whether someone is a F or not

A
  1. An undertaking to act in the interests of another
  2. Delegation of power and discretion- fiduciary can bind them to legal contracts
  3. The need for self-denial- not to make profit on the side
  4. Vulnerability
  5. The danger of suborning the autonomy of the principal (power imbalance)- can the fiduciary bind you to things you don’t want to be bound to.
26
Q

what was held in Fishel (3)

A
  • that Employees are not Fs but they may have special features which may make them a F
  • This case shows thar analogy is not the right method to determine whether someone owes a FD
  • But the first principle route may be used instead
27
Q

3 examples of cases where there was a a first principle F

A
  • Ross River Ltd- Joint venture case
  • Fishel- employee
  • Sinclair investments- we look the individual in question, not the company to see if there was a breach of FD
28
Q

when establishing first principle fiduciaries what do we need to look for

A

we need to look for whether there was a requirement of loyalty in these relationships or whether they were commercial relationships

29
Q

what was held in Bray v Ford

A

you cannot make a secret profit

30
Q

what was held in Boulting v ACTAT, in contrary to Bray v Ford

A

if a breach of FD can be authorised by their master for example, then this can be allowed.

31
Q

what was held in Shipway v Broadwood

A

it is the secrecy involving the payment of the money, not the taking of the money.

32
Q

what was held in Kuys regarding defences

-which case also confirmed this

A
  • There must be full disclosure of the facts- a defence to breach of FD
  • Principle must be informed about what is going on and understand everything
  • Confirmed in Re Pauling’s ST
33
Q

what was held in Gwembe Valley

A

-Highlighted that the principle must the full extent of what is going on- they need to know all the facts and numbers

34
Q

what type of consent was found in Kelly v Cooper

A

implied consent- The defence of consent will be a defence when acting for multiple principles, but not a defence for taking secret commission.

35
Q

what defence was rejected in Murad v Al-Saraj

A

causation defence rejected

36
Q

what was held in FHR v Cedar about an account of profits as a remedy

A

-Need to make sure there is a profit in the first place that a constructive trust will arise over

37
Q

what was held in CMS Dolfin about profits remedy

A
  • Fiduciary may pay back the money for the breach of no-profit rule
  • Rather than handing over trust property
38
Q

when will equitable compensation be awarded

A

where there is not an involvement of profit

39
Q

what was held in Swindle v Harrison

  • what must D disprove
  • losses caused by what
  • what do you have to prove here
  • lost case why
  • what happens if you prove causation
A
  • D must disprove breach caused loss
  • Losses caused by breach of FD
  • You have to prove causation here- did the breach of FD cause loss, or would she have lost money in any case?
  • She lost case because she would have entered into this loan anyways as her business was desperate for capital
  • If you can prove causation, principle can get compensation for breach of FD
40
Q

what was held in Tang Man Sit (3)

A
  • Highlighted that you cannot claim for an account of profits and compensation together you can only claim for one.
  • Double recovery is not permitted
  • The loss is the price of the gain
41
Q

what was held in Boardman v Phipps about the strictness of the law when it comes to breaching FD

A

there was a breach of FD, but he did it with the best interests of the business.

And although he did not obtain consent, he was very honest and was allowed a liberal allowance for work and skill (remuneration)

42
Q

what was held in Guinness in response to Boardman being allowed a liberal allowance

A

that the allowance must not undermine the deterrent/ prophylactic purpose of FDs

43
Q

what can happen to remuneration

A

it can be forfeit

44
Q

what was held in Keppel v Wheeler in response to remuneration

A

-Even authorised remuneration may be forfeit for breach of fiduciary duty in bad faith – deliberately going against the F engagement

45
Q

what was held in Image View Management in response to remuneration (2)

A
  • Any remuneration will be forfeit except where the breach was a case of ‘harmless collaterality’ to the engagement.
  • If the breach was very innocent, you can keep you remuneration, but for everything else the remuneration will be forfeit
46
Q

what was seen to be done by the courts with remuneration

A

It is seen that the courts attempted to lower the bar where remuneration can be forfeit

47
Q

what was held in Galambos v Perez

A

need to show that there:

  • vulnerability (agreed by Lord Millet)
  • and a relationship of loyalty
48
Q

what does FHR v Cedar say about profits and constructive trust

A

you need to make sure there is a profit in the first place that a constructive trust will arise over

49
Q

what does CMS Dolphin say about remedies

A

that a F may pay back the money for the breach of the no-profit rule rather than handing over trust property

50
Q

what was held in Bray v Ford

A

you cannot make a secret profit

51
Q

what was held in ACTAT

A

that a breach of FD can be authorised by their master- then allowed

52
Q

what was held in Shipway v Broadwood

A

that it is the secrecy involving payment of the money, not the taking of the money that matters

53
Q

what was held in Kuys (3)

A
  • there must be full disclosure of the facts-a defence to breach of FD
  • principle must be informed about what is going on and understand everything
  • confirmed in Re Pauling’s ST
54
Q

what was held in Gwembe Valley

A

that the principle must understand the full extent of what is going on- they need to know all the facts and numbers

55
Q

what type of defence was found in Kelly v Cooper

A

implied consent

56
Q

when will consent be a defence

A

when acting for multiple principles, but not a defence for taking secret commission

57
Q

what defence was rejected in Al-Saraj

A

causation defence rejected

58
Q

where there is no involvement of profit what remedy can be awarded

A

equitable compensation

59
Q

what did Kelly v Cooper say about dishonesty

A

dishonesty is sufficient

equity (5 decks)

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