Property Law - Fiduciaries Flashcards
Bristol & West v Mothew general
Solicitor further charges
What judge in Bristol referred to single-minded loyalty to principle as obligation of F?
LJ Millett
What several facets of single-minded loyalty did LJ Millett give in Bristol?
Good faith, no profit, no conflict and no acting for self-benefit/3rd w/o principal consent
Who argued F is an F because subject to FD, not he other way around?
LJ Millett in Bristol
No conflict rule
Even if good faith, even if P better off and even if only potential, there can be NO conflict
What does there need to be for breach of FD?
Conflict + loss/profit
Keech v Sandford general
Lease infant
Keech v Sandford judgment
Inability of trust immaterial - lease on CT for infant
What judge in Keech said it is better for lease to run out than T take it?
LC King
Boardman v Phipps general
Family trust, Tom Phipps
What was found at first instance in Boardman v Phipps?
Not full disclosure to trustees
Decision split in HoL in Boardman
3:2
Judges in majority in Boardman
Cohen, Hodson and Guest
Judges in minority in Boardman
Dilhorne and Upjohn
Majority in Boardman
Opportunity came because of family trust, potential conflict enough (because bias advice) and honesty irrelevant as focus is on dishonesty
Minority in Boardman
Vital trust was not able to purchase shares
Boardman v Phipps judgment
Disgorge all profits, with liberal remuneration for work and skill
Bryan on Boardman
No explanation as to why B and TP were Fs - must have been ‘self-appointed agents’
Why is the no conflict rule perhaps not so strict?
If F wants to retain a profit, he can make full disclosure to sui juris Bs
FHR European v Cedar Capital on ‘no profit’
Neuberger confirmed ‘no profit’ is a subset of ‘no conflict’
What case confirmed ‘no profit’ is a subset of ‘no conflict’?
FHR European v Cedar Capital
Conaglen on no profit
Extension of ‘no conflict’ rule
Lionel Smith on no profit
Separate from no conflict, with different underpinnings - Keech v Sandford
How did Smith refer to Keech v Sandford to suggest no profit is separate from no conflict?
In Keech, no conflict (because couldn’t get the lease), but still required to hold on CT because profit
Self-dealing rule
T dealing with trust as both buyer and seller
Fair dealing rule
T buys beneficial interest from B
Tito v Waddell (No.2)
Self-dealing is always voidable, even if fair value
Re Thompson’s Settlement
Under self-dealing, T cannot sell trust property to company in which she is the main shareholder, managing director or other principal
Under self-dealing, T cannot sell trust property to company in which she is the main shareholder, managing director or other principal
Re Thompson’s Settlement
Self-dealing is always voidable, even if fair value
Tito v Waddell (No.2)
Wright v Morgan
Sale to spouse not prohibited by self-dealing, as long as in B’s BI
Sale to spouse not prohibited by self-dealing, as long as in B’s BI
Wright v Morgan
How can a transaction be set aside for failing ‘fair dealing’ rule?
If unfair - onus on T to establish consent was fully obtained and value of purchase fair
Where does the disability model still apply in remedies?
Rescission, account of profits and CT
Where does the duty model apply in remedies?
Equitable compensation
What is the disability model
Enforce primary duties - proscriptive, prophylactic and not dependent on causation/remoteness
What academic called disability model prophylactic?
Conaglen
Two supporters of disability model
Lord Millett and Birks
What is the duty model?
F committed a wrong by breaching FD, so positive, prescriptive duty to act loyally breached, leading to secondary repair duty
Hospital Products v US Surgical
F owes + duty not to promote personal interests
Koshy
Suggested disability/duty irrelevant for remoteness/causation for unauthorised profits
Conaglen on duty
Disability will yield to BoD model in unauthorised profits
Who argued we impose F duties to encourage people to act altruistically?
Frankel
Who argued F duties are really about ‘deliberative exclusivity’?
Penner
What is the idea behind deliberative exclusivity?
P doesn’t need to be priority, just decisions made solely with P in mind
Re Duke of Norfolk’s ST
Courts can authorise remuneration in exceptional cases
Bristol v Mothew on fiduciary remuneration
Consent can be implied
What Act provides for remuneration of F in particular situations?
S.28 - 33 Trustee Act 2000
What section of what Act allows professional Ts to receive remuneration even without charging clause?
S.28 and 29 TA 2000
What is the basic rule on fiduciary remuneration?
Ts and Fs act gratuitously
Bristol v Mothew on fiduciary relationship
Millett LJ required act undertaken, giving rise to relationship of trust and confidence
Aberdeen Town Council v Aberdeen Uni
T and B = F
Boston Deep Sea v Ansell
Agent and principal = F
Aas v Benham
Partners = F
Regal v Gulliver
Director and company = F
Hilton v Barker Booth
Solicitor and client = F
Name at least two cases showing settled categories of F
Aas v Benham; Regal v Gulliver; Hilton v Barker Booth; Boston Deep Sea v Ansell; Aberdeen Town Council v Aberdeen Uni
Name at least two cases showing ad hoc categories of F
Reading v AG; JP Morgan v Springwell; Vercoe v Rutland; Murad v Al-Saraj
Reading v AG
Soldier bribe checks
JP Morgan v Springwell
Trust alone does not equal FD
Vercoe v Rutland
Expect degree of ruthlessness in commercial dealings
Expect degree of ruthlessness in commercial dealings
Vercoe v Rutland
Trust alone does not equal FD
JP Morgan v Springwell
Soldier bribe checks
Reading v AG
Murad v Al-Saraj
F can be ad hoc - not necessarily formal (e.g. solicitor)
F can be ad hoc - not necessarily formal (e.g. solicitor)
Murad v Al-Saraj
How is the scope of F’s duty determined?
From party’s relationship as a question of fact
Learoyd v Whiteley/Speight v Gaunt
Scope of F duty is diligence person of ordinary prudence would exercise in managing own affairs
Re Whiteley
If investment, minded to make investment for benefit of others, for whom he feels morally bound to provide
Bartlerr v Barclays Bank
Higher DoC from professional Ts
Henderson v Merrett Syndicates
Contract can modify scope of F relationship, e.g. allow for competiton
Hospital Products v US Surgical on scope/contract
F relationship cannot be imposed so as to change operation of contract
Boardman v Phipps on consent to FD breach
Can get consent to avoid breach, as long as ‘full and frank disclosure’, sui juris and burden on F
Walsh v Shanahan
FD end with relationship
FD end with relationship
Walsh v Shanahan
CMS Dolphin v Simonet
F cannot reassign post then take opportunity that arose whilst in F capacity
F cannot reassign post then take opportunity that arose whilst in F capacity
CMS Dolphin v Simonet
Contract can modify scope of F relationship, e.g. allow for competition
Henderson v Merrett
who said that the 2-party rule (e.g. rye v rye) is not the fundamental reason for the self-dealing rule?
Conaglen
What judge in what case thought the SD and FD rules were distinct?
Megarry VC in Tito v Waddell
What case showed that SD can be overcome if B’s consent?
Sanderson v Walker
Sanderson v Walker
SD not an issue if B’s consent
Who argues FD is not based on fairness but consent?
Conaglen
Who aligns the FD and SD rules?
Conaglen
How does Conaglen align the FD and SD rules?
Consent, not FD on fairness
What judge in what case defines FD based on fairness?
Megarry VC in Tito
Who calls Megarry’s position on FD’s anomalous?
Conaglen
Two cases suggesting FD is based on consent
Jones v Thomas; Selsey v Rhoades
Jones v Thomas
FD - fair but no consent
Selsey v Rhoades
Unfair but consent
Fair but no consent for FD
Jones v Thomas
Unfair but consent for FD
Selsey v Rhoades
