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equity and trusts > Accessory Liability > Flashcards

Accessory Liability Flashcards

1
Q

Which case describes traditional accessory liability?

A

Barnes v Addy

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2
Q

What did Barnes v Addy describe accessory liability as?

A

third parties don’t become liable because they’ve helped a dodgy trustee or fiduciary, unless they receive money or assist with knowledge

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3
Q

what is knowing receipt?

A

where a third party accepts money after helping a dodgy trustee or fiduciary they knew were dodgy

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4
Q

what is knowing assistance?

A

where a third party helps a dodgy trustee or fiduciary and is aware they are dodgy

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5
Q

How many points are on the Baden-delvaux scale?

A

5

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6
Q

what are the categories of the Baden-delvaux scale?

A

actual knowledge and constructive knowledge

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7
Q

what are the points under actual knowledge on the Baden-delvaux scale?

A

i. actual knowledge
ii. willfully shutting ones eyes to the obvious
iii. willfully and recklessly failing to make such inquiries as to an honest and reasonable man would make

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8
Q

what are the points under constructive knowledge on the Baden-delvaux scale?

A

iv. knowledge of circumstances which would indicate the facts to an honest and reasonable man
v. Knowledge of circumstances which would put an honest and reasonable man on inquiry.

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9
Q

What are some examples of actual knowledge?

A

intentionally turning a blind eye, or failing to conduct checks you are professionally obliged to do

eg, a banker may be liable if they process a multi-million transaction without checking where it has come from

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10
Q

Some criticisms of the Baden-delvaux scale?

A

. are levels 1-3 necessary?
. does it miss the point?
. where is the line drawn between liable and non-liable on the scale?

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11
Q

Which case did away with the Baden-delvaux scale?

what did it replace it with?

A

Royal Brunei Airlines Sdn Bhd v Tan

who is dishonest and who isnt

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12
Q

Which case introduced the 3 types of dishonesty?

A

twinsectra v yardley

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13
Q

Describe objective dishonesty

A

was the conduct dishonest by the standard of the ordinary decent person?

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14
Q

Describe subjective dishonesty

A

did D realise their conduct was dishonest?

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15
Q

What type of dishonesty was said to have been at play in the case of twinsectra v yardley?

A

a combination of objective and subjective dishonesty

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16
Q

the descision in twinsectra v yardley was per what previous case?

A

Ghosh

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17
Q

Twinsectra v Yardley facts?

A

Yardley used money for other purposes, and Leech was paying money to him without checking what he was doing was right. Leech honestly believed he was following instructions from twinsectra and said he was misguided.

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18
Q

Who’s dishonesty does Royal Brunei Airlines Sdn Bhd v Tan say to focus on?

A

the accessory’s dishonesty

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19
Q

Which case confirms that Royal Brunei Airlines Sdn Bhd v Tan is now the law?

A

Ivey v Genting Casinos

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20
Q

Ivey v Genting Casinos facts

A

Professional card counter won 7.7 million which is dishonest in a game of chance

21
Q

why is Ivey v Genting Casinos outcome significant?

A

because it confirmsTan as the law, but also because the courts said the ruling of dishonesty should apply universally, not just to counting cards

22
Q

Which case demonstrates the subjective element well?

A

Weavering Capital (UK) Ltd v Dabhia & Platt

23
Q

what rule did Weavering Capital (UK) Ltd v Dabhia & Platt produce?

A

that the better informed/educated D is, the more they should have known it was dishonest

24
Q

what was Mr Platt said to have done in Weavering Capital (UK) Ltd v Dabhia & Platt?

A

His “incompetent best”

25
Q

summary of dishonest assistance?

A

A breach of trust or FD assisted by D

objective dishonesty of D, no need to realise dishonesty

26
Q

What are the elements of knowing receipt?

A

.assets are disposed in a breach of trust or FD
.defendant benefits from receiving the property
.they need some form of knowledge

27
Q

The baden-delvaux scale is not the law, can it be used still?

A

yes, as a useful tool

28
Q

which case says that dishonesty is not required for one to be a knowing recipient but they must recognise underlying wrongdoing?

A

BCCI v Akindele

29
Q

what is unjust enrichment?

A
  1. D has been enriched
  2. the enrichment was at C’s expense
  3. the enrichment was unjust
30
Q

what is an example of unjust enrichment?

A

if you give the cashier £5 and they give you change for £10, and you take the change without realising. you haven’t been deceitful and are under no obligation to repay overpaid money

31
Q

with unjust enrichment, what can D show to prove they are not liable?

A

if they spend the money as they usually would do, bona fide (without the intention to deceive)

32
Q

case for unjust enrichment?

A

lipkin gorman v karpnale

33
Q

what is another name for a trustee de son tort?

A

de facto trustee

34
Q

what is a trustee de son tort?

A

they take it upon themselves to act as a trustee, and manage trusts, funds, make appointments etc

35
Q

case for trustee de son tort?

A

blyth v fladgate

36
Q

blyth v fladgate facts?

A

fladgate soliciotrs took management of the trust after the trustees died. the trust suffered losses as a result of their failures. liable as they assumed the position of the trustees

37
Q

What is a constructive trustee?

A

where you arent something but youre treated as if you are

38
Q

what are the two classes of constructive trustee?

A

class 1- one that acts in accordance with the family trust initially
class 2- one that acts contrary to the trust from the outset

39
Q

which case sets out the two classes of constructive trustee?

A

Williams v Central Bank of Nigeria

40
Q

What class of constructive trustee would dishonest assistance and knowing recipient be in?

A

class 2

41
Q

what class of constructive trustee would a true trustee or a trustee de son tort be in?

A

class 1

42
Q

what is the remedy for dishonest assistance?

A

joint and several liability to financially compensate for the loss

43
Q

case for remedy for dishonest assistance?

A

Ultraframe (UK) Ltd v Fielding

44
Q

what is the remedy for knowing receipt?

A

compensation limited to value of the property received

45
Q

case for knowing receipt?

A

Kasikornbank Public Co Ltd v Akai Holdings Ltd

46
Q

what is the remedy for Knowing Receipt and Dishonest Assistance?

A

account of secondary profits (additional profts made from the underlying wrong)

47
Q

case for Knowing Receipt and Dishonest Assistance?

A

Novoship (UK) Ltd v Mikhaylyuk

48
Q

what is the remedy for unjust enrichment?

A

restitution (returning what was transferred)

equity and trusts (4 decks)

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