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Mapa mental

LIABILITY OF INTERMEDDLING STRANGERS

costafortune Equity and Trusts Degree Inglés

Contenido del mapa

LIABILITY OF INTERMEDDLING STRANGERS

  1. If trustee allows trust property to fall into the hands of someone else, trustee will be liable

    • If stranger knows they're receiving trust property, in breach of trust, stranger holds on CT for beneficiary
      • Must have actual or constructive knowledge
        • Which strangers will NOT be liable?
          • BFP - PILCHER v RAWLINS
            • Innocent Volunteer RE DIPLOCK
              • Agent of the Trustee - BARNES v ADDY
          • Which strangers WILL become liable?
            • Trustee de son Tort - MARA v BROWNE
              • A person who is not a trustee and has no authority from the trustee and becomes involved in the estate
            • Knowing/Dishonest Assistance
              • BARNES v ADDY - indicated that knowingly assisting in a fraudulent and dishonest disposition of the trust property is knowing assistance
                • Stranger does not have to be in receipt of trust property, liability can be imposed if they facilitate a fraudulent design - EAVES v HICKSON
              • Liability is personal not proprietary
                • 4 elements for liability
                  • Existence of a trust or other FR
                    • Existence of a dishonest or fraudulent design on part of trustee or other FID
                      • Although - ROYAL BRUNEI AIRLINES v TAN decided this is not essential
                        • Assistance by the stranger in the design
                          • Guilty knowledge on part of the stranger
                            • What constitutes knowledge? BADEN DELVAUS v SOCIETE GENERALE
                              • 5 BADEN criteria, widely accepted that stranger has guilty knowledge when:
                                • 1) Immediate knowledge of a trustees fraudulent breach of trust
                                  • 2) Willfully shuts his eyes to the obvious
                                    • 3) Willfully or recklessly failed to make such enquiries as a reasonable and honest person would make in the circumstances
                                      • Generally accepted that stranger has actual knowledge if the above 3 elements are present
                                        • Shown to have constructive knowledge when:
                                          • 4) has knowledge of circumstances that would indicate the facts to a reasonable and honest man OR
                                            • 5) has knowledge of circumstances that would put a reasonable and honest man on enquiry
                                              • Liability for dishonest assistance on basis of constructive knowledge can only be imposed in exceptional circumstances
                                                • SELANGOR UTD RUBBER ESTATES v CRADDOCK
                                                  • Other cases suggest dishonesty required BELMONT FINANCES V WILLIAMS FURNITURE
                                                    • BUT - preferable to consider the honesty/probity of def ROYAL BRUNEI case

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Degree Equity and Trusts Mapa Mental sobre LIABILITY OF INTERMEDDLING STRANGERS, creado por costafortune el 01/05/2013.
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