Dishonest Assistance, Knowing Receipt, Tracing Structured Answer Help!

Right, you need to consider what the standard of knowledge is for 'knowing receipt'. You have all the appropriate cases for that in your OP.

Whether the father has committed knowing receipt or is a mere donee, the boat is the traceable proceeds of the £25,000. However, if he is a mere donee then he has the defence of change of position - the boat sank, he has nothing left of it, and he wouldn't have bought a boat 'anyway', so in that case there will be no remedy. If he has committed knowing receipt then the beneficiaries can abandon their worthless proprietary claim on the boat and bring a personal claim instead.

Might this not be going too far in a third year equity problem question? You could write an entire book on the differences in opinion between say Virgo, Burrows, Birks, etc! I have to admit I haven't read Virgo's book, what's his take on this case? Burrows is happy enough that this is a true unjust enrichment in 'The Law of Restitution'.

Are you taught by Virgo (you are at Cambridge, right?) It must be great fun to be taught by academics at the cutting edge of fields like this, unfortunately don't get anything like that at BPP

Therefore the majority of that section will be spend on arguing whether the father should have made inquiries as to how Larry got the money. Will go through the knowledge criterias etc... of Baden and Montagu.

Would i go through the same steps with regards to the Rug given to the mother?

Well, it's endorsed in 2 later cases... you can just mention it because knowing the counter-opinions gets you better marks. Wouldn't take more than two lines, he doesn't dwell that long on it.

Virgo lectured this topic and also taught us restitution in our Aspects class (also lectures criminal law for Part IA/Part II). It's quite interesting (unless you do one subject which I won't name but as the main lecturer wrote a textbook, we all have to read that one. And it's so dense, I've actually debated whether hitting my head against a wall might be more productive!)

Well, it's endorsed in 2 later cases... you can just mention it because knowing the counter-opinions gets you better marks. Wouldn't take more than two lines, he doesn't dwell that long on it.

Virgo lectured this topic and also taught us restitution in our Aspects class (also lectures criminal law for Part IA/Part II). It's quite interesting

There's nothing on the facts to suggest that the mother has any knowledge of the breach of fiduciary duty, so she is a donee again, and this time it seems she has the defence of change of position.

I always envy people who study law at Cambridge or Oxford, such a better place to learn and be challenged intellectually. It's not the same in institutions like Nottingham Trent, I always feel stupid compared to people who study at better universities.

Well done for getting in must have taken a lot of hard work!

This seems one of the most interesting areas of the law to me - won't actually be studying it formally for another two years but looking forward to it.

Now I'm trying to guess the ridiculously dense area of law lectured by the textbook writer. I'm going to say, Tax Law lectured by John Tiley, or International Commercial Litigation lectured by Richard Fentiman. Did I win? (sorry for random digression, OP!)

Is there nothing I can talk about other than saying she has a defence of change of position because she had no knowledge?

I hate Equity and Trusts So bloody difficult!

Nope. You're thinking too private law.

Careful - she doesn't have a change of position defence because she had no knowledge. She had no knowledge, therefore she is an innocent donee, therefore, she will be liable to make restitution unless she has the defence of change of position. She does have the defence here because the boat sank.

The basic idea of this defence is to not make an innocent donee worse off than they would have been if there had never been any breach at all - if she had to repay £25,000 then she would be worse off as she would be out £25,000 and not have anything to show for it at all. That's different from Ian's case because he is not worse off by having to repay £10,000 - he's in the exact same position he would have been if he had never been given £10,000 since he had already booked the spa break.

Going to make it clearer with numbers. Suppose Mother has £25,000 to start, gets given a boat, it sinks. If she has to repay £25,000 she now has nothing and is worse off than if she never got given the boat. Suppose Ian has £10,000 to start with. If he gets given £10,000, spends it on his spa break, and has to repay it, then he has nothing. But he had already booked the spa break, and would have had to pay for it out of his own money, so he would have had nothing in any case.

Hopefully that makes sense to explain the difference?

Munday - evidence?

Going to stop guessing if that is wrong.

Hi,

I've got a quick question guys! I've been revising for my equity and trust exam on Wed and I came across this question of knowing receipt. The claimants in the case scenario do not have legal interests in the trust fund so I assume that they can only bring their claim in equity? If that is the case, when the trustee misappropriated the fund and transferred it to a volunteer, could the latter invoke the defence of change of position? I thought the defence was only available to legal proprietary claim if I'm not mistaken?

Thanks! I'm really confused!

Nope I like that book actually. Much better than Cross and Tapper which was actually awful.

It's not Sealy and Hooley is it....i feel like strangling myself when i read that book!

Hey can you help me on this example question please would appreciate it

Thank you so will Beth be considered to be a third party - so will this mean the beneficiaries will be able to take a personal claim against her?

Also what approach would I need to take against the charity? Would they be a "donee" and were unjustly enriched?

Also is this scenario all based on tracing I'm not quite sure :/ I think it is but is it a constructive trust?

Beth is a third party. She appears to be as much a donee as the charities are. Which personal claim do you think the beneficiaries have? Why have you decided that the other personal claims are not available? Why have you decided that there is no proprietary claim against her? (Don't assume that is a trick question).

Yes the charity is a donee. The unjust enrichment claim looks like the main one to discuss but explain why you have decided the other personal claims do not exist. Is it so obvious that there is no proprietary claim against the charity?

Yes the scenario is based on tracing. If any third party still retains trust property then the best view is probably that the B's have a power to impose a constructive trust over that property, but nothing really turns on that here.

Yeah I think that's a good approach, but when you say personal claims what other personal claims can they be for the beneficiaries? in this scenerio

Also in the scenerio it says the charity received a gift and made a building out of the money - couldn't the beneficiaries make a proprietary claim? As they can trace back their trust money to the building made - or is this wrong?

Also what can be said for maggie's bankruptcy not really sure on that?

As I said in my earlier post, there are three possible personal claims against a third party:

(i) a claim for knowing receipt;
(ii) a claim for dishonest assistance;
(iii) a claim in unjust enrichment

So if you say "there is a personal claim against Beth", you need to specify which personal claim you are discussing, why it exists, and why the other personal claims don't exist.



Well no, in general if someone builds on land they already own the building materials accede to the land and cease to exist as separate items of property. You could argue that the B's are entitled to a charge on the 'improved' land, but so far as I know no such remedy has ever been awarded (cf. Ministry of Health v Simpson).



Presumably the point of this is to make it clear that the beneficiaries' personal remedy against Maggie is worthless. In general, of course, if a trustee spends trust property in various ways that are breaches of trust, the trustee is primarily liable to restore the trust fund. As Maggie is bankrupt, she can't do that.