Dear All:

This discussion has raised an interesting issue (for me at least). Why

is a trustee allowed to obtain damages representing the consequential

losses of the beneficial owners?  Is he or she really getting

consequential damages or are the damages more like substitutive damages

(if we use Rob's terminology). I don't know the answer, because I just

don't know the cases.

If it truly is the case that this is what a trustee can do (i.e. get

someone else's consequential losses), then it does seem to be form over

substance to not let the beneficial owner sue directly.

Cheers,

Jason Neyers

Associate Professor of Law

Faculty of Law

University of Western Ontario

N6A 3K7

(519) 661-2111 x. 88435

Lionel Smith, Prof. wrote:

> Jason's two points are intimately linked.

> The rights against rights theory says that the beneficiary's right is a right in or against the trustee's ownership of the asset. The beneficiary does not have any direct right against the tortfeasor, who owes a duty of care to the trustee.

> If however the trustee is joined as a party, then it becomes possible to adjudicate his right against the tortfeasor, and also his obligation to the beneficiary to account for the recovery to the beneficiary. If all parties are joined, then a court can make an order that short circuits the two claims.

> Lionel

>

>

> On 31-03-10 15:32 , "Jason Neyers" <jneyers@uwo.ca> wrote:

>

> Dear Colleagues:

>

> I was wondering if anyone had any thoughts about this case. I suppose one's view might depend ultimately on how one views the rights enjoyed by the equitable owner. If they are simply "rights against rights" as I have heard argued at the various Obligations conferences, then the decision appears wrongly decided.

>

> I was also a little surprised with the ease that the Court of Appeal side-stepped The Aliakmon:  what difference in justice is made when the legal owner is joined?

> Jason Neyers

> Associate Professor of Law

> Faculty of Law

> University of Western Ontario

> N6A 3K7

> (519) 661-2111 x. 88435

>

>

> Colin Liew wrote:

> Dear all,

>

>

>

> The English Court of Appeal in Shell UK Ltd & Ors v Total UK Ltd & Ors [2010] EWCA Civ 180 <http://www.bailii.org/ew/cases/EWCA/Civ/2010/180.html>  has decided (at [142]) that a duty of care is owed to a beneficial owner of property by a defendant who can reasonably foresee that his negligent actions will damage that property. If, therefore, such property is, in breach of duty, damaged by the defendant, that defendant will be liable not merely for the physical loss of that property but also for the foreseeable consequences of that loss, such as the extra expenditure to which the beneficial owner is put or the loss of profit which he incurs. Provided that the beneficial owner can join the legal owner in the proceedings, it does not matter that the beneficial owner is not himself in possession of the property.

>

>

>

>

> The appeal arose out of the 2005 Buncefield fire where, due to the negligence of Total (as found by David Steel J in March 2009), substantial damage was caused to the Hertfordshire Oil Storage Terminal. At issue in this appeal, however, was whether Shell could claim damages against Total in respect of economic losses caused to it as beneficial owner of land and facilities at Buncefield.

>

>

>

>

> Regards,

>

> Colin

>

>