Robert

I think it may be too reductionist to say that we needed a clear decision one way or the other (akin to whether a particular jurisdiction opts to have its vehicles driving on the left or right hand side of the road).

I incline to the view that the Supreme Court has got the right answer consistent with sound legal virtues of accordance with principle, treating like cases alike, public policy, consistency, intelligibility and even simplicity of explication and application.

In a refreshingly concise and brisk way paying proper regard to academic commentary and the importance of consistency across common law jurisdictions.

I personally was persuaded that this is the better (or best) answer to this issue watching one of Millett (pere) v Millett (fils) debates last year. Lord Millett got it right in [1993] Restitution Law Review (and great names such as Goode and Birks made the wrong call).

Hope all well,

Gerard



Gerard McMeel
Barrister

Guildhall Chambers
23 Broad Street Bristol BS1 2HG

T 0117 930 9000 F 0117 930 3814
E gerard.mcmeel@guildhallchambers.co.uk



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From: Robert Stevens [mailto:robert.stevens@law.ox.ac.uk]
Sent: 16 July 2014 12:50
To: Mitchell, Charles; James Lee; obligations@uwo.ca; ENRICHMENT@LISTS.MCGILL.CA
Subject: RE: UK Supreme Court in FHR European Ventures

I think that is true, and has to be conceded.

So, when he says

"The agent's duty is accordingly to deliver up to his principal the benefit which he has obtained,"

No reason is given as to why this must entail a duty to deliver up the very right, and not just its value in the abstract, which is what the result turns upon.

That said, if I pay $1m as a bribe to an agent, is it ok for him to dissipate these funds for his own benefit, just so long as he has other funds from which he can pay his principal $1m? I don't think he should be so free, and if not that is a trust in the principal's favour.

But, the most important thing was to get a ruling one way or the other. A clear decision was better 9and easier to rationalise) than a fudge.
________________________________________
From: Mitchell, Charles [charles.mitchell@ucl.ac.uk]
Sent: 16 July 2014 12:31
To: Robert Stevens; James Lee; obligations@uwo.ca; ENRICHMENT@LISTS.MCGILL.CA
Subject: RE: UK Supreme Court in FHR European Ventures

Here's a question, though: why does Lord Neuberger set up the question to be decided in FHR as a choice between equitable compensation, on the one hand, and a constructive trust of property, on the other? What happened to the personal duty to account for the value of benefits received? I suspect that in his Lordship's mind equitable compensation and the personal duty to account for the value of gains are not clearly separated, although one might have thought that the former was a loss-based and the latter a gain-based measure (never mind that the two might coincide on some facts). In fact, during the course of argument, counsel tried to set up an opposition between the proprietary response of constructive trust and the personal response of duty to account, and Lord Neuberger didn't get it, insisting that the latter response had to be 'proprietary' because it was focussed on the value of property held by the defendant. This seems very confused to me, and so does the idea that equitable compensation is some kind of gain-based measure. Best wishes, Charles




________________________________________
From: Robert Stevens <robert.stevens@law.ox.ac.uk>
Sent: 16 July 2014 12:15
To: James Lee; obligations@uwo.ca; ENRICHMENT@LISTS.MCGILL.CA
Subject: RE: UK Supreme Court in FHR European Ventures

The key is at 33:

"The agent owes a duty of undivided loyalty to the principal, unless the latter has given his informed consent to some less demanding standard of duty. The principal is thus entitled to the entire benefit of the agent's acts in the course of his agency. This principle is wholly unaffected by the fact that the agent may have exceeded his authority. The principal is entitled to the benefit of the agent's unauthorised acts in the course of his agency, in just the same way as, at law, an employer is vicariously liable to bear the burden of an employee's unauthorised breaches of duty in the course of his employment. The agent's duty is accordingly to deliver up to his principal the benefit which he has obtained, and not simply to pay compensation for having obtained it in excess of his authority. The only way that legal effect can be given to an obligation to deliver up specific property to the principal is by treating the principal as specifically entitled to it. "

If I bribe your agent with a jade chess set, what is his obligation to you? Is he obliged just to account for its value, or to transfer the right to the very thing he has acquired?

If he happens to like jade chess sets, should he get the choice? Or should the principal be able to require that he transfer the very right with which he is bribed (or if he doesn't have that any longer, what traceably represents it)?

My view is the latter.

If that is correct, then there is a trust, because a duty to transfer a particular right to someone else is a trust.

It doesn't matter that before the bribe occurred I had no title to the chess set, any more than it matters if I pay you for Blackacre that I had no prior title to it. Your duty to convey to me that right is a trust.

Even more important was that we got a clear ruling one way or the other, rather than the contortions the CA had engaged in to try and reconcile the irreconcilable, or the nonsense position in some other jurisdictions that this is all just up to the judge.

Everything else is just noise.

Good.
RS