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Sender:
Charles Mitchell
Date:
Wed, 11 Dec 2002 15:30:55
Re:
Tracing - Clayton's case - FIFO

 

Paul Matthews has just drawn my attention to a recent decision by Lindsay J in the Chancery Division, which further erodes the status of Clayton's case as the English default rule to resolve evidential difficulties whenever the money of two innocents is wrongfully mixed by a third party in a current bank account. The case is Russell-Cooke Trust Co v Prentis [2002] EWHC 2227 (Ch). Counsel in the case included Tony Oakley.

At para 55, Lindsay J reviews Barlow Clowes v Vaughan, remarks that it is 'plain' from all three of the CA judgments there that the rule in Clayton's case 'can be displaced by even a slight counterweight', and concludes that 'in terms of its actual application between beneficiaries who have in any sense met a shared misfortune, it might be more accurate to refer to the exception that is, rather than the rule in, Clayton's case'.

 

Charles


__________________________________________________________
Dr Charles Mitchell
Reader in Law and Director of Postgraduate Taught Programmes
School of Law
King's College London
Strand
LONDON WC2R 2LS

tel: 020 7848 2290
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