The subjective element was discussed by the House of Lords in [ case ]. Here Twinsectra had loaned Yardley £1 million, paying it to his solicitor, Sims, who gave a written undertaking to Twinsectra’s solicitors that the money was to be used solely for acquiring property (immovables) for Yardley and for no other purpose. Sims transferred the money to Yardley’s other solicitor, Leach, who knew of Sims’ undertaking but yet used the money on Yardley’s instructions for other purposes. Leach knew that he was using the money for an unauthorised purpose, but thought that Sims was merely under a contractual obligation to Twinsectra not a Quistclose purpose trust obligation. The House of Lords held that the money was held on trust only to be used for acquiring property but (Lord Millett dissenting) appeared to hold that since Leach was not himself subjectively aware that what he was doing was something that the ordinary reasonable person would think was dishonest, he had rightfully had the case against him dismissed by the trial judge, whom the Court of Appeal had reversed, Lord Millett applied an objective test. Leach, a solicitor, had knowingly participated in arrangements which he knew to be an unauthorised use of the money in breach of Sims’ undertaking as a solicitor to Twinsectra’s solicitors. Leach was liable, regardless of whether or not he appreciated that the ordinary reasonable person would consider his knowing mishandling of the money (at the very least in breach of Sims’ contractual undertaking) as dishonest. The majority, whilst expressing approval for the Privy Council’s advice in Tan, appeared to have changed the test for dishonesty to the more subjective criminal test, so that not only must the defendant have done something that right- thinking people would consider dishonest, he must have been aware that they would so view his conduct. Lord Millett strongly dissented.
Answer
Twinsectra Ltd v Yardley & Others [2002] 2 AC 164
Tags
#equity #law #strangers
Question
The subjective element was discussed by the House of Lords in [ case ]. Here Twinsectra had loaned Yardley £1 million, paying it to his solicitor, Sims, who gave a written undertaking to Twinsectra’s solicitors that the money was to be used solely for acquiring property (immovables) for Yardley and for no other purpose. Sims transferred the money to Yardley’s other solicitor, Leach, who knew of Sims’ undertaking but yet used the money on Yardley’s instructions for other purposes. Leach knew that he was using the money for an unauthorised purpose, but thought that Sims was merely under a contractual obligation to Twinsectra not a Quistclose purpose trust obligation. The House of Lords held that the money was held on trust only to be used for acquiring property but (Lord Millett dissenting) appeared to hold that since Leach was not himself subjectively aware that what he was doing was something that the ordinary reasonable person would think was dishonest, he had rightfully had the case against him dismissed by the trial judge, whom the Court of Appeal had reversed, Lord Millett applied an objective test. Leach, a solicitor, had knowingly participated in arrangements which he knew to be an unauthorised use of the money in breach of Sims’ undertaking as a solicitor to Twinsectra’s solicitors. Leach was liable, regardless of whether or not he appreciated that the ordinary reasonable person would consider his knowing mishandling of the money (at the very least in breach of Sims’ contractual undertaking) as dishonest. The majority, whilst expressing approval for the Privy Council’s advice in Tan, appeared to have changed the test for dishonesty to the more subjective criminal test, so that not only must the defendant have done something that right- thinking people would consider dishonest, he must have been aware that they would so view his conduct. Lord Millett strongly dissented.
Answer
?
Tags
#equity #law #strangers
Question
The subjective element was discussed by the House of Lords in [ case ]. Here Twinsectra had loaned Yardley £1 million, paying it to his solicitor, Sims, who gave a written undertaking to Twinsectra’s solicitors that the money was to be used solely for acquiring property (immovables) for Yardley and for no other purpose. Sims transferred the money to Yardley’s other solicitor, Leach, who knew of Sims’ undertaking but yet used the money on Yardley’s instructions for other purposes. Leach knew that he was using the money for an unauthorised purpose, but thought that Sims was merely under a contractual obligation to Twinsectra not a Quistclose purpose trust obligation. The House of Lords held that the money was held on trust only to be used for acquiring property but (Lord Millett dissenting) appeared to hold that since Leach was not himself subjectively aware that what he was doing was something that the ordinary reasonable person would think was dishonest, he had rightfully had the case against him dismissed by the trial judge, whom the Court of Appeal had reversed, Lord Millett applied an objective test. Leach, a solicitor, had knowingly participated in arrangements which he knew to be an unauthorised use of the money in breach of Sims’ undertaking as a solicitor to Twinsectra’s solicitors. Leach was liable, regardless of whether or not he appreciated that the ordinary reasonable person would consider his knowing mishandling of the money (at the very least in breach of Sims’ contractual undertaking) as dishonest. The majority, whilst expressing approval for the Privy Council’s advice in Tan, appeared to have changed the test for dishonesty to the more subjective criminal test, so that not only must the defendant have done something that right- thinking people would consider dishonest, he must have been aware that they would so view his conduct. Lord Millett strongly dissented.
Answer
Twinsectra Ltd v Yardley & Others [2002] 2 AC 164
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Open it The subjective element was discussed by the House of Lords in Twinsectra Ltd v Yardley & Others [2002] 2 AC 164. Here Twinsectra had loaned Yardley £1 million, paying it to his solicitor, Sims, who gave a written undertaking to Twinsectra’s solicitors that the money was to be used solely for ac
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