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Published online by Cambridge University Press: 17 November 2011
This article is concerned with the extent of a fiduciary's obligation to account for profits that have been made in breach of fiduciary duty. In particular, it responds to suggestions made recently by some senior judges that the courts ought to have a wide-ranging discretion to alter the degree to which a fiduciary must account for profits. It is well-settled that a fiduciary must account for profits that have been generated from his fiduciary position or in circumstances involving a conflict between the fiduciary's duty and his interest. The fiduciary need not account if the profit or conflict was properly authorised, in which case there was no breach of fiduciary duty. But in the absence of such authorisation, the fiduciary must account for all of the profit that has been made in breach of fiduciary duty, other than insofar as the court grants an equitable allowance to the fiduciary for work done in generating that profit. The question addressed here is whether the court ought to have a wider discretion to award an account of only part of the profits that a fiduciary has made in breach of fiduciary duty, leaving the remainder of the profits in the fiduciary's hands?
1 Chan v. Zacharia (1984) 154 C.L.R. 178, 199. Statements to this effect are legion in the case law. For recent examples in England, see Don King Productions Inc. v. Warren [2000] Ch. 291, 340–342 (CA); In Plus Group Ltd. v. Pyke [2002] EWCA Civ 370 at [71], [2002] 2 B.C.L.C. 201; Ultraframe (UK) Ltd. v. Fielding [2005] EWHC 1638 (Ch) at [1305]–[1306]; Sinclair Investments (UK) Ltd. v. Versailles Trade Finance Ltd. [2011] EWCA Civ 347 at [42], [2011] W.T.L.R. 1043.
2 Chan v. Zacharia, ibid., at p. 204.
3 Phipps v. Boardman [1965] Ch. 992, 1031 (CA) (emphasis added). See also CMS Dolphin Ltd. v. Simonet [2001] 2 B.C.L.C. 704 at [97] (ChD).
4 See, e.g., Boardman v. Phipps [1967] 2 A.C. 46, 104 & 112. See further the discussion accompanying notes 63–93 below.
5 Warman International Ltd. v. Dwyer (1995) 182 C.L.R. 544, 565; Murad v. Al-Saraj [2005] EWCA Civ 959 at [85], [112], [115]–[116], [2005] W.T.L.R. 1573. The account must be proportionate (see Ultraframe v. Fielding, note 1 above, at paras. [1579]–[1588]) in the sense that the fiduciary need only account for the profit that is found to have been made in breach of fiduciary duty, not for other profits.
6 J. Lowry & Edmunds, R., “The Corporate Opportunity Doctrine: The Shifting Boundaries of the Duty and its Remedies” (1998) 61 M.L.R. 515, 517. For an earlier version of the same kind of criticism, see L.S. Sealy, Commercial Law and Commercial Reality (London 1984), pp. 39–40Google Scholar.
7 Boardman v. Phipps [1967] 2 A.C. 46, 124 per Lord Upjohn. Lord Upjohn was in dissent in Boardman v. Phipps, but his dissent was “on the facts but not on the law”: Queensland Mines Ltd. v. Hudson (1978) 52 A.L.J.R. 399, 400 (PC). His statement has been applied in numerous subsequent decisions as an accurate statement of the doctrine: e.g., Industrial Development Consultants Ltd. v. Cooley [1972] 1 W.L.R. 442, 450–451; Swain v. Law Society [1982] 1 W.L.R. 17, 31 (CA); Framlington Group plc v. Anderson [1995] 1 B.C.L.C. 475, 495 (ChD); Beach Petroleum NL v. Abbott Tout Russell Kennedy [1999] NSWCA 408 at [425], (1999) 48 N.S.W.L.R. 1; Bhullar v. Bhullar [2003] EWCA Civ 424 at [30] & [42], [2003] 2 B.C.L.C. 241; Quarter Master UK Ltd. v. Pyke [2004] EWHC 1815 (Ch) at [55], [2005] 1 B.C.L.C. 245; Conway v. Ratiu [2005] EWCA Civ 1302 at [59], [2006] W.T.L.R. 101 (also partially reported at [2006] 1 All E.R. 571n.); Foster Bryant Surveying Ltd. v. Bryant [2007] EWCA Civ 200 at [52], [2007] 2 B.C.L.C. 239; Rigg v. Sheridan [2008] NSWCA 79 at [39]–[41]; Bell Group Ltd. v. Westpac Banking Corp. (No. 9) [2008] WASC 239 at [4506]–[4507].
8 For company directors these two points have recently been combined, by statute, so that the obligation to account for profits now only applies to profits made in circumstances where there was a reasonable prospect of conflict: see Companies Act 2006, s. 176(4). That limitation does not apply to other fiduciaries.
9 See text accompanying note 3 above.
10 See note 4 above.
11 Citing D.J. Hayton, “Unique Rules for the Unique Institution, the Trust”, in S. Degeling & J. Edelman (eds.), Equity in Commercial Law (Pyrmont 2005) 279, p. 284.
12 Strother v. 3464920 Canada Inc. [2007] SCC 24 at [154]–[155], [2007] 2 S.C.R. 177.
13 As to that question, see now Sinclair Investments (UK) Ltd. v. Versailles Trade Finance Ltd. [2011] EWCA Civ 347, [2011] W.T.L.R. 1043. See also Attorney-General for Hong Kong v. Reid [1994] 1 A.C. 324 (PC); Daraydan Holdings Ltd. v. Solland International Ltd. [2004] EWHC 622 (Ch) at [86], [2005] Ch. 119.
14 See Mason, A.F., “The Place of Equity and Equitable Remedies in the Contemporary Common Law World” (1994) 110 L.Q.R. 238, 246–48Google Scholar; Nolan, R.C., “A Fiduciary Duty to Disclose?” (1997) 113 L.Q.R. 220Google Scholar, 225; D.W.M. Waters, “The Reception of Equity in the Supreme Court of Canada (1875–2000)” (2001) 80 Can. Bar Rev. 620, 676; Harris v. Digital Pulse Pty. Ltd. [2003] NSWCA 10 at [31]–[32], (2003) 56 N.S.W.L.R. 298; Breen v. Williams (1996) 186 C.L.R. 71, 112; Pilmer v. Duke Group Ltd. [2001] HCA 31 at [121], (2001) 207 C.L.R. 165. Recent decisions appear to be bringing Canadian fiduciary doctrine closer to its English progenitor: see Galambos v. Perez 2009 SCC 48, [2009] 3 S.C.R. 247 (noted: [2010] C.L.J. 450); Alberta v. Elder Advocates of Alberta Society 2011 SCC 24.
15 John Taylors v. Masons [2001] EWCA Civ 2106 at [41], [2005] W.T.L.R. 1519.
16 Murad v. Al-Saraj [2005] EWCA Civ 959 at [82], [2005] W.T.L.R. 1573 (noted: [2006] C.L.J. 278).
17 [1952] 3 D.L.R. 1, 15 (PC).
18 This does not rule out an allowance (see Crown Dilmun v. Sutton [2004] EWHC 52 (Ch) at [213], [2004] 1 B.C.L.C. 468; Murad v. Al-Saraj [2005] EWCA Civ 959 at [68], [2005] W.T.L.R. 1573), although it must render one far less likely: see Phipps v. Boardman [1965] Ch. 992, 1021 (CA).
19 The references to 1874 and “the safety of mankind” relate to Parker v. McKenna (1874) L.R. 10 Ch. App. 96, 125.
20 Murad v. Al-Saraj [2005] EWCA Civ 959 at [121], [2005] W.T.L.R. 1573.
21 Ibid., at paras. [83] and [121].
22 Langbein, J.H., “Questioning the Trust Law Duty of Loyalty: Sole Interest or Best Interest?” (2005) 114 Yale L.J. 929Google Scholar.
23 Ibid., at p. 951.
24 Warman International Ltd.v. Dwyer (1995) 182 C.L.R. 544, 559–560. See also Ultraframe (UK) Ltd. v. Fielding [2005] EWHC 1638 (Ch) at [1579]; Vercoe v. Rutland Fund Management Ltd. [2010] EWHC 424 (Ch) at [340].
25 For a full exposition of this view of fiduciary doctrine, see M. Conaglen, Fiduciary Loyalty (Oxford 2010). See also Conaglen, M., “The Nature and Function of Fiduciary Loyalty” (2005) 121 L.Q.R. 452Google Scholar.
26 Re Bloye's Trusts (1849) 1 Mac. & G. 488, 495 (41 E.R. 1354).
27 Bray v. Ford [1896] A.C. 44, 51.
28 Fiduciary doctrine's pursuit of this task is limited to situations where one party has undertaken, or can reasonably be taken to have undertaken, to act in the interests of the other, to the exclusion of the first party's own several interests: see Hospital Products Ltd. v. United States Surgical Corp. (1984) 156 C.L.R. 41, 96–97; Bristol & West Building Society v. Mothew [1998] Ch. 1, 18 (CA); Galambos v. Perez 2009 SCC 48 at [66], [2009] 3 S.C.R. 247; P.D. Finn, Fiduciary Obligations (Sydney 1977) at para. [15]; P.D. Finn, “The Fiduciary Principle” in T.G. Youdan (ed.), Equity, Fiduciaries and Trusts (Toronto 1989) 1, pp. 46 & 54. In other cases, the parties are taken to be acting in, and are therefore expected to protect, their own several interests: see Canson Enterprises Ltd. v. Boughton & Co [1991] 3 S.C.R. 534, 543 & 554; Norberg v. Wynrib [1992] 2 S.C.R. 226, 272; Pilmer v. Duke Group Ltd. [2001] HCA 31 at [71], (2001) 207 C.L.R. 165; Cubillo v. Commonwealth of Australia [2001] FCA 1213 at [462], (2001) 112 F.C.R. 455; Vercoe v. Rutland Fund Management Ltd. [2010] EWHC 424 (Ch) at [343].
29 The idea of ‘subsidiarity’ is used here in the sense of something which assists (see J.M. Finnis, Natural Law and Natural Rights (Oxford 1980), p. 146) rather than of something which is secondary or subordinate. Fiduciary duties assist the proper performance of non-fiduciary duties by enhancing the likelihood of such performance.
30 See, e.g., Aberdeen Railway Co. v. Blaikie Bros (1854) 1 Macq. 461, 471–472 (149 R.R. 32); Regal (Hastings) Ltd. v. Gulliver [1967] 2 A.C. 134n., 153; Boardman v. Phipps [1967] 2 A.C. 46, 129.
31 Costa Rica Railway Co. Ltd. v. Forwood [1901] 1 Ch. 746, 761 (CA).
32 In the absence of universal enforcement, the deterrent effect of profit-stripping is not perfect: Williams, G., “The Aims of the Law of Tort” (1951) 4 C.L.P. 137, 147Google Scholar; Cooter, R. & Freedman, B.J., “The Fiduciary Relationship: Its Economic Character and Legal Consequences” (1991) 66 N.Y.U.L.R. 1045Google Scholar, 1053. That does not, however, render it non-existent. See further the discussion accompanying notes 36–41 below.
33 Phipps v. Boardman [1965] Ch. 992, 1031 (CA).
34 Murad v. Al-Saraj [2005] EWCA Civ 959 at [74], [2005] W.T.L.R. 1573; see also at paras. [107] & [121].
35 Harris v. Digital Pulse Pty. Ltd. [2003] NSWCA 10 at [407]–[408], (2003) 56 N.S.W.L.R. 298; see also at paras. [161] & [170] per Mason P. And see Docker v. Somes (1834) 2 My. & K. 655, 655 (39 E.R. 1095); Guth v. Loft Inc. 5 A. 2d. 503, 510 (1939); Lindsley v. Woodfull [2004] EWCA Civ 165 at [30], [2004] 2 B.C.L.C. 131; Strother v. 3464920 Canada Inc. [2007] SCC 24 at [70], [2007] 2 S.C.R. 177.
36 J.C. Shepherd, The Law of Fiduciaries (Toronto 1981), p. 82 (fn. 122); R. Cooter & Freedman, B.J., “The Fiduciary Relationship: Its Economic Character and Legal Consequences” (1991) 66 N.Y.U.L.R. 1045, 1053; L.D. Smith, “The Motive, Not the Deed” in J. Getzler (ed.), Rationalizing Property, Equity and Trusts (London 2003) 53, pp. 60–61Google Scholar.
37 See Benson v. Heathorn (1842) 1 Y. & C.C.C. 326, 343 (62 E.R. 909).
38 That such effects are felt as real by fiduciaries can be seen in the libel claim brought in Bray v. Ford [1896] A.C. 44.
39 Gray v. New Augarita Porcupine Mines Ltd. [1952] 3 D.L.R. 1, 15 (PC); Murad v. Al-Saraj [2005] EWCA Civ 959 at [67], [71] & [111]–[112], [2005] W.T.L.R. 1573. The fiduciary is not here worse off than he would have been had he done nothing, which is a permissible course of conduct (at least for the purposes of fiduciary doctrine), but he is worse off than he would be had he acted properly once he had decided to take the profit (by seeking fully informed consent from his principal).
40 See further the discussion accompanying notes 96–100 below.
41 See, e.g., Attorney-General v. Alford (1855) 4 De G.M. & G. 843, 851 (43 E.R. 737); Burdick v. Garrick (1870) L.R. 5 Ch. App. 233, 241; Vyse v. Foster (1872) L.R. 8 Ch. App. 309, 333, affirmed on appeal: (1874) L.R. 7 H.L. 318, 336; Westdeutsche Landesbank Girozentrale v. Islington London Borough Council [1996] A.C. 669, 692–693 & 723; Harris v. Digital Pulse Pty. Ltd. [2003] NSWCA 10 at [336]–[337], [408], [415] & [420], (2003) 56 N.S.W.L.R. 298. Punitive awards for breach of fiduciary duty have been made in New Zealand (e.g., Cook v. Evatt (No. 2) [1992] 1 N.Z.L.R. 676, 705) and may be available in the United States (see T. Frankel, Fiduciary Law (New York 2011), p. 213).
42 Harris v. Digital Pulse, note 35 above, at para. [414].
43 R. Flannigan, “The Strict Character of Fiduciary Liability” [2006] N.Z. L. Rev. 209, 210.
44 For other critiques of Langbein's argument, see M.B. Leslie, “In Defense of the No Further Inquiry Rule: A Response to Professor John Langbein” (2005) Wm. & M. L. Rev. 541; Flannigan, ibid., at pp. 231–241.
45 See text accompanying note 23 above.
46 See text accompanying notes 26–31 above.
47 This point is expanded on below: see text accompanying notes 63–93.
48 Langbein, J.H., “Questioning the Trust Law Duty of Loyalty: Sole Interest or Best Interest?” (2005) 114 Yale L.J. 929Google Scholar, 980.
49 Boulting v. Association of Cinematograph, Television & Allied Technicians [1963] 2 Q.B. 606, 636 (CA).
50 Dale v. Inland Revenue Commissioners [1954] A.C. 11, 27 (emphasis added). See also Ellison v. Airey (1748) 1 Ves. Sen. 111, 115 (27 E.R. 924).
51 Boulting v. Association of Cinematograph, Television & Allied Technicians [1963] 2 Q.B. 606, 637 (CA).
52 Peso Silver Mines Ltd. v. Cropper (1965) 56 D.L.R. (2d.) 117, 139 (BCCA).
53 There is no reason in principle why consent cannot be given in advance, even “without the identification of any particular opportunity”: Commonwealth Oil and Gas Co. Ltd. v. Baxter [2009] CSIH 75 at [10], 2010 S.C. 156. The words used in the consent clause will need to be addressed carefully, to make sure that they were intended to, and do, cover the type of conduct in question: see, e.g., Re Fish [1893] 2 Ch. 413, 419–420, 422–423 & 424–425 (CA). But that is merely a matter of construction. Where the consent is granted prior to the fiduciary relationship being created, the consent need not be fully informed (Australian Securities & Investments Commission v. Citigroup Global Markets Australia Pty. Ltd. [2007] FCA 963 at [345]–[346], (2007) 160 F.C.R. 35), but where a fiduciary relationship has already arisen the consent must be fully informed. The sophistication of the principal will be a relevant consideration in determining whether the grant of consent was fully informed: see Farah Constructions Pty. Ltd. v. Say-Dee Pty. Ltd. [2007] HCA 22 at [107], (2007) 230 C.L.R. 89; Gray v. New Augarita Porcupine Mines Ltd. [1952] 3 D.L.R. 1, 14 (PC); ASIC v. Citigroup, above, at para. [296].
54 See section III.A above.
55 See text accompanying note 20 above.
56 Lindsley v. Woodfull [2004] EWCA Civ 165 at [30], [2004] 2 B.C.L.C. 131.
57 Butler, H.N. & Ribstein, L.E., “Opting Out of Fiduciary Duties: A response to the Anti-Contractarians” (1990) 65 Washington L. Rev. 1Google Scholar, 29.
58 Easterbrook, F.H. & Fischel, D.R., “Contract and Fiduciary Doctrine” (1993) 36 Jo. of Law & Econ. 425CrossRefGoogle Scholar, 427.
59 For discussion of the difficulties, see M. Conaglen, Fiduciary Loyalty (Oxford 2010), pp. 214–219.
60 Ayres, I. & Gertner, R. “Filling Gaps in Incomplete Contracts: An Economic Theory of Default Rules” (1989) 99 Yale L.J. 87CrossRefGoogle Scholar, 91.
61 M. Conaglen, Fiduciary Loyalty (Oxford 2010), pp. 220–221.
62 See Whincop, M.J., “Of Fault and Default: Contractarianism as a Theory of Anglo-Australian Corporate Law” (1997) 21 Melb. U.L.R. 187, 199–200Google Scholar & 208–215.
63 Guinness plc. v. Saunders [1990] 2 A.C. 663, 692; see also pp. 689 & 694.
64 Ibid., at p. 700.
65 See, e.g., Sykes v. Hastings (1805) 11 Ves. 363, 364 (32 E.R. 1128); Nicholson v. Tutin (No. 2) (1857) 3 K. & J. 159, 161 (69 E.R. 1063); Newport v. Bury (1857) 23 Beav. 30, 31 (53 E.R. 12); Barrett v. Hartley (1866) L.R. 2 Eq. 789, 796 & 798.
66 See, e.g., Marshall v. Holloway (1820) 2 Swans. 432, 453 (36 E.R. 681) (in respect of time spent in the past); Morison v. Morison (1838) 4 My. & Cr. 215, 224 (41 E.R. 85); Forster v. Ridley (1864) 4 De G.J. & S. 452, 453 (46 E.R. 993); Re Freeman's Settlement Trusts (1887) 37 Ch.D. 148, 152; Re Masters [1953] 1 W.L.R. 81, 83 (ChD); Re Jarvis [1958] 1 W.L.R. 815, 820 (ChD); Re Codd's Will Trusts [1975] 1 W.L.R. 1139, 1140 (ChD); Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61, 75 (CA); Foster v. Spencer [1996] 2 All E.R. 672 (ChD).
67 See, e.g., Marshall v. Holloway, ibid., at pp. 453–454 (in respect of time to be spent in the future); Bainbrigge v. Blair (1845) 8 Beav. 588, 593–594 & 596–597 (50 E.R. 231); Re Bignell [1892] 1 Ch. 59, 63 (CA); Re Macadam [1946] Ch. 73, 82–83; Dale v. Inland Revenue Commissioners [1954] A.C. 11, 34; Re Worthington [1954] 1 W.L.R. 526, 528 (ChD); Re Barbour's Settlement Trusts [1974] 1 W.L.R. 1198, 1203 (ChD).
68 Trustees are precluded from taking remuneration (unless they have authorisation, which is often now available by statutory default mechanisms: see Trustee Act 2000, s. 29) because of the conflict between duty and interest that such payments generate: Robinson v. Pett (1734) P. Wms. 249, 251 (24 E.R. 1049); How v. Godfrey (1678) Rep. t. Finch 361, 362 (23 E.R. 198); Bonithon v. Hockmore (1685) 1 Vern. 316, 316 (23 E.R. 492); Scattergood v. Harrison (1729) Mosely 128, 130 (25 E.R. 310); Burden v. Burden (1813) 1 Ves. & Bea. 170, 172 (35 E.R. 67); Brocksopp v. Barnes (1820) 5 Madd. 90, 90 (56 E.R. 829); New v. Jones (1833) 1 H. & Tw. 632, 634 (47 E.R. 1562) (also reported at 1 Mac. & G. 685 (41 E.R. 1429)); Moore v. Frowd (1837) 3 My. & Cr. 45, 50 (40 E.R. 841); Stanes v. Parker (1846) 9 Beav. 385, 389 (50 E.R. 392); Dale v. Inland Revenue Commissioners [1954] A.C. 11, 27.
69 See, e.g., Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61, 78 (CA).
70 See, e.g., Re Walker [1901] 1 Ch. 879, 885; Re New [1901] 2 Ch. 534, 544; Chapman v. Chapman [1954] A.C. 429, 446.
71 See, e.g., Re Berkeley Applegate (Investment Consultants) Ltd. [1989] Ch. 32; Green v. Bramston [2010] EWHC 3106 (Ch).
72 See, e.g., Hospital Products Ltd. v. United States Surgical Corp. (1984) 156 C.L.R. 41, 68.
73 Public Trustee v. Cooper [2001] W.T.L.R. 901, 922 (ChD).
74 Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61, 78 (CA); see also p. 79. And see Bainbrigge v. Blair (1845) 8 Beav. 588, 594 & 596–597 (50 E.R. 231); Re New [1901] 2 Ch. 534, 545; Re Worthington [1954] 1 W.L.R. 526, 530 (ChD). This jurisdiction exists in addition to any statutory jurisdiction to award remuneration: Re Masters [1953] 1 W.L.R. 81, 83 (ChD).
75 Re Berkeley Applegate (Investment Consultants) Ltd. [1989] Ch. 32, 50–52, referring to Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61. See also Re Berkeley Applegate (Investment Consultants) Ltd. (No. 3) (1989) 5 B.C.C. 803, 805.
76 Re Sports Media Betting Ltd. [2007] EWHC 2085 (Ch) at [10]–[11], [2008] B.C.C. 177.
77 See Re Worthington [1954] 1 W.L.R. 526, 529–530 (ChD) and Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61, 77 (CA), disapproving statements to the contrary in Re Salmen (1912) 107 L.T. 108, 110 (ChD).
78 See, e.g., Campbell v. Walker (1800) 5 Ves. 678, 681–682 (31 E.R. 801); Brocksopp v. Barnes (1820) 5 Madd. 90, 90–91 (56 E.R. 829); Farmer v. Dean (1863) 32 Beav. 327 (55 E.R. 128).
79 See, e.g., Geldard v. Randall (1845) 9 Jur. 1085; Tennant v. Trenchard (1869) L.R. 4 Ch. App. 537, 547; Re Pease The Times, 12 December 1900, 13 (ChD); Re White (1910) 10 S.R. (N.S.W.) 295, 299 & 302; Throp v. Trustees, Executors and Agency Co. of New Zealand Ltd. [1945] N.Z.L.R. 483, 486; Union Trustee Co. of Australia Ltd. v. Gorrie [1962] Qd. R. 605, 615–616; Re Brooke Bond & Co. Ltd.'s Trust Deed [1963] Ch. 357, 365; Holder v. Holder [1968] Ch. 353, 398 & 402.
80 See also Re New [1901] 2 Ch. 534, 544–545; Re Drexel Burnham Lambert UK Pension Plan [1995] 1 W.L.R. 32, 41 (ChD); Public Trustee v. Cooper [2001] W.T.L.R. 901, 933–934 (ChD). The court could also potentially grant trustees power to enter such transactions under the Trustee Act 1925, s. 57.
81 Popham v. Exham (1860) 10 Ir. Ch. Rep. 440, 451.
82 Ibid. See also Sidny v. Ranger (1841) 12 Sim. 118, 120 (59 E.R. 1076); Guest v. Smythe (1870) L.R. 5 Ch. App. 551, 556; Coaks v. Boswell (1886) 11 App. Cas. 232, 233, 237 & 242.
83 Phipps v. Boardman [1964] 1 W.L.R. 993, 1018 (ChD).
84 Phipps v. Boardman [1965] 1 Ch. 992, 1020–1021.
85 Ibid., at pp. 1020 & 1032.
86 Boardman v. Phipps [1967] 2 A.C. 46, 104 & 112.
87 See, e.g., Popat v. Shonchhatra [1997] 1 W.L.R. 1367, 1375 (CA); Brown v. De Tastet (1821) Jac. 284, 298 (37 E.R. 858); Cook v. Collingridge (1823) Jac. 607, 623 (37 E.R. 979). See also Lord Provost, Magistrates & Town Council of Edinburgh v. Lord Advocate (1879) 4 App. Cas. 823, 839; Lindsley v. Woodfull [2004] EWCA Civ 720 at [6] & [8], [2004] 2 B.C.L.C. 131.
88 [1985] Q.B. 428, 459, 468 & 472 (CA). See also Badfinger Music v. Evans [2002] E.M.L.R. 35 at [39]–[61].
89 (1995) 182 C.L.R. 544, 568. See also Fraser Edmiston Pty. Ltd. v. AGT (Qld) Pty. Ltd. [1988] 2 Qd. R. 1, 12; Mid-City Skin Cancer & Laser Centre v. Zahedi-Anarak [2006] NSWSC 844 at [273], (2006) 67 N.S.W.L.R. 569.
90 [2005] EWCA Civ 959 at [88], [2005] W.T.L.R. 1573.
91 Accidia Foundation v. Simon C Dickinson Ltd. [2010] EWHC 3058 (Ch) at [94]–[95].
92 Brown v. Litton (1711) 1 P. Wms. 140 (24 E.R. 329).
93 Ibid., at pp. 141–142.
94 See, e.g., Accidia Foundation v. Simon C Dickinson Ltd. [2010] EWHC 3058 (Ch) at [95].
95 Even in cases where no allowance is made for remuneration, the fiduciary need only account for the net profit: see, e.g., De Bussche v. Alt (1878) 8 Ch.D. 286, 307; Regal (Hastings) Ltd. v. Gulliver [1967] 2 A.C. 134n., 154; Patel v. Brent London Borough Council [2003] EWHC 3081 (Ch) at [29], [2004] 3 P.L.R. 1.
96 Birks, P.B.H., “The Content of Fiduciary Obligation” (2000) 34 Israel L. Rev. 3, 3; see also pp. 8–9Google Scholar. For earlier expositions of the same idea, see Sealy, L.S., “The Director as Trustee” [1967] C.L.J. 83Google Scholar, 85–86 & 91–103; Sealy, L.S., “Fiduciary Relationships” [1962] C.L.J. 69CrossRefGoogle Scholar, 71–73; P.D. Finn, Fiduciary Obligations (Sydney 1977), para. [7]; P.D. Finn, “The Fiduciary Principle” in T.G. Youdan (ed.), Equity, Fiduciaries and Trusts (Toronto 1989) 1, pp. 34–35. See also M. Conaglen, Fiduciary Loyalty (Oxford 2010), pp. 12–15.
97 Swindle v. Harrison [1997] 4 All E.R. 705, 734 (CA).
98 Gwembe Valley Development Co. Ltd. v. Koshy (No. 3) [2003] EWCA Civ 1048 at [89], [2004] 1 B.C.L.C. 131.
99 Re West of England & South Wales District Bank, ex parte Dale & Co (1879) 11 Ch.D. 772, 778.
100 Re Lands Allotment Co. [1894] 1 Ch. 616, 638 (CA); see also p. 631 per Lindley L.J. And see JJ Harrison (Properties) Ltd. v. Harrison [2001] EWCA Civ 1467 at [26], [2002] 1 B.C.L.C. 162.
101 Re Worthington [1954] 1 W.L.R. 526, 528 (ChD). See also, for liquidators, Re Berkeley Applegate (Investment Consultants) Ltd. [1989] Ch. 32, 50.
102 Re New [1901] 2 Ch. 534, 545.
103 Coaks v. Boswell (1886) 11 App. Cas. 232, 245.
104 Guinness plc. v. Saunders [1990] 2 A.C. 663, 701.
105 Re New [1901] 2 Ch. 534, 545.
106 See, e.g., Campbell v. Walker (1800) 5 Ves. 678 (31 E.R. 801); Newport v. Bury (1857) 23 Beav. 30 (53 E.R. 12).
107 Tennant v. Trenchard (1869) L.R. 4 Ch. App. 537, 547; Throp v. Trustees, Executors and Agency Co. of New Zealand Ltd. [1945] N.Z.L.R. 483, 489; Union Trustee Co. of Australia Ltd. v. Gorrie [1962] Qd. R. 605, 615–616.
108 Brocksopp v. Barnes (1820) 5 Madd. 90, 91 (56 E.R. 829) (emphasis added). See also J. Hill, Law Relating to Trustees (London 1845), p. 602.
109 See, e.g., Marshall v. Holloway (1820) 2 Swans. 432, 453 (36 E.R. 681); Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61 (CA); Foster v. Spencer [1996] 2 All E.R. 672 (ChD). See also Harris v. Sleep [1897] 2 Ch. 80 (CA), regarding a receiver who had been appointed without salary but who was permitted it after the fact.
110 See, e.g., Barrett v. Hartley (1866) L.R. 2 Eq. 789, 796 & 798; Re Thompson's Settlement [1986] Ch. 99.
111 Sinclair v. Sinclair [2009] EWHC 926 (Ch) at [76].
112 Coleman Taymar Ltd. v. Oakes [2001] 2 B.C.L.C. 749 at [84] (ChD), addressing Companies Act 1985, s. 727 (see now Companies Act 2006, s. 1157). The difference of opinion could potentially be ascribed to the different wording of the statutory provisions for trustees and for company directors. However, Khoo J. considered that the Singaporean statutory relief provision for directors, drafted in terms virtually identical to section 727, was inapt to relieve against liability to disgorge gains: Hytech Builders Pte. Ltd. v. Tan Eng Leong [1995] SGHC 85 at [62] & [68], [1995] 1 S.L.R.(R.) 576 (originally reported at [1995] 2 S.L.R. 795).
113 Perrins v. Bellamy [1899] 1 Ch. 797, 798 & 800 (CA).
114 It is to be borne in mind that such provisions are not powers to relieve fiduciaries in general, but only the kinds of fiduciaries which they specify.
115 Perrins v. Bellamy [1898] 2 Ch. 521, 526 (ChD).
116 Evans Williams v. Byron (1901) 18 T.L.R. 172, 176 (ChD).
117 Re Pauling's Settlement Trusts [1964] Ch. 303, 339.
118 See similarly text accompanying note 104 above.
119 Re New [1901] 2 Ch. 534, 545.
120 Re Duke of Norfolk's Settlement Trusts [1982] Ch. 61, 76 (CA).
121 Re New [1901] 2 Ch. 534, 544–545.
122 Accessible at http://www.kcl.ac.uk/content/1/c6/01/92/21/Herbert-ConflictsofInterest.pdf (last accessed 2 August 2011).
123 CPR Part 64, PD 64A, para. 1A.1.
124 CPR Part 64, PD 64A, para. 1A.3.
125 See, e.g., Trustee Act 2000, ss. 3 & 6 and ss. 8 & 9.
126 Companies Act 2006, s. 175(5). See also Company Law Review Steering Group, Modern Company Law for a Competitive Economy: Completing the Structure (London 2000), para. [3.27]; Company Law Review Steering Group, Modern Company Law for a Competitive Economy: Final Report (London 2001), paras. [3.24]–[3.27]; Company Law Reform, Cm. 6456, (2005), p. 21.
127 Re Orwell's Will Trusts [1982] 1 W.L.R. 1337, 1340 (ChD); Law Commission, Trustees' Powers and Duties, Law Com CP 146, (London 1997), paras. [10.1] & [10.4].
128 1st ed., (London 1992), cl. 9. A second edition is currently in draft, which also contains such a clause.
129 See, e.g., P.J. Millett (ed.), Encyclopedia of Forms and Precedents, 5th ed., vol. 40(1) (London 2010 Reissue), paras. [3812], [3827], [4899], [4903]–[4904], [5007], [5013] & [5020]–[5021]. See also J. Kessler & L. Sartin, Drafting Trusts and Will Trusts: A Modern Approach, 10th ed., (London 2010), paras. [6.13]–[6.16] & [21.58].
130 Agip (Africa) Ltd. v. Jackson [1990] Ch. 265, 294.
131 Youyang Pty. Ltd. v. Minter Ellison Morris Fletcher [2003] HCA 15 at [39], (2003) 212 C.L.R. 484. See also Nocton v. Lord Ashburton [1914] A.C. 932, 963.
132 See Coaks v. Boswell (1886) 11 App. Cas. 232 and Re Pease The Times, 12 December 1900, 13–14 (ChD).