The court looked to various forms of knowledge which could be attributed to a party when considering a rectification. Knowledge may be proved affirmatively or inferred from circumstances. The various mental states which may be involved are (i) actual knowledge; (ii) wilfully shutting one’s eyes to the obvious; (iii) wilfully and recklessly failing to make such inquiries as an honest and reasonable man would make; (iv) knowledge of circumstances which would indicate the facts to an honest and reasonable man; (v) knowledge of circumstances which would put an honest and reasonable man on inquiry. A person in categories (ii) or (iii) will be taken to have actual knowledge, while a person in categories (iv) or (v) has constructive notice only. Peter Gibson J: ‘Again, however, I do not think it need be knowledge of the whole design: that would be an impossibly high requirement in most cases. What is crucial is that the alleged constructive trustee should know that a design having the character of being fraudulent and dishonest was being perpetrated. Further he must know that his act assisted in the implementation of such design.’
Judges:
Peter Gibson J
Citations:
[1993] 1 WLR 509
Jurisdiction:
England and Wales
Cited by:
Cited – George Wimpey UK Ltd v VI Construction Ltd CA 3-Feb-2005
A land purchase contract had been rectified by the judge for unilateral mistake. A factor had been dropped from a formula for calculating the price.
Held: The judge’s conclusion that the circumstances existed to allow a rectification was . .
Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Lists of cited by and citing cases may be incomplete.
Trusts
Updated: 16 May 2022; Ref: scu.222561