The regulated bank Kaupthing Singer and Friedlander Ltd (KSF) was in financial difficulties. The Bank of England required KSF to credit to a trust account all future deposits. KSF later went into insolvency. Some deposits had been credited to the trust account but not all. The court was asked whether the sum held was for those for whose deposits transfers had actually been made, or for all those for whom transfers should have been made.
Held: The trust account was for all those for whom deposits should have been made under the direction. It operated as a class trust not a client account.
Sedley, Thomas, Lloyd LJJ
 EWCA Civ 561,  WLR (D) 140
Financial Services and Markets Act 2000 44
England and Wales
Explained – Cherry v Boultbee HL 22-Nov-1839
B died having made a will leaving a fund to pay income to A who owed her money but had been made bankrupt before the death. The debt to B remained unpaid.
Held: The liability to pay the debt and the right to receive the legacy had never tested . .
See Also – In re Kaupthing Singer and Friedlander Ltd CA 11-May-2010
The court was asked as to the set-off, in a company administration, of future debts owed by the company to its creditors and by those creditors to the company, and whether the effect of those provisions was that, after the future debts were . .
See Also – Mills and Others v HSBC Trustee (CI) Ltd and Others ChD 18-Dec-2009
Appeal from – Brazzill and Others v Willoughby and Others ChD 10-Jul-2009
Cited – Moriarty and Another v Atkinson and Various Customers of BA Peters Plc CA 16-Dec-2008
The company, a boat sales agent, made a promise to its customers to hold the funds received from them in a trust account. In breach of that promise, it used the funds to pay its own debt. The customers now appealed against a refusal to allow them to . .
Cited – In re SSSL Realisations (2002) Ltd and Another; Squires and others v AIG Europe (UK) Ltd and Another CA 18-Jan-2006
A creditor claiming an equity in a debt but who himself owed money to the debtor, could not pursue his claim without first contributing the sum due. A person could not take an aliquot share out of a fund without first contributing what he owed to . .
Cited – Moriarty and others v Various Customers of BA Peters Plc (In Administration) ChD 29-Apr-2008
The company had acted as boat sales and brokerage. Claims were made on its insolvency as to the status of boats sold and unsold, and of deposits paid and held by the company. . .
Cited – Picken v Lord Balfour of Burleigh CA 1945
The rules of a pension scheme set up by a railway company provided for members’ contributions to be deducted from their salary, but in practice the deductions made had been less than they should have been.
Held: The rule in Cherry v Boultbee . .
Cited – OT Computers v First National Tricity Finance ChD 2003
Cited – Ogden and Another v Trustees of the RHS Griffiths 2003 Settlement and others; In Re Griffiths deceased ChD 25-Jan-2008
A life-time transfer which had been made under a mistake as to the donor’s chances of surviving long enough for the transfer to be exempt from Inheritance Tax was set aside. Unbeknown to the donor, he had lung cancer at the time.
Held: Lewison . .
Cited – In re Akerman ChD 2-Jul-1891
The court was asked whether in the division of the testator’s residuary estate three of the testator’s seven children had to bring into account statute-barred debts due to the estate.
Held: They were bound to bring them into account. Kekewich . .
mentioned – Ogilvie v Allen HL 1899
The plaintiff, a widow, had executed deeds founding two charities and devoting to them a considerable part of the large fortune which she had inherited from her husband, but later brought proceedings to set the deeds aside asserting that she had not . .
Cited – Ogilvie v Littleboy CA 1897
Lindley LJ discussed the variation of a gift for mistake: ‘Gifts cannot be revoked, nor can deeds be set aside, simply because the donors wish they had not made them and would like to have back the property given. Where there is no fraud, no undue . .
Cited – Kleinwort Benson Ltd v Lincoln City Council etc HL 29-Jul-1998
Right of Recovery of Money Paid under Mistake
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable when made. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap . .
Cited – In Re Rhodesia Goldfields Ltd ChD 1910
Partridge, a director of the company who held some of its debenture stock, was facing a serious misfeasance claim which had not yet been resolved. Set-off was therefore not available.
Held: Payment of what was due to Partridge and his . .
Lists of cited by and citing cases may be incomplete.
Updated: 02 November 2021; Ref: scu.416098