When arranging with the plaintiff company to obtain a loan for the defendant V stipulated that he should be paid half the procuration fee which the defendant would be charged for the company’s services. The company knew that V was to receive from the defendant a share of the profits on the resale of property to be purchased with the money lent, and that he was acting as agent for the defendant, but they had no dishonest intention to cause him to persuade the defendant to accept and the rate of commission demanded or to urge the defendant to act disadvantageously to his own interest. Neither V nor the company informed the defendant of the payment to V.
Held: for the purposes of the civil law a bribe meant nothing more than the payment of a secret commission, and proof of a corrupt motive on the part of the payer was unnecessary; once it was established that one party to a contract that made a secret payment to the agent of the other party the law would presume that he had acted corruptly, that the agent had been influenced by the payment to the detriment of his principal, and that the principal had suffered damage at least to the amount of the bribe; in the present case the payment by the plaintiffs to V constituted a bribe and it’s amount was recoverable by the defendant from the plaintiffs as damages or money had and received.
The court discussed difficulties in defining what is a bribe, Slade J said: ‘Sometimes the words ‘secret commission’ are used, sometimes ‘surreptitious payment’, and sometimes ‘bribe’. For the purposes of the civil law a bribe means the payment of a secret commission, which only means (i) that the person making the payment makes it to the agent of the other person with whom he is dealing; (ii) that he makes it to that person knowing that that person is acting as the agent of the other person with whom he is dealing; and (iii) that he fails to disclose to the other person with whom he is dealing that he has made that payment to the person whom he know to be the other person’s agent. Those three are the only elements necessary to constitute the payment of a secret commission or bribe for civil purposes.’ and ‘Yes, but earlier the learned judge has said that if a gift be made to a confidential agent with a view to inducing him, it is a bribe, and, therefore, in using the later language and referring to the bribes the learned judge is in effect saying: ‘I am using these later presumptions in cases where a bribe has been established and I have already defined a bribe as being only something which has been established as being paid with a certain motive.’ That, of course, would tear up the whole of the learned judge’s observation because he says lower down that the courts will not receive evidence as to what is the motive of the person making the payment. The motive will be conclusively inferred against him.’
References: [1949] 2 All ER 573, 93 Sol Jo 577
Judges: Slade J
This case cites:
- Explained – Hovenden and Sons v Millhoff 1900 ([1900] 83 LT 41)
Romer LJ said: ‘The courts of law in this country have always strongly condemned and, when they could, punished the bribing of agents, and have taken a strong view as to what constitutes a bribe. I believe the mercantile community as a whole . .
This case is cited by:
- Cited – Armagas Ltd v Mundogas SA (‘The Ocean Frost’) CA 1985 ([1985] 1 Lloyd’s Rep 1, [1985] 1 WLR 640)
In establishing that money was paid as an improper inducement or bribe, proof of corruptness or a corrupt motive was unnecessary.
When a court looks at a decision of a judge at first instance, the court stressed the need to look at the . . - Cited – Tesco Stores Limited v Pook, Pook, Universal Projects (UK) Limited ChD 14-Apr-2003 (, [2003] EWHC 823 (Ch), [2004] IRLR 618)
A trustee in breach of his duty has a duty to disclose that breach. It was alleged that the defendants, including a director of the claimant, had submitted false invoices to the claimants, and purchased property with the resulting profits.
These lists may be incomplete.
Last Update: 25 October 2020; Ref: scu.194862
