A company sold its business under an agreement containing a promise by the purchaser to collect on behalf of the vendor the amount of the book debts owed to it at the date of the agreement. From the sums collected, the purchaser paid andpound;455 into his general bank account, but he failed to account for the money to the vendor and made drawings from the account which reduced it at one stage to andpound;25. He later made payments into the account from an unrelated source, and died with a balance in his account of andpound;358, to which the vendor claimed to be beneficially entitled.
Held: The maximum which the vendor was entitled to trace was andpound;25, representing the lowest sum to which the balance on the account had fallen between the payment of the andpound;455 into the account and the purchaser’s death, on the ground that at that date of the lowest balance the purchaser must have denuded the account of all the trust moneys except to the extent of andpound;25.
Judges:
Sargant J
Citations:
[1915] 1 Ch 62
Jurisdiction:
England and Wales
Trusts
Updated: 08 May 2022; Ref: scu.556804
