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 trace the funds paid in breach of trust.
Held: The claim failed. No specific fund had been created in which the claimants had any proprietary right such as would allow tracing to apply. The fact that the customers might have other good claims in equity did not mean that the remedy of tracing would apply to support them in the absence of a proprietary claim. There was a need to restrict any growth in the ambit of proprietary claims to avoid confusion and unfairness to other creditors.
Lord Justice Dyson, Lord Justice Jacob and Lord Neuberger of Abbotsbury
[2008] EWCA Civ 1604, Times 14-Jan-2009
Bailii
England and Wales
Citing:
Appeal from – Moriarty and Another v Various Customers of BA Peters Plc (In Administration) ChD 22-Jul-2008
. .
See also – 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 by:
Cited – Brazzill and Others v Willoughby and Others CA 27-May-2010
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 . .
Lists of cited by and citing cases may be incomplete.
Equity, Insolvency, Consumer
Updated: 02 November 2021; Ref: scu.291916
