The Attorney General of Hong Kong v Reid and Reid And Marc Molloy Co: PC 1 Nov 1993

(New Zealand) The Board considered the power to recover property owned by a public official found to have taken bribes.
Held: The bribes received by the policeman were held on trust for his principal, and so they could be traced into properties which he had acquired in New Zealand.
Lord Templeman said: ‘When a bribe is accepted by a fiduciary in breach of his duty then he holds that bribe in trust for the person to whom the duty was owed. If the property representing the bribe decreases in value the fiduciary must pay the difference between that value and the initial amount of the bribe because he should not have accepted the bribe or incurred the risk of loss. If the property increases in value, the fiduciary is not entitled to any surplus in excess of the initial value of the bribe because he is not allowed by any means to make a profit out of a breach of duty.’ and
‘a fiduciary must not be allowed to benefit from his own breach of duty, that the fiduciary should account for the bribe as soon as he receives it and that equity regards as done that which ought to be done. From these principles it would appear to follow that the bribe and the property from time to time representing the bribe are held on a constructive trust for the person injured. A fiduciary remains personally liable for the amount of the bribe if, in the event, the value of the property then recovered by the injured person proved to be less than that amount.’
Templeman, Goff of Chieleley, Lowry, Lloyd of Berwick LL, Sir Thomas Eichelbaum
[1993] UKPC 36, [1994] 1 All ER 1, [1994] AC 324, [1993] 3 WLR 1143
DisapprovedMetropolitan Bank v Heiron CA 1880
A claim brought by a company against a director was time-barred: the claim was to recover a bribe paid by a third party to induce the director to influence the company to negotiate a favourable settlement with the third party. The bank failed in its . .

Cited by:
PreferredDaraydan Holdings Limited, Cairn Estates Limited and Others v Solland International Limited and Others ChD 26-Mar-2004
The court was asked whether Lister and Co v Stubbs 45 ChD 1, a decision of the Court of Appeal, was binding on him or whether he could apply the Privy Council’s decision in Attorney General for Hong Kong v Reid
Held: On the facts of the case . .
CitedFHR European Ventures Llp and Others v Cedar Capital Partners Llc SC 16-Jul-2014
Approprietary remedy against Fraudulent Agent
The Court was asked whether a bribe or secret commission received by an agent is held by the agent on trust for his principal, or whether the principal merely has a claim for equitable compensation in a sum equal to the value of the bribe or . .

These lists may be incomplete.
Updated: 05 March 2021; Ref: scu.429787