Trust Law Tracing

Front 1

Foskett v Mckeown

Back 1

tracing is not a remedy but the process by which you find the property you wish to make the subject of a claim

Tracing in equity follows the same process as the law

where property has been bought with trust money and trustees money, claimant is entitled to assert ownership in proportion to their contribution

condemned the need for a fiduciary relationship

Front 2

Taylor v Plumer

Back 2

Tracing at common law-the property must be ascertainable, the right only ceases when the means of ascertainment fail, ie when the subject is turned into money and mixed into a general mass of the same description

Front 3

Hambrouk

Back 3

Claimant was allowed to trace money into a substantially unmixed account , this would not be available in an active account

Front 4

AGIP

Back 4

where money is paid into one branch and withdrawn at another this will defeat tracing at common law which is a physical process

tracing in equity gives rise to a proprietary remedy.

Unless D is a bona fide purchaser he must restore the property to its rightful owner.

a fiduciary relationship must exist which permits the assistance of equity to be provoked

Front 5

Lehman

Back 5

at law someone with an equitable interest cannot make a claim

Front 6

Lipkin-Gorman

Back 6

with money, claimants may have a restitutionary remedy

having id'd property in the hands of the recipient, they may be able to some benefit. the extent of which will depend on the extent of change of position in reliance of the receipt. paying out winnings from gambling was a successful change in position-acted in good faith and paid out in reliance of the bets placed

Front 7

FC Jones

Back 7

partners went bankrupt, legal title to assets passes to trustees in bankruptcy. one partner drew cheques on the partnership account, invested and profits placed in another account. beneficiary was entitled to the original money and the £50k in profits

Front 8

Montrose v Orion

Back 8

ultimate recipient of sale proceeds of certain share was accountable to the trustee for those proceeds even though the trustee was in breach of trust in disposing of shares in the first place

Front 9

Chase Manhattan

Back 9

initial fiduciary relationship is a necessary foundation of the equitable right of tracing.

Front 10

Re Diplock

Back 10

tracing can be done against trustee and 3rd parties

It is inequitable to trace against innocent volunteers

Front 11

Sinclair v Brougham

Back 11

the payment into the wrong hands gave rise to the fiduciary relationship

where t has mixed money from different sources all claimants take pari passu-equally

Front 12

Westdeutsche Landesbank

Back 12

restricted Sinclair so that those who receive money under a void or ultra vires contract will no longer be regarded as fiduciaries by reason only of that payment and tracing will not be possible against them

Front 13

Re Halletts Estate

Back 13

claimant can either take the property purchased with trust money or to have a charge on the property for the amount of the trust money

Front 14

Pennell v Deffell

Back 14

the real advantage-equitable tracing is not defeated by the property having been mixed with other property

Front 15

Re Hallett

Back 15

trustee does not take trust money when he had a right to take his own. where money has been spent on property, if the remainder is sufficient, must proceed against the fund as prima facie the property has been bought with trustees money. if insufficient, proceed against the property-Re Oatway

Front 16

Clayton's Case

Back 16

where mixing takes place in an active account, the rule is first in first out-this is a presumption that may be displaced by the facts

Front 17

Barlow Clowes

Back 17

where Claytons is impracticable or unjust in the circumstances eq contrary to presumed intention of the investors, a pari passu approach should be ordered

Front 18

Russell Cooke

Back 18

investors intentions for their money to form a common fund, pari passu is more appropriate

Front 19

Bishopsgate Investment

Back 19

if the trustee dissipates the money, consumes it or uses it to pay a debt or the account is overdrawn, the property ceases to be identifiable and cannot be traced

Front 20

Scottish Equitable v Derby

Back 20

mortgage payment was not a change of position

Front 21

Boscawen

Back 21

paying off a mortgage was successful as the claimant took the place of the mortgage lender