Attorney General for Hong Kong v Reid
| Jurisdiction | England & Wales |
| Judgment Date | 01 November 1993 |
| Date | 01 November 1993 |
| Court | Court of Appeal (Civil Division) |
Court of Appeal
Before Lord Templeman, Lord Goff of Chieveley, Lord Lowry, Lord Lloyd of Berwick and Sir Thomas Eichelbaum
Privy Council - agency - breach of fiduciary duty - bribes - liability of fiduciary
When a bribe was accepted by a fiduciary in breach of his duty he held that bribe in trust for the person to whom the duty was owed. If property representing the bribe decreased in value the fiduciary had to pay the difference between that value and the initial amount, and if the property increased in value the fiduciary was not entitled to any surplus in excess of the initial value of the bribe because he was not allowed by any means to make a profit out of a breach of duty.
Lister & Co v StubbsELR ((1890) 45 ChD 1) should not be followed.
The Judicial Committee of the Privy Council allowed an appeal by the Attorney-General for Hong Kong from the judgment of the Court of Appeal of New Zealand ((1992) 2 NZLR 385) dismissing his appeal from Mr Justice Penlington in the High Court of New Zealand, who had refused to order that caveats lodged by the Attorney-General in proceedings against the respondents, Mr Charles Warwick Reid, Mrs Judith Margaret Reid and Mr Marc Molloy should not lapse.
Mr David Oliver, QC and Mr Stephen Kos (of the New Zealand Bar) for the Attorney-General; Mr Antony White for Mrs Reid; Mr Reid and Mr Molloy did not appear and were not represented.
LORD TEMPLEMAN said that Mr Reid, a solicitor and New Zealand national, had joined the legal service of the Government of Hong Kong becoming successively crown counsel, deputy crown prosecutor and ultimately acting Director of Public Prosecutions.
In the course of his career in breach of the fiduciary duty which he owed as a servant of the Crown he accepted bribes as an inducement to him to exploit his official position by obstructing the prosecution of certain criminals.
He was arrested, pleaded guilty to offences under the Prevention of Bribery Ordinance and was sentenced on July 6, 1990, to eight years' imprisonment and ordered to pay the Crown HK$12.4 million, equivalent to NZ$2.5 million, being the value of assets then controlled by him which could only have been derived from bribes. No part of that sum had been paid.
Among Mr Reid's assets were three freehold properties in New Zealand. The trial judge's finding that the Attorney-General had established an arguable case that each of the three properties had been acquired with moneys received by Mr Reid as bribes had not been challenged. Two of the properties were conveyed to him and his wife and one to his solicitor, Mr Molloy.
The total value of assets in New Zealand thought to be derived from bribes exceeded NZ$2.4 million. The appeal proceeded on the assumption that the freehold New Zealand properties were purchased with bribes received by Mr Reid and were held in trust for him subject to the claims of the Crown in those proceedings.
A bribe was a gift accepted by a fiduciary as...
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Sinclair Investments (UK) Ltd v Versailles Trade Finance Ltd
...form of "cestui que trust"). I will also have to deal with the precedential status of the decision of the Privy Council in Attorney-General for Hong Kong v Reid [1994] 1 AC 324. My task is not to provide a definitive statement of the law, but to find my way through the labyrinth, unaided b......
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Sinclair Investments (UK) Ltd v Versailles Trade Finance Ltd
...takes out of a trust and a profit such as a bribe which a trustee receives from a third party", to quote Lord Templeman in Attorney-General for Hong Kong v Reid [1994] 1 AC 324. However, Sugden 2 Sm & G 192 was a first instance decision, and the same result would have obtained on the basis......
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