Sewell v Zelden [2010] NSWSC 1180

Sewell v Zelden [2010] NSWSC 1180

The solicitor (first defendant) breached his fiduciary duty to the plaintiff by failing to properly disclose the conflict of interest, failing to provide independent advice, and by promoting the sale for his own and his wife's benefit; the second and third defendants are liable for knowing assistance in the dishonest and fraudulent design given their knowledge and conduct. The proper equitable remedy is an account of profits of $60,000 being the profit derived from the sale above acquisition price, plus interest.

Jurisdiction
Australia
Judgment Date
03 September 2010
Procedural Posture
Equity Fiduciary Duty and Knowing Assistance Claim / Judgment After Hearing
Outcome
First defendant was found to have breached fiduciary duty. Second and third defendants are liable for knowing assistance. Account of profits to the plaintiff ordered. Judgment stood over for orders to be prepared.
Legal Topics
['fiduciary Duties' 'breach of Fiduciary Duty' 'conflict of Interest' 'remedies in Equity' 'knowing Assistance' 'barnes V Addy' 'disclosure and Informed Consent' 'account of Profits']
['equity'] ['fiduciary Duties' 'breach of Fiduciary Duty' 'conflict of Interest' 'remedies in Equity' 'knowing Assistance' 'barnes V Addy' 'disclosure and Informed Consent' 'account of Profits']

Case Brief

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Procedural Posture

Equity Fiduciary Duty and Knowing Assistance Claim / Judgment After Hearing

Legal Issues

  1. 1 ['Whether the first defendant (solicitor) breached his fiduciary duty to the plaintiff in relation to a property sale' "Whether the second and third defendants are liable for 'knowing assistance' in the breach of fiduciary duty under the second limb of Barnes v Addy" 'The appropriate remedy for breach of fiduciary duty']

Ratio Decidendi

The solicitor (first defendant) breached his fiduciary duty to the plaintiff by failing to properly disclose the conflict of interest, failing to provide independent advice, and by promoting the sale for his own and his wife's benefit; the second and third defendants are liable for knowing assistance in the dishonest and fraudulent design given their knowledge and conduct. The proper equitable remedy is an account of profits of $60,000 being the profit derived from the sale above acquisition price, plus interest.

Court Disposition

First defendant was found to have breached fiduciary duty. Second and third defendants are liable for knowing assistance. Account of profits to the plaintiff ordered. Judgment stood over for orders to be prepared.

Orders

  • ['Parties to bring in Short Minutes of Orders to reflect judgment findings' 'Registrar directed to send reasons to Office of the Legal Services Commissioner' 'Plaintiff to receive account of profits of $60,000 plus interest to be determined under the Uniform Civil Procedure Rules 2005 (NSW) and Practice Note SC Gen...