Hotel Portfolio II UK Limited (In Liquidation) & Anor v Andrew Joseph Ruhan & Anor

Hotel Portfolio II UK Limited (In Liquidation) & Anor v Andrew Joseph Ruhan & Anor

A dishonest assistant is not liable for equitable compensation for profits made by the fiduciary where the claimant has elected for an account of profits against the fiduciary; liability is limited to profits personally made by the assistant, and no compensation for loss is recoverable in these circumstances.

Parties
Claimant: Hotel Portfolio II UK Limited (in liquidation); Claimant: Elizabeth Alexandra Aird-Brown (as liquidator of Hotel Portfolio II UK Limited); Defendant: Andrew Joseph Ruhan; Defendant/appellant: Anthony Edward Stevens; Interested Party: Phoenix Group Foundation; Interested Party: Minardi Investments Limited; Interested Party: Tania Jane Richardson
Jurisdiction
England and Wales
Judgment Date
11 October 2024
Procedural Posture
Civil Appeal / Court of Appeal Judgment
Outcome
Appeal allowed
Legal Topics
Dishonest Assistance, Breach of Fiduciary Duty, Account of Profits, Equitable Compensation, Constructive Trust
Equity Company Law Dishonest Assistance Breach of Fiduciary Duty Account of Profits Equitable Compensation Constructive Trust

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Parties

Hotel Portfolio II UK Limited (in liquidation)

Claimant

Elizabeth Alexandra Aird-Brown (as liquidator of Hotel Portfolio II UK Limited)

Claimant

Andrew Joseph Ruhan

Defendant

Anthony Edward Stevens

Defendant/appellant

Phoenix Group Foundation

Interested Party

Minardi Investments Limited

Interested Party

Tania Jane Richardson

Interested Party

Procedural Posture

Civil Appeal / Court of Appeal Judgment

Legal Issues

  1. 1 Is a dishonest assistant liable for equitable compensation for profits made by the fiduciary, or only for profits made personally?
  2. 2 Can a claimant recover compensation for loss from a dishonest assistant where the claimant has elected for an account of profits against the fiduciary?
  3. 3 Are profits derived from breach of fiduciary duty held on a true trust for the company?

Ratio Decidendi

A dishonest assistant is not liable for equitable compensation for profits made by the fiduciary where the claimant has elected for an account of profits against the fiduciary; liability is limited to profits personally made by the assistant, and no compensation for loss is recoverable in these circumstances.

Court Disposition

Appeal allowed

Orders

  • Order for Mr Stevens to pay equitable compensation set aside
  • Order for Mr Stevens to pay interest on compensation set aside