Goyal v Florence Care Ltd & Ors

Goyal v Florence Care Ltd & Ors

The judge was wrong in principle to refuse an account of profits against the Second Respondent; the Appellant was prima facie entitled to an account and inquiry to ascertain any profit made in breach of fiduciary duty, and there were no equitable reasons to withhold this remedy. As to the Third Respondent, no trust in favour of the Appellant arose over the sums paid into the solicitors' client account, as the solicitors were not aware of any restriction or trust, and the default position applied; even if a trust had arisen, there was no breach by the solicitors.

Parties
Appellant: Vidya Bhushan Goyal; First Respondent: Florence Care Limited; Second Respondent: Shanthi Edwards; Third Respondent: DKLM LLP
Jurisdiction
England and Wales
Judgment Date
19 March 2020
Procedural Posture
Civil Appeal / Appeal From County Court Judgment
Outcome
Appeal allowed in part, dismissed in part
Legal Topics
Account of Profits, Breach of Fiduciary Duty, Resulting/quistclose Trusts, Attribution and Imputation of Knowledge, Remedies for Breach of Trust
Equity Trusts Fiduciary Law Account of Profits Breach of Fiduciary Duty Resulting/quistclose Trusts Attribution and Imputation of Knowledge Remedies for Breach of Trust

Case Brief

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Parties

Vidya Bhushan Goyal

Appellant

Florence Care Limited

First Respondent

Shanthi Edwards

Second Respondent

DKLM LLP

Third Respondent

Procedural Posture

Civil Appeal / Appeal From County Court Judgment

Legal Issues

  1. 1 Whether the judge erred in refusing to order an account of profits against the Second Respondent for breach of fiduciary duty
  2. 2 Whether the sums paid by the Appellant to the Third Respondent's client account were held on trust for the Appellant (Quistclose/resulting trust)
  3. 3 Whether the Third Respondent solicitors breached any trust owed to the Appellant

Ratio Decidendi

The judge was wrong in principle to refuse an account of profits against the Second Respondent; the Appellant was prima facie entitled to an account and inquiry to ascertain any profit made in breach of fiduciary duty, and there were no equitable reasons to withhold this remedy. As to the Third Respondent, no trust in favour of the Appellant arose over the sums paid into the solicitors' client account, as the solicitors were not aware of any restriction or trust, and the default position applied; even if a trust had arisen, there was no breach by the solicitors.

Court Disposition

Appeal allowed in part, dismissed in part

Orders

  • Appeal allowed against the Second Respondent; order for account and inquiry into the use of the Appellant's money by the Second Respondent
  • Appellant to make written submissions as to the precise form of order within 14 days; matter to be remitted to County Court for further applications