Puneet Varma

A G for Hong Kong v Reid

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Decided  1 November 1993
End date  November 1, 1993
A-G for Hong Kong v Reid
Full case name  The Attorney General for Hong Kong v Charles Warwick Reid and Judith Margaret Reid and Marc Molloy
Citation(s)  [1993] UKPC 36, [1994] 1 AC 324
Transcript(s)  Full transcript on bailii.org
Ruling court  Judicial Committee of the Privy Council
Judge sittings  Sydney Templeman, Baron Templeman
Similar  Boardman v Phipps, FHR European Ventures, Keech v Sandford, Westdeutsche Landesbank Girozentr, Regal (Hastings) Ltd v Gulli

Attorney‐General for Hong Kong v Reid [1993] UKPC 36 is a British and New Zealand trust law case, where it was held that bribe money accepted by a person in a position of trust, can be traced into any property bought and is held on constructive trust for the beneficiary.

Contents

Facts

Mr Charles Warwick Reid was a New Zealand national and the Hong Kong Deputy Crown Prosecutor and then Acting Director of Public Prosecutions, so in a fiduciary relationship with the Hong Kong government. He took bribes to obstruct prosecution of some criminals, and used the money to buy land in New Zealand. Some was kept by Mr Reid and his wife, Mrs Judith Margaret Reid, some conveyed to Reid’s solicitor. The Hong Kong government argued the land was held on trust for them.

Advice

The Privy Council advised the bribe money received by Reid, and the land acquired after, was held on constructive trust for the Hong Kong government. This meant that the land bought by Reid and his wife was held on trust, and had to be given over to the Hong Kong government. This was held to be necessary to ensure that people in positions of trust could in no way profit from their wrongdoing. If the property was badly invested, the fiduciary in breach would still be under a duty to make good the shortfall. Lord Templeman delivered the advice of the Board.

Lord Goff, Lord Lowry, Lord Lloyd and Sir Thomas Eichelbaum concurred.

Significance

In Sinclair Investments (UK) Ltd v Versailles Trade Finance Ltd the Court of Appeal declined to follow the Privy Council's advice and preferred Lister. The conflict of authority has finally been resolved with the case of FHR European Ventures LLP v Cedar Capital.

References

A-G for Hong Kong v Reid Wikipedia


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