Equity
Alysia Debowski
alysia@largestprime.net
Fiduciary obligations
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1. Is there a fiduciary relationship?
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2. What is the scope of the fiduciary relationship?
3. Were the fiduciary’s obligations breached?
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No conflict
No profit
4. Is there a relevant defence?
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Established category?
On the facts?
Disclosure and informed consent
5. What remedy is available for the breach?
The Source of Fiduciary Duties
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Hospital Products Ltd v United States Surgical
Corp (1984) 156 CLR 41 at 97
Re Coomber; Coomber v Coomber [1911] 1 Ch
723, per Fletcher-Moulton LJ at 728-9
Aberdeen Railway Co v Blaikie Bros (1854)
[1843-60] All ER Rep 249, at 252
Chan v Zacharia (1984) 154 CLR 178, esp per
Deane J at 198-9
Lac Minerals Ltd v International Corona
Resources Ltd (1989) 61 DLR (4th) 14
The Scope of the Fiduciary
Relationship
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N Z Netherlands Society ‘Oranje’ v Kuys [1973]
2 All ER 1222
Noranda Resources Ltd v Lachlan Resources
NL (1988) 14 NSWLR 1
Blythe v Northwood (2005) 63 NSWLR 531
Farah Constructions P/L v Say-Dee P/L (2007)
236 ALR 209; [2007] HCA 22 (24 May 2007)
The Recognised Categories of
Fiduciary Relationships
Solicitor and Client
 Boardman v Phipps [1967] 2 AC 46
 Queensland Mines Ltd v Hudson (1978)
52 ALJR 399
 Farrington v Rowe McBride and Partners
[1985] 1 NZLR 83
 Maguire v Makaronis (1997) 188 CLR 449
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The Recognised Categories of
Fiduciary Relationships (cont.)
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Director and Company
Bell v Lever Brothers [1932] AC 161
Regal (Hastings) Ltd v Gulliver [1967] 2 AC 134
Peso Siver Mines Ltd (NPL) v Cropper (1966) 58 DLR
(2d) 1
Canadian Aero Services Ltd v O’Malley (1973) 40 DLR
(3rd) 371
Queensland Mines Ltd v Hudson (1978) 18 ALR 1
Mordecai v Mordecai (1988) 12 NSWLR 58
The Recognised Categories of
Fiduciary Relationships (cont.)
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Trustee and Beneficiary
Partners
Birtchnell v Equity Trustees (1929) 42 CLR 384
Chan v Zacharia (1984) 154 CLR 178
United Dominions Corp Ltd v Brian Pty Limited
(1985) 157 CLR 1
Ravinder Rohini Pty Ltd v Krizaic (1991) 105
ALR 593
The Recognised Categories of
Fiduciary Relationships (cont.)
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Employee and Employer
DPC Estates Pty Ltd v Grey & Anor [1974] 1 NSWLR
443
Hivac Ltd v Park Royal Scientific Instruments Ltd [1946]
Ch 169
Printers & Finishers v Holloway [1965] RPC 239
Industrial Development Consultants Ltd v Cooley [1972]
1 WLR 443
British Reinforced Concrete v Lind (1917) 86 LJ Ch 486
Sterling Engineering Co v Patchett [1955] 1 All ER 369
The Recognised Categories of
Fiduciary Relationships (cont.)
Agent and Principal
 Haywood v Roadknight [1927] VLR 512
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Other Relationships
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Broker and Client
Hewson v Sydney Stock Exchange [1968] 2 NSWR 224; 87 WN (NSW) Pt 1
422
Daly v Sydney Stock Exchange Ltd (1986) 160 CLR 371
Commercial Transactions
Keith Henry & Co v Stuart Walker & Co Pty Ltd (1958) 100 CLR 342
Hospital Products Ltd v United States Surgical Corp (1984) 156 CLR 4
LAC Minerals v International Corona Resources Ltd (1989) 61 DLR (4th) 14
Moorgate Tobacco Co Ltd v Phillip Morris Ltd (No 2) (1984) 156 CLR 414
News Limited v Australian Rugby Football League Ltd (1996) 139 ALR 193
Other Relationships (cont.)
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Banker and Customer
Commonwealth Bank v Smith (1991) 102 ALR
453
Standard Investments Ltd v Canadian Imperial
Bank of Commerce (1985) 22 DLR (4th) 411
Other and Special Relationships
Breen v Williams (1996) 70 ALJR 772
Breach of Duty: “Conflict of
Interest” and “Improper Gain”
Prince Jefri Bolkiah v KPMG [1999] 2 AC
222
 The Doctrine in Keech v Sandford
 Keech v Sandford (1726) Sel Cas T King
61; 25 ER 223
 Chan v Zacharia (1984) 154 CLR 178
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Defences: The Duty of Disclosure
and Informed Consent
Boardman v Phipps [1967] 2 AC 46
 BLB Corporation of Australia v Jacobsen
(1974) 48 ALJR 372
 NZ Netherlands Society v Kuys [1973] 2
All ER 1222
 Gemstone Corporation of Australia Ltd v
Grasso (1994) 13 ACSR 695
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Remedies for Breaches of
Fiduciary Duty
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Nocton v Lord Ashburton [1914] AC 932
Hospital Products Ltd v United States Surgical Corp (1984) 156 CLR 41
Chan v Zacharia (1984) 154 CLR 178
Maguire v Makaronis (1997) 188 CLR 449
Daly v Sydney Stock Exchange Ltd (1986) 160 CLR 371
Re Dawson [1966] 2 NSWR 211
Peter Pan Corp Ltd v Corsets Silhouette Ltd [1963] RPC 45; [1964] 1 WLR
96
Timber Engineering Co Pty Ltd v Anderson [1980] 2 NSWLR 488
Hagan v Waterhouse (1992) 34 NSWLR 308 at 360-365F
Boardman v Phipps [1967] 2 AC 46
Mordecai v Mordecai (1988) 12 NSWLR 58
Warman International Ltd v Dwyer (1995) 128 ALR 201
Gemstone Corporation v Grasso (1994) 13 ACSR 695
Secret Commissions and Equitable
Debt
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Metropolitan Bank v Heiron (1880) 5 Ex D 319
Boston Deep Sea Fishing and Ice Co v Ansell (1888) 39
Ch D 389
Lister v Stubbs (1890) 45 Ch D 1
A-G (Hong Kong) v Reid [1994] 1 AC 324
DPC Estates Pty Ltd v Grey [1974] 1 NSWLR 443
Re Stephenson Nominees (1987) 76 ALR 485
Reading v AG [1951] AC 507
Jirna Ltd v Mister Donut of Canada Ltd (1973) 40 DLR
(3d) 303
Applying the theory…
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Mary and Martha agree to develop a property in Sydney
owned by Mary. Martha will provide her technical
expertise and supervise the project. They agree to split
the profits.
Mary and Martha successfully obtain development
consent from the Council.
Before a formal agreement can be entered into, Mary
and Martha have a falling out. Mary sells the land and
makes a substantial profit, as the land already has
development approval.
Does Martha have a claim against Mary for breach of
fiduciary duty? If so, what remedy should Martha seek?
Next class
Estoppel in Equity and Confidential
Information
 Equity & Trusts, Chapters 5 and 7
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