Boardman v Phipps

Ratio Decidendi

তথ্য

Boardman was a solicitor to a trust. He and one beneficiary (Tom Phipps) used information gained through the trust to purchase shares in a company, resulting in profit for both themselves and the trust. Another beneficiary (John Phipps) claimed the profits.

রায়ের সারসংক্ষেপ

The House of Lords held, by a 3–2 majority, that Boardman (the trust's solicitor) and Tom Phipps stood in a fiduciary relationship to the trust and had obtained their profit by use of information and an opportunity that came to them through that position while purporting to act on the trust's behalf. Applying the strict rule in Keech v Sandford and Regal (Hastings) v Gulliver, they were liable to account for the profit even though they had acted honestly and in good faith, had benefited the trust, and the trust itself could not or would not have bought the shares. The majority (Lords Cohen, Hodson, and Guest) stressed that liability does not depend on fraud or bad faith, nor on any loss to the beneficiaries, but on the possibility of a conflict between interest and duty. Because Boardman and Phipps had acted openly and their skill and effort had greatly increased the value of the trust's holding, the House allowed them a generous allowance on a liberal scale for their work. Lords Upjohn and Viscount Dilhorne dissented, taking a narrower view of when information or opportunity is truly obtained by reason of the fiduciary position.

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