Remedies for Breach of Trust

The decision of the Supreme Court in AIB Group (UK) Plc v Mark Redler & Co confirms the approach taken by Lord Browne‐Wilkinson in Target Holdings Ltd v Redferns: where a trustee misapplies trust assets, a beneficiary is limited to a claim for equitable compensation for losses caused by the trustee's breach of duty. This seems to be a departure from traditional equitable doctrine, which held that the beneficiary could falsify the trustee's unauthorised disbursement and bring a claim for an ‘equitable debt’. This note considers the impact of the decision of the Supreme Court, and how the law regarding ‘equitable compensation’ might continue to develop.     

On the Relations between Agent and Principal: Angove's Pty Ltd v Bailey

In Angove's Pty Ltd v Bailey the Supreme Court faced ‘two important and controversial questions of commercial law’: whether an agent's authority could ever be ‘irrevocable’, and whether the receipt of money by an imminent insolvent could ever give rise to a constructive trust of that sum. It answered both in the affirmative, albeit subject to heavy qualifications. This note supports these conclusions in principle, however it will argue that the court's reasoning, especially in answering the second question, leaves much to be desired. In particular, it ignored the central role of fiduciary law in regulating the conduct of agents.     

Animal Defenders International v United Kingdom: Sensible Dialogue or a Bad Case of Strasbourg Jitters?

In Animal Defenders International v United Kingdom a majority of the Grand Chamber of the European Court of Human Rights held that the UK's statutory broadcasting ban on political advertisements under the Communications Act 2003 did not breach the right to freedom of expression under Article 10 of the European Convention on Human Rights. The judgment departs from the Court's established case law and, it is argued, raises several issues of concern both with regard to freedom of expression, and for human rights adjudication more generally. In particular, the Court's use of a doctrine of ‘general measures’ led it to place a great deal of reliance on the quality and quantity of legislative debate that preceded the UK ban, rather than its actual impact upon the applicant.     

Assumption of Responsibility in Corporate Groups: Chandler v Cape plc

In Chandler v Cape plc, the Court of Appeal imposed for the first time liability on a company for a breach of its duty of care to an employee of its subsidiary. In doing so, the court laid out a new four‐part test for ascertaining a parent company's responsibility for the health and safety of individuals employed by group companies. Although liability of parent companies may be justified under the right circumstances, the court's approach in Chandler is problematic in a number of ways and raises more questions than it answers.     

All Bark and No Bite: Notes on the Federal Constitutional Court's 'Banana Decision'

The Federal Constitutional Court's banana decision of 7 June 2000 continues the complex theme of national fundamental‐rights control over Community law. Whereas in the ‘Solange II’ decision (BVerfGE 73, 339) the Federal Constitutional Court had lowered its standard of review to the general guarantee of the constitutionally mandatorily required minimum, the Maastricht judgment (BVerfGE 89, 155) had raised doubts as to the continued validity of this case law. In the banana decision, which was based on the submission of the EC banana market regulation by the Frankfurt‐am‐Main administrative court for constitutional review, the Federal Constitutional Court has now confirmed the ‘Solange II’decision and restrictively specified the admissibility conditions for constitutional review of Community law as follows. Constitutional complaints and judicial applications for review of European legislation alleging fundamental‐rights infringements are inadmissible unless they show that the development of European law including Court of Justice case law has since the ‘Solange II’ decision generally fallen below the mandatorily required fundamental‐rights standard of the Basic Law in a given field. This would require a comprehensive comparison of European and national fundamental‐rights protection. This paper criticises this formula as being logically problematic and scarcely compatible with the Basic Law. Starting from the position that national constitutional courts active even in European matters should be among the essential vertical ‘checks and balances’ in the European multi‐level system, a practical alternative to the Federal Constitutional Court's retreat is developed. This involves at the first stage a submission by the Federal Constitutional Court to the Court of Justice, something that in the banana case might have taken up questions on the method of fundamental‐rights review and the internal Community effect of WTO dispute settlement decisions. Should national constitutional identity not be upheld even by this, then at a second stage, as ultima ratio taking recourse to general international law, the call is made for the decision of constitutional conflicts by an independent mediating body.     

O'Keeffe v Ireland: The Liability of States for Failure to Provide an Effective System for the Detection and Prevention of Child Sexual Abuse in Education

In O'Keeffe v Ireland, the Grand Chamber of the European Court of Human Rights found that Ireland failed to protect the applicant from sexual abuse suffered as a child in an Irish National School in 1973 and violated her rights under Article 3 (prohibition of inhuman and degrading treatment) and Article 13 (right to an effective remedy) of the European Convention on Human Rights. This note argues that the decision is important in expanding the Court's jurisprudence regarding positive obligations under Article 3 to child sexual abuse in a non‐state setting where there was no knowledge of a ‘real and immediate’ risk to the applicant. It also argues that the case raises concerns about the Court's methodology for the historical application of the Convention and about the interaction of Article 3 positive obligations with vicarious liability in common law tort regimes.     

Social Insurance Monopolies in Community Competition Law and the Italian Constitution: 'Practical' Convergences and 'Theoretical' Conflicts

An Italian judge, following earlier suggestions of the national antitrust Authority, has referred to the Court of Justice for a preliminary ruling under Article 234 EC Treaty two questions on the interpretation of Articles 81 and 86 of the EC Treaty. With those questions, raised in an action brought by a self‐employee against the Istituto Nazionale per l'Assicurazione contro gli Infortuni sul Lavoro (INAIL) concerning the actor's refusal to pay for social insurance contributions, the Tribunale di Vicenza has in summary asked the Court of Justice whether the public entity concerned, managing a general scheme for the social insurance of accidents at work and professional diseases, can be qualified as an enterprise under Article 81 EC Treaty and, if so, whether its dominant position can be considered in contrast with EC competition rules. This article takes this preliminary reference as a starting point to consider in more general terms the complex constitutional issues raised by what Ge´rard Lyon‐Caen has evocatively called the progressive ‘infiltration’ of EC competition rules into the national systems of labour and social security law. The analysis is particularly focused on the significant risks of ‘constitutional collision’, between the ‘solidaristic’ principles enshrined in the Italian constitution and the fundamental market freedoms protected by the EC competition rules, which are implied by the questions raised in the preliminary reference. It considers first the evolution of ECJ case law—from Poucet and Pistre to Albany International BV—about the limits Member States have in granting exclusive rights to social security institutions under EC competition rules. It then considers specularly, from the Italian constitutional law perspective, the most recent case law of the Italian Constitutional Court on the same issues. The ‘contextual’ reading of the ECJ's and the Italian Constitutional Court's case law with specific regard to the case referred to by the Tribunale di Vicenza leads to the conclusion that there will probably be a ‘practical convergence’in casu between the ‘European’ and the ‘national’ approach. Following the arguments put forward by the Court of Justice in Albany, the INAIL should not be considered as an enterprise, in line also with a recent decision of the Italian Constitutional Court. And even when it was to be qualified as an enterprise, the INAIL should in any case be able to escape the ‘accuse’ of abuse of dominant position and be allowed to retain its exclusive rights, pursuant to Article 86 of the EC Treaty. This ‘practical convergence’in casu does not, however, remove the latent ‘theoretical conflict’ between the two approaches and the risk of ‘constitutional collision’ that it implies. A risk of a ‘conflict’ of that kind could be obviously detrimental for the European integration process. The Italian Constitutional Court claims for herself the control over the fundamental principles of the national constitutional order, assigning them the role of ‘counter‐limits’ to the supremacy of European law and to European integration. At the same time, and more generally, the pervasive spill over of the EC market and competition law virtually into every area of national regulation runs the risk of undermining the social and democratic values enshrined in the national labour law traditions without compensating the potential de‐regulatory effects through measures of positive integration at the supranational level. This also may contribute to undermine and threaten, in the long run, the (already weak) democratic legitimacy of the European integration process. The search for a more suitable and less elusive and unilateral balance between social rights and economic freedoms at the supranational level should therefore become one of the most relevant tasks of what Joseph Weiler has called the ‘European neo‐constitutionalism’. In this perspective, the article, always looking at the specific questions referred to the Court of Justice by the Tribunale di Vicenza, deals with the issue of the ‘rebalance’ between social rights and economic and market freedoms along three distinct but connected lines of reasoning. The first has to do with the need of a more open and respectful dialogue between the ECJ and the national constitutional courts. The second is linked to the ongoing discussion about the ‘constitutionalization’ of the fundamental social rights at the EC level. The third finally considers the same issues from the specific point of view of the division of competences between the European Community and the Member States in the area of social (protection) policies.     

Black Spiders Weaving Webs: The Constitutional Implications of Executive Veto of Tribunal Determinations

In R (Evans) v Attorney General, the Supreme Court quashed the Attorney General's statutory veto of the Upper Tribunal's original determination made under freedom of information legislation. The Upper Tribunal had held that so‐called ‘advocacy’ memos should be published after a full hearing on the merits. The Supreme Court split five to two, with the lead judgment of Lord Neuberger using constitutional rather than administrative language and focusing on the rule of law. This note raises four objections to the lead judgment. First, it argues that the Upper Tribunal was acting in an executive not judicial capacity and the veto was not therefore a breach of the rule of law. Secondly it suggests the veto clause is best understood as a variant Henry VIII clause. Thirdly, it suggests Lord Neuberger's judgment is founded on a paradox. Finally, it argues that the judgment undermines parliamentary sovereignty. Future implications are then considered.     

The Reasonable Expectation of Privacy and the Criminal Suspect

In In re JR38, the Supreme Court unanimously dismissed an appeal from a 14 year‐old boy who argued that the dissemination of his image, taken whilst he was participating in sectarian rioting, to local newspapers, violated his rights under Article 8 of the European Convention on Human Rights (ECHR). However, the Court was divided on whether or not the measures taken by the police engaged the applicant's Article 8(1) rights at all. This case raises fundamental questions as to the scope of private life in the context of criminal investigations, and the place of the European Court of Human Rights’ ‘reasonable expectation of privacy’ test in determining whether Article 8(1) of the ECHR is engaged. This case comment subjects the majority's interpretation of Article 8(1) to critical scrutiny, concluding that this interpretation may unduly restrict the scope of Article 8 protection for those subject to criminal investigations.     

Peacekeepers Facilitating Human Rights Violations: The Liability of the Dutch State in the Mothers of Srebrenica Cases

This article provides a critical reading of the judgments of The Hague District Court and especially The Hague Court of Appeal in the case of Mothers of Srebrenica v. the State of the Netherlands, which concerned the liability in tort of the Dutch State for facilitating the massacre of Bosnian Muslims in 1995. It engages with the courts’ considerations regarding the attribution of conduct to the State in UN peacekeeping operations, the extraterritorial application of human rights treaties, the State obligation to prevent genocide, and the State’s liability for damages. While not fully agreeing with the courts’ argumentation, the author concludes that the judgments contribute to the refinement of the law and practice of State responsibility in respect of wrongful acts committed in complex multinational peace operations.

     

‘Factual causation’ and ‘scope of liability’: What's the difference?

According to a dominant view, for the negligent defendant to be held liable for the plaintiff's harm the plaintiff must establish first, that the breach was the ‘factual cause’ of the harm, and second, that the harm is within the ‘scope of liability’. On this view, factual causation is purely factual, while scope of liability is normative and non‐causal. This article accepts the basic two‐step approach, but argues that the distinction is overstated. A close analysis of the principles shows that factual causation may require value judgment, and that scope of liability often involves an assessment of the strength and nature of the causal connection between breach and harm.     

Reluctant Bedfellows: Want of Authority and Knowing Receipt

The case note examines the recent decision of the Hong Kong Court of Final Appeal in Thanakharn Kasikorn Thai Chamkat (Mahachon) v Akai Holdings Ltd, where Lord Neuberger of Abbotsbury adopted the test of irrationality in determining whether a defaulting agent had apparent authority to act on behalf of his principal to confer benefits on a third party. His Lordship further held that a concurrent claim in knowing receipt arose against the third party, and the test of unconscionability is substantially the same as that of irrationality. The present note argues that symmetry of the two tests is not necessary, for knowing receipt and apparent authority deal with issues that are categorically different and serve different purposes. It also examines, in the context of benefits conferred upon an underlying agreement that is void, the oft‐overlooked issue as to what amounts to receipt for the purpose of knowing receipt.     

Relatively Absolute? The Undermining of Article 3 ECHR in Ahmad v UK

The recent decision of the European Court of Human Rights in Ahmad v UK dangerously undermines the well‐established case law of the Court on counter‐terrorism and non‐refoulement towards torture, inhuman and degrading treatment or punishment. Although ostensibly rejecting the ‘relativist’ approach to Article 3 ECHR adopted by the House of Lords in Wellington v Secretary of State for the Home Department, the Court appeared to accept that what is a breach of Article 3 in a domestic context may not be a breach in an extradition or expulsion context. This statement is difficult to reconcile with the jurisprudence constante of the Court in the last fifteen years, according to which Article 3 ECHR is an absolute right in all its applications, including non‐refoulement, regardless of who the potential victim of torture, inhuman or degrading treatment is, what she may have done, or where the treatment at issue would occur.     

Fundamental rights in the EU after Kadi and Al Barakaat

This article takes stock of the emerging scholarship on the European Court of Justice's 2008 Kadi decision and seeks to make sense of the court's apparent evasiveness towards international law. The article argues that Kadi is best understood as an act of civil disobedience prompted by the UN Security Council's misapplication of foundational principles of the international order. In turn, the court's forceful articulation of the stakes in this case signals a prioritisation of basic rights within the supranational constitutional architectonic. In this respect, the ‘domestic’ constitutional implications of Kadi are just as far reaching as its consequences for the EU's status as an actor under international law.     

Citizen Led Policing in the Digital Realm: Paedophile Hunters and Article 8 in the case of Sutherland v Her Majesty's Advocate

In Sutherland v Her Majesty's Advocate, the Supreme Court unanimously dismissed an appeal which argued that the use of communications obtained by a paedophile hunter group as evidence in criminal prosecution was a violation of Article 8 of the European Convention on Human Rights. The case raises fundamental questions of the scope of the right to private life as regards to the content of communications and the role played by private actors in the criminal justice process. This note argues that by limiting the protection of Article 8 to private communications which satisfy a contents-based test, the Court has bypassed the Article 8(2) balancing test to the detriment of the due process rights of the accused. The note concludes that the decision opens up the prospect of the state circumventing the accused's Article 8 privacy rights by lending tacit approval to the proactive investigations of these private ‘paedophile hunter’ groups.     

Delfi AS v Estonia: The Liability of Secondary Internet Publishers for Violation of Reputational Rights under the European Convention on Human Rights

In October 2013, the European Court of Human Rights in Delfi AS v Estonia upheld a decision of the Estonian Supreme Court to impose liability on the owners of an internet news portal for defamatory comments which had been posted on their website by anonymous third parties. This note suggests that the decision is important in the context of publications with a ‘public interest’ element to them, because it appears to afford more protection to the right to reputation (deriving from the Article 8 right to privacy) and less to freedom of expression than was formerly the case. It is further argued that the Court's emphasis on the positive obligation of states to protect this right to reputation may mean that the existing English law in this area, including, potentially section 5 of the Defamation Act 2013, is inconsistent with the ECHR jurisprudence.     

The right of the child to be heard in education litigation: an analysis of the ‘intelligent design’ Pennsylvania case on the separation of Church and State in the public schools

This paper examines a seminal case in US education law regarding the separation of Church and State in the public schools. The issue decided was whether it is constitutional under American law for a school district to mandate reference to ‘intelligent design’ (ID) as an alternative to the theory of evolution whilst instructing students only in the latter. ID theory postulates an unspecified ‘master intelligence’ as being responsible for the origins of life. A Pennsylvania court found that ID was a religious theory and held the school district had officially endorsed ID contrary to constitutional requirements. The issue of children's participation rights was not raised by the parties or the Court and student views were not solicited. The reasons for this failure to allow students to be heard in the judicial proceedings are explored as are the implications for how the notion of children's rights is understood in North America.     

Unjust Enrichment in the ‘Fairchild Enclave’ International Energy Group Ltd v Zurich Insurance plc

In International Energy Group v Zurich Insurance, the Supreme Court considered the implications of the special rule in Fairchild v Glenhaven Funeral Services Ltd for insurers’ for employers’ liability. The question for the Court was whether, in the light of its earlier decision in Durham v BAI (Run off) Ltd, insurers could be held liable for employees’ mesothelioma claims, even if the employer was not insured throughout the period of employment. The seven Justices unanimously held that insurers’ liability was proportionate to the period of insurance. In reaching that result, the majority recognised that the insurers were entitled to ‘equitable recoupment’ from insured‐employers in respect of periods during which they were uninsured. This note critiques the recoupment right with an unjust enrichment lens.     

‘Reasonable Offers’ As a Defence to Unfair Prejudice Petitions: Prescott v Potamianos

It is long established that a ‘reasonable offer’ for a petitioner's shares can defeat an unfair-prejudice petition. Lord Hoffmann gave guidance about such offers in O'Neill v Phillips. Now, in Prescott v Potamianos, the Court of Appeal has set out three factors that help to determine in general whether an offer is ‘reasonable’. Those factors are: the value offered; the likelihood of implementation; and the proximity to the unfairly prejudicial conduct. The Court's guidance is useful for lawyers and their clients, as well as being broadly favourable for petitioners. But the Court emphasised that the unfair-prejudice jurisdiction is based on fairness and so requires a considerable degree of flexibility. Such flexibility impairs the certainty that Lord Hoffmann was seeking to promote, and may create difficulties for parties making or receiving offers.     

Fraud by Abuse of Position and Unlicensed Gangmasters

This article analyses the Court of Appeal's interpretation of the fraud by abuse of position offence in R v Valujevs. Two issues are explored: first, the Court's welcome clarification of the meaning of a relevant ‘expectation’; second, the inadequacy of the Court's reasoning in deciding that an unlicensed gangmaster ‘is expected to safeguard, or not to act against, the financial interests’ of his workers.