Chapter 19 Multiple choice questions

. Suppose that trustee Tabitha and trustee Tim hold property on trust for Brenda and Bashir and the trustees appoint and pay a stockbroker to invest certain moneys on behalf of the trust. Who is/are the stranger(s) in this scenario?

The Stockbroker and any person to whom he passes the money.

Tabitha and Tim.

Brenda and Bashir.

The Stockbroker.

. "if one, not being a trustee and not having authority from a trustee, takes upon himself to intermeddle with the trust matters or to do acts characteristic of the office of trustee, he may thereby make himself a trustee". What is being defined here?

Liability for knowing receipt.

Liability for intermeddling.

A trustee de son tort.

Liability for dishonest assistance.

. The remedy for knowing receipt is:

Restitutionary

Compensatory

Compensatory and Restitutionary

None of these options

. Which of the following will count as knowledge sufficient to prove liability for knowing receipt?

A rumour

Something once known but since forgotten.

. Which of the following is not within the Baden categories of knowledge?

"Wilfully shutting one's eyes to circumstances which would indicate the facts to an honest or reasonable man" is not within the Baden categories of knowledge? (per Peter Gibson J in Baden v Société Générale [1983] BCLC 325).

Actual knowledge.

Wilfully shutting one's eyes to the obvious.

. The House of Lords in Twinsectra Ltd v Yardley [2002] 2 AC 164 was concerned with which of the following heads of liability?

Inconsistent dealing with trust property.

Knowing receipt of property misapplied in breach of trust or fiduciary duty.

Knowing assistance in a dishonest or fraudulent design.

Dishonest assistance in or procurement of a breach of trust.

. Which of the following is the standard of dishonesty applied when determining liability for dishonest assistance?

"A subjective standard".

"A purely objective standard".

"Objective judgment of the defendant's state of mind by the objective standards of ordinary decent people".

"Subjective assessment of whether the defendant appreciated that his actions fell short of the the objective standards of ordinary decent people".

. Which of the following extra-legal or contextual factors might best explain the decision of the House of Lords in Twinsectra Ltd v Yardley [2002] 2 AC 164.

The need to encourage solicitors to act on behalf of trusts.

The need to ensure that commerce runs smoothly.

Judicial reluctance to tar a fellow legal professional with the label "dishonest".

Decline in social standards of honesty generally.

. It has been said that committing the equitable wrong of dishonest assistance is essentially the same as liability for committing…

A crime

A breach of trust

A tort

Knowing receipt of trust property

. Which of the following statements is FALSE in the context of a beneficiary's attempt to recover the value of misapplied funds?

It is useful to seek to impose personal liability on strangers where tracing is only partially successful.

It is useful to seek to impose personal liability on strangers where tracing is fails outright.

It is useful to seek to impose proprietary liability on strangers where tracing is only partially successful.

It is useful to seek to impose personal liability on strangers at the same time as seeking to trace misapplied funds.

Quiz Content