Camran Mirza & Ors v CMS Cameron McKenna Mabarro Olswang LLP
[2024] EWHC 2058 (Ch)
Snehal Dattani & Anor v Messrs Ferns Solicitors
22 November 2024
[2024] EWHC 2980 (Ch)
High Court
Lawyers sued for helping a client steal money. A judge said there was enough doubt about whether the lawyers knowingly helped that a full trial is needed to decide. However, a separate claim, based on the lawyers simply handling money that belonged to someone else, failed because the lawyers didn't act dishonestly.
Key Facts
- •Appeal against two orders by Master McQuail striking out claims against Messrs Ferns Solicitors (Ferns) based on constructive trust and dishonest assistance.
- •Claimants alleged Ferns, acting for Mr and Mrs Rasheed, wrongly transferred sale proceeds knowing of an interim charging order (ICO) affecting Mr Rasheed's interest.
- •Ferns argued lack of dishonesty and that knowledge of the ICO wasn't sufficient for liability.
- •The Court considered whether the striking-out was appropriate given the developing jurisprudence and need for factual findings.
Legal Principles
Test for striking out a statement of case under CPR 3.4(2)(a) and for summary judgment under CPR 24.2.
CPR 3.4(2)(a), CPR 24.2
Principles for summary judgment applications as summarised in Easyair Limited v Opal Telecom Limited [2009] EWHC 339 (Ch).
Easyair Limited v Opal Telecom Limited [2009] EWHC 339 (Ch)
Liability of an agent receiving money belonging to a third party (Williams-Ashman v Price and Williams [1942] Ch. 219; Carl Zeiss Stiftung v Herbert Smith & Co [1969] 2 Ch 276).
Williams-Ashman v Price and Williams [1942] Ch. 219; Carl Zeiss Stiftung v Herbert Smith & Co [1969] 2 Ch 276
Elements of a claim for dishonest assistance in relation to a breach of trust (Group 7 Ltd v Nasir [2019] EWCA Civ 614).
Group 7 Ltd v Nasir [2019] EWCA Civ 614
Test for dishonesty in the context of accessory liability for breach of trust (Royal Brunei Airlines Sdn Bhd v Tan [1995] 2 AC 378).
Royal Brunei Airlines Sdn Bhd v Tan [1995] 2 AC 378
Effect of 'blind-eye knowledge' in dishonest assistance claims.
Group 7 Ltd v Nasir [2019] EWCA Civ 614
Sufficiency of pleading dishonesty (Three Rivers District Council v Bank of England [2001] UKHL 16).
Three Rivers District Council v Bank of England [2001] UKHL 16
Outcomes
Appeal allowed in respect of the Dishonest Assistance Strikeout Order.
The question of dishonesty was an arguable case requiring evidence of Mr Narayan's knowledge and state of mind; the Master's decision was premature.
Appeal dismissed in respect of the Constructive Trust Strikeout Order.
The Claimants' argument that Ferns' dealing with money impressed with an equitable charge was itself a breach of trust, irrespective of dishonesty, failed. Liability for constructive trust only arises if Mr Narayan's conduct amounts to dishonesty.
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