ABSTRACT
Where a person dishonestly assists in a breach of trust, that dishonest assistant will be personally liable to account to the beneficiaries of that trust for the value lost to the trust. The test for dishonesty is an objective test which requires that the court consider what an honest person would have done in the circumstances, albeit seen through the lens of the personal characteristics and knowledge of the defendant.1 There is a discredited line of authority which required the defendant to be subjectively aware that honest people would consider their behaviour to have been dishonest. ‘Dishonesty’ in this context encompasses fraud, lack of probity and reckless risk-taking. This liability is predicated on an equitable wrong and imposes a personal liability to account to the beneficiaries as though a constructive trustee.2 It is not necessary that any trustee of the trust is dishonest; simply that the dishonest assistant is dishonest.3 The claim for dishonest assistance is one which has provoked great controversy among academic commentators and has spawned two Privy Council and two House of Lords decisions, seven decisions of the Court of Appeal including dishonest assistance claims, and dozens of decisions in the High Court in recent years. The principal issue is as to the nature of the test for dishonesty and the precise level of subjectivity which can be admitted into an avowedly objective test.
