Proprietary Claims Against Strangers - Equitable Proprietary Claims against Wrongdoers - Three Main Tracing Rules
3 important questions on Proprietary Claims Against Strangers - Equitable Proprietary Claims against Wrongdoers - Three Main Tracing Rules
What is meant by the first tracing rule of clean substitution and what can the claimant claim?
Under clean substitution (Re Hallett):
- Claim the asset
- But if the asset has lost value, it might be better to take a charge over the property for the amount belonging to the trust
Explain the second equitable tracing rule on withdrawals from a mixed bank account? What the two main authorities?
First, use the rule in Re Hallet which states that the defendant spends his own money first. If the allocation of the withdrawals has been dissipated, use Re Oatway and assert a charge over the assets bought with the trust money.
Explain the third equitable tracing rule on mixed-asset purchase? What are the two options the claimant can claim from? What is the main authority?
Can claim either a lien over the asset for the amount of trust money used to purchase it or claim ownership of a proportion of the asset corresponding to the proportion of the purchase price contributed by the trust (Foskett v McKeown).
The question on the page originate from the summary of the following study material:
- A unique study and practice tool
- Never study anything twice again
- Get the grades you hope for
- 100% sure, 100% understanding
Remember faster, study better. Scientifically proven.
