Publisher Citation: [2002] All ER (D) 294 (Jan)
Court: Court of Appeal, Civil Division

Mummery, Dyson LJJ and Douglas Brown J

Representation James Behrens (instructed by Churchers, Fareham) for the claimant.
  Clifford Darton (instructed by Bennett Griffin & Partners, Worthing) for the second defendant.
  The first defendant did not appear and was not represented.
Judgment Dates: 31 January 2002


Solicitor - Duty - Conflict of interest - Acting for both parties in transaction - Loan transaction - Doctrine of abuse of confidence - Solicitor acting for lenders and borrower - Solicitor failing to disclose receipt of service charges from lenders - Borrower agreeing to loan and putting up surety - Surety being called in - Whether doctrine of abuse of confidence capable of applying in transactions where no transfer of property involved - Whether recission of surety only remedy available to court.

The Case

The doctrine of abuse of confidence was not limited to cases involving a transaction in which property passed. Where an abuse of confidence had led to a contract being entered into, that contract did not become unenforceable at law; rather, it was within the court's discretion to decide what remedy equity required.

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