Speight v Gaunt
Encyclopedia
Speight v Gaunt LR 9 App Cas 1 is an English trusts law
case, concerning the extent of the duty of care owed by a fiduciary.
industrialist, had appointed Mr Isaac Gaunt and Mr Alfred Wilkinson as trustees for his estate in his will. The trustees employed a young broker, John Cooke, to invest £15,000 of the estate's money into company shares. The trustees gave over the money. The broker dishonestly took the money for himself, and gave excuses for the delays in getting the company shares. The truth only transpired when Cooke was declared bankrupt. The beneficiaries of Speight's trust sued Mr Gaunt for failing in his duty of care as a trustee.
Lindley LJ and Bowen LJ gave concurring judgments.
English trusts law
English trusts law is the original and foundational law of trusts in the world, and a unique contribution of English law to the legal system. Trusts are part of the law of property, and arise where one person gives assets English trusts law is the original and foundational law of trusts in the...
case, concerning the extent of the duty of care owed by a fiduciary.
Facts
Mr John Speight, a BradfordBradford
Bradford lies at the heart of the City of Bradford, a metropolitan borough of West Yorkshire, in Northern England. It is situated in the foothills of the Pennines, west of Leeds, and northwest of Wakefield. Bradford became a municipal borough in 1847, and received its charter as a city in 1897...
industrialist, had appointed Mr Isaac Gaunt and Mr Alfred Wilkinson as trustees for his estate in his will. The trustees employed a young broker, John Cooke, to invest £15,000 of the estate's money into company shares. The trustees gave over the money. The broker dishonestly took the money for himself, and gave excuses for the delays in getting the company shares. The truth only transpired when Cooke was declared bankrupt. The beneficiaries of Speight's trust sued Mr Gaunt for failing in his duty of care as a trustee.
Court of Appeal
Sir George Jessel MR held that because the trustee acted in the ordinary course of business, he was not liable to make good the loss occasioned by the embezzlement of the trust moneys by the broker. The key part of his judgment stated as follows.Lindley LJ and Bowen LJ gave concurring judgments.
House of Lords
The House of Lords upheld the Court of Appeal. Lord Blackburn said the following.See also
- English trusts lawEnglish trusts lawEnglish trusts law is the original and foundational law of trusts in the world, and a unique contribution of English law to the legal system. Trusts are part of the law of property, and arise where one person gives assets English trusts law is the original and foundational law of trusts in the...
- Morley v Morley (1678) 2 Cases in Chancery 2, 22 ER 817, Lord Nottingham LC
- Ex parte Belchier 27 ER 144; (1754) Amb 218, Lord Hardwicke LC