Harstedt Pty Ltd v Tomanek

(2018) 55 VR 158; [2018] VSCA 84

Victorian Court of Appeal

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Interrogate

Catchwords

1. Equity
2. › Accessorial liability
3. › Knowing assistance
4. › Second limb of Barnes v Addy
5. › Elements of liability
6. › Knowledge requirement
7. › Baden scale of knowledge
8. › Whether third party had knowledge of essential facts constituting breach of trust
9. › Whether dishonesty by third party an element of knowing assistance
10. › Effect of Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89
1. Equity
2. › Accessorial liability
3. › Knowing assistance
4. › Second limb of Barnes v Addy
5. › Assistance requirement
6. › Whether third party assisted in dishonest and fraudulent design
7. › Whether corporate role and knowledge alone constitute assistance
8. › Whether conduct facilitated breach of trust
1. Trusts and Trustees
2. › Breach of trust
3. › Fraudulent breach of trust
4. › Knowing assistance
5. › Where corporate trustee committed fraudulent breach of trust
6. › Where director held liable but company secretary's claim dismissed
7. › Whether company secretary assisted trustee with knowledge of dishonest and fraudulent design
1. Appeal
2. › Fact finding
3. › Where finding based on documentary evidence
4. › Where appellate court in as good a position as trial judge
5. › Fox v Percy (2003) 214 CLR 118 applied

Quick Take

A third party's knowledge of a trustee's dishonest and fraudulent design, combined with a corporate role within the trustee entity, does not without more constitute 'assistance' under the second limb of Barnes v Addy. Active involvement facilitating the breach of trust must be demonstrated. Proof of absence of informed consent by the beneficiary is not an element of the plaintiff's case for knowing assistance; rather, the existence of such consent operates as a defence only. The question whether acquiescence or omission can constitute 'assistance' remains open.