Unjust Enrichment and Unlawful Dividends: A Step Too Far?

• Main Author: THAM, Chee Ho
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2005
• Subjects: Contracts
• Online Access: https://ink.library.smu.edu.sg/sol_research/741; http://dx.doi.org/10.1017/s0008197305006835
• Institution: Singapore Management University

Until recently, it was widely accepted that a recipient of company distributions such as dividends paid in breach of the requirements of the Companies Act 1985 (the Act) could only be made to repay such distributions if he knew of the illegality. Whether one looked to the Act (to wit, section 277) or beyond (to the knowing receipt-type liability encountered in Precision Dippings Ltd. v. Precision Dippings Marketing Ltd.), liability required knowledge. In Bairstow v. Queen’s Moat House plc, however, there appears to be the faintest of suggestions that this position may be open for re-examination. This is reinforced by Lord Nicholls’ recent speech in Criterion Properties Plc v. Stratford UK Properties LLC.