LEGAL RESEARCH PAPER SERIES

Paper No 65/2010 October 2010

When Do Fiduciary Duties Arise?

JAMES EDELMAN

(2010) 126 Law Quarterly Review 302–327

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 WHEN DO FIDUCIARY DUTIES ARISE?

This article considers when fiduciary duties arise. I explain that fiduciary duties
are simply particular terms which are expressed or implied into voluntary
(contractual and non-contractual) undertakings. I consider the development and
central role of the undertaking and show that the process of implication of terms
is identical to the process involved in determining whether fiduciary duties arise
in particular undertakings. I then examine each of the most well recognised
fiduciary duties and show how those duties are sometimes described as
“fiduciary” and sometimes described as “implied terms”.

I. Introduction

Lord Longford wrote of an occasion when he walked in the country with Stanley
Baldwin. Baldwin said to him, “There is one political thinker who has had more influence
on me than all others - Sir Henry Maine.” The influence, Baldwin explained, came from
Maine’s “supreme contribution”, in showing that human progress “was from status to
contract”. But then, according to Longford, Baldwin paused, “suddenly a look of
dawning horror… stole across his face. ‘Or was it,’ he said, leaning just a little towards
me, ‘or was it the other way round?”’1

Sir Henry Maine’s thesis is broadly the same argument made here in the context of
fiduciary duties. The argument is that we must move can only understand when fiduciary
duties arise if we conceive of them as obligations based upon manifestations of a
voluntary undertaking to another. By examining the corpus of cases involving fiduciary
duties we can see that the scope of those obligations depends upon the scope of this
express or implied undertaking. Fiduciary duties thus arise in the same manner as any
other express or implied term: by construction of the scope of voluntary undertakings.
They are not duties which are imposed by law nor are they necessarily referable to a
relationship or status. It is time to move from thinking of fiduciary duties as a matter of
status to understanding them as based upon consent.

This article is divided into three parts. The first part considers the origins of the word
“fiduciary” and the debate surrounding the relationships which should be treated as
fiduciary. The second part explains the meaning and nature of the concept of a voluntary
undertaking and shows why this concept is a necessary condition for any fiduciary duty.
The final part shows how the duties which are most commonly recognised as “fiduciary”
are expressed or implied duties in relationships arising by voluntary undertakings to
another.

1
F. Longford, Eleven at Number 10 (1984), at p.19.

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Constraints of space do not permit detailed consideration of the consequences of this
analysis. There are many. For instance, an analysis of fiduciary duties as terms expressed
or implied into voluntary undertakings explains why a contract can “modify” and
“mould” fiduciary duties2 and why fiduciary duties cannot be superimposed upon a
contract to alter its intended operation;3 it shows why fiduciary duties can be excluded by
agreement (express or implied);4 it elucidates the reason why a fiduciary duty which
arises in the context of a contractual undertaking cannot survive the termination of a
contract although an (imposed) duty of confidence can;5 it illustrates why cases where the
fiduciary duty is expressed or implied in a contractual relationship involve a choice of
law rule following the law which governs the contract;6 and it demonstrates why it is no
coincidence that a jurisdiction which recognizes exemplary damages for a breach of
contract also recognizes exemplary damages for a breach of fiduciary duty.7

Apart from this list of consequences, understanding fiduciary duties as terms expressed or
implied into voluntary undertakings also enables us to understand why the same difficult
remedial issues arise in relation to breach of contract and breach of fiduciary duty and
why each area is following the same pattern of development. Custodial fiduciaries who
promise to maintain an asset generally find themselves in the same position as defendants
who make a contractual promise. Their promised primary obligations might be enforced
specifically. It might also be enforced non-specifically by an order for payment of the
cost to ensure performance at the date of trial.8 In either case courts have held that
considerations of mitigation or remoteness of damage do not readily apply to these
obligations to perform.9 For both contractual and fiduciary duties, a claim for the cost of

2
Hospital Products Ltd v United States Surgical Corp (1984) 156 C.L.R. 41 at 102; Phipps v
Boardman [1967] 2 A.C. 46 at 123-125; Netherlands Society “Oranje” Inc v Kuys [1973] 1
W.L.R. 1126 PC at 1129-1130; Hilton v Barker Booth & Eastwood (a firm) [2005] UKHL 8;
[2005] 1 W.L.R. 567 at 575 [30].
3
Benedetti v Sawiris [2009] EWHC 1806 Ch D at [502].
4
Kelly v Cooper [1993] A.C. 205 (implied exclusion); Citibank NA v QVT Financial LP [2007]
EWCA 11 (express exclusion). Cf. Stevens v Premium Real Estate Ltd [2009] NZSC 15 at [77].
5
Attorney General v Blake [1998] Ch 439 CA at 453-455; Bolkiah (Prince Jefri) v KPMG (a firm)
[1999] 2 A.C. 222 HL at 235.
6
Dicey, Morris and Collins The Conflict of Laws, 14th edn, at p.1884; AG for England and Wales v
R [2002] 2 N.Z.L.R. 91.
7
Whiten v Pilot Insurance Company [2002] 1 S.C.R. 595; Norberg v Wynrib [1992] 2 S.C.R. 226.
See also J. Edelman, “Exemplary Damages for Breach of Contract” (2001) 117 LQR 539.
8
In relation to contract see Tabcorp Holdings v Bowen Investments Pty Ltd [2009] HCA 8; (2009)
83 A.L.J.R. 390 and Semelhago v Paramadevan [1996] 2 S.C.R. 415. See also B. Coote, “Contract
Damages, Ruxley and the Performance Interest” [1997] 56 C.L.J. 537. In relation to fiduciaries
who misapply property contrary to their promises to maintain it, ‘this obligation is ‘tantamount to
an obligation to effect restitution in specie’ Re Dawson [1966] N.S.W.R. 211 at 216. It is ‘an
equitable debt or liability in the nature of a debt’: Ex p Adamson (1878) 8 Ch. App. 807 CA at
819. See also J. Edelman and S. Elliott, “Money Remedies against Trustees” (2004) 18 T.L.I. 114.
9
Contract: Joyner v Weeks [1891] 2 Q.B. 31 CA; Mount v Oldham Corp [1973] QB 309 CA; Jervis
v Harris [1996] Ch 195 CA. Fiduciary duties: Re Dawson; Union Fidelity Trustee Co Ltd v
Perpetual Trustee Co Ltd [1966] 2 N.S.W.R. 211 at 215; Federal Court of Australia in
Commonwealth Bank of Australia v Smith (1991) 102 A.L.R. 453 at 459; Target Holdings v
Redferns [1996] 1 A.C. 421 HL at 434. See also S. Elliott ‘Remoteness Criteria in Equity’ (2002)
65 M.L.R. 588 at 591-593.

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correcting or ensuring performance will be refused if it is unreasonable.10 In both areas
damages are also available to compensate for losses suffered by the contracting party or
fiduciary subject to the usual rules of causation and remoteness. And in both areas
disgorgement of profits can be awarded where the defendant has expressly or impliedly
undertaken not to make a profit from his position. This disgorgement remedy is common
in fiduciary cases where such express or implied undertakings are usual, but, irrespective
of whether the defendant is characterized as a “fiduciary”, if the claimant has a
“legitimate interest in preventing the defendant’s profit making activity” then
disgorgement is also permitted at common law to deter a breach of that contractual11 or
other voluntarily undertaken obligation.12

II. The meaning of ‘fiduciary’

The word ‘fiduciary’ derives from the Latin fiducia which means trust or confidence.13 In
Roman law fiducia was a pactum, an “appendage to a conveyance”.14 Its primary use was
a direction to the holder of property concerning that person’s obligations in relation to the
property. One such example was fiducia cum amico,15 an institution which still exists in
Civilian jurisdictions,16 in which a person receives assets subject to an obligation to deal
with them in a particular way, in good faith.

The classic English exposition of the fiduciary concept has relied upon the “status” of the
defendant. The exemplar of a fiduciary is often said to be a trustee.17 Company directors
were considered to be an obvious extension given the power they have to deal with
company property.18 But early in the development of fiduciary law it was clear that the
notion of a fiduciary had extended so far beyond this analogy that this “status”
conception of a fiduciary could no longer have any real explanatory power. Fiduciary
duties have been recognized between parties despite the absence of any proprietary
connection: lawyer to client,19 doctor to patient,20 partner to partner,21 bailee to bailor,22

10
Breach of contract: Tabcorp Holdings v Bowen Investments Pty Ltd [2009] HCA 8; (2009) 83
A.L.J.R. 390 at [17] explaining passages in Ruxley v Forsyth [1996] 1 A.C. 344 HL at 358, 360.
Breach of fiduciary duty: P. Millett, “Equity’s Place in the Law of Commerce” (1998) L.Q.R. 214
at 224 and Bairstow v Queen’s Moat Houses [2001] 2 B.C.L.C. 531 CA at 105 [53] discussing the
refusal to award the money cost of ensuring performance in Target Holdings v Redferns [1996] 1
A.C. 421.
11
Attorney General v Blake [2001] 1 A.C. 268 HL at 285.
12
Boston Deep Sea Fishing and Ice Co v Ansell (1888) LR 39 Ch D 339 CA, especially at 367-8
Bowen L.J. describing the common law disgorgement of profits as arising by “implied contract”.
13
J. Morwood (ed.) Pocket Oxford Latin Dictionary (2001), at p.56; Oxford English Dictionary, 2nd
edition (1989), definition 3: “Of the nature of, proceeding from, or implying trust or reliance”.
14
W. Buckland, A Textbook of Roman Law , 3rd edition (1966), at p.431.
15
G. 2.60.
16
G. Gretton, “Trusts without equity” (2000) 49 I.C.L.Q. 499 at 501.
17
P. Birks, “The Content of Fiduciary Obligation” (2002) T.L.I. 34.
18
Regal (Hastings) Ltd v Gulliver [1967] 2 A.C. HL 134.
19
Maguire v Makaronis (1997) 188 C.L.R. 449.
20
Norberg v Wynrib [1992] 2 S.C.R. 226; Breen v Williams (1996) 186 C.L.R. 71 (Gaudron,
McHugh and Gummow JJ; Contra Brennan CJ, Dawson and Toohey JJ.
21
Helmore v Smith (1886) 35 Ch. D 436 CA at 444.
22
Hallett’s Estate; Knatchbull v Hallett (1879) 13 Ch. D. 696 CA at 709.
stockbroker to client,23 joint venturer to joint venturer,24 parent to child,25 the State to its
Aboriginal people26 and many others. By 1885, Field J. was prepared to say that “the
fiduciary relation, as it is called, does not depend upon any particular circumstances. It
exists in almost every shape.”27

As the recognition of fiduciary relationships expanded, contradictory theories of fiduciary

duties were proposed. For instance, the expansion of fiduciary duties was decried by
some who warned of the advance of fiduciary law into the commercial arena as having
the potential to “paralyse the trade of the country and fundamentally affect the security of
business transactions”.28 But others applauded it as “part of a pervasive policy of the law
to protect the integrity of commercial organizations”.29 Some sought to rationalize and
explain the modern conception of fiduciary duties by reference to its etymology of
“trust”, “faith” and “vulnerability”.30 But others observed that “trust” is not a necessary
condition for the presence of a fiduciary relationship31 and that the word “fiduciary” with
its etymology of “trust” and “faith” is manifestly unstable.32 Amidst this confusion and
conflict, most commentators and judges are agreement on one matter: the quest to define
fiduciary relationships “continues without evident sign of success”.33 As Fletcher
Moulton L.J. said almost a century ago “[t]here is no class of case in which one ought
more carefully to bear in mind the facts of the case”.34

III. Voluntary undertakings (objectively manifested)

A. Concurrent development of voluntary undertakings at common law and in equity

23
Daly v Sydney Stock Exchange Ltd (1986) 160 C.L.R. 371.
24
United Dominions Corporation Ltd v Brian Pty Ltd (1985) 157 C.L.R. 1; Chirnside v Fay [2006]
NZSC 58; [2007] 1 N.Z.L.R. 433.
25
M(K) v M(H) [1992] 3 S.C.R. 6; Plowright v Lambert (1885) 52 L.T. 646 at 652; Clay v Clay
(2001) 202 C.L.R. 410.
26
Guerin v R [1984] 2 S.C.R. 335.
27
Plowright v Lambert (1885) 52 L.T. 646 at 652.
28
A. Mason, “The Place of Equity and Equitable Remedies in the Contemporary Common Law
World” (1994) 110 L.Q.R. 238 at 245, citing Manchester Trust v Furness [1895] 2 Q.B. 539 CA at
545 and In Re Wait [1927] 1 Ch 606 CA at 634.
29
E. Weinrib, “The Fiduciary Obligation” (1975) 25 Univ. Toronto Law Rev. 1 at 15.
30
Tate v Williamson (1866) LR 2 Ch. App. 55 at 61; Permanent Building Society v Wheeler (1994)
14 A.C.S.R. 109 at 158; Bristol and West Building Society v Mothew [1998] Ch 1 CA at 18.
31
Hospital Products Ltd v United States Surgical Corporation (1984) 156 C.L.R. 41 at 69, 141–142;
White v Jones [1995] 2 A.C. 207 HL at 271–273; Breen v Williams (1996) 186 C.L.R. 71 at 93;
F.W. Maitland, Equity: A Course of Lectures, rev edn, (1936), at 42–43.
32
P. Birks, “The Content of Fiduciary Obligation” (2002) T.L.I. 34 at 52.
33
P. Millett, “Equity's Place in the Law of Commerce” (1998) 114 L.Q.R. 214 at 219; A. Mason,
‘The Place of Equity and Equitable Remedies in the Contemporary Common Law World’ (1994)
110 LQR 238 at 246. See also D. Klinck, “The Rise of the Remedial Fiduciary Relationship”
(1988) 33 McGill L.J. 600 at 603; R. Austin, “Commerce and Equity-Fiduciary Duty and
Constructive Trust” (1986) 6 O.J.L.S. 444 at 445.
34
Re Coomber [1911] 1 Ch 723 CA at 728-729.
The most obvious class of obligations based upon voluntary undertakings is contract or
agreement.35 However, there are other common sources of voluntary undertakings which
create binding obligations. One example is a unilateral deed. A (non-contractual) deed
can take effect even if the object of the promise was not aware of it.36 Another example is
the obligation that arises as a result of a unilateral undertaking, made without
consideration. This is the broadest category of voluntary assumed undertaking and the
most common example of a non-contractual undertaking.

Prior to the decision Derry v Peek37 there was a conflict between common law and equity
in relation to whether statements made by a defendant could include an implied voluntary
undertaking to take care. The common law position was that a claimant who misstated a
fact to a defendant never impliedly undertook that care had been taken in making the
statement.38 The equitable position was that he had so undertaken and could be liable for
negligence.39 When the Court of Appeal was dominated by common law judges, it upheld
the common law rule. But as those judges were promoted to the House of Lords and
equity judges began to be appointed to the Court of Appeal the equitable rule was
reinstated by that court.40 In Derry v Peek the matter came before the House of Lords.
Directors had made careless misrepresentations in the company prospectus asserting that
the company had the right to use steam power. Relying upon these representations the
claimant had purchased shares. The claimant’s case was based upon deceit at common
law and the House of Lords adopted the common law position and rejected the argument
that liability could be imposed for honest but careless statement.41

For some time after Derry v Peek it was thought that “in the absence of contract, an
action for negligence cannot be maintained when there is no fraud”.42 The effect of Derry
v Peek was to put pressure on the concept of consideration in contract. Courts stretched
the idea of consideration to impose liability for careless performances of unilateral
undertakings. For instance, in De la Bere v Pearson,43 a newspaper owner offered to give
financial advice to anyone who wrote to the editor. The Court of Appeal held that a
contract “to take reasonable care in the nomination of a broker” had been formed when
the claimant wrote to the editor. Writing about this decision, Sir Frederick Pollock
remarked that perhaps “the cause of action is better regarded as arising from default in
the performance of a voluntary undertaking independent of contract.”44

35
The most famous proponent of this view is Professor Atiyah who argued that promises are merely
a species of consent: P. Atiyah, Promises, Morals and Law (1983), at p.178.
36
Xenos v Wickham (1867) L.R. 2 H.L. 296 at 312; Macedo v Stroud [1922] 2 A.C. 330 at 337; E.
Peel (ed.), Treitel’s Law of Contract, 12th edn., (2007) at p.171.
37
(1889) L.R. 14 App. Cas. 337.
38
Taylor v Ashton (1843) 11 M. & W. 401; Ormrod v Huth (1845) 14 M. & W. 651.
39
Burrowes v Locke (1805) 10 Ves. 470. Cf Evans v Bicknell (1801) 6 Ves. 74.
40
Common law: Weir v Bell (1878) 3 Ex. D. 238; Equity: Smith v Chadwick (1882) 20 Ch. D. 27.
See C. Reed, “Derry v Peek and Negligence” (1987) Journal of Legal History 64.
41
See especially (1889) LR 14 App. Cas. 337 at 352 (Lord Bramwell).
42
Le Livre v Gould [1893] Q.B. 491 at 498 (Lord Esher M.R.). The effect of the decision in Derry v
Peek in relation to directors’ liability for careless misstatements in prospectūs was quickly
reversed by statute: Directors’ Liability Act 1890.
43
[1908] 1 K.B. 280.
44
F. Pollock, Principles of Contract, 10th edn (1936) at p.173.
The first direct inroad into Derry v Peek came twenty five years later in Nocton v Lord
Ashburton.45 A solicitor, Nocton, negligently advised Lord Ashburton to release part of a
first mortgage security leaving one of Lord Ashburton’s debts inadequately secured.
Nocton had a second mortgage over the land from which Lord Ashburton had released
part of his prior security. Lord Ashburton sued Nocton when, upon default, his security
proved inadequate. The trial judge found that Nocton did not know that this would be the
consequence, nor was he reckless. He had simply been careless. The House of Lords
rejected Nocton’s argument that deceit was the only action pleaded against him. Lord
Haldane LC (with whom Lord Atkinson concurred and Lord Dunedin expressed
agreement) was the most circumspect. Prior to giving his decision Lord Haldane had told
Frederick Pollock that to minimise the consequences of Derry v Peek, “the Lords are
going to hold that it does not apply to the situation created by a positive fiduciary duty
such as a solicitor’s, in other words, go as near as they dare to saying it was wrong, as all
in Lincoln’s Inn thought at the time.”46 In ordering Nocton to pay compensation, Lord
Haldane LC explained that he would be “sorry to be thought to lend countenance to the
idea that recent decisions have been intended to stereotype the cases in which people can
be held to have assumed such a special duty.”47 He remarked that the “special duty”
which gave rise to Nocton’s liability might arise from “an implied contract at law” or a
“fiduciary obligation in equity”.48 These remarks were later seized upon by the House of
Lords half a century later as evidence that Lord Haldane LC did not intend to confine the
principle of liability for carelessness in a voluntary undertaking to cases of fiduciary
relationships in equity.49 As will be explained below, the recognition of fiduciary duties
and the implication of terms involve an identical process. In contrast with Lord Haldane
LC, Lord Shaw of Dunfermline was the least circumspect in relation to Derry v Peek.
Lord Shaw explained that liability in Nocton arose simply because “it was a matter
equivalent to contract”.50 Lord Shaw relied upon an argument made by Sir Roundell
Palmer (the later Lord Selborne LC) in Peek v Gurney51 that “there was such a proximate
relation between himself and the person making the representation as to bring them
virtually into the position of parties contracting with each other”.52 In other words, the
circumstances between the parties were such that Nocton had impliedly promised to take
care in undertaking his work for Lord Ashburton.

The direct analysis of Lord Shaw was the approach taken in 1964 at common law in the
well known decision of Hedley Byrne & Co Ltd v Heller and Partners.53 Advertising
agents had asked their bankers for a customer references. The bankers gave a favourable,
and gratuitous, reference although stipulating that it was given ‘without responsibility’.

45
[1914] A.C. 932 HL.
46
M. Howe (ed) Holmes-Pollock Letters (1961) at p.215. The letter was written on 20 May 1914;
Nocton was decided on 19 June 1914.
47
[1914] A.C. 932 HL at 948.
48
[1914] A.C. 932 HL at 955.
49
Hedley Byrne & Co Ltd v Heller and Partners [1964] A.C. 465 HL.
50
[1914] A.C. 932 HL at 972.
51
(1873) L.R. 6 H.L. 377.
52
[1914] A.C. 932 HL at 971-972.
53
[1964] A.C. 465 HL.
The extension of credit in reliance upon this reference caused the advertising agents
£17,000 of losses when the customer was unable to pay. The House of Lords
unanimously held that but for the disclaimer of responsibility the bankers would have
been liable to the advertising agents. Their potential liability arose because they had
voluntarily assumed responsibility for the reference. Relying upon the reasoning of
McNair J. at first instance, counsel for the bankers had objected that to recognise an
obligation to take care would be to impose a contractual warranty in the absence of a
contract.54 This objection was ignored. Lord Devlin gave a compelling example:55

“If irrespective of contract, a doctor negligently advises a patient that he can

safely pursue his occupation and he cannot and the patient's health suffers and he
loses his livelihood, the patient has a remedy. But if the doctor negligently advises
him that he cannot safely pursue his occupation when in fact he can and he loses
his livelihood, there is said to be no remedy. Unless, of course, the patient was a
private patient and the doctor accepted half a guinea for his trouble: then the
patient can recover all. I am bound to say, my Lords, that I think this to be
nonsense.”

Hedley Byrne provides a clear example which shows that “contract” does not exhaust the
category of promises or undertakings having legal effect.56 Where the issue involves a
failure to take care or skill the only question is whether there has been a voluntary
assumption of responsibility to the defendant in the performance or undertaking of a
task.57 The voluntary assumption of responsibility might be as a result of a contract, it
might be contained within a unilateral deed or it might simply be an informal undertaking
intended to be binding.58 The category of these Hedley Byrne informal undertakings is
not limited to spoken words. The undertakings can arise in any relationship. In
Henderson v Merrett Syndicates Ltd (No 1)59 Lord Browne-Wilkinson said that “the duty
of care imposed on bailees, carriers, trustees, directors, agents and others is the same
duty: it arises from the circumstances in which the defendants were acting, not from their
status or description. It is the fact that they have all assumed responsibility for the
property or affairs of others which renders them liable for the careless performance of
what they have undertaken to do.”

There is debate about whether a gratuitous undertaking or promise, which is not relied
upon, should create an obligation. There were suggestions in Hedley Byrne that reliance
is essential,60 but it was not made clear whether this was required as part of proving

54
[1964] A.C. 465 HL at 475.
55
[1964] A.C. 465 HL at 517.
56
E. Peel (ed.), Treitel’s Law of Contract, 12th edn (2007) at p. 80.
57
See now Hamilton v Allied Domecq plc [2007] UKHL 33; 2007 S.C. (H.L.) 142 at [23].
58
Treating tortious obligations as those imposed by law, the liability arising from voluntary
undertakings was described by Sir Joseph Beale in 1891 as neither contract nor tort: J. Beale
“Gratuitous Undertakings” (1891) 5 Harv. Law Rev. 222 at 222.
59
[1995] 2 A.C. 145 HL at 205.
60
[1964] A.C. 465 HL at 502-503 (Lord Morris) 514 (Lord Hodson).
causation of loss or as part of the duty.61 The better view is that reliance is not an
essential element of the duty itself but is required to prove causation of loss.62 For
instance, the creation of a deed obliges the promisor to fulfill the promises under seal
even if the promisee is unaware of the deed and does not rely upon it. So too, a promisor
is obliged to compensate for losses arising from gratuitous undertakings made without the
form of a deed but with the intention to be bound.63

B. Voluntary undertakings as a necessary condition of fiduciary obligation

We can begin with fiduciary obligations which arise in a commercial context. There are
many examples of fiduciary obligations which arise in the commercial context. These
obligations always require a pre-existing relationship with a voluntary undertaking by the
fiduciary. Perhaps the most common examples where commercial relationships can be
recognized as fiduciary are joint ventures.64 An example is Chirnside v Fay.65 In that case
the claimant and defendant property developers had discussed the prospect of jointly
developing two sites. When relations deteriorated between the two, the defendant
proceeded with the developments to the exclusion of the claimant. The developments
were a success, making a profit in excess of a million dollars. The Supreme Court of New
Zealand held that the profit had been made in breach of the fiduciary duty owed by the
defendant to the claimant. In the leading judgment, Blanchard and Tipping JJ said that
“the essence of a joint venture which is not yet contractual is that it is an arrangement or
understanding between two or more parties that they will work together towards
achieving a common objective.”66

The classic English decision on fiduciary duties in a commercial context is Boardman v

Phipps.67 A solicitor to a will trust and a beneficiary under the will trust became aware,
through their positions as solicitor and beneficiary, of the operations of a company in
which the trust held shares. They represented the trust at the general meeting of the
company and in negotiations with the company. They were dissatisfied with the way the
company was run and thought that it should be taken over. The trust could not afford to
make a take over bid for the company so the solicitor and beneficiary made the bid
themselves. They succeeded. The House of Lords held, by majority, that the solicitor and
beneficiary had breached their fiduciary duties to the company in purchasing the shares
because they had not obtained fully informed consent. They were held liable to account

61
Cf J. Raz, “Promises in Morality and Law” (1982) 95 Harv. Law Rev. 916, who argues that
gratuitous promises should not be binding in the absence of reliance because enforcement of
promises serves only the purpose of protecting the institution of promising.
62
White v Jones [1995] 2 A.C. 207. Cf Sandhar v Department of Transport [2004] EWCA Civ 1440;
[2005] 1 W.L.R. 1632.
63
The category of gratuitous bailments is a good example. See also R Stevens Torts and Rights
(2007) at p.14-15.
64
‘Joint venture’ is not a technical term and it encompasses associations of person for many different
purposes: United Dominions Corporation Ltd v Brian Pty Ltd (1985) 157 C.L.R. 1 at 10-11. The
term has been criticized for its breadth: Maruha Corp v Amaltal Corp [2007] NZSC 40; [2007] 1
N.Z.L.R. 608 at [20].
65
Chirnside v Fay [2006] NZSC 58; [2007] 1 N.Z.L.R. 433.
66
Chirnside v Fay [2006] NZSC 58; [2007] 1 N.Z.L.R. 433.
67
[1967] 2 A.C. 46 HL.
for their profits. All the courts in Boardman v Phipps held that a fiduciary relationship
arose. Unfortunately, the focus was not on the voluntary undertaking but, instead, upon
the status of the relationship as one of agency. The trial judge, Wilberforce J., 68 and the
Court of Appeal69 held that the beneficiary and solicitor both owed fiduciary duties since
they had represented the trust as self-appointed agents at the company meeting. But a
majority of the House of Lords, expressed doubts as to whether the beneficiary and
solicitor were really agents. Lord Cohen observed that they were not “general agents”;
they were only agents in the “special” or “limited” sense that they had held themselves
out as agents for company business. Lord Cohen relied upon the circumstances generally
to impose the duty.70 Lord Guest also found it difficult to describe them as agents and
preferred to base his decision on the “special position which was of a fiduciary character
in relation to the negotiations… relating to the trust shares.”71 As Professor Reynolds has
argued, “[a] crucial reason seems to have been that [they] purported, at any rate initially,
to be acting for the trust: there was certainly no pre-existing agency relationship.”72 In
other words, although dressed in the language of agency, the essence of the reasoning
was that the beneficiary and solicitor had undertaken responsibility for the affairs of the
claimants.73

Outside the commercial context it is occasionally suggested that a fiduciary relationship

can exist without an undertaking by the defendant towards the claimant. This suggestion
was made by the Supreme Court of Canada in M(K) v M(H).74 In that case a 28 year old
claimant sued her father for sustained sexual battery while she was a child. There was no
doubt that the father had committed the tort of battery.75 The duty not to commit battery
was imposed upon him by law: it was no different from the duty any other person owed
to the claimant. The father was also held liable for breach of fiduciary duty. This was not
merely duplicating the tortious duty. It was, as the Supreme Court of Canada said, an
obligation which depended upon “the factual context of the relationship in which it
arises”.76 In that case, the factual context was the father’s voluntary undertaking of
responsibility for his daughter. However, in the course of his leading judgment, La Forest J.
suggested in obiter dicta that “fiduciary obligations are imposed in some situations even in
the absence of any unilateral undertaking by the fiduciary”.

Although La Forest J. did not explain the circumstances in which he considered that
fiduciary obligations might be imposed in the absence of an undertaking by the fiduciary
the relationship of parent and child in that case might have informed his comment. For
68
[1964] 1 W.L.R. 993 at 1007.
69
[1965] Ch. 992 CA at 1017 (Lord Denning M.R.), 1022 (Pearson L.J.), 1031 (Russell L.J.).
70
[1967] 2 A.C. 46 HL at 103.
71
[1967] 2 A.C. 46 HL at 118.
72
F. Reynolds (ed.), Bowstead and Reynolds on Agency, 18th edition (2006) p.230, fn 89.
73
Lyell v Kennedy (1889) 14 App. Cas. 437 HL; English v Dedham Vale Properties Ltd [1978] 1
All E.R. 382 at 397; Phipps v Boardman [1965] Ch. 992 CA at 1017-1019 (Lord Denning M.R.)
1030 (Pearson L.J.).
74
[1992] 3 S.C.R. 6.
75
The limitation period for the tort was extended until the time of discoverability which was
considered to be when the claimant began therapy.
76
In the joint reasons of La Forest, Gonthier, Cory and Iacobucci JJ, with which L’Hereux-Dubé,
Sopinka and McLachlin JJ agreed on this point,
instance, it might be thought that a custodial relationship of parenthood could not give
rise to a voluntary, unilateral undertaking if a person found the obligations of parenthood
thrust upon him and did not consider adoption to be a genuine option. The answer to this
objection is that voluntary undertakings are assessed by objective manifestations of
conduct not by subjective thoughts. Custodial parents manifest an undertaking of
responsibility for their children irrespective of any subjective or inner conflict which they
may have over their role. This is why there is no difference between those who become
parents by procreative choice and those for whom custodial parenthood was not chosen,
cases involving foster parents, and cases involving guardianship including where the
State takes children into its care.77 All manifest an undertaking towards the child and all
are treated alike. The obligations arise because of the manifestations of the undertaking,
not because of the mere fact of parenthood (which might, or might not, be custodial). The
mere fact of parenthood only gives rises to statutory obligations; the common law or
equity never imposes duties simply from parenthood.78

The notion that the construction of a voluntary undertaking is based only upon objective
manifestations is most clear in the law of contract. Contractual obligations arise based
upon what “would objectively be conveyed by what was said or done, having regard to
the circumstances in which those statements and actions happened.” They do not involve
“a search for the uncommunicated subjective motives or intentions of the parties.”79 The
same is true for such undertakings in a fiduciary context. For instance, in Eves v Eves80
the defendant led the claimant to believe that title to the house in which they lived was
held on trust for her and that her name was not only the title only because she was under
the age of 21. Subjectively, the defendant never intended to create a trust. But his
subjective intentions were irrelevant. As Lord Denning said, “he should be judged by
what he told her — by what he led her to believe — and not by his own intent which he
kept to himself.”81

It is, of course, undeniably true that obligations are sometimes imposed on fiduciaries in the
absence of unilateral undertakings. But these obligations are imposed upon everyone. They
cannot be meaningfully described as fiduciary. Obligations not to assault another, not to
batter another, not to defame another, not to trespass on another’s land, not to breach
another’s confidence, are all examples of obligations imposed in the absence of any
manifest undertaking of responsibility. Perhaps all that La Forest J. meant in M(K) v M(H)

77
Trevorrow v South Australia (No 5) (2007) 98 S.A.S.R. 136. Such an undertaking cannot be
construed simply from a statutory power to deal with surrendered indigenous land: Guerin v R
[1984] 2 S.C.R. 335.
78
“[P]arenthood is not itself the source of the duty”: Surtees v Royal Borough of Kingston upon
Thames [1992] P.I.Q.R. 101 at 121 (Beldam L.J., dissenting only on the issue of breach of duty)
quoting Hahn v Conley [1971] 45 A.L.J.R. 631 at 635 (Barwick CJ). See also McCallion v Dodd
[1966] N.Z.L.R. 710 at 718-721 and all the authorities cited there. Cf R Stevens Torts and Rights
(2007) at p.15.
79
Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95 at 105-
106 [25] (Gaudron, McHugh, Hayne and Callinan JJ).
80
[1975] 1 WLR 1338.
81
[1975] 1 WLR 1338 at 1342.
was that the existence of a fiduciary relationship could not alter these imposed duties.
Indeed, McLachlin J. (who agreed with La Forest J.) had earlier said in Norberg v Wynrib,82

“Although fiduciary relationships may properly be recognized in the absence of

consent by the beneficiary -- the consent of a child to his or her parents' acting in a
fiduciary capacity for the child's benefit is not required -- they are more typically the
product of the voluntary agreement of the parties that the beneficiary will cede to the
fiduciary some power, and are always dependent on the fiduciary's undertaking to
act in the beneficiary's interests.”

The starting point for an understanding of fiduciary duties is therefore the necessity of
such a voluntary undertaking. As Professor Scott said in 1949, a fiduciary is “a person
who undertakes to act in the interest of another person. It is immaterial whether the
undertaking is in the form of a contract. It is immaterial that the undertaking is
gratuitous.”83 The next question is how fiduciary duties become part of that undertaking.

IV. Terms expressed or implied in voluntary undertakings

A. Implication of terms generally

We have seen that voluntary undertakings can be either contractual or non-contractual.

Terms in those undertakings can also be express or implied. Hedley Byrne is a typical
example of the latter. The decision shows that terms such as an undertaking of care and
skill will be implied into the undertaking, unless the circumstances show that the parties
could not reasonably be taken to have intended to include such a term. These
circumstances include cases where responsibility is disclaimed, or where the undertaking
is “made in jest, or on social, political or special occasions”.84

The Privy Council has recently consolidated the traditional verbal formulations for
implied terms into a single statement.85 In Attorney General of Belize v Belize Telecom
Ltd86 the issue concerned the construction of articles of association of the respondent
company which was formed to take over telecommunications in Belize. Treating the test
for implication of terms as nothing more than an exercise in construction,87 Lord
Hoffmann said that an implied term is “not necessarily or always what the authors or
parties to the document would have intended. It is the meaning which the instrument
82
Norberg v Wynrib [1992] 2 SCR 226. See also Galambos v Perez [2009] SCC 48 at [69].
83
A. Scott, “The Fiduciary Principle” (1949) 37 Calif. Law Rev. 539 at 544.
84
Magill v Magill [2006] H.C.A. 51; (2006) 226 C.L.R. 551 at [212] (Heydon J.); Tackey v McBain
[1912] A.C. 186 at 189, 193.
85
The traditional test derives from the Privy Council in BP Refinery (Westernport) Pty Ltd v Shire of
Hastings (1977) 180 C.L.R. 266 at 282-283 where Lord Simon recognised five factors “which
may overlap”: “(1) (the implication) must be reasonable and equitable; (2) it must be necessary to
give business efficacy to the contract, so that no term will be implied if the contract is effective
without it; (3) it must be so obvious that ‘it goes without saying’; (4) it must be capable of clear
expression; (5) it must not contradict any express term of the contract.”
86
[2009] U.K.P.C. 10; [2009] 1 W.L.R. 1988.
87
Mediterranean Salvage & Towage v Seamar Trading & Commerce "The Reborn" [2009] EWCA
Civ 531 at [15].
would convey to a reasonable person having all the background knowledge which would
reasonably be available to the audience to whom the instrument is addressed.” Lord
Hoffmann emphasised that the various verbal formulae involved in the search for an
implied term are not independent criteria but instead should be seen as issues of
construction of the agreement and the surrounding circumstances. A leading decision
such as The Moorcock88 now needs to be read in the light of this statement. In that case
the defendants contracted with the claimant shipowner to allow the shipowner to
discharge cargo at their jetty. When the ship landed at the jetty it sustained damage as a
result of the uneven nature of the riverbed. The defendants were found to have breached a
term implied in their contract that they had take reasonable care to ensure that the
riverbed was reasonably fit for the purpose promised. Bowen L.J. said that the
implication “is to give such business efficacy to the transaction as must have been
intended at all events by both parties who are business men”.89 Lord Hoffmann’s
approach replaces such a verbal formulation with the simple test of construction which
asks what terms a reasonable person would have intended.

Implied terms therefore arise where one party asserts that despite the absence of express
words in a contract, the manifested intention of the parties (as construed by a reasonable
person) was to include such a term. In relation to implying terms into a contract, the focus
is upon “the language of the contract itself, and the circumstances under which it is
entered into”.90 Lord Hoffmann’s reasonable person ought to reach the same conclusion
as the “officious bystander”: “if, while the parties were making their bargain, an officious
bystander were to suggest some express provision for it in their agreement, they would
testily suppress him with a common 'Oh, of course!”’.91 Although it is sometimes said
that the officious bystander represents the presumed intention of the parties,92 this is not
accurate. A presumption arises where “common experience [shows] that when one fact
exists, another fact also exists.”93 In contrast, the officious bystander approach to
implication of terms involves proof of a single fact (the manifested intention of the
parties) by evidence of the contract terms and surrounding circumstances. If it were truly
a presumption of (subjective) intention then it could be rebutted by evidence of subjective
state of mind to the contrary. It cannot. This point was made by Lord Steyn when he said
that an implied term “is not critically dependent on proof of an actual [subjective]
intention of the parties. The process "is one of construction of the agreement as a whole
in its commercial setting.”94

88
(1889) L.R. 14 P.D. 64 CA.
89
(1889) L.R. 14 P.D. 64 CA at 68 (Bowen L.J.).
90
Hamlyn & Co v Wood & Co [1891] 2 Q.B. 488 CA at 494 (Kay L.J.).
91
Southern Foundaries (1926) Ltd v Shirlaw [1939] 2 K.B. 206 CA at 227 (Mackinnon L.J.);
affirmed on appeal ([1940] A.C. 701 HL). See also Luxor (Eastbourne) Ltd v Cooper [1941] AC
108 HL at 137 (Lord Wright).
92
E. Peel (ed.), Treitel’s Law of Contract , 12th edition, (2007) at p.225; Chitty on Contracts, 29th
edition (2004) at p.774 [13-004]; Ashmore v Corporation of Lloyds (No 2) [1992] 2 Lloyd’s Rep.
620 at 626 (Gatehouse J.).
93
Calveley v Green (1984) 155 C.L.R. 242 at 264.
94
Equitable Life Assurance Society v Hyman [2002] 1 A.C. 408 HL at 459 citing Banque Bruxelles
Lambert SA v Eagle Star Insurance Co Ltd [1997] A.C. 191 HL at 212.
The same construction approach also explains why courts can have regard to evidence of
previous dealing or of an existing custom.95 In these cases a term can be implied even if
it was not expressed by the parties themselves on the particular occasion because a
reasonable person in those circumstances would expect such a term to be included.96 This
evidence of general custom is therefore subject to any contrary intention which might be
manifest in the contract or undertaking on the relevant occasion,97 such as by using
language inconsistent with the custom.98 Although there remains controversy about the
relationship between different tests for implication of terms in fact,99 each of the
approaches should now be seen as directed to the single question of determining the
manifested intention of the parties.100

B. Expression and implication of fiduciary duties

More than 30 years ago Dr Finn (now Justice Finn), in a passage subsequently adopted by
the Court of Appeal, said that a person “is not subject to fiduciary obligations because he
is a fiduciary; it is because he is subject to them that he is a fiduciary.”101 To put this
another way, the label “fiduciary” is a conclusion which is reached only once it is
determined that particular duties are owed. This article does not enter the debate about
which duties must be owed in a voluntary undertaking before a person can be said to be a
“fiduciary”.102 The focus is instead upon explaining why those duties which are usually
characterized as fiduciary will arise: (a) a fiduciary must not to put himself in a position
of conflict103 without informed consent, (b) a fiduciary must not to make a profit from his
position without informed consent; (c) a fiduciary must act in the best interests of the
beneficiary; and (d) a fiduciary must act in good faith. Some or all of these duties have
been described as “the irreducible core of the fiduciary obligation”.104 The reason that
this article does not need to engage in the debate about whether these, or any other duties,
are fiduciary is because the thesis here is simply that fiduciary duties arise when they are
expressed or implied into voluntary relationships. Therefore, it does not matter which
duties are described as fiduciary because they arise in the same manner as any other duty.
It is, therefore, necessary to show that the duties commonly recognized as fiduciary are

95
Produce Brokers Co Ltd v Olympia Oil and Cake Co Ltd [1916] 1 A.C. 314 HL at 324.
96
Reynolds v Smith (1893) 9 T.L.R. 494.
97
London Export Corp Ltd v Jubilee Coffee Roasting Co Ltd [1958] 1 W.L.R. 661 CA at 675;
Danowski v Henry Moore Foundation [1996] E.M.L.R. 364 CA.
98
Produce Brokers Co Ltd v Olympia Oil and Cake Co Ltd [1916] 1 A.C. 314 HL at 324 (Lord
Atkinson).
99
E. Peel (ed), Treitel’s Law of Contract, 12th edition (2007) at p.225.
100
See, e.g., Marcan Shipping (London) Ltd v Polish Shipping Co [1989] 2 Lloyd’s Rep. 138 CA at
143 (Bingham L.J.).
101
Bristol & West Building Society v Mothew [1998] Ch. 1 CA at 18. See P. Finn, Fiduciary
Obligations (1977) at p.2. See also Galambos v Perez [2009] SCC 48 at [37].
102
Including whether those duties are ‘proscriptive’ only: Pilmer v Duke Group Ltd (In Liq) [2001]
HCA 31; 207 C.L.R. 165 at [74]; Friend v Brooker [2009] HCA 21 at [86]. Cf J D Heydon ‘Are
the Duties of Company Directors to Exercise Care and Skill Fiduciary?’ in S. Degeling and J.
Edelman (eds.), Equity in Commercial Law (2005).
103
Between duty to the principal and self-interest or duty to two principals.
104
E. Weinrib, “The Fiduciary Obligation” (1975) 25 Uni. Toronto L.J. 1 at 16; M. Conaglen. “The
Nature and Function of Fiduciary Loyalty” (2005) 121 L.Q.R. 452 at 459.
expressed or implied into voluntary relationships by the standard principles of
construction and implication.

In Bristol & West Building Society v Mothew,105 in a passage which has been cited with
approval on many occasions,106 Millett L.J. described the four fiduciary duties above107
as duties of loyalty which are “special to fiduciaries” and explained that such duties arise
when “someone…has undertaken to act for or on behalf of another in a particular matter
in circumstances which give rise to a relationship of trust and confidence.”108 Essentially
the same approach is taken elsewhere in the Commonwealth. In the leading Australian
case of Hospital Products Ltd v United States Surgical Corp109 Mason J. said, in an often
cited passage, that fiduciary duties arise when there is an “undertaking or agreement by
the fiduciary to act for or on behalf of or in the interests of another person” and that “[i]t
is partly because the fiduciary's exercise of the power or discretion can adversely affect
the interests of the person to whom the duty is owed and because the latter is at the mercy
of the former that the fiduciary comes under a duty to exercise his power or discretion in
the interests of the person to whom it is owed.” 110 The Canadian courts have also
explained that in determining which duties will be part of a voluntary undertaking the
same factors (which, although said to be neither necessary nor sufficient are sometimes
applied mechanically)111 are important: the scope for exercise of discretion or power by
the fiduciary, the ability of a fiduciary to affect the legal or practical interests of the
beneficiary and the vulnerability of the beneficiary.

In England, Australia and Canada the common emphasis is therefore upon all particular
circumstances of the undertaking, especially circumstances of trust, confidence, power,
vulnerability and/or discretion. The essential question being asked when those
circumstances are examined is exactly the same as the test for implication of terms as
enunciated by Lord Hoffmann in the Belize case: did the party, by his words or conduct,
give rise to an understanding or expectation in a reasonable person that he would behave
in a particular way (eg not put himself in a position of conflict, not make an unauthorized
profit, and act in good faith and in the best interests of the beneficiary). The greater the
105
[1998] Ch. 1 CA at 18.
106
Cases which have quoted this passage with approval include Arklow Investments Limited v
Maclean [2000] 1 W.L.R. 594 PC at 599-600; Daraydan Holdings Ltd v Solland International Ltd
[2004] EWHC 622 (Ch); [2005] Ch 1 at [55]; Sinclair Investment Holdings SA v Versailles Trade
Finance Limited, AV Lomas, Robert W Birchall [2005] EWCA Civ 722 at [13]; Temple Legal
Protection Limited v QBE Insurance (Europe) Limited [2009] EWCA Civ 453 at [12]. In Johnson
v EBS Pensioner Trustees Ltd [2002] EWCA Civ 164 at [37] it was described as a passage which
is “widely regarded as a masterly survey of fiduciary duties”.
107
His Lordship referred to the ‘best interests’ duty as a duty upon the fiduciary not to act for his own
benefit or the benefit of a third party without informed consent of the principal. This different
formulation is addressed below in the text accompanying footnotes 144 -150 below.
108
A slightly broader expression of the circumstances was given in Reading v R [1949] 2 K.B. 232
CA at 236, where Asquith L.J. said that there is a fiduciary relationship whenever the claimant
entrusts a job to be performed and relies upon the other party in its performance. This was
approved on appeal by Lord Porter [1951] A.C. 507 HL at 516.
109
(1984) 156 C.L.R. 41.
110
(1984) 156 C.L.R. 41 at 97.
111
First proposed in Frame v Smith [1987] 2 S.C.R. 99 at 136 by Wilson J.. See, eg, Non-Marine
Underwriters, Lloyd’s of London v Scalera [2000] SCC 24; [2000] 1 S.C.R. 551 at [131].
degree of trust, vulnerability, power and confidence reposed in the fiduciary then the
more likely that a reasonable person would have such an expectation. In devlopments
which perfectly mirror those in relation to terms implied in fact, Canadian,112 English113
and Australian114 courts, following the lead of Dr Finn,115 have all been moving to
coalesce these factors into a test based upon the “reasonable” or “legitimate” expectations
of a principal. As the Supreme Court of Canada has recently reiterated, these “reasonable
expectations” are part of the process of determining, by implication or expression, the
nature of the fiduciary duties which have been undertaken: “fiduciary duties will only be
imposed on those who have expressly or impliedly undertaken them.”116 Each of the
duties which are commonly recognized as fiduciary follows exactly this pattern.

(1) Obligation to avoid conflict with the duties owed to the principal

This duty to avoid actual or potential conflict with the duties owed to the principal has
two facets: a duty upon the fiduciary not to put himself in a position where his self-
interest might conflict with his duty to his principal, and an obligation not to put himself
in a position in which his duty to his principal might conflict with duties he owes to other
parties. In relation to employment contracts involving a high level of trust these duties
have long been recognized as implied terms. In Pearce v Foster117 the defendant was
employed as a clerk for the claimants whose commercial firm provided services including
engaged in large scale dealings in securities on behalf of their clients. The defendant had
worked his way up from a low salary to a very high one. The claimants had complete
trust in him and consulted him about how to deal with securities of their clients and
investments to make for clients. The claimants discovered that the defendant had, for
many years, been engaged in huge scale speculation on the Stock Exchange. They
dismissed him and he brought an action for wrongful dismissal. The question before the
Court of Appeal was whether the defendant was in breach of contract such that he could
be dismissed. The court held that he was. The employee had an implied obligation not to
allow his interests to conflict with his duty to his employer. He had breached that duty
and had been justifiably dismissed. Even though the claimants could not point to any
instance where the defendant’s duty to his employer had conflicted with his personal
interests, he was liable because he “had deliberately placed himself in that position which
rendered his interest conflicting with his duty.”118 The reason why this obligation was
implied into the contract of service was because “the relation of master and servant

112
Waxman v Waxman [2002] O.T.C. 443 at [1225]; Atlantic Business Interiors ltd v Hipson [2005]
N.S.C.A. 16 at [47]. The Canadian emphasis on ‘reasonable expectations’ is discussed in detail in M
Litman ‘Fiduciary Law in the Hospital Context: the Prescriptive duty of Protective Intervention’
(2007) 15 Health Law Journal 295.
113
Arklow Investments Limited v Maclean [2000] 1 WLR 594 at 598; Brandeis Brokers Ltd v Black
[2001] 2 Lloyd’s Rep 359 at 368; J. McGhee (Gen ed.), Snell’s Equity, 21st edition (2008) at
p.148.
114
News Limited v Australian Rugby Football League Limited (1996) 64 F.C.R. 410 at 541;
Australian Securities and Investments Commission v Citigroup Global Markets Australia Pty Ltd
[2007] F.C.A. 963 at [273].
115
P. Finn, “The Fiduciary Principle” in T. Youdan (ed.) Equity, Fiduciaries and Trusts (1989) 1 at 54.
116
Galambos v Perez [2009] SCC 48 at [71].
117
(1886) 17 Q.B.D. 536 CA. See also Sterling Engineering Co Ltd v Patchett [1955] A.C. 534 HL.
118
(1886) 17 Q.B.D. 536 CA at 541-542 (Lindley L.J.).
implies necessarily that the servant shall be in a position to perform his duty duly and
faithfully”.119

More recently, in Malik v Bank of Credit and Commerce International SA,120 speaking of
the implied obligation of trust and confidence in employment contracts (discussed
below), Lord Steyn observed that this implied term was probably just part of the very
long established implied term “to serve his employer loyally and not to act contrary to his
employer's interests.”121 This reasoning which implies a term upon a party to particular
undertakings not to put himself in a position of conflict between interest and duty (or
duty and duty) mimics precisely the fiduciary analysis. The simple reason for this is that
it is the same analysis. Indeed, the most recent decision of the House of Lords in relation
to a fiduciary’s obligation not to place himself in a position involving conflicting duties
was a case which was pleaded, and decided, as breach of an implied term of a contract.122

(2) Obligation not to profit from the relationship without the principal’s consent

Another so-called core fiduciary obligation is the obligation not to profit from a fiduciary
position without consent from the principal. This “profit rule” is very closely associated
with the “conflict rule” discussed above. In Boardman v Phipps,123 Lord Upjohn went so
far as to say that it was just part of the conflict rule.124 It may be, as Dr Conaglen has
argued,125 that the two rules, whilst overlapping, are distinct.126 However, even if they are
independent, the basal reason why the “profit rule” arises is the same as that for the
conflict rule: it is expressed or implied as a matter of fact into the voluntary undertaking.

The most commonly cited example of the no-profit obligation is Boardman v Phipps
itself. Although the majority and minority in that case divided over the application of the
rule to the facts of the case, the decision is not inconsistent with the principle, well
established in the partnership context,127 that the no-profit obligation might sometimes
permit a director or trustee to take advantage of an opportunity which falls outside the
scope of the principal’s business.128 As Austin J. has said extrajudicially, “[t]here is
surely no positive duty to report every business opportunity to the company, however

119
(1886) 17 Q.B.D. 536 CA at 539 (Lord Esher M.R.). See also at 543 “their position is highly
fiduciary” (Lopes L.J.).
120
[1998] A.C. 20 HL.
121
[1998] A.C. 20 HL at 46.
122
Hilton v Barker Booth & Eastwood (a firm) [2005] UKHL 8; [2005] 1 W.L.R. 567 HL.
123
[1967] 2 A.C. 46 HL.
124
[1967] 2 A.C. 46 HL at 123. See also Bray v Ford [1896] A.C. 44 HL at 51 and Netherlands
Society “Oranje” Inc v Kuys [1973] 1 WLR 1126 PC at 1129.
125
M. Conaglen, “The Nature and Function of Fiduciary Loyalty” (2005) 121 L.Q.R. 452 at 466-468
citing Chan v Zacharia (1984) 154 C.L.R. 178 at 199.
126
M. Conaglen, “The Nature and Function of Fiduciary Loyalty” (2005) 121 L.Q.R. 452 at 467.
127
Both before Boardman- see Aas v Benham [1891] 2 Ch. 244 CA- and after it, Re Bell’s Indenture
[1980] 1 W.L.R. 1217.
128
Although in the minority on application to the facts, the example given by Lord Upjohn at [1967]
2 A.C. 46 at 130 is instructive: a trustee of Blackacre purchasing neighbouring Whiteacre without
liability if there is no possibility of the trustees of Blackacre making the purchase. Cf O’Donnell v
Shanahan [2009] EWCA Civ 751 confining the exception to partnerships.
remote it is, from the company’s existing and future business activities.’129 The scope of
the no-profit duty of a director, a trustee, a partner or any other fiduciary depends upon
the circumstances of the undertaking in every case.130

An example of the operation of the no-profit duty is Netherlands Society “Oranje” Inc v
Kuys.131 In that case Kuys was the secretary of a New Zealand society established for its
Dutch community. Its newsletter, the Holland Bulletin, was in serious financial
difficulty and eventually ceased. Kuys wanted the society to establish a national
newspaper but was told by members of the executive that this was impossible. So Kuys
did it himself. He bought the only other Dutch newspaper in New Zealand and developed
it profitably with a partner, calling it the ‘Windmill Post’. Subsequently the society began
publishing a newspaper under the same name and Kuys obtained an injunction preventing
the society’s publication. The society appealed, arguing that Kuys had breached his
fiduciary duties by purchasing and running the Windmill Post. The society argued that
Kuys’ rights to the Windmill Post were held on trust for the society. The Privy Council
rejected this argument. Although accepting that Kuys was in a fiduciary position with the
society, the Privy Council held that his acts in starting the newspaper were outside the
scope of his fiduciary obligations. The Privy Council relied upon several circumstances
in reaching the conclusion that the no-profit duty did not arise: his unpaid responsibilities
to the society were loosely defined; the society’s bulletin was moribund; and Kuys had
told the society of his newspaper and secured society advertising in it prior to publication
of the first edition. Delivering the advice of the Privy Council, Lord Wilberforce said that
the fiduciary duty must be “moulded according to the nature of the relationship”132 and
that “[t]he subject matter over which the fiduciary obligations extend is determined by
the character of the venture or undertaking.”133 Applying what we have seen to be the test
for implied terms generally, all the specific circumstances in Netherlands Society
described by Lord Wilberforce showed that a reasonable person would not have
understood Kuys to have undertaken to refrain from establishing a newspaper when it
was rejected by the society. The correspondence with the approach to implication of
terms is again apparent.

(3) Obligations to act in the beneficiary’s best interests

The duty to act in the best interests of the beneficiary is sometimes relied upon to
suggest, contrary to the thesis of this article, that fiduciary duties are imposed by law and
are not voluntary obligations. For instance, Professor DeMott argues that “[t]he
fiduciary’s duties go beyond mere fairness and honesty; they oblige him to act to further

129
R. Austin, “Fiduciary Accountability for Business Opportunities” in P. Finn, Equity and
Commercial Relationships (1994) 141 at 147.
130
R. Meagher, J. D. Heydon, M. Leeming, Meagher, Gummow and Lehane’s Equity Doctrines and
Remedies (2004) at 173. This point was precisely and succinctly made by Romer J. in the context
of a duty of care and skill in Re City Equitable Fire Insurance Co Ltd [1925] Ch. 407.
131
[1973] 1 W.L.R. 1126.
132
[1973] 1 W.L.R. 1126 at 1130.
133
[1973] 1 W.L.R. 1126 at 1130 quoting Birtchnell v Equity Trustees, Executors and Agency Co Ltd
(1929) 42 C.L.R. 384 at 408 (Dixon J.). See also Aas v Benham [1891] 2 Ch. 244 CA.
the beneficiary’s best interests”.134 With this duty at the heart of fiduciary obligations, she
concludes that fiduciary obligations must be imposed by law because “for a variety of
reasons, one person’s discretion ought to be controlled because of characteristics of that
person’s relationship with another.”135 The contrary view expressed here is that the “best
interests” duty, whatever it might mean, is a duty which arises by express or implied
terms into voluntary undertakings. Hence, it has been described as an obligation which
arises as a result of a “pledge” by a fiduciary to act in that way.136

The ‘best interests’ duty was recently applied in Fassihi v Item Software (UK) Ltd.137 In
that case the Court of Appeal held that a director’s duty to act in the best interests of the
company required a director to disclose his own wrongdoing. The Court of Appeal had to
confront the decision of the House of Lords in Bell v Lever Brothers Ltd138 in which Lord
Atkin and Lord Thankerton (with both of whom Lord Blanesburgh agreed) held that no
term was to be implied into the director’s contract of employment requiring him to
disclose his wrongdoing.139 The Court of Appeal did not distinguish Bell v Lever
Brothers Ltd on the basis that it concerned implication of a contractual term whilst
Fassihi concerned a fiduciary duty. To the contrary, in the leading judgment, Arden L.J.
was at pains to stress that in Lord Atkin’s speech, his Lordship was concerned only to
exclude the implied term because, in those circumstances, there could be no reasonable
expectation of disclosure by the employee.140 Arden L.J. also approved the words of Goff
L.J. applying a test for implied terms in the context of an argument for the same fiduciary
duty: “the law should not impose a duty of disclosure where that would be contrary to the
expectations of the parties”.141 Arden L.J. also referred to decisions where such an
implied term had been recognized in the context of the facts of the case.142 The ‘best
interests’ fiduciary duty thus mimics precisely the approach taken to implied terms. Even
in Australia, where the opposite conclusion was reached and it was denied that the “best
interests” duty includes a duty to disclose wrongdoing this was done by the same implied
term reasoning. In the leading Australian case, Dawson and Toohey JJ suggested that the
duty was no more than an obligation to exercise reasonable care which arises in contract
and tort; since there is no implied term of disclosure then no such term can arise as part of
the best interests duty.143

134
D. DeMott, “Beyond Metaphor: An Analysis of Fiduciary Obligation” [1988] Duke L.J. 879 at
882.
135
D. DeMott, “Beyond Metaphor: An Analysis of Fiduciary Obligation” [1988] Duke L.J. 879 at
915.
136
See Youyang Pty Limited v Minter Ellison Morris Fletcher [2003] 212 C.L.R. 484 at [40], quoting
McLachlin J. in Canson Enterprises Limited v Boughton & Co [1991] 3 S.C.R. 534 at 543.
137
[2004] EWCA Civ 1244; [2004] B.C.C. 994.
138
[1932] A.C. 161.
139
See, eg, Lord Atkin at 228 “to imply such a duty would be a departure from the well established
usage of mankind and would be to create obligations entirely outside the normal contemplation of
the parties concerned”.
140
[2004] EWCA Civ 1244; [2004] B.C.C. 994 at [51].
141
Horcal Ltd v Gatland (1984) 1 B.C.C. 99,089.
142
Sybron Corporation and Another v Rochem Ltd [1984] Ch 112.
143
Breen v Williams (1995) 186 C.L.R. 71 at [18], [22]; applied generally in P & V Industries Pty Ltd
v Porto [2006] VSC 131; (2006) 14 V.R. 1). See also The Bell Group Ltd (In Liq) v Westpac
Banking Corporation (No 9) [2008] WASC 239 at [4564].
The difficulty with the duty to act in the ‘best interests’ of another is not with
understanding it as part of an express or implied fiduciary undertaking. Rather, the
problem is that the duty is extremely vague. For this reason, significant academic
criticism has been levelled at the “best interests” duty, describing it as “unhistorical,
simplistic, true in part only and misleading”,144 as “a combination of existing duties”145
and as “essentially an umbrella duty—one which embraces a large number of individual,
well-recognised duties”.146 In KLB v British Columbia,147 in the context of the
parent/child relationship, the Supreme Court of Canada denied the existence of such a
duty because it was not “a legal or justiciable standard”.148 Writing extrajudicially, Lord
Nicholls has also suggested that a trustee’s duty to act in the “best interests” of the
beneficiary is no more than an obligation to act for the proper purposes for which the
trustee had agreed to act.149 This was also the formulation preferred by Millett L.J. in
Mothew.150 Such an alternative formulation sits comfortably with the notion of fiduciary
duties as obligations which are manifested from voluntary undertakings. As we will see
below there is a line of English authority which recognizes an implied term in contracts
that a contracting party with a broad discretion will act for proper purposes.

(4) Obligation to perform duties in good faith

The final duty which is commonly described as a fiduciary duty is the duty of a fiduciary
to perform his obligations in good faith.151 In one sense the duty of good faith is an
obligation imposed on every person, fiduciary or not. Honesty is a “duty of universal
obligation. This obligation exists independently of contract or of special obligation
[whenever] a man intervenes in the affairs of another.”152 This obligation not to act
dishonestly is imposed by law and it is well established that it can be broader than the tort
of deceit.153

144
S. E. K. Hulme, “The Basic Duty of Trustees of Superannuation Trusts—Fair to One, Fair to All?”
(2000) Trust Law International 130.
145
J. Lehane, “Delegation of Trustees’ Powers and Current Developments in Investment Funds
Management” (1995) 7 Bond L. Rev. 36 at 37.
146
G. Thomas, “The duty of trustees to act in the ‘best interests’ of their beneficiaries” (2008) 2
Journal of Equity 177 at 202.
147
[2003] SCC 51; [2003] 2 S.C.R. 403.
148
[2003] SCC 51; [2003] 2 S.C.R. 403 at [46].
149
D. Nicholls ‘Trustees and Their Broader Community: Where Duty, Morality and Ethics Converge’
(1995) 9 T.L.I. 71.
150
See the discussion above in footnote 107.
151
See the often quoted passage from Millett L.J., referred to in the text to footnote 105 above, in
Bristol and West Building Society v Mothew [1998] Ch. 1 CA at 18.
152
Nocton v Lord Ashburton[1914] A.C. 932 HL at 954. For its application to contract, and the
inability of parties to exclude this imposed term, see HIH Casualty and General Insurance Ltd v
Chase Manhattan Bank [2003] 1 All E.R. (Comm) 349 at [16], [76], [98], [121]-[122].
153
Magill v Magill [2006] HCA 51; (2006) 226 C.L.R. 551 at [17] (Gleeson CJ); Mahesan S/O
Thambiah v Malaysia Government Officers' Cooperative Housing Society [1979] A.C. 374. Cf. K.
Handley “Civil Liability for Bribery (No 2)” (2001) 117 L.Q.R. 536.
However, when reference is made to a fiduciary duty of ‘good faith’, courts usually mean
to refer to a broader duty than the imposed duty of honesty. The fiduciary duty of good
faith has been described as “incapable of precise definition” but as a duty which requires
candid, reasonable, honest and forthright action.154 It is this broader aspect of the duty
which requires justification because although parties to every voluntary agreement are
subject to imposed duties of honesty it is commonly thought that such a broad obligation
of good faith involving “reasonableness” has no place in the law of contract. In the
leading speech in Walford v Miles,155 Lord Ackner said that “a duty to negotiate in good
faith is … unworkable in practice as it is inherently inconsistent with the position of a
negotiating party.” And the leading English practitioner text on the law of contract
elevates the Walford v Miles denial of a duty to negotiate in good faith to a principle that
good faith has no role in English contract law. It is asserted that a duty of good faith
would introduce too much uncertainty into contract law and would trespass into the
legislative domain.156 If the genesis of fiduciary duties is the manifestation of voluntary
undertakings then such an exclusionary rule in the law of contract seems surprising. How
could this broad duty of good faith exist in fiduciary obligations generally but almost
never in contractual ones if fiduciary duties are express or implied duties in voluntary
undertakings?

The answer to this objection is that there is, in truth, no rule which excludes a broader
good faith duty from contract law. In every case it is a question of construction of the
manifested agreement between the parties. In cases where there is a high degree of trust
and discretion imposed as a result of the undertaking then, whether the duty is described
as contractual or fiduciary, a broad duty of good faith, involving requirements of
reasonableness, can be implied into the exercise of the discretion. The implied duty of
good faith in insurance contracts is not anomalous. It is just an example of this general
principle. There are many other examples of such implied duties of good faith in contract
cases whether or not the label ‘fiduciary’ is attached. In Abu Dhabi National Tanker Co v
Product Star Shipping Ltd (No 2)157 an unqualified discretion was given to owners under
a charterparty to determine whether any port was dangerous and prohibit the ship from
docking there. In the leading judgment, Leggatt L.J. held that in cases where a party has a
discretion to influence the interests of another it must be exercised in good faith and for
proper purposes.158 The decision has been approved several times.159 More recently, in
Socimer International Bank Ltd v Standard Bank London Ltd160 the Court of Appeal
considered the proper construction to be given to a term which provided that in the event
of default by a buyer a seller could liquidate portfolio assets held for future delivery to
the buyer. The sale by the seller was ‘in its sole and absolute discretion…at such time, in
such manner and at such price as it deems reasonable and appropriate.’ Again, the Court

154
Wallace v United Grain Growers Ltd [1997] 3 S.C.R. 701 at [98].
155
[1992] 2 A.C. 128 HL at 138.
156
Chitty on Contracts, 30th edn., (2008) at §1-025
157
[1993] 1 Lloyd's Rep. 397.
158
[1993] 1 Lloyd's Rep. 397 at 404.
159
Ludgate Insurance Co Ltd v Citibank NA [1998] Lloyd's Rep. I.R. 221; Gan Insurance Co Ltd v
Tai Ping Insurance Co Ltd (No 2) [2001] 2 All E.R. (Comm) 299 at 324; Paragon Finance Plc v
Nash [2002] 1 W.L.R. 685.
160
[2008] EWCA Civ 116; [2008] 1 Lloyd’s Rep. 558.
of Appeal held that a term should be implied to require the seller to act in good faith and
for proper purposes.161

The comparison between the ‘good faith’ contractual duty and ‘fiduciary’ duty is most
instructive in employment cases involving alleged breaches of good faith by an employer.
In Imperial Group Pension Trust Ltd v Imperial Tobacco Ltd,162 counsel had argued that
the power of a company to give or withhold consent to changes to a pension scheme was
a fiduciary power and therefore subject to obligations of good faith. Browne-Wilkinson
V.C. held that the power of the company was not a fiduciary power because the company
was entitled to prefer its own interests over the interests of the beneficiaries. In other
words, one of the fiduciary duties described above was not present. But, the company
was nevertheless subject to other duties which are often described as fiduciary, including
this obligation to act in good faith and for proper purposes. These duties were implied by
the Vice Chancellor as a matter of contract law. The Imperial Group decision was
approved by the House of Lords in Malik v Bank of Credit and Commerce International
SA.163 In that case two employees of a corrupt employer sued their employer for breach of
contract alleging that his dishonesty had seriously impaired their future job prospects. On
the basis of the Imperial Group line of cases, it was conceded in the House of Lords that
their contracts of employment contained implied terms that “the bank would not, without
reasonable and proper cause, conduct itself in a manner likely to destroy or seriously
damage the relationship of confidence and trust between employer and employee.”164
Both the speeches delivered in the House of Lords considered that the concession had
been properly made. Lord Jauncey had earlier described this duty as fiduciary,165 but
Lord Nicholls simply explained that the obligation arose as a matter of implication: the
employment contract “implicitly envisages” that the employer should not engage in
conduct “likely to destroy or seriously damage the degree of trust and confidence the
employee is reasonably entitled to have in his employer”.166 The same implied
contractual obligation in employment cases has been recognised in Canada167 and New
Zealand.168

V. CONCLUSION

This article has argued that the focus in fiduciary cases must shift from a debate about
which relationships are fiduciary, based on notions of status or relationship, to a focus
upon whether duties are expressed or implied in relationships involving manifestations of
voluntary undertakings. As we have seen, in many cases this shift in focus has already

161
[2008] EWCA Civ 116; [2008] 1 Lloyd’s Rep. 558 at 577 [66].
162
[1991] 1 W.L.R. 589.
163
[1998] A.C. 20 HL.
164
[1998] A.C. 20 HL at 34. See also at 45.
165
Neary v Dean of Westminster [1999] I.R.L.R. 288 at 290.
166
[1998] A.C. 20 at 35.
167
Wallace v United Grain Growers Ltd [1997] 3 S.C.R. 701; RBC Dominion Securities Inc. v
Merrill Lynch Canada Inc [2008] SCC 54.
168
Re UEB Industries Ltd Pension Plan [1992] 1 N.Z.L.R. 294; Auckland Electric Power Board v
Auckland Provincial District Local Authorities Officers Industrial Union of Workers Inc [1994] 2
N.Z.L.R. 415.
occurred. But there are still many references to fiduciary duties as sui generis imposed
obligations.

Lord Browne-Wilkinson observed that “the phrase ‘fiduciary duties’ is a dangerous one,
giving rise to a mistaken assumption that all fiduciaries owe the same duties in all
circumstances. This is not the case.”169 But if we persist in seeing fiduciary obligations as
imposed by law, and dependent upon conceptions of status, then the quest to understand
and explain why different fiduciaries owe different duties will remain an impossible task.
In contrast, by understanding fiduciary duties as terms which are expressed or implied
into manifested undertakings to another, it is much easier to understand why the nature of
fiduciary duties will always depend upon the circumstances. This explanation illuminates
the reason why exactly the same analysis is undertaken by courts when determining, on
the one hand, whether fiduciary duties have arisen and, on the other hand, in determining
whether such duties should be implied into contracts or other voluntary undertakings. The
analyses are the same because fiduciary duties are terms expressed or implied in
voluntary undertakings. It is no coincidence that the most recent decision of the House of
Lords, usually considered to be about fiduciary duties,170 was actually pleaded and
decided as a case involving a breach of an implied contractual term.171

The thesis of this article has only been a positive one. It has not examined the many other
theories of why fiduciary obligations arise.172 It suffices to say that each of these theories
(unjust enrichment, deterrence and prophylaxis, reliance, property, deemed motives, and
unequal relationship) relies in part, or in whole, upon a concept of fiduciary duty which is
imposed by law and dependent upon attributing some status to the relationship. Each of
these theories has difficulties explaining the diversity of different relationships in which
‘fiduciary duties’ arise, as well as the reason why different duties might arise in different
circumstances.173 However, there might be one exception to the general thesis of this
article that fiduciary duties arise as a result of express or implied manifestations of
consent in voluntary undertakings. This exception arises if fiduciary duties could also be
imposed to deter fiduciaries from particular action.174 On the model suggested in this

169
Henderson v Merrett Syndicates Ltd [1995] 2 A.C. 145 HL at 206. See also Hospital Products Ltd
v United States Surgical Corp (1984) 156 C.L.R. 41 at 59, 96–97; Re Coomber [1911] 1 Ch 723
CA at 729. For a recent example where a solicitor/client relationship was held not to give rise to
fiduciary duties in the circumstances, see Galambos v Perez [2009] SCC 48.
170
Re Ahmed & Co [2006] EWHC 480 (Ch) at [27]; J. Getzler, “Inconsistent Fiduciary Duties and
Implied Consent” (2006) 122 L.Q.R. 1.
171
Hilton v Barker Booth & Eastwood (a firm) [2005] UKHL 8 HL; [2005] 1 W.L.R. 567.
172
Many of these are summarised in J. C. Shepherd, The Law of Fiduciaries (1981) at pp. 51-91.
173
The theory which is closest to the argument in this paper is the “contractarian” theory which sees
fiduciary duties as contractual: J. Langbein, “The Contractarian Basis of the Law of Trusts”
(1995) 105 Yale L.J. 625; F. Easterbook and D. Fischel “Contract and Fiduciary Duty” (1993) 36
Journal of Law and Economics 425; A. Duggan “Contracts, Fiduciaries and the Primacy of the
Deal” in E. Bant and M. Harding Exploring Private Law (2010). However, this article does not
rely upon the economic justifications usually accompanied by the proponents of the theory, nor
does this article confine instances of manifested undertakings to contract.
174
For instance, the well known statement of Lord Herschell in Bray v Ford [1896] A.C. 44 HL at 50
that “human nature being what it is, there is danger, in such circumstances, of the person holding a
fiduciary position being swayed by interest rather than by duty.” See also M. Conaglen “The
article these issues of deterrence and prophylaxis are not relevant to why fiduciary duties
arise, although they might be relevant to understanding the appropriate remedy (such as
explaining why a fiduciary should disgorge profits made in breach of a duty owed to the
principal).175 Nevertheless, it is not impossible that a fiduciary duty might arise be
imposed upon a party making an undertaking although, as a matter of fact, there was no
such duty expressed or implied into the undertaking. If such cases exist, then the
fiduciary duty would still be an implied term, although it would be implied in law, as a
matter of policy, rather than implied in fact as part of the objective agreement.176 In one
of the leading cases on implication of terms as a matter of law or policy,177 Viscount
Simonds referred to terms implied in law as based upon “broad equitable considerations”,
giving his paradigm example the (fiduciary) duty of faithfulness owed by partners to each
other.178 Nevertheless, it is hard to see the need for such a policy based approach, which
imposes duties upon a person who makes an undertaking, if a satisfactory explanation
exists which explains the same duties in a principled and long established manner based
simply upon a construction of the undertaking itself to determine the expressed or
implied duties undertaken by the parties.

James Edelman♦

Nature and Function of Fiduciary Loyalty” (2005) 121 L.Q.R. 452. See also P. Birks “The Content
of Fiduciary Obligation” (2002) Trusts Law International 34.
175
J. Edelman, Gain-based Damages (2002) at 85, 212.
176
E. Peden, “Policy Concerns behind Implication of Terms in Law” (2001) 117 L.Q.R. 459. Cf. L
Hoffmann, “The Achilleas” (2009) Edinburgh Law Review (forthcoming) who argues that even
terms implied by law by these default rules of policy are “at the highest level of abstraction”
concerned with the duties which a party “would reasonably have been considered to have
undertaken.”
177
So regarded by Dyson L.J. in the leading judgment in Crossley v Faithful & Gould Holdings Ltd
[2004] EWCA Civ 293 at [36]-[39] and by Steyn L.J. in The Star Texas [1993] 2 Lloyd’s Rep. 445
at 452.
178
Lister v Romford Ice and Cold Storage Co Ltd [1957] A.C. 555 HL at 577.
♦
Professor of the Law of Obligations and Fellow of Keble College, University of Oxford. Parts of
this article were presented at the Obligations IV conference at the National University of
Singapore, and at the Faculties of Law at the University of Alberta and Singapore Management
University. I am grateful for the comments from participants at those presentations and for
discussions with Simon Colton, Tony Duggan, Joshua Getzler, Lewis Klar, Moe Litman, Robert
Stevens and Chee Ho Tham.