Of course it's just a tree.  What does it look like ?
RDG online
Restitution Discussion Group Archives

front page

What's new?

Another tree!

Archive front page
















Another tree!

<== Previous message       Back to index       Next message ==>
Andrew Tettenborn
Wed, 4 Apr 2007 17:35:09 +0100
Wilson v. Hurstanger Ltd [2007] EWCA Civ 299


A curious case in the English CA about secret commissions: Wilson & Anor v. Hurstanger Ltd [2007] EWCA Civ 299 (4 April 2007). The result seems, if one may say so, fairly sensible: whether the reasoning is may be another matter.

Cash-strapped mortgage borrowers, through a loan broker acting as their agent, remortgaged with usurers at the usual usurious rates, in addition paying the latter a "brokers' arrangement fee" of £1,000. In proceedings by the lenders for repayment and/or possession they raised a technical consumer credit defence (which failed), and also a secret commissions point. The brokers, they said, had not disclosed that in addition to the £1,000 fee received from the borrowers they had also received £240 commission from the lenders. This, they went on, meant that the transaction was voidable: hence, subject to providing counter-restitution in the shape of repayment of the principal with interest at a moderate rate, they could escape liability on the loan contract.

The CA found that (a) there had been disclosure to the borrowers of the possibility of a commission, but (b) there was no sufficient informed consent by the lenders to the acceptance of that commission. The borrowers said this made no difference: if they hadn't properly consented to the payment, it was illegitimate and all the normal remedies, including rescission, remained available. The CA disagreed. There was, it said, a half-way house between secret commissions and informedly-consented-to-commissions. For rescission to be available as of right, the commission had to be entirely undisclosed: here it wasn't, so the borrowers remained liable. (The CA said that there remained a discretion to grant rescission, but declined to exercise it.) On the other hand, because of the lack of informed consent they did have a right to an account of the commission from the brokers: and this also extended to giving them a right to equitable compensation against the lender for instigating the broker's breach of fiduciary duty.


Happy Easter

Andrew Tettenborn
University of Exeter.

<== Previous message       Back to index       Next message ==>

" These messages are all © their authors. Nothing in them constitutes legal advice, to anyone, on any topic, least of all Restitution. Be warned that very few propositions in Restitution command universal agreement, and certainly not this one. Have a nice day! "

Webspace provided by UCC   »
For editorial policy, see here.
For the unedited archive, see here.
The archive editor is Steve Hedley.
only search restitution site

 Contact the webmaster !