20. Personal Liability of Third Parties

Abstract

This chapter examines the personal liability of third parties when there is a breach of trust or breach of fiduciary duty. It explains that there are two types of personal liability of third parties. One is receipt-based liability when a third party has received property in which the beneficiary or principal has an equitable proprietary interest and the other is accessorial liability when the third party has encouraged or assisted a breach of a trust or fiduciary duty. The elements of different causes of action relevant to receipt-based liability and accessorial liability are examined, notably the action for unconscionable receipt and the action of dishonest assistance. The controversial question of whether liability should be strict or fault-based is considered and, if the latter, the nature of the fault requirement.