The Supreme Court on Friday handed down a landmark judgment in the motor finance appeals. The judgment was keenly awaited and the appeal, which was heard on 1-3 April 2025, was one of The Lawyer's Top 10 Appeals of 2025. It has far-reaching implications for a number of different areas of the law, notably the civil law of bribery and the law relating to fiduciary duties.
The judgment repays careful study and no summary can be a substitute for it. But there are three principal conclusions in the judgment that have wider significance. The first is that a claim for bribery (whether in equity or at common law) is not available unless the recipient of the benefit owed a fiduciary duty of loyalty to the claimant. While a fiduciary relationship in one of the established categories (e.g. trustee/beneficiary or company/director) is not required, a fiduciary duty of loyalty is. This conclusion was the product of a careful analysis of the authorities and the historical development of the law of bribery.
Second, there is a fiduciary duty of loyalty only if the putative fiduciary objectively undertook to act in the claimant's interests to the exclusion of their own. The Court rejected the respondent's contention that it is sufficient that the putative fiduciary has a role in the decision making process of the claimant or that the claimant relies on or trusts the putative fiduciary in making their decisions, noting that if this alone were sufficient then a whole range of individuals such as a salesman or a sommelier would become fiduciaries, which would be anomalous.
Third, applying the "undertaking" test referred to above, the Court concluded that car dealers do not owe customers any fiduciary duty of loyalty in arranging finance. On the contrary, they are salesmen acting in their own interests and cannot become fiduciaries merely because customers trust them or because they told a customer that they would recommend the best available financing product.
Accordingly, the appeal succeeded and the claim of Ms Hopcraft, the claimant, for various remedies for bribery failed.
Laurence Rabinowitz KC and Niranjan Venkatesan KC acted for Close Brothers, the successful appellant. They were instructed by Slaughter and May.
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