When a trust is breached, the defaulting trustee is rarely the only person involved. Banks process the payments, advisers structure the deals, and family or business associates receive the money. Equity does not let these outsiders walk away untouched. Through the doctrine of intermeddling, a 'stranger to the trust' — anyone who is not a trustee but who gets caught up in the breach — can be made personally liable. For a practising solicitor, knowing who can be pursued, and on what basis, is often the difference between a beneficiary actually recovering their loss and chasing an empty-handed trustee.
This lesson builds that picture step by step:
- Overview of Intermeddling — who counts as a stranger to the trust and the three forms liability can take.
- Dishonest Assistance — holding accountable those who help a breach along, even without ever touching trust property.
- Knowing Receipt — liability for receiving trust property where it would be unconscionable to keep it.
- Trustee de Son Tort — when someone who acts like a trustee is treated as one.
- Defences and Recovery — the bona fide purchaser defence, how the heads differ, and why personal versus proprietary claims matter on insolvency.
By the end, you'll be able to identify each route to liability and apply the right test to a set of facts.