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Fiduciaries, secret commissions-existence of relationship and scope of duties (Medsted Associates Ltd v Canaccord Genuity Wealth (International) Ltd)

Fiduciaries, secret commissions-existence of relationship and scope of duties (Medsted Associates Ltd v Canaccord Genuity Wealth (International) Ltd)
Published on: 08 February 2019
Published by: LexisPSL
  • Fiduciaries, secret commissions-existence of relationship and scope of duties (Medsted Associates Ltd v Canaccord Genuity Wealth (International) Ltd)
  • What are the practical implications of this case?
  • What was the background?
  • What did the court decide?
  • Case details

Article summary

Dispute Resolution analysis: Canaccord (formerly Collins Stewart), a second-tier provider of contracts for differences had a contract with a broker, Medsted, under which Collins Stewart was required to pay commission to Medsted in respect of investors introduced by Medsted. In breach of that contract, Collins Stewart did business directly with certain investors, thereby depriving Medsted of the commission to which it was entitled. At first instance the judge found that Medsted had suffered loss, but, on public policy grounds, awarded only nominal damages to Medsted, on the basis that Medsted was a fiduciary which had breached its fiduciary duties to the investors by failing to disclose the amount of commission it received from Collins Stewart. The Court of Appeal found: (a) that Medsted was a fiduciary, but (b) that, in the circumstances of the case, the scope of its duties did not extend so far as to require it to reveal the extent of its commission. It therefore allowed the appeal and made an order for damages to be assessed. Written by Iain G Mitchell QC (Scotland), barrister at Tanfield Chambers. or take a trial to read the full analysis.

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