Similarly at first instance in United States Surgical Corporation v Hospital Products International Pty Ltd the judge held that the liability of one defendant company (HPI) to account should be secured by a lien over shares in a second defendant company (HPL) that represented the proceeds of the sale to HPL of the business conducted in breach of fiduciary duty. He also concluded that the liability of that other company should not be secured by a lien because of the potential harmful effects on its creditors. (The assumption that a lien might otherwise be available perhaps supports the idea that a proprietary remedy is available in respect of general enrichment.)

In Hospital Products, the judge said that he was following Goff and Jones imposing the lien in the exercise of his discretion. There is no discussion of the basis of the charge in Warman v Dwyer.

The order in Warman might perhaps be regarded as part of the enforcement of the personal remedy rather than as a proprietary remedy in itself were it not for the fact that a charging order is generally unavailable until the amount due has been ascertained. Does the charge in Warman operate only from when the account has been completed? Without reading too much into this one sentence in the judgment, this does not seem to be what was intended.

So what is the basis of these orders? Is anyone aware of any other cases where an account was ordered to be secured in this way?

Thanks for any information or insights.

Simon Evans.

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Simon Evans
Gonville and Caius College
Cambridge CB2 1TA

(01223) 506940
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