Restitution Discussion Group Archives
| Sender: |
Allan Axelrod |
| Date: |
Thu, 30 Mar 2000 11:47:41 -0500 |
| Re: |
Hong Kong Securities Ordinance and the Grocer's Dilemma |
arianna pretto
wrote:
S 84 says stockbrokers/dealers must pay into a trust
account money received from clients to buy shares and from buyers where
they have sold shares for the clients. That is all normal. Equally normal
is s 85(1) which says the money in the trust account is not available
for payment of the debts of the dealer or liable to be taken in execution.
But 85(2) says any payment in contravention of 85(1) is void ab initio
'and no person to whom the money is paid shall obtain any title to it'.
Does this last phrase cover the shopkeeper, who is
paid for the eggs and the butter with money the dealer has taken from
the trust account? Will he therefore have to give the money back? Instinct
would tell me that the sub-section is nonsense in the case I put, and
that the money belongs to the innocent grocer as soon as the eggs are
bought (i.e. the banknotes are delivered to him). Arianna Pretto Brasenose College the statutory language seems to create an effect previously
unknown to our law--- ie permitting the recovery in specie of [or a judgment
for the amount of] stolen money taken in trade without knowledge
is there any reason to suppose such a result comes from serious legislative
policy rather than uninformed drafting??
any american courts faced with unattractive consequences from exuberant
use of the word 'void' have interpreted this as 'voidable': such an interpretation
would give the malefactor enough title to create a bona-fide purchase
in the storekeeper.
another approach---- fight one bit of brainless literalism
with another: confine the statutory operation to the 'money' of which
the drafter speaks, and interpret that as 'currency', thus preserving
for the store any received 'credits'--- ie the most likely form of its
acquisition
finally as prof smith has surely suggested, allow the store to prevail
unless the applicant can prove that the 'money' paid over by the malefactor
was traceable to the trust money, and use a tracing rule which supposes
that the malefactor would pay out his/her/its own money before that of
the trust
__________________________________________________
Oxford
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