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A somewhat belated response to Lionel and Steve,

Members of the list are probably well aware of the important decision of the English Court of Appeal in Securities & Investments Board v Pantell (No 2) [1993] Ch 256 on sections 6 and 61 of the Financial Services Act 1986, on which the restitution orders of the new 2000 Act are largely based. The judgment of Steyn LJ especially repays study. In a nutshell, the statute empowers the SIB to seek a restitution order against a third party "knowingly concerned" in an unauthorised person's contraventions of the Act. "Restitution" could be ordered even though the third party had received nothing. Didn't Dawson once write a piece called "Restitution without enrichment"? Valiant arguments by counsel that this was compensation in disguise (a remedy only available against the contravenor under the Act) were swept aside. Steyn LJ says wisely we must not assume that, where a statutory mechanism for restitution/rescission exists, Parliament intended to reproduce the jurisdiction of the common law and equity. Steve Hedley's caution appears to be justified in the context of statutes.

Sorry for being so black letter. Reviewing the mailings of the last month or so from the RDG it seems the prediction of Professor Burrows ("Understanding the Law of Obligations") that Restitution would move towards more theoretical analysis and away from "practical scholarship" may be coming true.

I am off for a sabbatical and will be packing Darwin's "Origin of the Species" (in order to keep up with the current debate) and some James Bond novels (to avoid future faux pas in the field of popular literature).

Gerard McMeel
University of Bristol

PS Good luck with the move to Canada Lionel!

On Mon, 10 Jul 2000 17:56:14 +0100 Lionel Smith wrote:

From the Financial Services and Markets Act 2000 (this section not yet in force):

Restitution orders

382. - (1) The court may, on the application of the Authority or the Secretary of State, make an order under subsection (2) if it is satisfied that a person has contravened a relevant requirement, or been knowingly concerned in the contravention of such a requirement, and-

(a) that profits have accrued to him as a result of the contravention; or

(b) that one or more persons have suffered loss or been otherwise adversely affected as a result of the contravention.

(2) The court may order the person concerned to pay to the Authority such sum as appears to the court to be just having regard-

(a) in a case within paragraph (a) of subsection (1), to the profits appearing to the court to have accrued;

(b) in a case within paragraph (b) of that subsection, to the extent of the loss or other adverse effect;

(c) in a case within both of those paragraphs, to the profits appearing to the court to have accrued and to the extent of the loss or other adverse effect. (etc)