Article: Unauthorised Gains and Limitation after FHR

The proper characterisation of bribes, secret commissions, and other unauthorised gains has long presented conceptual difficulties. In FHR European Ventures LLP v Cedar Capital Partners LLC, a seven-member bench of the UK Supreme Court, considering conflicting authorities, held that unauthorised gains accepted by a fiduciary were held on trust for his principal, thereby enabling the principal to assert a proprietary claim over them.  However, in the recent case of Hui Chun Ping v Hui Kau Mo, the Hong Kong Court of Final Appeal seemingly arrived at an opposite conclusion, holding that a claim for unauthorised gains from a fiduciary by the principal was not a claim “to recover from the trustee trust property” for the purpose of limitation.  This note contends that Hui Chun Ping may have overlooked the implications of FHR and warrants reconsideration.