Gregson v HAE Trustees Ltd & Ors [2008] EWHC 1006 (Ch)

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Rowena Meager


“DOG-LEG” CLAIMS KICKED INTO TOUCH: BENEFICIARIES EXPOSED?The recent decision of the High Court in Gregson v HAE Trustees Ltd & Ors (“Gregson”) represents a low point for the potential sustainability of what has become known as a dog-leg claim, a hitherto rarely utilised cause of action. The essence of the dog-leg claim is this. When a trust suffers loss as a result of a breach by a corporate trustee, and that corporate trustee cannot or will not pursue its own directors to recover the losses to the settlement, a dog-leg claim recognises the right of action available to the corporate trustee as being the property of the trust. In the event that the corporate trustee fails to pursue its directors the beneficiaries may do so because the claim belongs to the trust.

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