Benefit obtained by agent

Where an agent received a benefit in breach of his fiduciary duty, he was obliged to account to the principal for such a benefit, and to pay, in effect, a sum equal to profit by way of equitable compensation

Principal's right to seek an account undoubtedly gave him a right in equitable compensation in respect of the bribe or secret commission, which equaled the quantum of that bribe or commission (subject to any permissible deduction in favour of the agent - e.g. for expenses incurred)

Where an agent acquired a benefit which came to his notice as a result of his fiduciary position, or pursuant to an opportunity which resulted from his fiduciary position, the general equitable rule was that he was to be treated as having acquired the benefit on behalf of his principal, so it was beneficially owned by the principal

In such cases, the principal had a proprietary remedy in addition to his personal remedy against the agent, and the principal could elect between the two remedies.

Whether in respect of secret profit/bribe/commission received by agent, the principal only had a claim for equitable compensation or also had a proprietary interest in the same

Deal for purchase of property

Agent acting on behalf of principal in respect of purchase of property from vendor - Agent obtaining undisclosed/secret commission from vendor without knowledge of principal

Agent held such secret commission or bribe on trust for his principal, and the principal had a proprietary claim to it

Bribes and secret commissions received by an agent should be treated as the property of his principal, rather than merely giving rise to a claim for equitable compensation

Secret commissions inevitably tended to undermine trust in the commercial world

Proceeds of a bribe or secret commission consisted of property which should not be in the agent's estate at all

In many cases, the bribe or commission would very often have reduced the benefit from the relevant transaction which the principal would have obtained, and therefore it could fairly be said to be the principal's property

Principal whose agent had obtained a bribe or secret commission should be able to trace the proceeds of the bribe or commission into other assets and to follow them into the hands of knowing recipients.