Kelly v Fraser [2012]

Facts

  • The Privy Council were presented with a case in which trustees of a pension fund had accepted, without authority, a large deposit from the defendant, which would increase payments to him later in life
  • The claimants wished to give the payment back to the defendant, as it was accepted without authority

Issue

  • Was the acceptance binding

Decision

  • Yes

Reasoning

  • The trustees had the apparent authority to deal with all administrative functions relating to contributors’ money
  • The trustees were the only point of contact for contributors such as the defendant
  • The pension fund (principal) had organised its affairs in such a way as to grant apparent authority to make the acceptance of the payment binding
  • The case did not disagree with either The Ocean Frost [1986] or First Energy v Hungarian International Bank [1993]
RELATED CASE  Lloyd v Grace, Smith & Co (1912)

Posted in Commercial Law Revision Notes.

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