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(A) FEATURES OF THE AGENT’S DEFENCE

(i) The Defendant Must Have Received the Benefit as Agent

The agent’s defence will not be available if the defendant received the benefit as principal, simply because in such circumstances the defendant will have received the benefit for his or her own use.[1] The defendant will not be considered to have received the benefit as agent in two particular circumstances:

  • (1) where the defendant did not have authority to receive the benefit on behalf of the supposed principal;[2]
  • (2) where the agent was acting on behalf of an undisclosed principal, so that the claimant was unaware that he or she was dealing with an agent.[3] Where, however, the agent is acting on behalf of an undisclosed principal, it may still be possible to defeat the restitutionary claim by reliance on the separate defence of change of position, which is not affected by such a limitation.

  • [1] Newall v Tomlinson (1871) LR 6 CP 405; Baylis v Bishop of London [1913] 1 Ch 127; Kleinwort Sons andCo v Dunlop Rubber Co (1907) 97 LT 263; National Bank of Egypt International Ltd v Oman Housing BankSAOC [2002] EWHC 1760 (Comm), [2003] 1 All ER (Comm) 246.
  • [2] Sorrell v Finch [1977] AC 728.
  • [3] See Sadler v Evans (1766) 4 Burr 1984,1986; 98 ER 34, 35; Baylis v Bishop of London [1913] 1 Ch 127,133(Cozens-Hardy MR); and Agip (Africa) Ltd v Jackson [1990] Ch 265, 288 (Millett J). Cf Transvaal and DelagoaBay Investment Co Ltd v Atkinson [1944] 1 All ER 579 where the defence succeeded even though the agent wasacting on behalf of an undisclosed principal, but the point was not argued.
 
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