Asian Journal of Comparative Law
Dishonest Assistance in Singapore and Malaysia since Barlow Clowes
Determining civil liability for dishonest assistance in breach of fiduciary duty requires courts to consider a combination of subjective and objective factors. Taking into account the person’s experience, intelligence and reasons for acting (subjective factors), did the person have sufficient knowledge of the transaction (subjective factor) so as to render participation in the transaction contrary to ordinary standards of honest behaviour (objective factor)? The piecemeal development of this test, as well as its complexity, led to inconsistency and confusion in application. In 2006, the Privy Council in Barlow Clowes International Ltd (in liq) v. Eurotrust International Ltd clarified that the person accused of dishonest assistance need not actually realise that involvement in the transaction would breach ordinary standards of honesty.
This article assesses how the dishonest assistance test has been applied since Barlow Clowes in two Commonwealth countries: Singapore and Malaysia. The article submits that recent Singaporean and Malaysian judgments have not satisfactorily articulated the various elements of the dishonest assistance test, and thus an attempt is made to provide a clear and concise formulation of the test. The article further posits that while Barlow Clowes indeed added badly needed clarity, it did so only with respect to the particular issue addressed by the Privy Council’s judgment. In other areas no less important – whether there is an active–passive dichotomy between dishonest assistance and knowing receipt, and the nature of wilful blindness in the non-criminal law context – fundamental questions about the contours of the test remain. The article proposes that there should not be an active–passive distinction, and that the test for wilful blindness – a type of dishonest assistance involving suspicion and turning a blind eye – should be revised to contain both subjective and objective elements.