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In a fairly recent decision laid down in Oraki v Bramston [2017] EWCA Civ 403, [2017] All ER (D) 174 (May) the Court of Appeal inferred that a trustee in bankruptcy might owe duties to a bankrupt on a common law basis, outside the misfeasance claim given to the bankrupt under section 304 of the Insolvency Act 1986 (IA 1986).
In the case of Reynard v Fox [2018] EWHC 443 (Ch), [2018] All ER (D) 105 (Mar) the bankrupt tried to unsuccessfully argue that a trustee can owe contractual duties to protect the interests of the bankrupt.
Facts
The bankrupt made a claim against the former trustee in bankruptcy claiming that the trustee had breached duties which were owed to him.
The bankrupt alleged that there was a contract between himself and his trustee under which the trustee would have to look out for his interests as well as those of the creditors. The judge dismissed this out of hand on the basis that such contract would not be made out given the clear adversarial conflict between the interests of the bankrupt and that of his creditors.
The bankrupt also alleged that the trustee owed him a duty of care under the common law of negligence. Given the ruling in Oraki the judge dismissed such claim on the basis that he was able to set out a clear distinction as to losses suffered by the bankrupt himself and that of losses to the bankrupt estate. In this case nearly all losses claimed by the bankrupt were estate losses and not personal loss or damage and were accordingly dismissed.
If the bankrupt had been able to show personal loss, he may be able to bring a claim for negligence but there would be limited duties owed to a bankrupt by his trustee, so this would be difficult.