ABSTRACT
Strangers to a trust, or agents of the trustees who act in breach of their obligations, do not automatically become constructive trustees. They may be liable for breach of their duties in accordance with general principles of law. Strangers (or agents of the trustees) become constructive trustees or are accountable to the trust if they exceed their authority and intermeddle with the affairs of the trust. This is the case if:
(a) they act as trustees de son tort (the phrase literally means trustees of their own wrong); or
(b) they knowingly receive the trust property for their own benefit; or
(c) they dishonestly participate in a breach of trust without receiving the trust property. In this last event, the modern view is that such strangers are accountable for any profits made, but ought not to be treated as constructive trustees. The earlier decisions have not always drawn this distinction and have loosely declared that defendants within this category are constructive trustees.
