Two recent successful appeals to the Privy Council from the Court of Appeal of New Zealand have once again emphasised the importance of proprietary claims in conferring priority in insolvency over the claims of the general creditors of a bankrupt. Attorney-General for Hong Kong v. Reid1 concerned land in New Zealand purchased with the proceeds of bribes accepted by a Hong Kong Public Prosecutor as an inducement to exploit his official position to obstruct the prosecution of certain criminals. The Privy Council imposed a constructive trust where the Court of Appeal of New Zealand had, in accordance with precedent,2 denied one and thus enabled the Government of Hong Kong to recover the land in priority to any other creditors of the Public Prosecutor. In Re Goldcorp Exchange3 concerned the liquidation of a gold-dealer which had offered its purchasers the option of leaving their gold in its custody as “non-allocated bullion”.

BRITISH commercial law scholars, of whom Prof. Roy Goode and Prof. Aubrey Diamond are two conspicuous examples, have long been attracted to the possibility of using Article 9 of the American Uniform Commercial Code as a basis for modernising and restructuring the English law of chattel security. As readers of Part V of the Crowther Report1 will know, this was the road to reform which the Crowther Committee recommended to the British government as long ago as 1971. In the course of his eighth Crowther Memorial Lecture, given at Queen Mary College in 1983,2 Prof. Goode expressed the hope that before the end of the decade England and Wales would enact the recommendations in the Crowther Report. We know now that he was too sanguine but our hopes were revived when Prof. Diamond submitted his lucid, and in the view of this writer and many others, highly persuasive recommendations to the Department of Trade and Industry in 1989.3