Disgorgement in Ireland

Abstract

Ireland is a common law jurisdiction whose private law largely resembles that of England and Wales. Irish law recognises disgorgement as a remedy in a variety of ways. Certain statutes provide for disgorgement of profits wrongfully achieved through intellectual property infringements or stock market abuses. The law of equity has long recognised disgorgement, or liability to account, for breaches of fiduciary duty. In addition, Irish common law allows for disgorgement in both contract and tort scenarios. Domestic case law has envisaged disgorgement for contractual breaches done in bad faith since before the United Kingdom House of Lords introduced disgorgement in Attorney-General v Blake. However, cases of direct disgorgement for breach of contract remain vanishingly rare, resulting in uncertainty about the standard of misconduct required. Disgorgement more commonly occurs in tort cases. The Irish Law Reform Commission has approved the availability of disgorgement in both contract and tort as a means of preventing people from profiting from their wrongdoing. Besides direct recognition of disgorgement, Irish law also contains a number of functional equivalents, including notably the remedial constructive trust. In addition, claims for compensation or exemplary damages may in some cases take account of profits made by the defendant. However, it is not possible to bring class actions in claims for damages and this may erect a practical obstacle to full disgorgement taking place where wrongdoing has affected many victims. Beyond the realm of private law, the Criminal Assets Bureau is an administrative body empowered to strip wrongdoers of the proceeds of criminal activity.