Re GoldCorp Exchange Ltd [1994]

Key Notes

• Facts: The company had contracts with customers for the purchase of bullion. Most of the gold was segregated and identified with specific customers, meaning that it was set aside for them.

• Issue: When the company went into insolvency, customers could not establish a proprietary interest in the gold, despite it being segregated and identified for their benefit.

• Reinforcement of Re London Wine: The case reinforced the principles established in Re London Wine, stating that equity should not develop a flexible approach to the certainty of subject matter, especially when dealing with tangible assets.

◦ In this case, even though the gold was segregated and identified, the court found that the customers did not have a proprietary interest in it because the necessary steps to create a valid trust were not taken.

• The ruling underscored that merely segregating or identifying assets without formal and clear actions to transfer or hold them in trust does not suffice to create a valid proprietary claim. The requirement for certainty in the subject matter of a trust remains strict, especially when it involves tangible property.

This case reinforces the need for a clear and certain approach to the subject matter of a trust, particularly in cases involving tangible property, and limits the development of flexible doctrines that might allow claims of beneficial ownership without proper formalities.