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Court refuses finding of fiduciary duty for informal assistance in Winehouse v Parry and Gourlay

Judgment was recently handed down in a claim brought by Amy Winehouse’s father, Mr Mitchell Winehouse, in his capacity as personal representative of her estate (the “Estate”), against two of her close friends, Ms Naomi Parry and Ms Catriona Gourlay. 

While the case dealt with a number of legal issues, the decision is notable as one of the first applications at first instance of the Supreme Court’s test for establishing a fiduciary duty in Hopcraft v Close Brothers Ltd  (“Hopcraft”). This article focuses on the application of the test for fiduciary duties and not on the issues of conversion, which constitute much of the 216-page judgment (and were decided in favour of the defendants).

Background

The defendants, Ms Parry and Ms Gourlay, were close friends of Amy Winehouse. In 2021 and 2023, they sold a number of items at an auction house, including clothing worn by Amy Winehouse, as well as handbags, jewellery and sketches associated with her. The claimant alleged that these items did not belong to the defendants but rather to the estate of Ms Winehouse, and therefore the defendants had no entitlement to sell them. The defendants’ case was that (i) the items were always owned by them, (ii) the items were gifted to them by Ms Winehouse prior to her death or abandoned by her, or (iii) neither Ms Winehouse nor her estate had possession or an immediate right to possession over them. 

Was there a fiduciary relationship?

Mr Winehouse also sold items from the Estate at the 2021 auction. He alleged that Ms Parry acted as an intermediary between the Estate and the auction house in relation to these items, in circumstances which gave rise to a fiduciary relationship. The Claimant alleged that the relationship between himself and Ms Parry was one of trust and confidence and that Ms Parry was aware that she had a duty to act honestly, loyally and in a disinterested manner and had assumed that responsibility. As such, Mr Winehouse alleged that Ms Parry was in breach of her fiduciary duty by acting in her own financial interests, rather than with “undivided loyalty” to him, without his informed consent to act, and was therefore liable to account for the profits she made as a result.

Ms Parry denied (i) the existence of any fiduciary relationship; (ii) that she owed any fiduciary duties to the claimant; and (iii) that she acted in breach of any such fiduciary obligations to the claimant.

Application of Hopcraft v Close Brothers Ltd

In determining whether any fiduciary duty arose, the judge applied the Supreme Court’s approach in Hopcraft as the leading authority on fiduciary duties.

In Hopcraft, three conjoined appeals concerning motor finance required the Supreme Court to consider when dealers or brokers owe fiduciary duties to customers. In considering the issues in that case, the Supreme Court noted the lack of any precedent to establish a fiduciary relationship in this novel situation, which lay beyond the accepted scenarios (such as solicitor and client, director and company, and trustee and beneficiary). The Supreme Court found that the presence of a “single-minded or undivided loyalty” was what united previous findings of a fiduciary duty. The Supreme Court noted that it was common ground in the case that “a de facto fiduciary relationship may arise outside the settled categories… where the particular facts about the relationship justify that conclusion”. The Supreme Court’s headnote which summarised the circumstances in which a fiduciary duty arises, was cited in this case, reads as follows:

… fiduciary duties arose where a person consciously assumed (or undertook) responsibility to act exclusively on behalf of another in relation to the management of the property or affairs of the other, in circumstances where he or she knew or ought to appreciate that this carried with it the expectation that he or she would act with single-minded loyalty (meaning an attitude of altruism) to that other in that regard; that such an undertaking or assumption of responsibility could arise where the fiduciary had expressly undertaken to exclude his or her own interests and those of third parties in the conduct of the other’s affairs, or where the objectively assessed circumstances (particularly arising out of the acts of the fiduciary) made it appropriate for equity to treat the parties as if such an undertaking had been given; that neither the existence of a relationship of trust and confidence, nor the existence of a relationship in which one party was in a position of power over another who was dependent on him, was sufficient to give rise to a fiduciary duty, each being the consequence rather than the cause of a fiduciary relationship …

In Hopcraft, the Supreme Court ultimately found that car dealers do not owe fiduciary duties to consumers, given the arm’s length nature of the relationship and the fact that each party was acting only in their own interest.

Applying Hopcraft to Winehouse v Parry, the judge held that Ms Parry did not consciously assume or undertake responsibility to act exclusively on behalf of the claimant with respect to the 2021 auction, and therefore could not be found to have undertaken a fiduciary relationship. The Court characterised her role as practical and supportive, acting as liaison, and providing reassurance and empathy.

The relevant factors considered by the Court were that:

• Mr Winehouse had his own separate line of communication with the auction house, finding that he had not left matters entirely to Ms Parry. 
• Ms Parry was not paid by the claimant, nor was there any formal agreement or arrangement in place that she would have any agency or intermediary role (and neither did she assume such a role). 
• Ms Parry did not undertake to the claimant that she would exclude her own interest or the interest of Ms Gourlay and there was nothing to indicate that she should be treated as if such an undertaking was given. 
• There was no evidence of deliberate concealment by Ms Parry (nor Ms Gourlay) in relation to the fact that they were also auctioning items. 

Comment

This judgment is an early indication of how the Supreme Court’s decision in Hopcraft is likely to impact fiduciary duties outside established categories. While on the facts of Winehouse v Parry, the claimant was unable to make out the fiduciary relationship, the Supreme Court emphasised in Hopcraft that the categories of fiduciary relationship are not closed and that fiduciary relationships can arise outside the settled categories. The recent decision in Winehouse v Parry highlights that to establish such a relationship, the English courts will look for clear evidence of an undertaking of loyalty, not merely reliance, trust, assistance or influence.

With thanks to Trainee Solicitor Macha Phelan for her contribution to this piece.