One of the benefits, apart from the foreign earnings, of London’s court clogging Russian litigation, has been the collation of principles relating to the English civil law of bribery which can be summarized as follows:
The underlying substantive and remedial policies behind protecting a principal against bribes is an agent’s obligation to act in the best interests of its principal and to avoid a real possibility of potential conflict. Secrecy rather than the substantive inducement is regarded as the main evil.
A bribe involves a third party, usually a counterparty or on its behalf, secretly providing an agent a commission or other inducement.
To substantiate a claim based on bribery, inducement, corruption and fraud are presumed, so a claim can be brought for an innocent bribe even in cases where an agent believed he was acting in his principal’s best interests.
Once a bribe is made to an agent it entirely taints and subverts the agency relationship, so it’s not transaction specific and also taints any other unrelated payments to the agent from the principal’s counterparty.
An agent receiving or arranging to receive a bribe from a person dealing or seeking to deal with his principal will be jointly and severally liable with that person to the principal as a trustee for the amount of the bribe by way of restitution; or, any tortious loss suffered from having entered into the resulting and substantive transaction.
These principles are shortly stated but are often hidden within a depressing morass of facts.
Alistair Craig is a commercial barrister practicing in London. He can be contacted here.