Macmillan Inc. v. Bishopsgate Investment Trust plc (No. 3)

"Macmillan Inc. v. Bishopsgate Investment Trust plc" (No. 3) is a court case in the English Court of Appeal (see Courts of England and Wales). A claimant company sought the return of shares it owned in another company which its controller, Robert Maxwell, had fraudulently pledged to a third party.

The Court of Appeal rejected the claimant company's argument that the question should be classified as restitutionary, and instead categorised the issue as on of breach of trust, and determined the choice of law issues accordingly. It emphasised that it was not the claim but the issue which fell to be characterised. In the instant case this issue concerned title to intangible movable property and was thus governed by the "lex situs" of the shares, whose application the claimant company was trying to avoid.

The Court also addressed the question of where the "situs" of shares issued by a company is under the English conflict of laws. Sadly, the three judges (all of whom gave reasoned judgments) appeared to take different approaches; a majority seemed to be in favour of the historical rule preferred by Dicey & Morris - that shares should be deemed to be located where they can be dealt with, which in the case of registered shares will normally be the place of the share register - but there also appeared to be some support for the alternative line of authority in certain Canadian cases - that the shares should be deemed to located in the jurisdiction where the company was incorporated. On the facts of the case both were the state of New York, and so the decision made little practical difference. The Court also confirmed that bearer securities are considered to be located in the place where the certificate is physically present under English law.