Common law damages are awarded to compensate the innocent party for the breach of a common law wrong, and equitable compensation is awarded to compensate an innocent party for a purely equitable wrong.

The central concept of the first part of this chapter is that the object of equitable compensation is to restore the plaintiff to the position they would be in if not for the breach. It discusses the application of this central concept to the recoverability of non-pecuniary loss and the basic measure of equitable compensation. The former explores whether equitable compensation is even available for non-pecuniary loss (embarrassment and distress); the latter probes the reasoning which establishes that equitable compensation puts the plaintiff into as good a position pecuniarily as before the injury, thereby satisfying the object of equitable compensation.

The second part of the chapter explores whether the wrongdoer should be visited with the consequences of their conduct in the context of the various equitable wrongs explored – Breach of trust; Breach of fiduciary duty; and Breach of an equitable duty of care.

A successful claim against the fiduciary may result in an award of compensation for loss, disgorgement of gain or restitution of property misappropriated by the fiduciary. But it will sometimes be impossible for the plaintiff to obtain complete relief, particularly if the fiduciary is insolvent or beyond the jurisdiction of the court. In some of these cases, the plaintiff may be able to pursue third parties who participated in the breach of duty. The principles governing the imposition of liability on participants are discussed in this chapter. This chapter principally examines the liability of third parties under the so-called ‘two limbs’ of Barnes v Addy. Liability under the first limb arises when the defendant has knowingly received property in breach of fiduciary duty. Liability is imposed under the second limb on a defendant who knowingly assists the commission of a breach of fiduciary duty. But, as the cases make clear, third parties can be held accountable on other equitable grounds. Finally, a common law claim can sometimes be brought in unjust enrichment against the third party which does not require proof of a breach of fiduciary duty.

In certain situations, equity orders the defendant to make payments to the plaintiff as a remedy for the wrong done. These are orders for the defendant to account for profits made, or pay equitable compensation to the plaintiff. These remedies impose a personal obligation on the wrongdoer to pay and do not per se attach to property. This is their disadvantage compared to proprietary remedies in the case of the defendant’s insolvency. The remedies perform substantially different tasks. We will now look at each remedy in turn.

The statutory regime that governs employee benefit plans includes fiduciary provisions that track the obligations of loyalty and care developed in trust law. Relationships among key benefit plan actors, however, never have mapped neatly onto the trust law structure of settlors, trustees, and beneficiaries. In particular, the self-interest of the employers that sponsor benefit plans is in tension with their fiduciary obligations. Changes in the relative importance of some types of benefit plans have caused the tensions to become more acute. To address the relationships among benefit plan actors and the tensions between self-interest and fiduciary obligation, courts have developed implementing rules to adapt the fiduciary standards to the employee benefit plan ecosystem. This chapter compares two implementing rules to identify differences in the ways they function and have adapted to the current plan paradigms.