The Trendtex principle in Australian law: context and recent developments

The Trendtex principle provides that a right to litigate can be assigned when the assignee has a genuine commercial interest in the litigation. The principle finds it origins in the English decision of Trendtex Trading Corporation v Credit Suisse and its application in Australia has recently been affirmed by the High Court decision in Equuscorp Pty Ltd v Haxton. There are, however, some uncertain aspects of the Trendtex principle, such as (1) exactly what constitutes a genuine commercial interest (2), whether an assignee must have a pre-existing enforceable right against the assignor (3), whether the Trendtex principle can include the assignment of a cause of action in tort, and if so (4), whether personal torts are assignable. The article resolves these uncertainties and concludes that the Trendtex principle has a wide scope, allowing for the assignment of causes of action in contract, restitution and tort – the latter extending to personal torts under appropriate conditions. It is contended that the principle’s wide scope appropriately mirrors the relaxation of judicial attitudes towards maintenance and champerty in the latter half of the last century. It also represents a suitably flexible policy response to the upsurge in diversified commercial litigation in the late twentieth and early twentyfirst centuries.