Bribery is coming under increasing attention following the passing of the Bribery Act 2010, under which bribery is a criminal act.
Whilst implementation of the Act, which was passed under the previous administration, has been delayed so that the Government has time to ensure the related guidance for business is practical and comprehensive, it is important to note that bribery is also a civil wrong. It is not well known that where a principal unknowingly uses an agent (who may be an employee of the principal) who accepts a bribe from a third party in order to secure a contract for the third party, a civil right of action also arises.
The right to recover damages depends on the principal not knowing that bribery is involved when the bribe is paid and also on whether or not the person receiving the bribe is acting in a fiduciary capacity as regards the principal.
The person receiving the bribe can be required to account to the principal for the amount of the bribe received and, where appropriate, for damages. Furthermore, the principal is entitled to rescind a contract procured by bribery and to refuse to perform their obligations under it on the ground that it is an illegal contract.
It is important to give careful consideration to what action to take as different approaches can have considerably differing ramifications. If you discover that a contract to which you have been a party has been entered into as a result of bribery, contact Jeremy Walker for advice.