Reviewed case brief
Re Kingston Cotton Mill Co (No 2)
[1896] 2 Ch 279
The Court of Appeal established the classic formulation of the auditor's standard of care. Lopes LJ held that an auditor is a watchdog, not a bloodhound — he is not required to approach his work with suspicion or to assume dishonesty unless circumstances specifically warrant it. He is entitled to r
- Court
- Court of Appeal
- Year
- 1896
- Subjects
- Company Law
- Reviewed
- 2026-06-30
Rule established
An auditor is a watchdog, not a bloodhound; he is not bound to approach his work with suspicion or to be a detective unless the circumstances are such as to arouse suspicion.
Facts
Issues
Held
Ratio decidendi
How to use it in an exam
Editorial source
[1896] 2 Ch 279
Educational summary only. Read the reported judgment or an authorised law report before relying on the case professionally.