Royal Brunei Airlines appointed Borneo Leisure Travel Sdn Bhd to be its agent for booking passenger flights and cargo transport around Sabah and Sarawak.

It was receiving money for Royal Brunei, which was agreed to be held on trust in a separate account until passed over.

But Borneo Leisure Travel, with Mr Tan's knowledge and assistance, paid money into its current account and used it for its own business.

The Court of Appeal of Brunei Darussalam held that the company was not guilty of fraud or dishonesty, and so Mr Tan could not be either.

Giving the advice of the Privy Council, Lord Nicholls held it was the dishonest assistant's state of mind which matters.