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For your information
Charles Rickett

Practice Area Classification: Banking.

Name: Crantrave Ltd v Lloyds Bank plc.

Cite: BLD 170400589.

Court: Court of Appeal, Civil Division.

Judge: Pill and May LJJ.

Hearing Date: 13 April 2000.

Representation: Nicholas Jackson (instructed by Emrys James & Co) for C. Matthew Phillips (instructed by Edge & Ellison) for L.

Annotations: Liggett (Liverpool) Ltd v Barclays Bank Ltd [1928] KB 48 considered. Re Cleadon Trust Ltd [1938] 4 All ER 518 applied.

Outline: Subrogation. Circumstances in which doctrine applicable. In the absence of authorisation or ratification by the customer of a bank's payment to a third party, the "mere fact" that the bank's payment enured to the benefit of the customer did not establish an equity in favour of the bank against the customer. In order to establish the equity, the bank would have to show that the payment discharged (at least partially) a legal liability of the customer. In the absence of evidence that the bank's payment had been made on the customer's behalf or subsequently ratified by him, the payment to a creditor would not of itself discharge the company's liability to the creditor. Further, the onus of establishing a defence that the customer would be unjustly enriched was on the bank.

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Charles Rickett