Restitution Discussion Group Archives
| Sender: |
Lionel Smith |
| Date: |
Thu, 28 Sep 2000 09:46:08 -0400 |
| Re: |
Change of Position |
Two new
English cases on change of position:
Scottish Equitable
plc v Derby [2000] 3 All ER 793 (QBD): the defendant had a life assurance/
investment product with the plaintiff. The plaintiff forgot that the defendant
had taken benefits and sent him a statement showing he had £200,000+
when it should have showed £29,000. The erroneous statement was confirmed
by the plaintiff. The defendant took out £51,000 cash and invested
the rest with another company in a pension-paying product. The lump sum
was spent as to £42,000 on paying his mortgage and as to the rest
on 'modest improvements to lifestyle.' The plaintiff discovered the error
and the pension product was changed to yield a smaller pension, with a
capital refund to the plaintiff. The defendant, now in financial difficulties,
resisted repayment of the lump sum, arguing estoppel and also change of
position, on the basis that he had been denied the opportunity to make
other provision for himself and his wife. The plaintiff agreed to limit
its claim to the £42,000 if the court was satisfied that the defendant
was not aware of the mistake at the time he spent the rest (and it was
so satisfied). Held, no defence of change of position except as conceded
by the plaintiff. Estoppel not allowed due to the availability of c of
p on the facts of this case (without stating a general bar).
Philip Collins
Ltd v Davis [2000] 3 All ER 808 (ChD): By mistake the plaintiff overpaid
royalties to the defendants, and proposed to recoup this by set off against
future royalties. The defendants pleaded estoppel and c of p. As to estoppel:
mere payment was not a representation; moreover, it should not be available
where c of p is apt. As to c of p: the defence was argued on the basis
of a general adjustment of day-to-day life on the basis of the level of
royalties coming in. Held that the defendant had the burden of proving
the defence, and no particular expenditures were shown to have been made
in reliance on the overpayments; but it was permissible to base the defence
on a general adjustment of lifestyle to a stream of income. Half of the
overpayments were recoverable.
Lionel
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