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The Victorian Court of Appeal today upheld a decision awarding the plaintiffs restitution based on a mistake of law.

The dispute arose following a horse race. The defendant owned a horse that came second past the post. However, when the winning horse was subsequently disqualified (it tested positive for a banned substance), the defendant's horse was elevated to first place. The plaintiffs then paid the defendant prize money on the basis that his horse was the legal winner.

At the time of paying the prize money to the defendant, the plaintiffs were not aware that the owners of the first horse had a right of appeal. That right of appeal was exercised, and the stewards' decision overturned. The defendant's horse was relegated to second place. The plaintiffs sought recovery of the additional $76,500 it paid to the defendant.

The defendant was ordered to return the money to the plaintiffs. Both defences of 'voluntary payment' and 'honest receipt' were rejected.

Michael