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This responds to Robert's second point, and in particular para [22] of Lord Hoffman's judgment.

Robert said "He is saying, I think, that mistake need not be an essential part of the cause of action for the purposes of section 32(1)(c) ...".

In my view, that is precisely what he was saying.

Robert went on to query Lord Hoffman's reasoning. I agree that it is difficult to understand, or at least see much force in, the "clinical negligence" example. But the general proposition seems reasonable enough.

The specific question in issue was whether a claim under Woolwich met the description of being "for relief from the consequences of mistake". As a matter of construing those words, it seems to me to be is possible to say that at least in some circumstances, of which the present case was an example, both a Woolwich claim, and a claim expressly asserting a right to recover a mistaken payment, are "for relief from the consequences of mistake". Mistake may not be an essential to the Woolwich cause of action, but it still can be seen as fitting that description.

Best regards

Jonathon

================================

JONATHON MOORE
Barrister, Victorian Bar

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----- Original Message -----
From: "Robert Stevens"
Sent: Thursday, October 26, 2006 2:30 AM
Subject: Re: [RDG] DMG

A first response to DMG.

(1) Unsurprisingly, I think Lord Scott, a judge I have always held in the highest esteem, gets it right.

That said, I think counsel for the Revenue dropped the ball. Badly. It seems to have been conceded by counsel that a claim for restitution was available but only under Woolwich (see Lord Hoffmann at [7], Lord Walker at [117], [135]). Lord Scott seems to have taken the view he did without the assistance of argument on the point.

Normally, it is a good tactic when seeking to resist an appeal to the House of Lords to simply maintain that the Court of Appeal were right for the reasons they gave. However, in this case the arguments for an 'exclusive regime' in relation to ultra vires tax demands were so hopeless, and dependent upon a strained reading of the speeches of Lord Goff which the House of Lords were not bound by, that to seek to defend the result in the Court of Appeal based upon the reasons they gave was a serious mistake. Unsurprisingly, the Revenue went down 5-0 on this point.

Only Lord Hoffmann in the majority in what he describes as a footnote, briefly alludes to the point that the money was still payable, although the UK had behaved unlawfully as a matter of Community law. He agrees with the Court of Appeal, rejecting Park J's view, that there was no liability to pay, but gives no substantive reasons [32]. The Scot in the court, Lord Hope, very disappointingly agrees with Park J's interpretation of the legislation at [62], concluding that there was liability to pay but that this didn't matter as there was a causative mistake. The latter view cannot be right.

(2) Lord Walker seems to think that neither the correct interpretation of section 32(1)(c) nor the question of whether the claim was based upon mistake or absence of legal ground arose for resolution. However if we accept, as he seems to do at [146]-[147] that a mistake must be an essential element of the cause of action under section 32(1)(c), it is hard to see how the second question does not arise. In DMG the absence of legal ground, if there was one, was not triggered by the mistake but by the contravention of European Union law. If restitution follows where there is an absence of legal ground, the mistake made was not an essential element of the cause of action and section 32(1)(c) is not triggered.

Whilst Lord Walker's toying with Peter's 'Pyramid' at [158] is interesting, I wonder whether it is consistent with the result he reaches. Only if the mistake, at the base of the pyramid, triggers the absence of legal ground higher up is it an essential part of the cause of action (eg a contract of sale where the price has been paid but the subject matter does not exist.)

Lord Hoffmann sees the point, I think, but I am puzzling over his answer, at [22]

That does not seem to me inconsistent with the existence of the mistake not being essential to the cause of action but merely one example of a case which falls within a more general principle, just as one could have (say, for the purposes of limitation) a category called "clinical negligence" without implying that it is a cause of action different in nature from other kinds of negligence.

He is saying, I think, that mistake need not be an essential part of the cause of action for the purposes of section 32(1)(c), but I am not sure I follow his reasoning as to why not. If anyone can help me out I'd be grateful.

(3) On whether there was a mistake the differences between Lords Hoffmann and Hope are those which where ascertainable from KB v Lincoln. Hoffmann is quite explicit in deeming there to be a mistake where the law has changed because of judicial decision ([23]) as he admits, this can be read as supporting the Birks view ([28]) that it is better not to try and square this with the orthodox approach that the transfer is vitiated by any mistake present in the claimant's mind, but rather to accept that the true basis of recovery is absence of legal ground. Lords Hope and Walker seem to me to place more emphasis on finding a real mistake.

(4) Lord Brown's point will have to be paid for by some litigant in the future.

(5) The shame is that a lot of time and effort has been spent rebutting the argument from 'exclusivity' which deservedly went down 5-0, when counsel's time, and their Lordships lengthy speeches, would more profitably have been spent focusing on other issues.