========================================================================= Date: Fri, 4 May 2001 13:04:00 -0400 Reply-To: Lionel Smith Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Lionel Smith Subject: Dr Hashim comes to Canada MIME-version: 1.0 Content-type: text/plain; charset="us-ascii"; format=flowed In front page news today, the main player in Arab Monetary Fund v Hashim is apparently on his way to Canada ... he has been pursued by the AMF ever since judgment was given against him in England in the amount of US$50m. Today's story says that the interest is now about $80m, and apparently about $12m has been recovered. http://www.globeandmail.com/gam/National/20010504/UJAWAN.html Lionel ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Sat, 5 May 2001 10:01:45 +0800 Reply-To: CHONG_Chin_Chin@SUPCOURT.GOV.SG Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: CHONG_Chin_Chin@SUPCOURT.GOV.SG Subject: Chin Chin CHONG/SUPCOURT/SINGOV is out of the office. MIME-Version: 1.0 Content-type: text/plain; charset=us-ascii I will be out of the office starting 05/05/2001 and will not return until 01/06/2001. ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Sun, 6 May 2001 06:57:02 -0700 Reply-To: common-law@FTNETWORK.COM Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Look Ho Subject: Bank Mandate MIME-Version: 1.0 Some time ago Rory White asked in relation to Barclays Bank v. Simms [1980] 1 QB 677: "What was the legal basis for the bank making good the drawer company's account?" Paul Matthews replied: "The bank has no legal basis for debiting the drawer's account, since the drawer has not (now) authorised this." On a related note, what if the bank did have a legal basis for debiting the drawer's account and yet tried to claim the money back from the payee? Consider this scenario. A potentially insolvent company (the "Payor") desired to pay off an inter-company debt owed to its sister company in the hope that the payment would fall outside the preference period should it go into liquidation later. However the signatory to its bank account was unavailable to sign the bank instruction to transfer. In order that the payment could be made immediately, a director of the Payor forged the signature of the signatory and sent the payment instruction to the bank by fax. The bank duly paid thinking that the signature was genuine. It later turned out that the Payor returned to profitability and did not go into liquidation. Under ordinary circumstances, the bank cannot debit the Payor's account on the basis of a forged signature as it was acting without mandate (Natwest v Barclays Bank [1975] QB 654, 666). However the bank has an indemnity in relation to instructions sent by fax along these lines: "In consideration of the bank accepting and acting on any instructions received from the Payor by fax, the Payor agrees to indemnify the bank against all losses incurred by the bank as a consequence of the bank acting on such instructions and irrevocably authorise the bank to debit the Payor's account immediately with all sums paid by the bank in respect of such instructions, provided the bank was not negligent". An indemnity of this sort is not uncommon. Assuming that the bank was not negligent, it seems that in these circumstances the bank can debit the Payor's account because the instruction was sent to the bank by fax and the bank did act on it. Having debited the Payor's account, can the bank also claim the money back from the payee on the ground of mistake as to the authenticity of the signature? The bank would argue as follows. The bank would not have effected the payment instruction but for its mistake as to the authenticity of the signature. But it was in fact acting without mandate (Natwest v Barclays Bank [1975] QB 654, 666). Since the bank was acting without mandate, the payee did not give consideration for the payment and thus was liable to repay the bank (Barclays Bank v. Simms). The fact that the bank has debited the Payor's account pursuant to the indemnity is irrelevant because passing on is not a defence. This doesn't sound right, does it? Look ______________________________________________________________________________________ _____________ Get your free e-mail account with *unlimited* storage at http://www.ftnetwork.com Visit the web site of the Financial Times at http://www.ft.com ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Sun, 6 May 2001 22:51:31 -0400 Reply-To: Lionel Smith Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Lionel Smith Subject: Re: Bank Mandate In-Reply-To: <02ead1258130651EMAIL002@email002> Mime-Version: 1.0 Content-Type: text/plain; charset="us-ascii"; format=flowed > >Having debited the Payor's account, can the bank also claim the money back >from the payee on the ground of mistake as to the authenticity of the >signature? The bank would argue as follows. The bank would not have >effected the payment instruction but for its mistake as to the >authenticity of the signature. But it was in fact acting without mandate >(Natwest v Barclays Bank [1975] QB 654, 666). Since the bank was acting >without mandate, the payee did not give consideration for the payment and >thus was liable to repay the bank (Barclays Bank v. Simms). The fact that >the bank has debited the Payor's account pursuant to the indemnity is >irrelevant because passing on is not a defence. > >This doesn't sound right, does it? If the question is whether, on those facts, the bank could recover from the payee, I think Barclays v Simms says that it can. But it is not clear why it would want to, if the customer was not making trouble about the debit, unless the bank were trying to debit the account AND recover from the payee ... If the question is whether, having recovered from the payee, the bank could keep both lots of money, it does not sound right. Surely the indemnity between banker and customer is just that, an indemnity; the customer promises to indemnify against loss; once the bank has recovered from payee, there is no loss, and the bank would have to re-credit the account. The customer might even have a security interest under Lord Napier & Ettrick. The fax-instruction indemnity against loss is not the same as authority to debit the account. It is more like a consensually created estoppel. Lionel ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Mon, 7 May 2001 16:21:06 +1200 Reply-To: Charles Rickett Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Charles Rickett Subject: Re: Bank Mandate Comments: To: Lionel Smith In-Reply-To: <5.0.2.1.2.20010506223040.00a25d40@po-box.mcgill.ca> Mime-version: 1.0 Content-type: text/plain; charset="US-ASCII" Content-transfer-encoding: 7bit For a strange New Zealand contribution, where the bank did sue both the payee and its customer, see Westpac v Rae [1992] 1 NZLR 338 Charles Rickett on 7/5/01 2:51 PM, Lionel Smith at lionel.smith@MCGILL.CA wrote: >> >> Having debited the Payor's account, can the bank also claim the money back >> from the payee on the ground of mistake as to the authenticity of the >> signature? The bank would argue as follows. The bank would not have >> effected the payment instruction but for its mistake as to the >> authenticity of the signature. But it was in fact acting without mandate >> (Natwest v Barclays Bank [1975] QB 654, 666). Since the bank was acting >> without mandate, the payee did not give consideration for the payment and >> thus was liable to repay the bank (Barclays Bank v. Simms). The fact that >> the bank has debited the Payor's account pursuant to the indemnity is >> irrelevant because passing on is not a defence. >> >> This doesn't sound right, does it? > > If the question is whether, on those facts, the bank could recover from the > payee, I think Barclays v Simms says that it can. But it is not clear why > it would want to, if the customer was not making trouble about the debit, > unless the bank were trying to debit the account AND recover from the payee > ... > > If the question is whether, having recovered from the payee, the bank could > keep both lots of money, it does not sound right. Surely the indemnity > between banker and customer is just that, an indemnity; the customer > promises to indemnify against loss; once the bank has recovered from payee, > there is no loss, and the bank would have to re-credit the account. The > customer might even have a security interest under Lord Napier & Ettrick. > The fax-instruction indemnity against loss is not the same as authority to > debit the account. It is more like a consensually created estoppel. > > Lionel > > ____________________________________________________________________ > This message was delivered through the Restitution Discussion Group, > an international internet LISTSERV devoted to all aspects of the law > of unjust enrichment. To subscribe, send "subscribe enrichment" in > the body of a message to . To unsubscribe, > send "signoff enrichment" to the same address. To make a posting to > all group members, send to . The list is > run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email > . > ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Tue, 8 May 2001 05:44:27 -0700 Reply-To: common-law@FTNETWORK.COM Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Look Ho Subject: Re: Bank Mandate MIME-Version: 1.0 ************************************************************ lionel.smith@MCGILL.CA wrote on 5/7/01 3:51:31 AM ************************************************************ "If the question is whether, having recovered from the payee, the bank could keep both lots of money, it does not sound right. Surely the indemnity between banker and customer is just that, an indemnity; the customer promises to indemnify against loss; once the bank has recovered from payee, there is no loss, and the bank would have to re-credit the account. The customer might even have a security interest under Lord Napier & Ettrick. The fax-instruction indemnity against loss is not the same as authority to debit the account. It is more like a consensually created estoppel." I was indeed postulating an evil bank trying to keep both lots of money. I agree that the loss analysis might be one way to argue about it, though stricly speaking this is not what the contract says. The Payor agreed to "irrevocably authorise the bank to debit the Payor's account immediately with all sums paid by the bank in respect of such instructions". I have seen indemnity with the same wording, though wholly unrelated to my hypothetical. Perhaps some sort of implied term is necessary to achieve the re-credit. Look ______________________________________________________________________________________ _____________ Get your free e-mail account with *unlimited* storage at http://www.ftnetwork.com Visit the web site of the Financial Times at http://www.ft.com ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Wed, 9 May 2001 13:40:16 +0100 Reply-To: Charles Mitchell Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Charles Mitchell Subject: Eastbourne DC v Foster, QBD, 20 Dec 2000 Mime-Version: 1.0 Content-Type: text/plain; charset="us-ascii" Group members may be interested to read this case, now on LEXIS, whose facts are very similar to those of Hinckley & Bosworth BC v Shaw, which I noted at [2000] RLR 355, and which itself is now reported at [2000] LGR 9. Foster was a former local authority employee whose redundancy package was inflated by his former employer in a way which fell foul of the statutory controls on local authority spending, with the result that the contract under which the payments were made to him was void ab initio. The authority sued to get the money back, and he pleaded change of position. In Shaw, this defence failed because Bell J followed Svenska to hold that you can't have C of P if you rely not on your receipt of money but on the supposed validity of the void contract under which the payments are made, a fine distinction as Colin Mackay QC, sitting as a deputy HCJ, remarked in Foster in the course of allowing the defence: > I believe that as each month from September 1998 went by a payment went >into his account and that as month succeeded month [Foster] must have believed, with >justification, that the payments would continue and could be relied on to do so. >If at any stage he had been told the truth, that no further payment could >lawfully be made because the agreement was void, what would he have done? It is >not possible to predict this with any confidence, save to say he would certainly >have done something. He could have hammered on the Council's door with at least >a moral case for some form of reinstatement or non-enhanced redundancy payment. >He could have looked for a job elsewhere. He could have considered the position >of those who had advised him. The one thing he would not have done is nothing >at all. Though the distinction is a fine one I believe it is right to say that >in refraining from doing these things he was relying not on the expectation of >future benefits under the agreement (such as the enhanced benefits due in >September 1999) but on the stream of payments themselves. ________________________________________________________________________ Dr Charles Mitchell Lecturer in Law School of Law King's College London Strand LONDON WC2R 2LS tel: 020 7848 2290 fax: 020 7848 2465 ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Wed, 9 May 2001 17:17:32 +0100 Reply-To: Steve Hedley Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Steve Hedley Subject: Eastbourne DC v Foster, QBD, 20 Dec 2000 In-Reply-To: <3.0.6.32.20010509134016.00798ac0@law-mail.kcl.ac.uk> Mime-Version: 1.0 Content-Type: text/plain; charset="us-ascii" At 13:40 09/05/01 +0100, "Dr Charles Mitchell" wrote: >In Shaw, this defence failed because Bell J followed Svenska >to hold that you can't have C of P if you rely not on your receipt >of money but on the supposed validity of the void contract under >which the payments are made, a fine distinction as Colin Mackay >QC, sitting as a deputy HCJ, remarked in Foster in the course of >allowing the defence: It's an exceedingly fine distinction. But even if we draw it, what good does it do? Someone who believed that the payments were illegal but would never be demanded back (eg who had noticed the error but believed that the payor never would) would not be entitled to keep the money. So even if we make the distinction, it gives the payee no escape - he still has to rely on his belief in the legality of the payment, to justify his retention of the sums paid. Perhaps a better approach is to ask how severe an infringment of ultra vires is involved. To allow the payee to keep the money flouts the ultra vires principle, but to remove it from the payee will sometimes flout the security of transaction which is also a goal of the law. So perhaps the way forward is to see what is at stake in the decision. Steve Hedley =================================================== FACULTY OF LAW, UNIVERSITY OF CAMBRIDGE telephone and answering machine : (01223) 334931 e-mail : steve.hedley@law.cam.ac.uk messages : (01223) 334900 fax : (01223) 334967 Christ's College Cambridge CB2 3BU =================================================== ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Fri, 11 May 2001 11:16:09 -0400 Reply-To: Lionel Smith Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Lionel Smith Subject: Re: Bank Mandate In-Reply-To: <068d24645120851EMAIL002@email002> MIME-version: 1.0 Content-type: text/plain; charset="us-ascii"; format=flowed > >"If the question is whether, having recovered from the payee, the bank could >keep both lots of money, it does not sound right. Surely the indemnity >between banker and customer is just that, an indemnity; the customer >promises to indemnify against loss; once the bank has recovered from payee, >there is no loss, and the bank would have to re-credit the account. The >customer might even have a security interest under Lord Napier & Ettrick. >The fax-instruction indemnity against loss is not the same as authority to >debit the account. It is more like a consensually created estoppel." > >I was indeed postulating an evil bank trying to keep both lots of money. I >agree that the loss analysis might be one way to argue about it, though >stricly speaking this is not what the contract says. The Payor agreed to >"irrevocably authorise the bank to debit the Payor's account immediately >with all sums paid by the bank in respect of such instructions". I have >seen indemnity with the same wording, though wholly unrelated to my >hypothetical. Perhaps some sort of implied term is necessary to achieve >the re-credit. If that is what the fax-instruction agreement says, it does not seem consistent with the other assumption in the earlier facts, that the signatory was not authorized. You would have to reconcile the "normal" contract governing the account, including signing authority, with this fax-instruction agreement, and if it includes the words above, surely you would have to say either (1) in respect of faxed instructions at least, the debit was fully authorized, and the bank did have its customer's mandate or (2) the words above cannot stand with the other agreement as to signing authority, and are just another way of expressing the indemnity nature of the fax-instruction agreement. LDS ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Fri, 18 May 2001 07:13:35 +0100 Reply-To: Steve Hedley Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Steve Hedley Subject: Recent cases Mime-Version: 1.0 Content-Type: text/plain; charset="us-ascii" I have recently added the following to the England and Wales page of my Restitution site (www.law.cam.ac.uk/restitution/): BSkyB v. Customs Commissioners (Adm Ct, 23 February 2001, the Woolwich principle) Casio v. Sayo (CA, 11 April 2000, dishonest assistance and conflicts) Customs Commissioners v. Cresta Holidays (CA, 20 February 2001, repayment of tax) Eastbourne Borough Council v. Foster (QBD, 20 December 2000, ultra vires payment) Wilson v. First County Trust (CA, 2 May 2001, Consumer Credit Act and Human Rights) The last has only a relatively tenuous connection with restitution, but I have included it because the main point in the case is of general private law relevance. It concerns a declaration that significant parts of the Consumer Protection legislation are incompatible with the creditor's human rights. Steve Hedley =================================================== FACULTY OF LAW, UNIVERSITY OF CAMBRIDGE telephone and answering machine : (01223) 334931 e-mail : steve.hedley@law.cam.ac.uk messages : (01223) 334900 fax : (01223) 334967 Christ's College Cambridge CB2 3BU =================================================== ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Thu, 24 May 2001 11:28:23 -0400 Reply-To: Lionel Smith Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Lionel Smith Subject: Hong Kong Barbers MIME-version: 1.0 Content-type: text/plain; charset="us-ascii"; format=flowed RDG members may remember a discussion in March 2000, which Arianna Pretto initiated by noting that s 85(2) of the HK Securities Ordinance provides that a disposition of client money by a broker is "void ab initio" which raised the question whether this denied a recipient (eg a grocer) any defence of bona fide purchase without notice. This has developed into a fascinating article by Arianna and Bernard Rudden, "Trust in money and money in trust: brokers, barbers and Hong Kong oddities" [2001] LMCLQ 157 (the grocer having been turned into a barber). In other news, I mentioned in a posting of 30 Jan that the former speaker of the Alberta legislature was suing the crown in right of Alberta for meeting the legal costs of a defamation settlement by a former provincial politician out of an insurance programme, the argument being that the question whether to pay was one for the legislature and not the executive. This "Auckland Harbour Board" claim has now been dismissed (18 May), presumably struck out on the pleadings. There may be an appeal. Lionel ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Sat, 26 May 2001 08:31:29 -0700 Reply-To: common-law@FTNETWORK.COM Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Look Ho Subject: Total Failure MIME-Version: 1.0 Members might be interested to learn that the requirement that the failure of consideration be total has still not been shaken off. In Clowes Development (UK) Ltd v Mulchinock (24 May 2001), John Martin QC sitting as a deputy judge said: "The contract contains no express provision stipulating what is to happen to payments already made when the contract is terminated by breach. The position is accordingly governed by the general law. The most recent authorities, notably the decisions of the House of Lords in Hyundai Heavy Industries v Papadopoulos [1980] 1 WLR 1129 and Stocznia Gdanska v Latvian Shipping [1998] 1 All ER 883, indicate that such payments will be recoverable only if there has been a total failure of consideration." Look ______________________________________________________________________________________ _____________ Get your free e-mail account with *unlimited* storage at http://www.ftnetwork.com Visit the web site of the Financial Times at http://www.ft.com ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email . ========================================================================= Date: Mon, 28 May 2001 10:46:57 -0400 Reply-To: Lionel Smith Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Lionel Smith Subject: Singapore Conference on Int'l Business Law MIME-version: 1.0 Content-type: text/plain; charset="us-ascii"; format=flowed Members of the RDG might be interested in the 9th Singapore Conference on International Business Law, 29-31 August, 2001. Sessions will include: Prof John C Coffee, Jr , Columbia Law School: The Changing Landscape of Securities Trading and Exchanges Sir Lawrence Collins , Royal Courts of Justice, London: Choice of Law and Jurisdictional Issues in Modern Securities Transactions Dr Frieder Roessler , Former Director of Legal Affairs GATT/WTO: The Liberalisation of Trade In Financial Services and the General Agreement on Trade in Services: Unresolved Legal Issues Dr E Ferran, Director, Centre for Corporate & Commercial Law, Cambridge: Reform Initiatives in UK Company Law Full details are at the conference website: Lionel ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, tel. (+1) 514 398 6645,email .