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Sender:
Steve Hedley
Date:
Wed, 9 May 2001 17:17:32 +0100
Re:
Eastbourne DC v Foster, QBD, 20 Dec 2000

 

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 infringement 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

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