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Stupid banker cases: Difference between revisions
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{{a|casenote|{{stupidbanker}}}}There is a series of what we can only describe as the “stupid banker” cases, which involve bankers negligently paying money to people they didn’t mean to, who then refuse to give it back. The cases are all quite similar in facts — the boil down to, well, bankers paying money on their customers’ behalves to creditors and later regretting it, but the courts come to wildly different conclusions, and it is quite the epistemological struggle to hold all of them in your head at once. So here is our handy cut-out-and-keep guide. | {{a|casenote|{{stupidbanker}}}}There is a series of what we can only describe as the “stupid banker” cases, which involve bankers negligently paying money to people they didn’t mean to, who then refuse to give it back. | ||
The cases are all quite similar in facts — the boil down to, well, bankers paying money on their customers’ behalves to creditors and later regretting it, but the courts come to wildly different conclusions, and it is quite the epistemological struggle to hold all of them in your head at once. So here is our handy cut-out-and-keep guide. | |||
The following factual variables: | The following factual variables: | ||
*'''Where did this happen?''' Possible answers: New York or the United Kingdom; | *'''Where did this happen?''' Possible answers: New York or the United Kingdom; | ||
*'''What were the customer’s instructions?''' Possible answers: ''do'' pay the money; definitely do ''not'' pay the money; and ''no particular instruction'' (so prima facie, do not pay the money, but room for that presumption to be rebutted) | *'''What were the customer’s instructions?''' Possible answers: ''do'' pay the money; definitely do ''not'' pay the money; and ''no particular instruction'' (so ''prima facie'', do not pay the money, but room for that presumption to be rebutted) | ||
*'''Was there any indebtedness?''': Did the customer owe the bank any thing as a result | |||
*'''Did the customer actually owe the payee anything?''' Possible answers: yes and no; | *'''Did the customer actually owe the payee anything?''' Possible answers: yes and no; | ||
*'''If the customer did own the payee, when was the debt due?''' Possible answers: On the day it was actually paid; at some point in the next month at the customer’s discretion (i.e., a normal trade invoice); at a specified date in the future (such as a loan repayment date) | *'''If the customer did own the payee, when was the debt due?''' Possible answers: On the day it was actually paid; at some point in the next month at the customer’s discretion (i.e., a normal trade invoice); at a specified date in the future (such as a loan repayment date) | ||
{{ | {{tabletopflex}} | ||
! Case | ! Case | ||
! Where | ! Where | ||
! When | ! When | ||
! | ! Customer’s Instructions | ||
! When due? | ! When due? | ||
! Authority? | ! Authority? | ||
! Outcome | ! Outcome | ||
{{aligntop}} | |||
|''[[Banque Worms]]'' | |''[[Banque Worms]]'' | ||
|New York | |New York | ||
|1989 | |1989 | ||
|Do NOT pay | |Do NOT pay | ||
|Immediately | |Immediately | ||
|Not relevant to [[Discharge-for-value defense|restitutionary defence]]. | |Not relevant to [[Discharge-for-value defense|restitutionary defence]]. | ||
|Payee kept the money | |Payee kept the money | ||
{{aligntop}} | |||
|''[[Citigroup v Brigade Capital Management|Citibank v Brigade]]'' | |''[[Citigroup v Brigade Capital Management|Citibank v Brigade]]'' | ||
|New York | |New York | ||
|2021 | |2021 | ||
|No instructions | |No instructions | ||
|Not till 2023 | |Not till 2023 | ||
| Ostensible, but not relevant to [[Discharge-for-value defense|restitutionary defence]]. | | Ostensible, but not relevant to [[Discharge-for-value defense|restitutionary defence]]. | ||
|Payee kept the money | |Payee kept the money | ||
{{aligntop}} | |||
|''[[Barclays Bank Ltd v WJ Simms|Barclays v Simms]]'' | |''[[Barclays Bank Ltd v WJ Simms|Barclays v Simms]]'' | ||
|UK | |UK | ||
|1979 | |1979 | ||
|Do NOT pay | |Do NOT pay | ||
|Trade invoice | |Trade invoice | ||
| Ostensible, not actual | | Ostensible, not actual | ||
| Payee returned the money | | Payee returned the money | ||
{{aligntop}} | |||
|''[[Lloyds Bank v Independent Insurance|Lloyds v Independent Insurance]]'' | |''[[Lloyds Bank v Independent Insurance|Lloyds v Independent Insurance]]'' | ||
|UK | |UK | ||
|1998 | |1998 | ||
|Do pay, as soon as I have cleared funds | |Do pay, as soon as I have cleared funds | ||
|Immediately | |Immediately | ||
|Actual | |Actual | ||
|Payee kept the money. | |Payee kept the money. | ||
{{tablebottom}} | {{tablebottom}} | ||