was

bills for the value of the whole quantities ordered-which bills were duly paid; but, on the arrival of the goods, it discovered that less than the specified quantities had been shipped it was held that the plaintiff might recover the sum overpaid (2).

CH. III, s. 3.
Implied
Contracts

(Money Had and Received).

Action will

not lie where

there has been only a partial failure of consideration.

clerk's

But a claim for money had and received is not maintainable if the contract has been in part performed, and the plaintiff has derived some benefit; so that were he to recover a verdict, the parties could not be placed in the same situation in which they respectively stood when the contract was entered into (a). Thus, where a solicitor had received a premium from an articled clerk, Article who was to be in his office for five years, and the solicitor died premium. before the five years were completed, it was decided that the clerk could not recover from the solicitor's estate any part of the premium (b). So, where a party sold a patent-right, and the vendee paid the purchase-money and used the patent-right, and enjoyed a benefit therefrom, but it afterwards appeared that the patent was invalid; it was held that this action could not be maintained by the vendee against the vendor, to recover back the purchase-money (c). And, upon the same principle, where the master and part-owner of a vessel agreed to purchase his partner's moiety; and, having paid the purchase-money and received the title-deeds, he had the entire possession of the vessel given up to him; but his partner afterwards refused to execute a bill of sale, or refund the purchase-money; it was held that it could not be recovered in an action for money had and received (d).

And so, where A. purchased an annuity for his life, which was regularly paid up to the time of his death, but no memorial of the annuity had been inrolled: it was held that A.'s executors could not, on that ground, insist that the contract was void, and recover back the money which had been paid for the annuity (e).

contract rescinded.

Where a contract has been rescinded, either by mutual consent, It lies where or by virtue of a clause contained therein, a claim for money had and received will lie, to recover any money which may have been paid by the plaintiff thereunder (ƒ).

So, where a policy of insurance is avoided, on the ground of the misrepresentation or concealment by the assured of a material

(z) Deveaux v. Conolly (1849), 8 C. B. 640; and see Covas v. Bingham (1853), 2 E. & B. 836.

(a) Blackburn v. Smith (1848), 2 Exch. 783.

(b) Ferns v. Carr (1885), 28 Ch. D. 409; and see Whincup v. Hughes (1871), L. R., 6 C. P. 78.

(c) Taylor v. Hare (1805), 1 B. & P.

(N. R.) 260.

(d) Beed v. Blandford (1828), 2 Y. & J. 278.

(e) Davis v. Bryan (1827), 6 B. & C. 651; Molton v. Camroux (1849), 2 Exch. 487, 495; S. C., 4 Exch. 17, in Ex. Cham.

(f) Payne v. Whale (1806), 7 East, 274.

Or to recover

paid on policy of insurance.

CH. III. s. 3.
Implied
Contracts
(Money Had

Or subscriptions to aban

doned scheme.

fact, the assured, if not guilty of fraud, may recover in this action all premiums which he has paid under the policy (g).

So, where a scheme for establishing a tontine was put forth, and Received). stating that the money subscribed was to be laid out at interest; and-after some subscriptions had been paid to the directors in whom the management of the concern was vested, but before any part of the money was laid out at interest-they resolved to abandon the project; it was held that each subscriber might recover from the directors in this action, the amount of his subscriptions, without the deduction of any part, towards payment of the expenses incurred by the directors, in endeavouring to start the scheme (h).

Conduct money of witness if no trial.

Money paid under contract void by Statute of Frauds.

Money paid by mistake.

Although

with means

of knowledge.

So, if conduct money be paid to a witness on service of a subpœna; and, in consequence of the cause being settled, the trial does not take place, and the witness incurs no expense and does no act under the subpoena; the money so paid to him may be recovered back (i).

But the mere fact of one party having paid money to another, under a contract which he cannot enforce against the latter, because of its non-compliance with the Statute of Frauds, will not entitle the party who has paid such money to recover the same as on a failure of consideration; for such a contract is not void, but there is merely a deficiency in the evidence thereof (k).

(g) Action for Money paid by Mistake.

The action for money had and received is also maintainable, for the recovery of money paid under a mistake on the part of the payer, of a material fact (1); that is, of "a fact which, if true, would have made the person paying liable to pay the money "(m).

The possession of the means of knowledge by the party who paid the money can be regarded only as affording a strong observation to the jury, to induce them to believe that he had actual knowledge of the circumstances; but there is no conclusive rule of law, that because a party has the means of knowledge, he has the knowledge itself (n); and accordingly, where it appears

(g) Per Parke, B., Anderson v. Thornton (1853), Exch. 425, 428.

(h) Nockels v. Crosby (1825), 3 B. & C. 814; and see Moore v. Garwood (1849), 4 Ex. 681, Ex. Ch.; Johnson v. Goslett (1857), 3 C. B., N. S. 569, Ex. Ch.

(i) Martin v. Andrews (1856), 7 E. & B. 1.

(k) Sweet v. Lee (1841), 3 M. & G. 452.

(1) Per Lord Mansfield, C.J., Bize v. Dickason (1786), 1 T. R. 285, 287.

(m) Per Bramwell, B., Aiken v. Short (1856), 1 H. & N. 210, 215; and see Mills v. Guardians of Alderbury Union (1849), 3 Exch. 590; Milnes v. Duncan (1827), 6 B. & C. 671.

(n) Per Tindal, C.J., Bell v. Gardiner (1842), 4 M. & G. 11, 24; and see Townsend v. Crowdy (1860), 8 C. B., N. S. 477.

that money has been paid by the plaintiff to the defendant, under a bona fide forgetfulness of facts which disentitled the latter to receive it, such money may be recovered back in an action for money had and received (o).

CH. III. s. 3.
Implied
Contracts

(Money Had and Received).

The same rules apply, where money is allowed in account Money under a mistake as to a material fact (p).

If money be paid by mistake to an agent, and be paid over by him to his principal without notice of the mistake, money had and received will not lie against the agent, at the suit of the payer. And the same rule holds where, although the money has not been actually paid over by the agent, he has given credit in account to his principal for it, and the account has been stated and settled on that footing (q). But the mere fact of passing such money to the principal's credit in an open account; or of making rests, without any new credit given, fresh bills accepted, or further sums advanced for the principal in consequence thereof, is not equivalent to a payment of it over (r).

And the agent cannot claim the benefit of the above rule, unless the money was paid to him as agent. So that, if the party to whom the money was paid, although acting as agent for an unnamed principal, dealt as principal with him who paid the money, the rule does not apply (s).

Nor, even if the money has been paid over by the agent, will he be protected, unless such payment was made bonâ fide, without notice of the plaintiff's claim. Where, therefore, the defendant, an attorney, who was also an auctioneer, received a deposit on property which he had sold by auction; and, after queries raised on the title and before they were answered, he paid over the deposit to his principal:-it was held, that the buyer might recover the deposit from the defendant, because the defendant, as attorney, had notice that the title was defective at the time he paid over the money (t).

So if there be a payment to A. expressly as agent of B., for the purpose of redeeming goods wrongfully detained by B., and a receipt by A. expressly for B., the party who paid this money has still a right of action against A. for money had and received (u).

(0) Kelly v. Solari (1841), 9 M. & W. 54, 55; Lucas v. Worswick (1833), 1 Moo. & Rob. 293.

(p) Per Best, C.J., Bramston v. Robins (1826), 4 Bing. 11, 15; Skyring v. Greenwood (1825), 4 B. & C. 264.

(q) Holland v. Russell (1863), 4 B. & S. 14, Ex. Ch.

(r) Buller v. Harrison (1772), 2 Cowp. 565; Cox v. Prentice (1815), 3 M. & S. 344; 16 R. R. 288; Peto v. Blades (1814), 5 Taunt. 657; 15 R. R. 609.

(s) Newall v. Tomlinson (1871), L.R., 6 C. P. 405.

(t) Edwards v. Hodding (1814), 5 Taunt. 815; 15 R. R. 662; and see per Dallas and Park, JJ., Horsfall v. Handley (1818), 8 Taunt. 136, 138.

(u) Per Cur., Smith v. Sleap (1844), 12 M. & W. 585, 588; Parker v. Bristol & E. Railway Company (1851), 6 Exch. 702, 737; and see Steele v. Williams (1853),

Exch. 625.

allowed in account.

Money paid to agent by

mistake.

CH. III. s. 3.
Implied
Contracts

(Money Had

and Received).

Payment by banker of forged cheque.

Money paid into wrong

bank.

By sheriffs.

Previous

notice and demand.

Voluntary

payment of statutebarred debt.

Bize v. Dickason.

And this action will lie against the agent in such a case, although he may have actually paid the money over to his principal, because the plaintiff paid the money under compulsion, to redeem his goods, and not with the intent that it should be paid over to the principal (x).

In general, a banker who pays a forged cheque which purports to be the cheque of a customer, must bear the loss (y); and if a banker pay a cheque, the amount of which has been improperly altered by a third person, he cannot charge the customer with the loss, unless the customer's own negligence in his mode of drawing the cheque caused it (z).

Where the Colonial Bank instructed by a customer to remit his money to a bank at Halifax, through the mistake of its agents, paid them to a New York Bank for transmission to a Nova Scotia Bank, who debited the New York Bank, and credited the customer in account with the money, and being afterwards advised of the mistake, claimed to retain and use the money in reduction of the customer's account with themselves, it was held that on being advised of the mistake, the Nova Scotia Bank were bound to repair it, and that the Colonial Bank had a sufficient interest in the moneys to recover them as moneys received to their use (a).

And so, if a sheriff sell goods under a fieri facias, and pay over the proceeds to the execution creditor, in ignorance of an act of bankruptcy committed by the defendant in the action; and the sheriff is afterwards compelled to pay the amount to the trustee ; he may recover it from the execution creditor as money paid in ignorance of facts (b); even although the latter, after repaying the money, cannot be placed in statu quo (c).

In order, however, to entitle a party to recover money in this form of action, on the ground that it was paid to the defendant by mistake, notice of the mistake must have been given to the defendant, and a demand made of the money (d).

It was observed by Lord Mansfield in Bize v. Dickason that the rule had always been that if a party voluntarily pay money, which the law would not have compelled him to pay, but which in justice he ought to have paid-such as a debt barred by the Statute

(x) Snowdon v. Davis (1808), 1 Taunt. 359, 363; per Parke, B., Oates v. Hudson (1851), 6 Exch. 346.

(y) Hall v. Fuller (1826), 5 B. & C. 750; Robarts v. Tucker (1851), 16 Q. B. 560, Ex. Ch. ; and see Bank of England v. Vagliano, [1891] A. C. 107, and Ch. XVI., sect. 2, post.

(z) Arnold v. Cheque Bank (1876), 1 C. P. D. 578.

(a) Colonial Bank v. Exchange Bank

of Yarmouth, Nova Scotia (1885), 11 App. Cas. 84, P. C.

(b) Brydges v. Walford (1817), 6 M. & S. 42; and see Notley v. Buck (1828), 8 B. & C. 160; Crowder v. Long (1828), id. 598.

(c) Standish v. Ross (1849), 3 Exch. 527, 534.

(d) Per Martin and Bramwell, BB., Freeman v. Jeffries (1869), L. R., 4 Ex. 189, 199, 200.

of Limitations, bankruptcy, infancy, or the like-he cannot recover it back (e), and the law appears to be the same even although the demand arose out of an illegal transaction (ƒ).

CH. III. s. 3. Implied Contracts (Money Had and Received).

demand.

So if a party, with full knowledge of the facts, voluntarily pay a demand unjustly made on him, and threatened or attempted to be of unjust enforced by bonâ fide legal proceedings (g), he cannot recover the amount as money paid by compulsion, although, at the time, he protested against his responsibility (h).

So, if a person pay money under a mistake as to the law, or as By mistake to the legal effect of the circumstances under which it is paid, but of law. with full knowledge of the facts, he cannot, at common law, recover

it back (i).

Therefore, if a tenant voluntarily pay his landlord's property tax, and afterwards pay his rent in full, without claiming, as he might have done, any deduction on account of the payments he has made; he cannot afterwards recover from his landlord the moneys so paid (k); and in Rogers v. Ingham (1) the principle was applied to the distribution of a trust fund, under the following circumstances. An executor, acting on the advice of counsel on the construction of a will, proposed to divide a fund in certain proportions between two legatees. One of them being dissatisfied took the opinion of counsel, which agreed with the former opinion, and the executor divided the fund in accordance with the two opinions. Two years afterwards the dissatisfied legatee claimed repayment from the executor and the other legatee, on the ground of misconstruction of the will, but Hall, V.-C., without considering the construction of the will, held that the claim could not be maintained, and this decision was affirmed by the Court of Appeal.

as

But, in equity, this rule is not inflexible; there being cases in Rule in which the Court has power to relieve against mistakes in law, equity. well as against mistakes in fact,—that is, where there is any equitable ground which makes it, in the particular case, inequitable that the party who received the money should retain it (m);

(e) Bize v. Dickason (1786), 1 T. R. 286; Munt v. Stokes (1792), 4 T. R. 561; 2 R. R. 459. So, by the French law: "La répétition n'est pas admise, à l'égard des obligations naturelles qui ont été volontairement acquittées." Code Civil, Book 3, tit. 3, art. 1235.

(f) Dawson v. Remnant (1806), 6 Esp. 25, 26, n.; Brisbane v. Dacres (1813), 5 Taunt. 143.

(g) See per Patteson and Coleridge, JJ., Duke de Cadaval v. Collins (1836), 4 A. & E. 858, 866, 867.

(h) Brisbane v. Dacres (1813), 5 Taunt. 143, 147; and see Wilson v. Ray (1839), 10 A. & E. 82; Gibson v. Bruce (1843), 5 M. & G. 399, 404.

(i) Bilbie v. Lumley (1802), 2 East, 469; Milnes v. Duncan (1827), 6 B. & C. 271, and ante, p. 60; per Holroyd, J., East India Company v. Tritton (1854), 3 B. & C. 280, 290; Platt v. Bromage (1854), 24 L. J., Ex. 63.

(k) Denby v. Moore (1817), 1 B. & Al. 123; 18 R. R. 444.

(1) Rogers v. Ingham (1876), 3 Ch. D. 351.

(m) Per Turner, L.J., Stone v. Godfrey (1854), 5 D. M. & G. 76, 90. By the French law (Code Civil, liv. 3, tit. 4, art. 1376, 1377), "celui qui reçoit par erreur ou sciemment, ce que ne lui est pas dú, s'oblige à le restituer à celui qui l'a indament reçu. Lorsqu'une personne qui,