ANZ Bank (Samoa) Ltd v Meredith [2006] WSSC 63 (13 April 2006)

IN THE SUPREME COURT OF SAMOA
HELD AT APIA

BETWEEN

THE ANZ BANK (SAMOA) LIMITED
a duly incorporated company having its registered office at Apia
Plaintiff

AND

GEORGE MEREDITH
businessman of Motootua
Defendant

Counsels: Mr George M Latu for Plaintiff
Mr Leulua’ialii Tasi Malifa for Defendant

Hearing: 3/03/2006 and 6/04/2006

Judgment: 6/04/2006
Reasons: 13/04/2006

REASONS FOR RULING OF VAAI J

These are my reasons for the oral ruling I made on the 6th April 2006.

1. The defendant a well known businessman in the construction sector is a customer of the plaintiff bank. He is the managing director of G.M Meredith and Associates which is also a customer of the plaintiff. In March 2003 GM Meredith and Associate submitted a tender for the construction of the Samoa Tel building at Maluafou. A cheque of $100,000 was required to accompany the tender. The defendant issued the $100,000 cheque drawn on his personal account with the plaintiff. But the defendant did not have funds anywhere near $100,000 in his personal account. In fact the account was already overdrawn by $590.16 and an overdraft facility was never approved. However the cheque was honoured by mistake and $100,000 was credited to the account of Samoa Tel.
   
2. When the tender by G.M Meredith and Associate was unsuccessful Samoa Tel with heaps of cash in the plaintiff bank refunded $100,000 to G.M Meredith and Associates. The Samoa Tel cheque for $100,000 was promptly deposited not to the defendant’s overdrawn account but to the account of G.M Meredith and Associates. In the meantime the plaintiff bank has discovered the oversight and mistake on its part in honouring the defendant’s $100,000 cheque resulting in the defendant’s account being overdrawn by $100,590.16.
   
3. The defendant’s has taken no steps to repay the $100,000 to the plaintiff; he is firmly of the view he is not obliged to repay the $100,000, the plaintiff bank should suffer the consequences of its mistake. In response to the plaintiff’s claim that he was unjustly enriched by the mistake of the plaintiff the defendant maintained inter alia that the plaintiff’s own mistake is its own liability.
   
4. From perusing the amended statement of defence it became quite obvious that the defendant was denied proper appraisal on the subject of unjust enrichment or unjust benefit. My suspicion was confirmed at the commencement of the trial when counsel for the defendant in response to an inquiry from the bench told the court he is not aware of the decision of the court in ANZ Banking Group Ltd v Ale Ulugia (1980 – 1993) WSLR 468 in which Ryan CJ after referring to authorities and legal texts on the principles of unjust enrichment of a person by another’s mistake adopted three presumptions:
   
   • (a) the defendant has been enriched by the receipt of a benefit.
   • (b) The defendant has been enriched at the expense of the plaintiff.
   • (c) It would be unjust to allow the defendant to retain the benefit.
     
5. The English House of Lords decision in Fibrosa Spolka Akcyjna v Fairburn Lawson Combe Barbour Ltd [1942] UKHL 4; (1942) 2 All ER 122, and the Australian High Court decision in David Securities Pty Ltd & Others v Commonwealth Bank of Australia (1992) 107 ALR 57 are two of numerous authorities for the proposition that recovery of money paid under a mistake or payment for a consideration that has totally failed can be pursued under the common law remedy of restitution which basically prevents a man from retaining the money of, or some benefit derived from another which it is against conscience that he should keep.
   
6. After counsel for the defence read the courts decision in ANZ Banking Group v Ale Ulugia the defence proceeded on the basis the defendant did not benefit from the plaintiff’s mistake. In his evidence in chief the defendant told the court he did not benefit from the Samoa Tel cheque of $100,000 made out to GM Meredith and Associate as he did not know where that cheque went to. Under cross examination he denied personally banking the cheque until he was shown a deposit slip for the same cheque with his signature on it. He deliberately and knowingly gave false evidence. As the general manager of GM Meredith and Associates he knew and should have known of the financial status of the company at all times and more importantly he himself signed the deposit slip for the lodging of Samoa Tel $100,000 into the account of GM Meredith and Associates.
   
7. He has been enriched by the receipt of the $100,000; he has been enriched at the expense of the plaintiff and it would be unjust to allow the defendant to retain the benefit.
   

Judgment

1. Judgment for the plaintiff in the sum of $143,595.58 plus interest of $22,337.50 from the 17th March 2005 to the 6th April 2006.
   
2. Defendant to pay costs of $1,500 to the plaintiff.
   

Vaai J