The creditor finance company complained that the customer had paid money into its account with the bank, in order to discharge its obligations by direct debit payments, but that the bank had refused to make the payments. The claimant argued that the direct debit mandate was a mandate in rem suam, and was not dependant upon a credit balance to be maintained.
Held: The respective rights as between a banker and his customer are not affected by direct debit instructions. The instruction to pay remained that of the account holder. The creditor was in the same position as was the payee on a cheque, namely that it was a prerequisitie of an assignative effect that the account should crry sufficient funds. Though there were no relevant averments of trust or of a fiduciary relationship, the bank’s knowledgeof the specific reason for the lodgment of the funds to meet a specific obligation might be enough to require proof to be heard on the claim for unjust enrichment.
Judges:
Lord Penrose
Citations:
Times 16-Sep-1996, 1996 SCLR 1005
Citing:
Cited – British Motor Trade Association v Gray 1951
The test for an allegation of wrongful interference in a contract required something more than a failure to act. . .
Cited – Sutherland v Royal Bank of Scotland 1996
. .
Cited – Clark Taylor and Company v Quality Site Development (Edinburgh) Limited 1981
It was claimed that a trust had come into being in circumstances where the alleged truster and the alleged trustee were the same person.
Held: It was competent for the claimant to be both truster and trustee. . .
Lists of cited by and citing cases may be incomplete.
Banking, Scotland
Updated: 09 April 2022; Ref: scu.83646