References: (1885) 1 TLR 329
Coram: Lord Coleridge CJ
The plaintiff had paid water rates to the defendant calculated in accordance with the law as it was held to be by the Court of Appeal. After payment, the House of Lords in the Dobbs case changed the law, and if calculated under the changed law the plaintiff had overpaid, and he sought to recover the overpayments on the ground that he had paid under compulsion and under a mistake of law.
Held: The Court accepted that if both compulsion and mistake of law were present, the overpayment could be recovered. Counsel having submitted that the payments had been made in ignorance of the law, Lord Coleridge CJ said: ‘Of what law? I was ignorant of it before the decision of the House of Lords. I had held to the contrary, and two eminent judges agreed with me. Can that be put as ignorance of law? Just see what consequences would follow–that wherever there has been a reversal of judgment all the money that has been paid under the previous notion of the law can be recovered back! Has that ever been held? Can it be that every reversal of a decision may give rise to hundreds of actions to recover back money previously paid?’ Lord Coleridge dismissed the plaintiff’s claim on the grounds both that there was no element of compulsion in the payment and that there was no relevant mistake of law, saying: ‘But here at the time the money was paid, which was before Dobbs case, the law was in favour of the company, and there was no authority to show that it could be recovered back on account of a judicial decision reversing the former understanding of the law.’
This case is cited by:
- Cited – Kleinwort Benson Ltd v Lincoln City Council etc HL (Gazette 18-Nov-98, Gazette 10-Feb-99, Times 30-Oct-98, House of Lords, Bailii,  UKHL 38,  2 AC 349,  4 All ER 513,  3 WLR 1095,  Lloyds Rep Bank 387)
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap agreements were . .