Claims for money had and received

“Wise men never sit and wail their loss, but cheerily seek to

redress them …”. (Wm Shakespeare: Queen Margaret in Henry VI, Part 3)

1. Preface and problems:

A Deposit is paid to your builder; he fails to attend on the appointed day – the work to your intended new bathroom is never begun, let alone completed.

One day you awake to find that your Bank account has been mysteriously credited overnight with a potentially life-changing sum.

Following a memorable stay on the coast at a well-appointed Hotel, you subsequently discover that you have been double-charged: the cost of that memorable meal in their restaurant – which you had readily paid the night before – has also been deducted from your Bank account.

In two of the instances above you have seemingly lost out; in the other you have been the beneficiary of an erroneous windfall.

• Remedies:

What can be done to seek redress and recompense?

The origins of your claims today are rooted in the centuries old common law concept of Indebitatus Assumpsit.

Such a claim could be brought if your money (by say mistake or through failure of consideration) had been wrongfully received or retained by another.

Put shortly you could sue for its return (even where no contract existed).  The law implied that the recipient had undertaken (Assumpsit) to refund it to you.

Commensurate claims might be made where for instance you may have shoed a farmer’s horse without agreeing the price in advance: quantum meruit (that is, to claim such sum as you fairly deserved).

If you had chosen to sell, say, a heifer to a neighbour but a dispute over the price had arisen you might wish to pursue a claim for quantum valebant (that is, what the cow was worth).

• Action for money had and received:

Although some legal commentators are of the view that this cause of action fell into abolition in the mid-19^th Century, the author respectfully differs; he can recall making recoveries in proceedings founded upon actions for money had and received (the former Indebitatus Assumpsit) in the latter part of the 20^th Century.

There are one or two interesting cases which highlight the practical working of this concept when it comes to meeting the individual justice of the case.

• Moses v. Macferlan [1760] (2 Burr. 1005):

Put shortly, the facts were these.  Mr Moses (D) owed Macferlan (C) £26.00.  D failed to honour his debt and was sued by C.  An Arbitration followed and the parties agreed a compromise.

Under the terms of that compromise D agreed to pay C £20.00.  This still left the unpaid balance of £6.00.

In relation to that balance D agreed to endorse to C four promissory notes which he in turn had received from one Jacob; the Notes came to 120 Shillings (equivalent to £6.00).

Even so, C assured D that he would not seek to enforce those promissory notes against D and attested to a Memorandum to that effect:

D should “not be liable to the payment of the money or any part of it”.

In breach of this assurance C chose subsequently to pursue D.  He sued him in the Middlesex Court of Conscience as the endorser of the four Notes.

Although the agreement was put before the Court, it was rejected.  Judgment was given against D for the £6.00.  D paid the money into Court and Macferlan C, withdrew it.

D it seems was far from content with the outcome.  He commenced a fresh claim in the King’s Bench Court to recover the £6.00.  The Jury found that D was entitled to be repaid the £6.00 subject to one point: whether before he could maintain an action for money had and received he needed to establish a “special agreement” (that is a Contract which did not have any consideration).

It must be borne in mind that the English Common Law that we know today was still in a nascent condition: there was no uniform nor settled notion of what might constitute an action for money had and received.

Lord Mansfield, who gave the lead Judgment, rejected the assertion that the Judgment at first instance (awarding the £6.00 to C) could not be overturned by the fresh action brought by D.

He also rejected C’s case that no such action could lie.  The very ties of natural justice meant that a debt was implied and D could recover.

It may be instructive to read the following passage from the learned Judge’s reasoning:-

“This kind of equitable action, to recover back money, which ought not in justice to be kept, is very beneficial, and therefore much encouraged.  It lies for money which, ex-aequo et bono (from equity and conscience) the Defendant ought to refund.

It does not lie for money paid by the Plaintiff which is claimed of him as payable in point of honour and honesty .. (or) in payment of a debt barred by the Statute of Limitations, or contracted during his infancy or .. upon an usurious contract, or, for money fairly lost at play .. in all these cases, the Defendant may retain it with a safe conscience.

It lies for money paid by mistake or upon a consideration which happens to fail; or for money got through imposition .. or extortion or apprehension ..

In one word, the gist of this kind of action is, that the Defendant, upon the circumstances of the case, is obliged by the ties of natural justice and equity to refund the money”.

This Judgment was and remains a cornerstone of the common law of restitution.

• Lipkin Gorman v. Karpnale Limited and Anor. [1988] UKHL 12:

This was an action for money had and received brought by a firm of solicitors against a Casino.

The broad facts were these:

One Mr Cass, a partner in the Claimant firm of solicitors (LG) had looted the business’ accounts in a sum approaching £220,000.00; the funds misappropriated by him had largely been expended in gambling at the Defendant’s (KL) premises.

The Casino had won £154,695.00 of the stolen money, with the remainder having been paid back to Mr Cass as his “winnings”.

LG sued the club for the return of the stolen funds.

At that point gambling contracts were contrary to public policy.  It was not possible to sue upon them by reason of Section 18 of the Gaming Act 1845.

Accordingly, the only route open to LG was an action for money had and received.

After working through the Court at first instance and the Court of Appeal the case came before the House of Lords; their Lordships held that the sum of £150,960 should be repaid by KL to LG as money had and received.

In giving the lead Judgment Lord Templeman stated thus:-

“If they (LG) can show that in the circumstances the club was unjustly enriched at the expense of the solicitors .. the club received stolen money by way of gift from the theft; the club, being a volunteer, has been unjustly enriched at the expense of the solicitors from whom the money had been stolen and the club must reimburse the solicitors”.

This case effectively stated that an action for money had and received is itself founded upon the equitable concept of unjust enrichment”.

• Criteria:

In summary, three criteria need to be met:

• Enrichment: that the Defendant is in receipt of a benefit such as money, property or services.

• The enrichment has been at the Claimant’s expense and

• Unjust retention or appropriation: it is neither fair nor equitable for the Defendant to be permitted to keep such benefit.

• Disclaimer:

The aim of this Article is to provide a pragmatic distillation of the main questions turning upon this area of law.  Properly the caveat must be that much may turn upon the individual facts of the case when it comes to any question of merit.  Nonetheless, it is hoped that the enclosed might be perceived to succeed in providing a pragmatic distillation of the essentials.

Richard Peter Tymkiw

Head of Litigation

KIDD RAPINET LLP

07.01.2026