Rogers v Louth County Council

• Jurisdiction: Ireland
• Judge: KENNY J.,GRIFFIN J.
• Judgment Date: 11 March 1981
• Neutral Citation: 1981 WJSC-SC 1181
• Court: Supreme Court
• Docket Number: (144/1979),[S.C. No. 144 of 1979]
• Date: 11 March 1981

ROGERS v. LOUTH COUNTY COUNCIL

ELIZABETH ROGERS

Plaintiff

and

LOUTH COUNTY COUNCIL

Defendants

1981 WJSC-SC 1181

(144/1979)

THE SUPREME COURT

1 JUDGMENT delivered on the 11th day of March 1981by GRIFFIN J.

2 In proceedings brought against the defendants in the Circuit Court for the County of Louth the plaintiff, who is the personal representative of James Murphy deceased, claims the return to her of the sum of£935.53 which it is alleged had been overpaid by her to the defendants in redeeming an annuity in respect of a cottage the property of the deceased at Rathnure, Co. Louth. The annuity was redeemed under an???query?????? in pursuance of the provisions of s. 99 of the Housing Act, 1966.

3 James Murphy was, at the time of his death, the owner of the said cottage, which by a vesting order made under the Labourers Act, 1936, was vested in him in fee simple free from encumbrances but subject to an annuity of £19.10.0 per annum for the period of forty nine years from the 2nd of April 1958, and to the statutory conditions, being those set out in s. 17 of the 1936 Act. In 1968, he was anxious to redeem the said annuity, and on the 25th of November 1968 his solicitors wrote to the defendants stating that their client "wished to purchase the fee simple of his property. We would be obliged if you would let us have a note of the amount due". The letter erroneously referred to the purchase of the fee simple; it was the purchase of the annuity which was intended. James Murphy died on the 17th of October, 1968, and after some further correspondence the defendants wrote to the solicitors for the personal representatives of the deceased on the 22nd of September 1969 stating that the amount required toredeem the outstanding annuity on the vested cottage would be£1,163. The personal representatives had some difficulty in raising that sum and the redemption was not concluded until the 12th of October 1972 when £1,163 was paid to the defendants. On the 18th of October 1972, the County Council certified that the annuity had been redeemed in full.

4 As already stated, the redemption took place under s. 99 of the Housing Act, 1966. That section provides:

"An annuity at any time outstanding may, if the housing authority entitled to receive the annuity think fit, be redeemed by the person liable to pay the annuity by payment to the authority of such amount as may be approved by the Minister, and the premises, which but for this section would be subject to and charged with the payment of the annuity or the part, shall, on receipty by the authority of the amount so approved, stand freed and discharged from the payment of theannuity".

5 The Minister therein referred to was the Minister forLocal Government, now the Minister for the Environment. Under s. 100 where an annuity is redeemed under s. 99, all the provisions of the Act of 1936, including the statutory conditions, shall cease to apply in respect of the cottage.

6 The sum of £1,163, as being the redemption value of the annuity, was arrived at by the defendants in accordance with directions included at paragraph 147D of a circular No. H.5/67 issued by the Department for Local Government (as it then was) in 1967, requiring the redemption value of the annuity to be based not on the capitalized value of the annuity, but on the current market value of the cottage, due allowance being made for the number of years for which the annuity had been paid on the cottage. In Meade v. Cork County Council (unreported, judgment delivered 31st of July, 1974), this Court decided that the method of assessment of the redemption value of an annuity assessed in accordance with para.147D of the said circular was incorrect, the correct amount being the capitalizedvalue of the annuity outstanding at the time when redemption took place. In the instant case, it is agreed that the redemption value of the annuity under s. 99 of the 1966 Act, in accordance with the principles laid down by this Court in Meade v. Cork County Council, is the sum of £227.47.

7 There was therefore an overpayment by the plaintiff of the sum of£935.53. After Meade' case had been decided, the plaintiff claimed the return of the sums so overpaid by her in respect of the redemption of the annuity, but the defendants refused to refund such overpayment.

8 The defendants having failed to repay the over payments made by the plaintiff, these proceedings were instituted, and the defendants pleaded that the sum of £1,163 was paid by the plaintiff voluntarily and with full knowledge of the facts, and that if any sum had been overpaid by the plaintiff, it was paid under a mistake of law and is irrecoverable. When the matter came for hearing before the Circuit CourtJudge,he referred to this Court for determination the following question;

9 1. Whether the defendants were entitled to require payment by the plaintiff of the sum actually paid in respect of redemption of the saidannuity?

10 2. If the defendants were not entitled to require the said sum to be paid, whether the said sum was paid by a mistake either of law or offact?

11 3. If the said sum was paid by the plaintiff by mistake, whether the said sum or any part thereof is now recoverable?

12 As to the first question, having regard to the decision of this Court in Meade v. Cork County Council, counsel for the defendants very properly conceded that the County Council were not entitled to require payment by the plaintiff of the sum of £1,163 and that, as stated earlier in this judgment, it was agreed that the sum of £227.47was the correct redemption value of the annuity.

13 Likewise, in respect of the second question, the argument in this Court proceeded on the basis that the mistake was not one of fact but of law. Both parties were agreed that the mistake was one of law; the defendants submitted that, as it was a voluntary payment, no sum was recoverable by the plaintiff, whilst the plaintiff submitted that whilst the mistake was one of law, it was one made by the defendants when they were in a privileged position with the right to withhold that privilege and that therefore the payment was not voluntary.

14 The real question therefore for determination is whether a payment made, in circumstances such as the present, in mistake of law is recoverable. The general rule is usually stated to be that where money is paid under the influence of a mistake, and the mistake is one of fact, an action will lie to recover it back; but that to entitle the plaintiff to recover, the mistake upon which he has acted must be one of fact, not of law. Thus in Pollock on Contracts, 13th edition, edited by Professor Winfield, it isstated at p. 378 that "money paid under a mistake of law cannot in any case be recovered". Similar statements are to be found in many textbooks. However, the Judicial Committee of the Privy Council held in Kiriri Cotton Co. Ltd. v. Dewani 1960 2 W.L.R. 127 that a plaintiff may recover money paid on a mistake of law provided that he is not in pari delicto with the defendant in mistaking the law. Delivering the advice of the Privy Council, Lord...