• What makes this case of significant interest, is that the debt was not disputed. The debtor had paid the monies due, albeit into a fraudulent account following the interception of an email which led to the client’s bank account details being change. The intercepted email was then sent from the client’s generic email account and contained bank details of an unknown third party.

    The client contacted us for advice as to how they should proceed and, whilst we considered the debtor’s position truly unfortunate, we suggested they continue to pursue payment as the debt remained due and outstanding.

    The client subsequently handed the matter over to us and a letter before action was sent to the debtor advising that a claim for payment would follow unless payment was received within 18 days from the date of the letter.

    The letter before action resulted in protracted correspondence being entered into between the parties but the debtor remained of the view that they had discharged their liability and suggested that our client recover the monies from the holder of the fraudulent account.

    As settlement could not be reached, legal proceedings were issued and the debtor filed a defence which merely stated that “payment was made by bank transfer in accordance with email instructions received from the Claimant”.

    After considering the debtor’s defence and whether they had any real merits of successfully defending the claim, we suggested to our client that an application for Summary Judgment be made. The client was happy to proceed in line with the advice given and Summary Judgment was subsequently awarded without a hearing.

    In response, the debtor filed an application to have Judgment set aside alleging that ostensible authority (agency) had arisen from a third party purportedly using the client’s email address.

    The hearing of the debtor’s application took place in June 2017 and the Judge dismissed the debtor’s application on the basis that their argument was flawed because agency must be instigated by the principal. This was not the case because an unknown third party impersonated our client. It also defies logic to suggest that a third party, without the knowledge of the principle, can put the principle in a legal bind.

    The debtor has now sought permission to appeal and an update will be provided in due course.

    At Brachers we offer a full range of services for your debt collection needs. Should you have a similar issue please do not hesitate to contact Jodene Conway on 01622 690691.

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