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Buachaill, Barrister
Category: Law
Satisfied Customers: 10955
Experience:  Barrister 17 years experience
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I receive a pension from a police force and I was 65 on 29th

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I receive a pension from a police force and I was 65 on 29th Decenber 2012. Payments are made in advance and my November payment contained two additional items - GMP post 1988 £16.30 and GMP No Inc(Pre 1988) £20.51. I had no idea what this was for so I queried it bt email but I got no response. I December I Got 2 further similar payments totalling £380.33. I therefore assumed the payments were correct and would continue so I spent the money by booking a much needed holiday. I have now received a letter from the police force and they say the overpayments were a clerical error and they intend to reclaim the money over the next 3 months. I have now fully researched the matter of GMP and it is clear that it should have been included in my pension and only paid if my pension did not meet the Guaranteed Minimum Pension as the service had opted out of SERPS. Additionally the service had outsourced the provision of the pension from 1/11/2012. I believe they have made a mistake in law (Holt v Markham 1923 and Kleinwort Benson v Lincoln City Council and others 1998) and they are not entitled to repayment. Could you comment please
David Lucas
1. You cannot really avoid repayment on the basis of a mistake in law, as these cases you cite are favourable examples of that principle but you can have a valid defence on the basis of a change of position defence. Namely that you altered your position to your detriment in reliance on the payments by increasing your general living outgoings. This has been held to be a valid defence in payments such as this. The main case is Lipman Gorman v. Karpnale. Mistake of law is not properly a defence to a mistaken payment, as that is old law. The modern law of restitution has been recast by Lord Goff & subsequent judges to base avoidance of repayment of mistaken payments on the basis of the change of position defence. This is what you should cite in your letter refusing to repay the monies.
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Customer: replied 5 years ago.

Hello and thank you for your reply. Could you please advise me what would be acceptable evidence for a defence of change of position, as in my case it may be said that I have had insufficient time to increase my general living outgoings, although it must be said that I did have plans for the extra money.

2. Well you went and spent it on a holiday. That is evidence of change of position. Otherwise, any evidence that you increased your general day to day living expenses owing to the payment. Be aware that this defence will only operate as to the past, not as to the future.
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Customer: replied 5 years ago.

I informed my pension privider on the lines you suggested and they claimed they did have the right to reclaim the money and that they had notified me as soon as the error came to their notice. They did not agree that my email, which they claim not to have seen, would have prevented them from overpaying in Devember. They propose to send me an invoice for the overpayment and use their legal dept to recover the debt. As it would cost me more to defend the matter than it is worth I shall have to settle with them.

3. I am sorry to hear that. As there was always the possibility of legal proceedings, you do need to be willing to defend them. Pension companies are loathe to allow exceptions as this opens the possibility of others claiming them, especially if the mistake was replicated across several clients.