A mistaken transfer can be costly. From whom can you seek a refund? Supreme Court ruling.

The Supreme Court ruled on 24 February 2021 that the creditor is not liable for satisfying claims from funds mistakenly transferred to the debtor’s account (case ref. SN III CSKP 59/21). The bank managing the client’s account cannot be held liable either. The Court upheld the bank’s cassation complaint and referred the case back to the appellate court for reconsideration.

Factual Background

On 26 April 2016, a bailiff seized the bank account of K. P. at the Cooperative Bank in S. On 5 May 2016, the plaintiff transferred PLN 120,979.85 to K. P.’s bank account, indicating VAT invoices dated 21 April 2016 and 22 April 2016 as the payment reference. Both invoices listed R. M. as the seller, and the plaintiff company as the buyer. On 10 May 2016, the plaintiff requested the defendant to release PLN 120,979.85 from seizure on K. P.’s bank account, stating the amount had been mistakenly transferred by the company.

On the same day, the plaintiff also asked the defendant (the bank) to release the amount, again indicating the transfer was made in error. The next day, the plaintiff submitted a similar request to the bailiff. Both the bank and the bailiff refused to release the funds. Eventually, the bailiff transferred PLN 98,000 of the seized PLN 107,000 to the creditor K. P., i.e., the defendant bank. The remainder was allocated to cover enforcement costs.

The aggrieved company sued the bank, claiming it caused damage by seizing amounts belonging to the company on K. P.’s account. The district court dismissed the claim, stating that the plaintiff has no claim for damages against the defendant under Article 415 of the Civil Code, and that unjust enrichment occurred not on the part of the defendant but on the account holder’s side (K. P.), whose debt to the defendant bank was satisfied following the seizure of funds from his bank account.

The appellate court ruled that the bank was aware the debtor had received funds due to a mistaken transfer and therefore should return them to the company (the debtor returned the remaining mistakenly received amount). Since the bank knew the debtor was not entitled to the funds, unjust enrichment occurred. The bank appealed this decision to the Supreme Court.

Supreme Court’s Position

The Supreme Court recalled that under Article 725 of the Civil Code, by a bank account agreement, the bank undertakes vis-à-vis the account holder, for a fixed or indefinite time, to store their funds and, if agreed, to execute payment transactions at their instruction. Upon depositing funds, the account holder acquires a claim against the bank for payment of those funds. When the deposit consists of cash (coins or banknotes), ownership transfers to the bank.

The Supreme Court agreed with the appellate court’s finding that the bank account agreement binds the bank to store the account holder’s funds, not those of third parties with whom it has no legal relationship. The account holder has a claim against the bank to withdraw funds held in the account. Until the entry in the bank account is corrected, it also serves a constitutive function, constituting a substantive legal basis for the account holder’s disposal of the funds.

In this case, the Supreme Court concluded that upon the plaintiff’s transfer of PLN 120,979.85 to K. P.’s bank account, the bank became entitled to those funds. The subject of the seizure was K. P.’s claim against the bank to withdraw that amount.

Therefore, it cannot be justifiably claimed that the defendant bank was unjustly enriched (Article 405 of the Civil Code). Under this provision, the prerequisites for a claim for unjust enrichment are: gain (enrichment), loss (at the expense of the other party), and a property transfer from one party to another. To qualify as “unjust,” the transfer must have occurred without justification under applicable law. The Supreme Court also stressed that unjust enrichment cannot result from legal acts performed by third parties.

Verification of the Recipient’s Account Number

The Supreme Court’s stance frees the bank from liability to the sender of a mistaken transfer if the sender erred in entering the account number in the payment order. Particularly in commercial transactions, it is crucial to carefully verify recipient details and bank account numbers before executing a transfer. The consequences may be difficult to reverse, especially when the account owner is subject to enforcement proceedings.