In Santander UK plc v The Royal Bank of Scotland plc and others, the High Court was asked to reconsider three applications for Norwich Pharmacal orders that had previously been refused. In doing so, it considered whether the court has jurisdiction to grant such orders in the context of claims for restitution or unjust enrichment.
In each of the three cases, Santander had mistakenly paid money into the wrong account held at another bank. Santander wanted to find out the identity of the account holders at this recipient bank in order to facilitate recovery of the funds which had been erroneously transferred. A Norwich Pharmacal order, which requires a respondent to disclose particular documents or information to the applicant if the respondent is either involved or mixed up in a wrongdoing, was sought by Santander in each of the cases. The order would enable Santander to find out information about the identity of the relevant account holders at the recipient bank, and to use this information to ensure that the funds were returned.
In his judgment, Master Matthews noted that he had declined to grant the Norwich Pharmacal orders when the cases were first brought to him in January 2014 on the basis of three key issues:
- he considered there to be no “wrongdoing” on the part of the account holders who had mistakenly received the money (any cause of action Santander had against them was in restitution because the payment of money was down to Santander’s mistake, and a claim in restitution did not amount to “wrongdoing” for the purposes of the Norwich Pharmacal jurisdiction);
- even if there had been “wrongdoing” by the account holders, there was no evidence that they had refused to pay the money back; and
- the recipient bank had not facilitated the account holders’ failure to repay the money to the Santander, and as such was not facilitating wrongdoing – a factor established in the Norwich Pharmacal case as being key in deciding whether the order should be granted.
In spite of this earlier decision, in July 2014, Mr Justice Birss had granted Santander Norwich Pharmacal orders against a variety of other banks and building societies (Santander UK plc v Natwest  EWHC 2626, reported on the blog here). Master Matthews deemed Birss J’s judgment to be “flawed”, due to the following:
- Birss J had applied the case of Bankers Trust v Shapira  1 WLR 1274, which involved the tracing of funds – a far stronger claim than simply debt. Similarly, Master Matthews did not consider the level of wrongdoing in two the cases as being comparable – a recipient passively receiving funds in error is a different circumstance to fraud. As a result, he did not consider the case to be authority for the proposition that a mere claim in restitution or unjust enrichment can justify a Norwich Pharmacal order.
- As a Norwich Pharmacal order involves a significant invasion of privacy, Master Matthews noted that it should only be granted in exceptional cases and that these were not exceptional cases.
- Finally, as with his first judgment in January 2014, Master Matthews observed that the bank that received the funds in error did not facilitate the wrong of the third party refusing to return the money mistakenly paid.
Despite these issues, Master Matthews noted that it was his duty to follow the judgment of Birss J so that the “courts speak with one voice on points of principle” until a different decision was reached at High Court judge level or above.
In light of this, he begrudgingly allowed the applications for Norwich Pharmacal orders on similar facts to the case heard by Birss J, although he refused the disclosure of the account holders’ telephone numbers, email addresses or dates of birth on the grounds that this information was not necessary. He also noted that, in accordance with the view expressed by Birss J, future claims should be made by claim form and not by Part 23 application notice.