Philip Collins Ltd v Davis
The defence of change of position applies where the defendant has altered his lifestyle in reliance on an overpayment, but only to the extent that the change was causally linked to the payment.
Facts
Phil Collins's companies overpaid royalties to two musicians who had performed on a live album, because the royalties were calculated on the basis that they had performed on all the tracks, when in fact they had performed on only some of them. The musicians, who had come to rely on the royalty payments, had spent the money on their ordinary living expenses and had increased their outgoings. The companies sought to recover the overpayments, and the musicians relied on the defence of change of position.
Legal principle
Jonathan Parker J held that the musicians had a partial defence of change of position. He said that the defence is concerned with the impact of the payment on the defendant's subsequent conduct, and requires a causal link between the payment and the change of position, so that a defendant who would have incurred the expenditure anyway has no defence. The defence is not limited to specific items of expenditure, and may apply to a general change in lifestyle, but the burden is on the defendant to show that the change of position was caused by the payment. On the evidence, the musicians had increased their outgoings in reliance on the payments, and the defence applied to half of the overpayments.
Related cases on public authorities, defences and remedies
- BCCI (Overseas) Ltd v Akindele [2001] Ch 437
- Re Diplock [1948] Ch 465
- Ministry of Health v Simpson [1951] AC 251
- Patel v Mirza [2016] UKSC 42, [2017] AC 467
- Pitt v Holt [2013] UKSC 26, [2013] 2 AC 108
- Prudential Assurance Co Ltd v Revenue and Customs Commissioners [2018] UKSC 39, [2019] AC 929
- Relfo Ltd v Varsani [2014] EWCA Civ 360
- Sempra Metals Ltd v Inland Revenue Commissioners [2007] UKHL 34, [2008] 1 AC 561
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