Mistakes in Remittance to Account

Abstract

Some courts have recently ruled in Japan with regard to mistakes in remittance to account. While the Supreme Court held that the recipient has become a depositor of a savings deposit as much as the remitted amount of the receiving bank as a result of a remittance, and the recipient obtains a bank deposit in the amount equivalent to the transferred amount even where there was no legal relationship which could be used as a legal basis for the remittance between the person who requested the remittance and the recipient, it held that the person who made a demand for repayment of a bank deposit while knowing that there was a remittance to account made into its bank account by error and received the repayment shall be guilty of fraud. In addition, some lower courts held that it is fair and equitable to interpret that the receiving bank must directly refund to the originator with regard to the originator’s claim to refund as much as the amount of the erroneous remittance as unjustified enrichment. Thus, the position of Japanese courts is still in disarray in respect to the legal consequences of mistakes in remittance to account.