BANQUE CANTONALE DE GENÈVE v POLEVENT LIMITED

Under the Rome II Regulation, a restitutionary claim for money paid by mistake is a claim arising out of unjust enrichment where the mistake-based restitutionary cause of action is independent of any associated tort. Article 4 does not govern merely because fraud explains the payment. Article 10(1) applies only where a relevant relationship existed between the parties before the events giving rise to the claim. If Article 10(1) and (2) do not apply, Article 10(3) selects the law of the country where the unjust enrichment took place, subject to Article 10(4). The manifestly closer connection exception requires more than a clear connection with another country.

BCGE, a Swiss bank, paid €6,870,058 to Polevent’s account in England after a fraudulent impersonation. The funds were frozen because of an order obtained by Enoi, another creditor of Polevent. BCGE advanced claims in deceit and, alternatively, restitution for money paid by mistake, including proprietary relief. The parties agreed that the deceit claim was governed by Geneva law and sought determination of the law governing the restitutionary claims.

The preliminary issue was whether those claims were governed by English law or Geneva law under the Rome II Regulation.

1. Paragraph 15 of the pleading was wide enough to allege both a proprietary remedy arising from deceit and a separate proprietary claim arising from restitution for money paid by mistake. The latter was a classic unjust-enrichment claim. Fraud explained the payment but was not a necessary ingredient of the mistake-based restitutionary cause of action.

2. Article 4 did not govern the independent restitutionary claim. Article 15, and the suggested application of Article 4(1) where restitution arose exclusively from waiver of a tort, did not alter that conclusion where restitution was claimed both in tort and unjust enrichment.

3. Article 10(1) was intended to apply where unjust enrichment concerned a pre-existing relationship between the parties, such as a contract. The mere relationship of tortfeasor and victim created by the tort was insufficient. No relationship between BCGE and Polevent existed before the events giving rise to the mistaken payment, so Article 10(1) did not apply. Article 10(2) was not relied upon.

4. Article 10(3) therefore selected the law of the country where the unjust enrichment took place. Polevent received the payment and was enriched in England. Although the payment instructions were given in Geneva, the obligation was not manifestly more closely connected with Geneva for the purposes of Article 10(4), since England had an equally clear connection with the enrichment.

5. The answer to the preliminary issue was that English law governed the restitutionary claims.