Rasmala Trade Finance Fund v Trafigura PTE Ltd

A mistaken payment may be recoverable in unjust enrichment even where the payer was careless. The claimant must establish enrichment, enrichment at its expense, and an unjust factor. A defendant may rely on change of position where, in good faith, the payment materially caused the defendant to alter its position and repayment would cause substantial detriment. Voluntary action need not be based on subjective knowledge of the enrichment, but it must have been caused by it. Substantial and irreversible detriment may make repayment inequitable even where the detriment is not precisely quantifiable. Relative fault is not part of English restitutionary law. Where a payment is made by an intended principal and a purported agency arrangement is unauthorised or forged, the payment is not necessarily made at the alleged agent’s expense and does not necessarily discharge the agent’s debt.

Rasmala, a trade-finance fund, made five payments totalling US$21,596,630 to Trafigura in purported advance payment for coal transactions with Farlin. Farlin had forged or altered the underlying contracts and forged Rasmala’s signatures on tripartite agreements which authorised Trafigura to apply the payments against Farlin’s existing debts.

Rasmala sought restitution in unjust enrichment, alleging mistake and, in the alternative, a proprietary remedy. Trafigura accepted that it had been enriched but relied on good consideration and change of position. The principal issues were whether the payments were made at Rasmala’s expense, whether they were unjust because of mistake, and whether Trafigura’s continued trading with Farlin constituted a good-faith change of position causing substantial detriment.

1. Fraud allegation. Rasmala’s narrowed case that Mr Jasani had dishonestly turned a blind eye was not properly supported by pleaded primary facts. The facts relied upon were consistent with innocence. Applying Three Rivers DC v Governor and Company of Bank of England (No.3) [2001] UKHL 16; [2003] 2 AC 1, the allegation of fraud failed. No adverse inference was drawn from Mr Jasani’s absence as a witness, applying the common-sense approach in Efobi v Royal Mail Group Ltd [2021] 1 WLR 3863 at [41].
2. Unjust enrichment. The elements were enrichment, enrichment at the claimant’s expense, and unjustness, with any defence then being established by the defendant. Trafigura was enriched by receiving the payments. Rasmala made them as intended principal under the fictitious transactions, not as Farlin’s agent. Farlin lacked authority to bind Rasmala to the tripartite agreements, and the forged signatures had no legal effect. The payments therefore were made at Rasmala’s expense and did not discharge Farlin’s debts.
3. Mistake and consideration. Rasmala paid because it mistakenly believed that it was making advance payments under genuine contracts. Carelessness would not prevent recovery. The payments were not made with the intention of discharging Farlin’s historic debts and Trafigura had not received payment from an authorised payer for those debts. The defence of good consideration therefore failed.
4. Change of position. The defence applied. Trafigura’s continued trading with Farlin was materially caused by the payments, because receipt of the payments restored Farlin’s position within its credit limit. The tripartite agreements were merely the mechanism for processing the payments and did not displace that causal connection. Trafigura acted in good faith: the surrounding anomalies did not give it knowledge or reasonable grounds to believe that the agreements were invalid or that the payments were repayable.
5. Detriment and outcome. Trafigura continued to supply coal under further contracts and lost the opportunity to stop trading and pursue earlier recoveries. The resulting detriment was substantial and partly irreversible, although not precisely quantifiable. It would be inequitable to require repayment. The restitutionary and constructive-trust claims were dismissed.