Payment dilemma

[remy lover]

My neighbours son worked freelance in 2004 and it appears the employer inadvertantly paid him twice on one occassion. Neighbours son was unaware of this at the time and recently contacted the company for proof of earnings so he could pay his tax. It was then the overpayment came to light. The Company have now demanded the payment back (approx �1800) immediately. Can they do this? As it was their mistake which only surfaced because he contacted them nearly 2 years later is he liable?

[len_1]

Yes they can. But of course he can negotiate on how this is to be paid back (ie lump sum or installments). If he doesn't pay them back he can be taken to court and CCJ's can get dragged into the equation.

He be best off going to CAB but i had personal experience with this with an ex girlfriend who got overpaid. And after an exhausted court hearing that went strongly in her favour. She still had to pay it back (some 3 years later).

[kazza12345]

definately they can ask for it back, as it is not his money at all, no matter how they found out, or how long ago it was as the first poster said though, it's better he negotiates with them rather than just refuses to pay

[Buenchico]

It's important that your friend's son acknowledges the debt and makes it clear that he intends to repay the money. If he does this, the matter will be a civil one and he will, hopefully, be able to negotiate a timetable for repayment. If a repayment plan can't be negotiated (or if he fails to keep to one that is agreed), the worst that can happen is that his former employer can pursue the matter through the small claims court.

If, on the other hand, your friend's son simply refuses to repay the money, it will be a criminal matter which could lead to a fine or imprisonment. This is because, once the matter has come to light, it is unlawful to retain money given to you in error. To do so constitutes an offence under Section 5(4) of the Theft Act 1968.

Chris

[buildersmate]

....or how long ago it was (Kazza). Minor point of clarification on the above - up to six years this is true, statute limit surely kicks in at that time.

[erimus1]

Builder's mate, under the Limitations Act, it is six years from notice, not from the event. I would concur that the debt has to be confirmed in order to ensure that the matter does not become a criminal one (obtaining money by deception - Theft Act 1968). As soon as your neighbour's son had notice of the mistake and he failed to return the money, this is where is becomes wrong. However, if he confirms that he will pay the money back as soon as he is able, this matter stays as a civil one. Ofcourse he could take an age to pay it back if he does not feel he is currently in the position to do so.

He could also argue, wrongly or rightly that the overpayment was not in fact an overpayment, but some form of productivity bonus or the like.

Hope this helps.

[remy lover]

Thank you all for your advice. Neighbours son accepts he owes the money and in fact sent a cheque off yesterday for the full amount. I personally would have asked for time to pay.....but it is all resolved now.

Remy

[gammaray]

Just a small point. How do you not notice an �1800 overpayment? Surely his own accountant should have found the errant amount.