S P Hywood Pty Ltd v Standard Chartered Bank Ltd No. SCGRG 92/678 Judgment No. 3764 Number of Pages 14 Tort Practice

The case before the Supreme Court of South Australia involves an appeal from an order of the Local Court Magistrate who dismissed third party proceedings brought by the appellant, S P Hywood Pty Ltd, against the respondent, Standard Chartered Bank Ltd. The appellant, a motor dealer, mistakenly contacted Standard Chartered Bank instead of Standard Chartered Finance to inquire about the pay-out figure on a leased motor vehicle. The bank, having an overdraft account in the name of the lessee, quoted the amount necessary to pay off the overdraft. The appellant then sent a cheque for that amount to the bank, which applied it to extinguish the overdraft. The court was required to decide whether the bank was guilty of conversion of the cheque and whether the Local Court Magistrate should have entered judgment on the Third Party proceedings issued by the appellant against the bank. The court held that it was doubtful that the bank was guilty of conversion of the cheque, as the appellant intended the bank to have it, albeit as a result of a mistaken belief as to the identity of the lessor of the vehicle. However, the Local Court Magistrate should have entered judgment on the Third Party proceedings either in negligence or for moneys paid under a mistake of fact. The appeal was allowed, and judgment was entered in favor of the appellant against the respondent in the amount of $4,025, together with interest from 21 August 1990 until the date of the judgment, 30 September 1991. The interest was assessed at a lump sum of $520, giving a total judgment sum of $4,545. The court also held that from the date of the judgment, the judgment will carry interest in accordance with Rule 302A until payment. The parties will be heard as to the costs of the appeal.