Lipkin Gorman v Karpnale

Parliamentary Archives,
HL/PO/JU/18/251

Judgment: 6.6.91

HOUSE OF LORDS

LIPKIN GORMAN (A FIRM)
(ORIGINAL APPELLANTS AND CROSS-RESPONDENTS)

v.

KARPNALE LIMITED

(FORMERLY PLAYBOY CLUB OF LONDON LIMITED)
(ORIGINAL RESPONDENTS AND CROSS-APPELLANTS)

AND OTHERS

Lord Bridge of Harwich
Lord Templeman
Lord Griffiths
Lord Ackner
Lord Goff of Chieveley

LORD BRIDGE OF HARWICH

My Lords,

I have had the advantage of reading in draft the speeches
of my noble and learned friends Lord Templeman and Lord Goff of
Chieveley. I agree with their conclusion that the appeal should be
allowed and the cross-appeal dismissed with the consequence that
the appellants become entitled to judgment for the principal sum
of £154,695 inclusive of the sum to which the cross-appeal relates.
All questions with respect to the amount of interest to be awarded
on this principal sum and with respect to the costs of the
proceedings must, unless the parties are able to agree, be deferred
to enable counsel to make further submissions.

With respect to the view that prevailed in the Court of
Appeal I cannot see that the respondents are in any better position
to resist the appellants' claim to recover the money which Mr.
Cass stole from them and gambled away in the casino by reason
of the fact that cash was exchanged for gaming chips before being
wagered at the gaming tables. The respondents were nevertheless
mere volunteers who gave no consideration for the stolen money.
This was the common sense view expressed in the dissenting
judgment of Nicholls L.J. Both my noble and learned friends have
thoroughly analysed this issue and I agree with the reasoning in
both their speeches.

I agree with my noble and learned friend Lord Goff of
Chieveley that it is right for English law to recognise that a claim
to restitution, based on the unjust enrichment of the defendant,
may be met by the defence that the defendant has changed his
position in good faith. I equally agree that in expressly
acknowledging the availability of this defence for the first time it
would be unwise to attempt to define its scope in abstract terms,
but better to allow the law on the subject to develop on a case
by case basis. In the circumstances of this case I would adopt the
reasoning of my noble and learned friend Lord Templeman for the
conclusion that the respondents can only rely on the defence to

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the extent that it limits their liability to the appellants to the
amount of their net winnings from Mr. Cass which must have been
derived from the stolen money.

The respondents submitted that the appellants' claims failed
on the ground that they had no title to the money which was the
subject of the appeal or to the banker's draft which was the
subject of the cross-appeal. The arguments in support of this
submission are examined in the speech of my noble and learned
friend Lord Goff of Chieveley. I agree with his reasons for
rejecting them.

LORD TEMPLEMAN

My…