Undue payment is an important term from the Dutch Civil Code (BW). The term can be used by a plaintiff in a lawsuit as a basis for ordering the other party to pay a sum of money. The article reads as follows:
art. 6:203 BW:
- The person who has given another good without legal basis, is entitled to reclaim this from the recipient as unduly paid.
- If the undue payment concerns a sum of money, the claim is for restitution of an equal amount.
- A person who has performed a performance of a different nature without a legal basis is also entitled to have it reversed against the recipient.
The legal logic of undue payment
The law provides for the need to create a logical legal basis for those cases where an amount of money is owed without an agreement between the parties (so that the payment is due in consideration) while the payment obligation also does not arise from an obligation to to compensate damage under tort .
Example of undue payment
Piet has a debt of € 10,000 to Jan. He uses the wrong bank account number and accidentally pays Truus. There is no agreement between Truus and Piet, and Truus has not committed an unlawful act against Piet. If Piet goes to court to reclaim the money, undue payment is the logical basis for the claim.
Relation to an agreement
Undue payment can also be used as a basis for legal action if an agreement has existed between the parties to the proceedings. Think of the situation in which the agreement has been dissolved or destroyed so that the reason for the payment has expired. Then, as a rule, the performance of the other party must also be reversed, if that is still possible.
Relation to a court decision
Also important for legal practice is the situation in which a payment obligation arises from a judicial conviction, while this judicial decision later changes. This can occur, for example, when alimony is reviewed, but also when a higher court overturns a payment order of a lower court. The amount that has been paid in excess can then be reclaimed on the basis of art. 6:203 BW.
Fraud and Scams
In the event of fraud, the recipient is not entitled to the money collected and the victim will have to ask himself which legal basis for the recovery is the most attractive. For evidential reasons, undue payment is often more attractive than tort, although the claim can often also be awarded on the basis of tort.
The relative limitation period for a claim on account of undue payment is 5 years (Article 3:309 of the Dutch Civil Code). This period starts to run from the moment when the rightholder is actually able to bring the claim (this can, in theory, only be after many years, for example because litigation has taken place for years). If the claim has still not been filed 20 years after the payment, it will still become time-barred (absolute prescription).