Barclays won its appeal. Mrs Philipp had personally instructed the bank to make two payments and confirmed both by telephone. The Supreme Court held that the fraudsters’ deception did not invalidate her instructions to Barclays. Her separate claim about the bank’s delay in trying to recover the money could proceed.
Facts
In March 2018, criminals persuaded Fiona Philipp and her husband that they were helping an official investigation and that their savings had to be moved to safe accounts. Mrs Philipp visited a Barclays branch on 10 March to instruct a transfer of £400,000 and again on 13 March to instruct one of £300,000. Both payments went to accounts in the United Arab Emirates. Before sending each payment, Barclays called Mrs Philipp and she confirmed that she wanted it to go ahead. After a police warning, the bank froze her account and a third transfer did not go through. Mrs Philipp told Barclays on 27 March that she had been defrauded. The bank first tried to recall the money on 31 May, without success. See paragraphs 10–15 of the judgment.
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What the courts decided
The High Court granted summary judgment to Barclays in [2021] EWHC 10 (Comm). The Court of Appeal allowed Mrs Philipp’s appeal in [2022] EWCA Civ 318. It thought a duty to pause a customer’s own instructions could arise in principle and that her claim should go to trial. On 12 July 2023 the Supreme Court unanimously allowed Barclays’ appeal. Lord Leggatt gave the judgment, with which the other four Justices agreed. See paragraphs 1–5 and 120.
Why the Quincecare duty did not apply
The distinction turned on who authorised the payments. In Barclays Bank plc v Quincecare Ltd [1992] 4 All ER 363, the instruction came from an agent acting for a customer. Where a bank has reasonable grounds to suspect that an agent is trying to defraud the customer, it must check the agent’s authority before paying. That principle can protect an individual as well as a company. See paragraphs 90–91 and 97–100.
Mrs Philipp gave clear instructions herself. The criminals had deceived her about why she should transfer the money, but she intended Barclays to send those sums to those accounts. Under the ordinary current-account contract, Barclays had to carry out her instructions promptly. Its terms permitted it to refuse a payment it reasonably believed was connected with fraud. That discretion did not create the duty she alleged. The Court left open how a bank should respond to reliable information about a fraud that its customer did not know. See paragraphs 3–5, 100–110 and 113–114.
The separate claim about recovering the money
Until 27 March, Mrs Philipp had continued to stand by her payment instructions. Once she reported the fraud, it was arguable that Barclays should have asked whether she wanted it to try to recall the transfers. Whether a prompt attempt would have given her a real chance of recovering anything required evidence. The Supreme Court therefore restored summary judgment for Barclays on the payment claim alone. It made no finding that Barclays had breached a recovery duty and awarded no compensation. See paragraphs 115–120.
Read the full judgment on Supreme Court or consult the Supreme Court case record.
Reported citations [2024] AC 346; [2023] 3 WLR 284; [2023] 4 All ER 847; [2023] 2 Lloyd’s Rep 125; [2023] Bus LR 1269; [2024] 1 All ER (Comm) 1; [2023] PNLR 29; [2023] WLR(D) 305
