Money paid in error to a Company in liquidation

[melanie777]

Hi, I had a contract for storage of goods with a company which has gone into liquidation. I collected my goods but forgot that a standing order was set up years ago and my bank paid monthly payments into the liquidated company's NatWest account for a few months before I realised.
The liquidation is still on going.
I've asked the liquidator for a refund but he said "NatWest have used the money to reduce the company’s overdraft and he will try to get it refunded to me, but essentially he suggest it's up to the bank. He also said I could write to NatWest.
I've since received a standard letter and debt registration form to complete from the Liquidator, but this seems strange as my payments were made in error, the contract had ended and there were no items in storage.
Does anyone with relevant legal expertise know if the liquidator has a legal obligation to return my money and/or NatWest bank, as its not simply a debt I am owed by the liquidated company/or the liquidator.

I don't think you can hope for much honestly. The error was yours. The bank did what you told them to do. When liquidation happens, there is a legal list in order of precendence of who gets paid until the money runs out. Customers are right at the bottom of that list.

I also think your cash is now subbing the shortfall and you have little chance of recovery. Lesson learnt! Sometime customers get .10p in the pound - if that

yup and they will be customers who actually didn't make a mistake about payment.

I'm not sure that's the case here. If what OP has said is correct, they are no longer a customer, these payments have been have been made in error outside of their previous contract and the bank has applied them to the company overdraft.

If you or I accidentally deposited money into this company's account, I doubt the bank would get away with applying it to the overdraft and making us creditors.

If the above is correct, the bank should refund the money.

It likely depends on the status of the contract though. OP says that the contract ended when they collected the items in storage. However if that isn't the case, and OP was instead essentially paying for storage space they weren't using, then they're unlikely to get the money back.

As I understand it the OP made a standing order to the company for the payment. Essentially she told the bank to make a payment to another entity and to continue until she told them to stop. She didn't tell them to stop.

Thanks guys, especially Velmy...that's how I see it...the money was sent in error for no service or anything supplied, so it seems fraudulent to keep it.

If a bank transfers out money to a personal account by mistake and the customer spends it instead of returning it to the bank, it's in fact fraud!

A liquidator can keep money held in the account BEFORE the company went into liquidation - not paid in error afterwards.

In your example, that would be the bank's mistake though, that they sent the money to an account that was not the one you told them to send it to. In your case, you told the bank to send money to a specific account until you told them to stop. That is what "standing order" means. Its not the bank's error, its your error. It wasn't one payment sent and then you realised you had sent it to the wrong place. It was a payment that you arranged to have sent that they sent to the right place and that you failed to cancel. The bank has no way of knowing that you had stopped using the service. The bank has no responsibility and the company you were paying no longer exists....I mean yeah, contact the bank, it couldn't hurt and they might be feeling kind (do banks ever feel kind?) but don't hold your breath.