One who, while under a moral obligation to confer a certain benefit upon another, confers it because he mistakenly supposes that he is under a legal obligation so to do, or because he mistakenly supposes that he will acquire a legal right by so doing, is not entitled to restitution. For there is nothing inequitable in the retention of a benefit to which the recipient is morally entitled, even though it is conferred by mistake:

Farmer v. Arundle, 1772, 2 Wm. Bl. 824: Action by the overseer of the parish of Grimley to recover money paid to the overseer of the parish of St. Martin's for the support of a pauper. The plaintiff had certificated the pauper to the defendant, but in this action contended that the defendant could not have enforced against the plaintiff a claim for the pauper's support. De Gray, C.J. (p. 825): " When money is paid by one man to another on a mistake either of fact or of law, or by deceit, this action will certainly lie. But the proposition is not universal, that whenever a man pays money which he is not bound to pay, he may by this action recover it back. Money due in point of honour or conscience, though a man is not compellable to pay it, yet if paid, shall not be recovered back: as a bona fide debt, which is barred by the statute of limitations. Put the form of the certificate out of the case, it is however evidence at all events, that the parish of Grimley have acknowledged the pauper to be their parishioner. And it is allowed, that he has been maintained four years by the parish of St. Martin's. Admitting, therefore, that this money could not have been demanded by the defendant (which it is not now necessary to decide), yet I am of opinion that it is an honest debt, and that the plaintiff, having once paid it, shall not, by this action, which is considered as an equitable action, recover it back again."

Pensacola, etc., R. Co. v. Braxton, 1894,34 Fla. 471; 16 So. 317: Action for cattle killed by defendant's engines, etc. The defendant pleaded as a set-off that its agent, by mistake, had delivered to the plaintiff a voucher for $22.50 which had been intended for another person of the same name. The plaintiff admitted the receipt of the voucher, but testified that he thought it was in payment of a claim for $25, that he had presented for the killing of an ox, which claim was not included in the present action. Taylor, J. (p. 481): "The law seems to be settled that money paid under a mistake of facts cannot be reclaimed, where the plaintiff has derived a substantial benefit from the payment, nor where the defendant received it in good faith in satisfaction of an equitable claim, nor where it was due in honor and conscience. The right to recovery in such cases turns upon the question as to whether the party receiving the money paid by mistake can, in good conscience, retain it. According to the plaintiff's evidence, he had a just and legal claim against the defendant for an ox wrongfully killed by it, amounting to $25, and of which he had notified the defendant, demanding payment thereof. He received the voucher for $22.50 without fraud upon his part, but in good faith, believing it was his, and that it was given him in payment of his claim, and he so appropriated it. His claim seems never to have been settled otherwise. Under these circumstances, we do not think that the retention of the money by him, necessarily involved any smartings of good conscience." 1

1 Also: Munt v.' Stokes, 1792, 4 Term R. 561, (Action to recover money paid in satisfaction of a respondentia bond. The bond was given by the plaintiff's testator, as master of a Danish vessel, as security for a loan. When the plaintiff paid the money he did not know that, since his testator was neither a natural born subject nor a denizen who had taken-the oath of allegiance, the bond could not have been enforced. Judge ment for the defendant.); Platt v. Bromage, 1854, 24 L. J. Exch. 63' (Pollock, C.B. (p. 65) : "If a man has two creditors, and, intending to pay one he by mistake pays the other, he cannot get the money back again."); Monroe Nat. Bank v. Catlin, 1909, 82 Conn. 227; 73 Atl. 3 ; Strange v. Franklin, 1906, 126 Ga. 715; 55 S. E. 943 ; Illinois Trust, etc., Bank v. Felsenthal, 1888, 26 111. App. 624, (Action to recover money paid on two checks. The checks were given to H. as part of a loan on his note and deed of trust. They were drawn in favor of B. and Z., two contractors who were mistakenly supposed to have claims or hens on the land conveyed by the deed of trust. H., instead of delivering them to B. and Z., forged their names as indorsees and sold the checks to the defendants who collected them. In fact B. and Z. had no claims on the land conveyed by the deed of trust, so H.was the equitable owner of the checks and passed his equitable title to the defendants. Judgment for defendants.); Hubbard v. City of Hickman, 1868, 4 Bush (67 Ky.) 204; 96 Am. Dec. 297; Walker v. Conant, 1888, 69 Mich. 321; 37

N. W. 292; 13 Am. St. Rep. 391; Foster v. Kirby, 1862, 31 Mo. 496, 499, (Action to recover overpayment on note. Held, that if plaintiff "did owe the amount paid, it is immaterial that the note was for a less amount; if he paid only what was justly due, he can recover no part of it back."); Ashley v. Jennings, 1892, 48 Mo. App. 142, (Action to recover $150 paid under the mistaken belief that two checks given by plaintiff to defendant - one for $277.08 and the other for $276.90 - had been refused payment by the bank. As a matter of fact only one of the checks had been refused payment. Judgment for defendant.); Buel v. Boughton, 1846, 2 Denio (N. Y.) 91, (The plaintiff had agreed to make a note payable with interest, but interest was left out by mistake in drawing it. Supposing the note to have been written with interest the plaintiff paid interest on it, and subsequently discovering his mistake, sued to recover the interest paid. Judgment for the defendant, Bronson, C.J., saying : ."The plaintiff first omitted, by mistake, to make the note payable with interest, as he should have done; and then, by another mistake, he corrected the first error by paying interest, when the note itself imposed no such obligation. And thus by two blunders,the parties have come out right at last."); Jackson v. McKnight, 1879, 17 Hun (N. Y. Sup. Ct.) 2, (Action to recover a payment of interest on an overdue bond and mortgage. As a matter of fact the interest had been paid before. After the second payment but before the plaintiff's demand for restitution the defendant assigned the mortgage. Judgment for defendant, Learned, P.J., saying: "The difficulty is that, at the time when the plaintiff made this payment, he was owing the defendant a much larger amount, overdue and payable on the very obligation upon which this payment was made. Clearly, if the plaintiff had handed the defendant $230 to apply on the bond and mortgage, he could not have recovered that sum back. But in this present case he claims to recover, because it was intended as a payment of interest which had, in fact, been paid; and not as a payment of principal, which had not. The payment, however, was really made on the debt. The plaintiff is, and always will be, entitled to a credit for so much paid thereon." For an extended criticism of this decision, questioning the correctness of the court's assumption that the plaintiff would always be entitled to a credit for the amount paid, see Keener, "Quasi-Contracts," pp. 52-8.); cf. Mayor, etc., of New York v. Erben, 1868, 38 N. Y. 305; s.c. 3 Abb. App. Dec. 255, (Where an award was made to a property owner by commissioners appointed to assess damages and awards in the matter of improving streets, and by the mistake of a clerk the property owner was overpaid, he could not resist an action to recover the overpayment by showing that the amount received by him was no more than fair compensation. The question of the amount of the award having been intrusted exclusively to the commissioners, subject to appeal, the court had no jurisdiction to examine the question in this action.); Morris v. Tarin, 1785, 1 Dall. (Pa.) 147; 1 Am. Dec. 233. And see Alton v. First Nat. Bank, 1892, 157 Mass. 341; 32 N. E. 228; 18 L. R. A. 144; 34 Am. St. Rep. 285. But see, contra, Sheridan v. Carpenter, 1872, 61 Me. 83, (Plaintiff where money paid on a subsisting demand has been recovered back on the ground that the person making the payment had subsequently discovered facts that shew he had a set-off against the demand."

There is a dictum in the New York case of Franklin Bank v. Raymond 1 which seems to carry this limitation somewhat too far. The action was on a promissory note and the defendants, by way of set-off, claimed to have paid another note by mistake. It appeared that the defendants had given this last-mentioned note to one Bailey, who had sold it before maturity to the Hoboken Bank but had failed, inadvertantly, to indorse it. The Hoboken Bank had sent the note to the plaintiff for collection and it had been paid by the defendants. Shortly after paying the note the defendants discovered that it had not been indorsed by Bailey to the Hoboken Bank and consequently that a claim which they had against Bailey might have been set off against the note in the hands of the holder. They immediately demanded the return of the money paid to the plaintiff, which refused to refund and credited the Hoboken Bank with the collection. The court properly refused to allow the defendants' claim, for since the failure to indorse the note was inadvertant the defendant was morally bound not to insist upon his set-off against the purchaser and it was therefore not against conscience for the purchaser or its agent to retain the money. But in the course of its opinion, the court said: " The debt paid by the defendants was one that subsisted against them at the time of payment. The fact of which they were ignorant, did not shew that there was no debt existing at the time; it only shewed that they were in a situation which enabled them to set off against the demand they had paid, a demand due to them from Bailey. I do not find any case was payee of a note supposed to be the note of St. Paul's parish. He sold it as such to defendant and was subsequently obliged to pay it as indorser. After payment plaintiff discovered that the note was originally so drawn as to be the personal note of the treasurer of the parish and had been altered so as to appear to be a parish note after its purchase by defendant. Plaintiff then brought this action to recover the money paid to defendant and was allowed to recover, notwithstanding the fact that after its alteration the note was what he supposed it to be when he took it and when he sold it to defendant, and what defendant supposed he was buying. See criticism of this decision, Keener, "Quasi-Contracts," pp. 47-9.). 1 1829, 3 Wend. (N. Y.) 69, 73.

Apparently the attention of the court had not been called to the case of Bize v. Dickason,1 in which Lord Mansfield permitted the recovery of money paid to an assignee in bankruptcy by one who had a claim against the bankrupt which might have been set off against the assignee's demand. In the latter case, it is true, the plaintiff's mistake was one of law, and for that reason relief would now, in most jurisdictions, be denied. But Lord Mansfield was clearly right in his conclusion that as between a debtor and his creditor, or one standing in the shoes of his creditor, the former is under no moral obligation to pay more than the balance due after deducting any set-off that he may have, and consequently, if, by mistake, he pays an amount in excess of such balance, its retention by the creditor is against conscience.2