A pita customer has paid me some money in error and has just requested I pay it back. There was no information on the bacs so I only found out this morning who had paid it. I have an invoice for a slightly smaller amount to the same customer which is a couple of months overdue. My question is am I legally entitled to keep what I am owed and repay the difference?
All depends on your contract with them I would guess*. If you have right to offset, yep. If not, bit more dodgy ground. @Zhed46 would be the man if he's about Been a few years but I used to do a lot of corporate contract stuff, B2B, at a lay level alongside corporate lawyers
'Off set' is usually deployed if they are a customer as well as a supplier. I'm unsure of the legal position, morally, I'd keep what's owed. He's being a bit cheeky asking for the full amount to be returned, then expecting you to wait even longer.
He has settled the outstanding amount and made an error by paying too much. Wait another 2 months and reimburse his overpayment amount.
Generally correct but the contract may specifically exclude the right to set off. @NoGutsNoGlory (sorry to talk about you as if you’re not here!) says there’s no contract but as @Mac says if they’ve done business it’s likely there is (even if it’s just verbal), and someone’s T&Cs may well be on a purchase order or attached to an email or increasingly these days, there may be a sentence like “T&Cs apply - please visit www.etc...” If there were no terms sent prior to purchase but were only provided after agreement eg: included on a receipt, then the general rule is they don’t bind the other party because for terms to be incorporated into a contract they have to be notified to the other party before, not after, agreement has been reached. There are a load of authorities, generally known as the “hotel and railway cases” from around 100 - 70 years ago which laid down these rules. @NoGutsNoGlory - I got your PM and we will speak about specifics on Monday if need be.
