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Mindy Chen-Wishart. Contract Law (2018 6 edn). p 359-360.

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Howes Percival LLP Partner Geraint Davies Manchester Polytechnic (1988 LLB), Guildford College of Law (LSF 1989). outlined (the defence of) Change of Position on 7 Aug 2017

Background

Where innocent third parties have been in receipt of funds that were misappropriated by an individual from a company, it may be lawful for them to retain the funds if they can demonstrate that they have changed their position in good faith following receipt of the funds. Otherwise, the company may be able to recover the funds if it can show that the third party has been enriched (or received another benefit) at its expense and that such enrichment was unjust. The remedy in such cases is an order for restitution (i.e. that the unjustly enriched party must return the funds/benefit). The court in this case has drawn a distinction where an otherwise “innocent” recipient defendant may have grounds to suspect that the funds they have received have been misappropriated.

Can someone please expatiate the red underline? It contains too many technical terms.

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