Unsuccessful cancellation of a standing order

Topic: Payment transactions Case number: 2019/03

The customer was the owner of a company and had a conflict with an employee. The employee terminated her employment on a Thursday without notice. The following Friday, the customer cancelled the standing order for the transfer of the employee’s salary in the late afternoon at a bank machine. The respective amount was nevertheless transferred the following Monday. The customer demanded that the bank reclaim it or compensate him for the payment of the salary despite the cancellation of the standing order. According to his account, he heard nothing more from the bank after that, which is why he turned to the Ombudsman. After examining his request, the Ombudsman had to inform him that, in his opinion, there had been no misconduct on the part of the Bank. He wrote the customer a final notice without contacting the bank beforehand.

The Ombudsman first got in touch with his contact at the Bank by telephone. There he was informed that the customer’s letter of complaint had been examined by the relevant department of the bank. An employee had contacted the customer and informed him that his request for repayment was unfortunately unsuccessful, as his former employee did not agree to a chargeback of her account and was of the opinion that she was entitled to the transferred salary. The bank refused to pay compensation because it clearly stated in its payment transaction conditions that a standing order must be cancelled at least five working days before execution, otherwise it would only take effect with the next but one execution. Cancellation on a Friday afternoon with effect for the following Monday had been too late.

In the Ombudsman’s view, the bank proceeded correctly. The provision that a standing order had to be cancelled or amended at least five days before the next execution was clearly stated in the payment transaction conditions and in plain language. The Ombudsman was also able to understand that a certain amount of lead time is necessary for such orders. The client’s order to reclaim the amount from the final recipient was executed by the bank and the applicable fee of CHF 30 was charged. The bank could not be blamed for the fact that the reclaim was unsuccessful, as the final recipient refused the chargeback. Moreover, it was not clear from the client’s documents why he was of the opinion that his employee was not entitled to the salary for the month in question.

As the Ombudsman could not identify any misconduct on the part of the bank, he closed the case with a notice addressed to the customer. He informed the customer that if he did not agree with the Ombudsman’s assessment, the customer could try to enforce his claim through the courts. In such a case, however, he would not only have to convince the court of the bank’s breach of its duty of care, but also to show that he had actually suffered a loss in the amount of the salary payment, since the employee was no longer entitled to the salary and he had made reasonable efforts to obtain from the bank the amount corresponding to unjust enrichment.