Background
OpenPayd provided QuidPay with electronic-money accounts and payment services. In March 2026, OpenPayd learned of suspected authorised push payment fraud involving approximately €8.99 million sent by a Croatian shipyard and routed through virtual IBANs allocated by QuidPay. OpenPayd restricted and later suspended QuidPay’s accounts while investigating the transactions.
On 23 April 2026, OpenPayd invoked clause 15 of its General Terms of Use and required a reserve comprising €2,453,717.89 and £7 million. The parties’ agreements terminated on 27 May 2026. At an expedited trial, the remaining preliminary issue was whether clause 15, or an accrued right created by its pre-termination exercise, allowed OpenPayd to continue requiring the reserve after termination. The parties agreed that a ruling for QuidPay would entitle it to immediate payment of the reserve.
The Court’s Holding
The High Court held that clause 15 did not survive termination. Its natural meaning imposed an ongoing obligation on QuidPay to maintain a reserve account during the contractual relationship. That obligation was a primary obligation rather than an accrued right preserved by clause 22.5, and clause 15 was omitted from the provisions expressly listed in clause 22.8 as surviving termination.
The court rejected OpenPayd’s argument that deducting e-money and crediting an internal ledger transformed the reserve into collateral that it could retain against possible future indemnity liabilities. The contract did not clearly authorize OpenPayd to transfer the amount into an account belonging to itself or extinguish QuidPay’s rights in that manner. Regulatory considerations under the Electronic Money Regulations 2011 and the competing commercial consequences did not justify departing from the contractual language.
Accordingly, OpenPayd could not continue requiring maintenance of the reserve after termination and was obliged under clause 22.6 to account for the deducted funds. The judgment recorded the parties’ accepted position that the reserve must be paid to QuidPay immediately and invited them to draw up an order; it did not itself set out a payment order. The court left any claim for interest and other consequential matters unresolved.
Key Takeaways
- A pre-termination requirement to maintain a reserve did not create an accrued right allowing OpenPayd to retain it after the agreements ended.
- A primary contractual obligation will not ordinarily survive termination when the contract expressly identifies surviving provisions but omits the relevant clause.
- Internal bookkeeping could not create post-termination collateral rights that were not clearly authorized by the contract.
Why It Matters
The decision illustrates the need for payment-services contracts to state expressly whether reserves secure future liabilities after termination, who owns the reserved assets, and how and when they may be released or applied. A broad indemnity that survives termination does not by itself preserve a separate reserve mechanism.
The judgment also shows that an electronic-money provider cannot establish enduring proprietary or security-like consequences merely through its own ledger treatment. Clear contractual language is especially important where the proposed arrangement affects redemption and safeguarding protections under the Electronic Money Regulations 2011.