(C) EXTORTION BY COLOUR OF OFFICE (COLORE OFFICII)
(i) Defining Extortion by Colour of Office
Extortion by colour of office, also known as colore officii, is a ground of restitution which is founded on the general principle of compulsion, like duress. Extortion by colour of office is confined in its operation to restitution from public authorities or public officials. It arises where ‘a public officer demands and is paid money he is not entitled to, or more than he is entitled to, for the performance of his public duty’.
It is unclear to what extent this ground of restitution is different from that of duress. The preferable view is that duress will only be established where the claimant can show that the public authority had obtained payment as the result of an unlawful threat. For the purposes of extortion by colour of office it is not necessary for the claimant to prove that the public authority had actually threatened the claimant in any way. The necessary compulsion can be implied where a public authority or official has demanded payment from the claimant, because of the peculiar powers of enforcement, and even punishment, which are available to such bodies or people if the payment is not made. For example, if the authority demands excessive payment for a licence, the claimant may have no choice but to pay the money since the licence is vital to his or her business. The public authority does not need to threaten that it will not issue the licence if the money is not paid, because it is implicit in the demand that if the money is not forthcoming the claimant will not get the licence. The refusal of the authority to issue the licence would in fact be unlawful because the money demanded was not lawfully due to the public authority. This was recognized by Lord Denning in Lloyds Bank Ltd v Bundy,45 who said that these cases arise where the public official is ‘in a strong bargaining position by virtue of his official position or public profession’. It follows that this ground of restitution can be considered to be founded on both the principles of compulsion and exploitation. But the best explanation of extortion by colour of office is that it is founded on compulsion. This was recognized by Isaacs J in Sargood Brothers v The Commonwealth:4
The right to recovery after a demand colore officii rests upon the assumption that the position occupied by the defendant creates virtual compulsion, where it conveys to the person paying the knowledge or belief that he has no means of escape from payments strictly so called if he wishes to avert injury to or deprivation of some right to which he is entitled without such payment.
-  ‘Colore officii’ was described by Glidewell LJ in Woolwich Equitable Building Society v IRC  AC 70,80 as an ‘archaic phrase [which] is at best vague and at worst almost meaningless at the present day’.
-  See Chapter 10. 44 Mason vNew South Wales (1959) 102 CLR 108, 140.
-  45  QB 326, 337.