Week 11: Unjustified Enrichment

Question 1

What are the three starting steps of UE?

Answer 1

1. enrichment of defender
2. no clear ground for retention
3. gained at the expense of the pursuer, loss and causation follow

Question 2

What is enrichment?

Answer 2

1. Addition of a new asset to a person’s wealth
2. Adding value to person’s already existing asset
3. preserving another’s asset which would’ve otherwise have been lost or reduced in value, saving the other the expense involved
4. performance of an obligation lying upon another, saving that other the expense of performance

Question 3

Receipt or acquisition of money?

Answer 3

Morgan Guaranty Trust v Lothian Regional Council

Contract was void, LRC has money and no legal basis to have it. UE.

Question 4

Receipt or acquisition of other property?

Answer 4

Findlay v Munro

M got ox by mistake, but ate it anyway. UE, payment for saving on food

Question 5

Improvement of another’s property

Answer 5

Newton v Newton

H bought house in Wifes name. W given house on divorce, H had improved house a lot. UE.

Question 6

Unauthorised use of another’s property

Answer 6

Jarvis v Manson

Jeweller bought ring and sold on after refurbishing for £10. Had been stolen, liable to pay true owner their enrichment, 5.50, as they were in good faith.

Question 7

What are the three situations where unjustified enrichment is recoverable?

Answer 7

1. Transfer - morgan and munro
2. Imposition - newton
3. Enrichment - jarvis

Question 8

How does transfer work?

Answer 8

No legal grounds for retention, then show one of the condictiones is applicable.

Question 9

What are the condictiones?

Answer 9

Condictio indebiti

Condictio causa data causa non secuta

Question 10

What indebiti?

Answer 10

Error that transfer was due by transferor because of some legal obligation owed to transferee. Error must be about liability and to who it is owned.

Question 11

What is causa data causa non secuta

Answer 11

something transferred for a future purpose which failed to materialise.

Question 12

Cases of indebiti?

Answer 12

Morgan Guaranty v Lothian Regional Council

Payment made under void contract not due: error of law

Bank of New York v North British Steel Group

Paying wrong person, error as no liability to person. Recoverable.

Question 13

Cases of not indebiti?

Answer 13

Scanlon v Scanlon

W paid car payments for M. No error about her liability.

Question 14

Cases of causa data causa non secuta

Answer 14

Shilliday v Smith

Cohabitants, w makes improvements. She could recover causa data… handed over money for purpose.

Cantiere San Rocco v Clyde Shipbuilding

Pre-payment frustrated by outbreak of war returnable. Pre-payments for purpose that couldn’t be fulfilled.

Question 15

What is imposition?

Answer 15

Classic case is unauthorised improvements of another’s property

Question 16

What are the rules

Answer 16

1. Impoverished person in good faith possession of property without knowledge of lack of right
2. Worked under error, usually that it was his
3. Recovery without error if some other ground making it UE as per Shill v Smith

Potentially transfers…

Question 17

What about performance of anothers obligation?

Answer 17

If P pays C’s debt to D, then P has enrichment claim against C. Even with full knowledge of facts. Makes no difference to C’s basic position.

Question 18

Cases?

Answer 18

Lawrence Building v Lanarkshire CC

Recompense claim allowed, dispute who was required to connect sewers but builders did anyway.

Varney v Burgh of Lanark

Same situation, not recoverable. Subsidiarity claim, had other options they could’ve taken.

Question 19

What is taking?

Answer 19

Normally the enrichment is the gain made from the use rather than the property used. Moveable goods onto third party difficult.

Question 20

Defences?

Answer 20

Change of position
RBS v Watt: W cashed E’s fake cheque. Claimed no longer had the money, rejected as negligent and order for repetition not just.

Question 21

Another?

Answer 21

Subsidiary, as per Varney. Courtney’s Exrs v Campbell, not allowed EU since subsidiary due to statutory remedy. Usually for imposition, not transfer, which this case was…

Question 22

What are the three remedies?

Answer 22

1. Repetition - repayment of money
2. Restitution - restoration of tangible property or equivalent
3. Recompense - payment for any other form of enrichment

Question 23

What is used in transfer?

Answer 23

Repetition or restitution

Question 24

Imposition and taking?

Answer 24

Recompense

Question 25

What happens in transfer where subject matter isn’t money?

Answer 25

Recovery of recipient’s enrichment, rather than the value of the previously transferred property as per Findlay v Munro

Same as improvement cases - addition to the value of the defender, not cost of service

Question 26

Exceptions?

Answer 26

Faulds v Townsend: Bought a horse at night to make medicine. Horse stolen, chemist liable for full value of horse, not just enrichment, as lack of due care in checking antecedents of the horse.

Question 27

Where they become owner of property used?

Answer 27

Oliver & Boyd v The Marr Typefounding

Employees stole type which ended up with MT, in good faith. MT melted down type and resold. Liable to OB for full value. Specifcators

Question 28

Second case?

Answer 28

IBC v Ferguson

bought refined cotton seed oil in good faith, and turned it into lard, which was then resold at a profit. But the party from whom the oil had been purchased had not had good title, and IBC, the true owners, sued FS as specificators for the full value of the oil. Held FS were liable for the full value of the oil.