Unjust Enrichment CASES
In English law, unjust enrichment is a legal principle preventing individuals from retaining benefits or gains received unfairly or without a valid legal basis, requiring restitution.
Definition and Principles
Unjust enrichment occurs when one party unjustly benefits at the expense of another, without justification, typically prompting courts to order repayment or compensation.
Essential Elements
- Enrichment: One party has received a benefit or gain.
- At Another’s Expense: Another party has incurred a loss or disadvantage.
- Unjust Factor: No legal justification for retaining the enrichment.
Common Scenarios
- Payments made by mistake.
- Benefits obtained through undue influence or duress.
- Situations where contracts fail or are unenforceable.
Remedies
Courts usually order restitution, requiring enriched parties to return or compensate for the unfair benefit gained.
Practical Importance
Understanding unjust enrichment ensures fairness, encouraging accountability and preventing unjust financial advantages.
Home » Unjust Enrichment
A property developer incurred substantial costs during 'subject to contract' negotiations for a development project. When the other party withdrew, they sought restitution for these expenses. The court held that such pre-contractual costs are a normal commercial risk and not recoverable. Facts The London Dockland Development Corporation (LDDC), the defendant, invited tenders for a licence to develop a valuable site in Wapping. Regalian Properties Plc, the plaintiff, submitted a proposal and was selected as the preferred bidder. All subsequent negotiations for the final building agreement were conducted explicitly on a ‘subject to contract’ basis. During this period, and as a
A Polish company paid an advance for machinery from an English company. The contract was frustrated by the outbreak of WWII. The House of Lords held the Polish company could recover its advance payment due to a total failure of consideration. Facts In July 1939, the appellants, Fibrosa Spolka Akcyjna (a Polish company), entered into a contract with the respondents, Fairbairn Lawson Combe Barbour, Ltd (an English company), for the purchase of certain machinery for £4,800. Delivery was to be to Gdynia, Poland. Per the contract terms, the appellants made an advance payment of £1,000. However, on 1 September 1939,
Facts Cleveland Bridge and Engineering Co Ltd (CBE) were contracted to construct the steel framework for a building in Jeddah, Saudi Arabia. They required a significant quantity of specialised cast steel nodes for this project. CBE sent a ‘letter of intent’ to British Steel Corp (BSC) requesting that BSC commence production of these nodes immediately, in anticipation of a formal contract being finalised. Negotiations on the formal contract proceeded but ultimately failed. A key point of contention was the liability clause; BSC insisted on a clause excluding liability for consequential loss arising from late delivery, whereas CBE sought to impose
