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Birks, Peter --- "Equity, Conscience, and Unjust Enrichment" [1999] MelbULawRw 1; (1999) 23(1) Melbourne University Law Review 1


ANNUAL MIEGUNYAH LECTURE:
Equity, Conscience, and Unjust Enrichment

PETER BIRKS[*]

[This paper seeks to present a revised picture of the relationship between unjust enrichment and the law of restitution. That picture then shows that it is an error to deny the utility and unity of the law of unjust enrichment by pointing to undoubted discontinuities within the law of restitution. The paper also attempts to show that the law of unjust enrichment must draw on the law derived by the Court of Chancery, just as it cannot but draw on the law derived by the Common Pleas and King’s Bench, hence that it is false to suppose that there is any competitive hostility in this field between equity and common law or that equity can in some way be expected to do the work of the law of unjust enrichment in some other way. One theme running through the whole paper is the need for constant attention to legal taxonomy. This means not only having such a taxonomy but also keeping it under constant critical review.]

I INTRODUCTION

Unjust enrichment is unfamiliar, even to many lawyers. A central example is a mistaken payment. Suppose that I pay you $1000 in the mistaken belief that I owe it to you. Provided that my claim does not get caught up in the finer tuning, I will be entitled to restitution from you. You have been enriched at my expense, and there is, in the mistake, an ‘unjust factor’, a factual reason why you should make restitution. ‘Unjust enrichment’ is the generalised description of the event. It forms the genus; mistaken payment is a particular species. Like cases must be treated alike. The generic description serves to gather together all the other events which ought to be treated in the same way as mistaken payment. For example, if money is paid over on a specified basis, and the basis fails, restitution must likewise follow. The ‘unjust factor’ is different in this case. It is failure of basis or, in the traditional phrase, failure of consideration.

If rather few common lawyers have yet had a legal education which built the category of unjust enrichment into their intellectual armoury, it is because until quite recently no law school could do the job. It is still a novel category. Its content was formerly fragmented and dispersed by language, and concepts, thrown up by the intuitive pragmatism of the past. Yet its identification and organisation has been one of the great success stories of the twentieth century. That stone has now been rolled to the top of the hill, and there it will certainly stay, unless some jurist manages to send it rolling down the other side.

There are some who are inclined to try. The High Court of Australia has played an important part in disengaging the new law of unjust enrichment from its muddled earlier history.[1] Nevertheless, some distinguished Australian lawyers have shown themselves to be sceptical, even hostile. They either doubt its claims to have sorted out a large area of the common law or believe that the sorting out could have been done, and still can be done, much better in some other way. This lecture is about some Australian species of that sceptical hostility or hostile scepticism. It is of course wholly right to test and probe. If the stone is unstably perched on the summit, it is dangerous. If it is dangerous, it should be pushed down under supervision as soon as possible. But my theme today will be that it is not unstable. These particular Australian suspicions are false. On the contrary, the recognition of the law of unjust enrichment is a genuine advance in the rationality of the common law. Since rationality and justice go hand in hand, it should not be repudiated.

II THE TWENTIETH CENTURY STORY

On the civilian side of the Western legal tradition the law of unjust enrichment goes back two millennia. The seeds were sown in the first life of Roman law, when the ius civile was the law of the Romans themselves. It was ultimately brought to flower in its second life, but not till some centuries after Justinian’s Corpus Iuris Civilis had become once again the law library of Europe.[2] This is not the place to trace that history, nor to examine the different positions taken by different national codifiers. In the codes the ius commune split up, much as the Rhine when it reaches its delta. However, we ought not to contemplate the twentieth century story within the common law without taking note of the fact that a century ago, in 1900, the enactment of the German Bürgerliches Gesetzbuch (‘German Civil Code’) included a compact set of outline rules for the operation of the fundamental principle that, in the event of unjust enrichment, the party enriched must make restitution. That was one culmination of the long history of the subject, or perhaps more accurately a staging post. But, if in experience difficult, the singularly clear German statement also serves as a marker for the beginning of common law’s attempt to make sense of its own position in the same matter. Under the rubric Ungerechtfertigte Bereicherung (‘Unjustified Enrichment’), § 812(1) of the German Civil Code stated the principle in these words:

A person who, through a performance by another or in some other way at the expense of that other, has received something without any legal ground is bound to make restitution to that other. This obligation also arises in the case in which the legal ground later falls away or the result contemplated by the performance, as judged by the nature of the legal transaction in question, fails to materialize.[3]

On the common law side, no detailed account has yet been written of the history of this subject in the first third of this century. The forces gathered which would eventually assemble the scattered pieces. It is difficult to prove that the German Civil Code § 812 was a catalyst. It is difficult to believe that it had no role at all. This formative period issued in the Restatement of Restitution, which the American Law Institute commissioned from Professor Austin Scott and Professor Warren Seavey in 1933 and published in 1937.[4] As Justice Gummow has recently written, the early work was all American. ‘England,’ he says ‘followed well behind.’[5] Sixty years later, in 1997, the American Law Institute finally set Professor Andrew Kull working on the second Restatement. That will be a twenty-first century event. If it takes a decade it will have been done quickly, for in the meantime the subject has grown and grown up. But it has grown up in a manner which in some ways poses serious problems for Professor Kull.

A great wave of learning has swept around the major common law jurisdictions of the world. Justice Gummow is quite right to emphasise the American initiative, and the very brevity of his brief account no doubt justifies his making no reference to the English chapter. But in truth the story cannot be understood without any reference to England. The work which started in America later moved across the Atlantic, and it was from there that it spread through the Commonwealth and, ultimately, back to the United States. Professor Kull’s problem is that the American case law is still in a relatively raw condition. Structural doctrine in private law has been largely forsaken by the great American law schools, just at a period in which this particular subject stood in particular need of more attention of precisely that kind.[6]

England reacted instantly to the first Restatement.[7] But between the first enthusiastic reaction and the substantive response, the Second World War intervened. Wars disrupt. Despite the length of the interruption, Goff & Jones was the response to the Restatement.[8] About the same time, graduate courses sprang up in Oxford, London, and Cambridge — in Cambridge under Gareth Jones himself, in London under George Webber, who was my own inspiring teacher, in Oxford under Guenter Treitel and Derek Davies. It was that book and those courses which provided the momentum which carried this exciting new learning throughout the Commonwealth and provoked the writing of new books in Canada, Australia, and New Zealand.[9]

The literature has in turn produced the cases, and one court after another has accepted that the common law does indeed have a law of restitution of unjust enrichment. The torrent shows no sign of abating. Professor Andrew Burrows’ Law of Restitution, together with the marvellous volume of cases and materials which he has recently put together with Professor Ewan McKendrick, has made the subject accessible at the LLB level. The subject has acquired its own dedicated journal, the Restitution Law Review. Only the other day Dr Robert Chambers, previously of this University, and I, as the persons responsible for a biennial publication called ‘The Triple R’ (The Restitution Research Resource), were bemoaning the fact that the days when it was possible to achieve comprehensive coverage were over.

That this has been a major twentieth century story is not in doubt. Whether it is a success story we will not know for certain for another hundred years. Great advances in knowledge and understanding take time to test, and they are not often achieved without errors and digressions. The errors and digressions have to be rooted out. The deepest question is whether the whole story ought really to be reversed. Mr Ian Jackman, a Sydney barrister, thinks it should. He studied the subject in Oxford and believes that he has discovered congeries of latent defects. In The Varieties of Restitution his aim is to send the stone rolling down the hill.[10] And Justice Gummow’s preface to Mr Jackman’s book, though it stops short of saying it in so many words, suggests that that most learned judge would have the reader believe that in his view Mr Jackman’s attack has not missed its mark. That which Justice Gummow endorses will command attention all over the world.

III MR JACKMAN’S VARIETIES

Ian Jackman’s title immediately discloses his thesis. The thesis is that the much-vaunted unity of the law of restitution, as the response to unjust enrichment, is as fictitious as any of the old figures which it claimed to have replaced. From fragments it was put together, and to fragments it must return. He is both right and wrong, but in the end more wrong than right.

A In What Way is Jackman Right?

Mr Jackman is right to insist that unjust enrichment is not the only causative event which gives rise to restitution. If we define ‘restitution’ as the giving up of a gain to another person who is entitled to claim it,[11] there is no doubt that restitution is multi-causal. That is to say, restitution is triggered by more than one category of causative event. In this multi-causality restitution resembles the otherwise different category of debt. For a debt – an entitlement in personam to, and corresponding obligation to pay, a sum certain – can arise from a contract, a wrong, an unjust enrichment, or from some other event, such as a taxable acquisition or a judgment. Mr Jackman is not the first person to insist on the multi-causality of restitution,[12] but that does not diminish the importance of the insight. It means that a statement along the lines, ‘This is an action in, or for, restitution’, does not unequivocally indicate that the claim in question arises from unjust enrichment.

This multi-causality is sufficiently established as soon as we recognise that restitution for wrongs (gain-based recovery for wrongs) has to be separated from restitution of unjust enrichment (as exemplified in the recovery of a mistaken payment). In the famous Kentucky Cave Case[13] a landowner had developed a profitable tourist industry after discovering on his land the entrance to a scenic cave. Unfortunately about one third of the attractions were under his neighbour’s land, though the trespassing tourists, deep below the surface, did no harm and caused no loss. The neighbour was held to be entitled to one third of the profits. If and so far as this award was given, as it appears to have been given, for the trespass as such, and not by recharacterizing the trespass as something else, it belongs to the law of wrongs, not the law of unjust enrichment. The cause of action was the trespass, the wrong itself.

Every case of restitution for a wrong as such belongs to the law of wrongs. Wrongs trigger entitlements of different kinds, frequently to compensation, sometimes to punitive damages, sometimes to restitution (ie to an award calculated to cause the wrongdoer to give up his gain). When the cause of action is the wrong, it cannot at the same time be an unjust enrichment, for these are exclusive categories. Facts are not infrequently susceptible of more than one analysis, as a contract or a wrong, or as a wrong or an unjust enrichment. But dual analysis of that kind should not distract from the truth of the proposition that, if and so long as a plaintiff is relying for her cause of action on a wrong, she cannot be said to be relying on an unjust enrichment.

It follows from this that, as soon as we see that there can be restitution on account of a wrong and restitution on account of an unjust enrichment, we have to admit that restitution is multi-causal. There is no perfect square, formed by the event ‘unjust enrichment’ and the response ‘restitution’. Restitution is the response to unjust enrichment, but not only to unjust enrichment. I was myself an advocate of the perfect square. It was not only a false doctrine, it was falsified within a page of its enunciation, for I myself immediately insisted, without noticing the full consequences, that it was essential to distinguish restitution for wrongs from restitution for autonomous unjust enrichment.[14]

In fact the multi-causality goes further. If we classify causative events as manifestations of consent, wrongs, unjust enrichment, and miscellaneous other events, and if we free the notion of restitution (giving up a gain to another) from the false association with any one event, it will turn out that restitution can arise from every event so named. I can contract to give up a gain, I may have to give up a gain because of a wrong, I may have to give up a gain which is an unjust enrichment, and I can be compelled to give up a gain by other facts, as for instance a judgment.

This is an important advance. An error is cleared out. We must not treat restitution and unjust enrichment at synonyms. If we want to talk about unjust enrichment, we will have in future to call it the law of unjust enrichment. In Macmillan v Bishopsgate[15] the courts found themselves conceding that the plaintiff’s case was indeed a claim to restitution but found it hard to say why the conflicts rules of unjust enrichment were inapplicable. A single sentence would have eased that problem: restitution being multi-causal, it does not follow that a claim for restitution will be a claim arising from unjust enrichment.

Mr Jackman is therefore quite right to insist that there are varieties of restitution, where ‘varieties’ indicates different causative events. In conceding this multi-causality, I have not conceded precisely the multi-causality which he seems to describe. I shall come back to that below.

B In What Ways is Jackman Wrong?

Mr Jackman is wrong to think that the multi-causality of restitution does any harm whatever to the project of the Restatement. The fact that entitlements to restitution turn out to be generated by events other than unjust enrichment inflicts no damage on that which the Restatement sought to achieve, because that which the Restatement sought to do was not to document the whole law of restitution but only the law of unjust enrichment. Article 1 proclaims the relation between event and response: ‘A person who has been unjustly enriched at the expense of another is required to make restitution to the other.’ Goff & Jones, in every edition, has opened with a statement which is functionally identical to that of the Restatement’s first article: ‘The law of restitution is the law relating to all claims, quasi-contractual or otherwise, which are founded on the principle of unjust enrichment. Restitutionary claims are to be found in equity as well as at law.’[16]

The evidence of these statements is that the authors regard the ‘restitution’ of the titles of their volumes as functionally synonymous with ‘unjust enrichment’, describing the same area of law, albeit from different perspectives. The project upon which these jurists were engaged was the law of unjust enrichment. They assumed that they could safely call it restitution. We now know that they could not do so. For the truth is that the two terms do not describe the same area of law. Restitution is a larger subject than unjust enrichment. Whether or not, had the multi-causality of ‘restitution’ been pointed out to them, the fathers of the modern subject would have changed its name, cannot be guessed. But it seems likely that they would have said, without hesitation, that they never intended to have anything to do with that matter which belonged to restitution but not to unjust enrichment.[17]

Mr Jackman, rightly insisting on the multi-causality of restitution, appears to have thought that he would thereby fragment a unity which ought never to have been unified. That depends on precisely what you think the intended unity was. As the last paragraph shows, my own view is that the founders, if we may so dignify them, never intended to unify anything but the law of unjust enrichment. Mr Jackman thinks that they intended to take the whole law of restitution and, falsely and fictitiously, purported to unify it as the law of unjust enrichment. But the contrast between my view of the original project and Mr Jackman’s view is not fully expressed in the simple difference between unjust enrichment and the multi-causal restitution. In the preface to The Varieties of Restitution Justice Gummow, rightly I believe, indicates the full extent of the category which Jackman, and he himself, believe the founders had in their sights. It is important to see just how it is described, for only then can one see how specious the exercise of unification seems to these critics and how maddening the world’s acceptance of the new falsehood.

The way they see it the category that Scott & Seavey and Goff & Jones were aiming to net was the category of all entitlements not generated by contract or by tort, a massive miscellaneous residuum. The more you think that they intended to bag, the more hubristic seems their undertaking. Justice Gummow attacks this hubris:

The forms of action are gone. But is there a genus which includes all those species of common law obligations which are neither contractual nor tortious in nature? Experience of the evolution and nature of the law of obligations would suggest that to maintain the existence of such a single genus is to favour logic and good order over the benefit of that experience. It encourages the treatment of the unlike as like, foreshortens analysis and, in the end, stultifies legal development.[18]

Oliver Wendell Holmes’ famous dictum, which seems to favour experience over logic, has a lot to answer for.[19] The law does not live by logic alone, but it is allergic to fallacy and contradiction. It requires good intellectual order. It cannot be that it requires bad intellectual order. There is much to be said for a good deal more reliance on logic and a good deal less on experience. However that may be, logic and good order have nothing whatever to do with, are indeed flatly opposed to, the creation of wholly false unities. If the founders had set out to unify all that was not contract or tort, they certainly could never have sailed under the flag of logic and intellectual order.

But there certainly never was a project to unify ‘all those species of common law obligations which are neither contractual nor tortious in nature.’[20] Justice Gummow here speaks of obligations (rights in personam) and asserts that it was bogus to pretend that all those which did not arise from either a contract or a wrong could be regarded as a unity. The law relating to restitution of unjust enrichment was intended to be both larger and smaller than that, larger because it included all entitlements (in personam and in rem), and smaller because it intended to extract from the class of all entitlements only those which arose from unjust enrichment.

Without the work which identified the law of unjust enrichment, all entitlements would have to be said to arise from consent, from a wrong, or from miscellaneous other events. Against that picture, we can identify the law of unjust enrichment as a nominate category quarried from the miscellany. It never intended to capture the whole miscellany. It intended only to narrow it by removing from it one more named category. That work once done, the threefold classification was replaced by a fourfold classification: all entitlements arise from consent, from a wrong, from an unjust enrichment, or from some other event. It has to be remembered that neither unjust enrichment nor restitution could possibly remove from the miscellany any entitlements which were not gain-based. Hence any that were loss-based and did not arise from consent or wrongs certainly had to stay behind in what would become the fourth category. It is not even true that all gain-based entitlements would be taken out, for the multi-causality of restitution reminds us that there may indeed be restitutionary entitlements arising under any of the four heads. That need not detain us here. It suffices, for the purpose of giving the fourth head content that it must necessarily have retained any entitlement which was loss-based and did not arise from a manifestation of consent or from a wrong.

It is difficult to say whether the residual miscellany is large or small. If Professor Stoljar was right that there is a class of cases entitled to the name ‘unjust sacrifice’, where a plaintiff is entitled to compensation for a loss incurred in the interest of the defendant even in the absence of any corresponding gain to him, those cases certainly belong in the miscellany. An entitlement to a reward is different from an entitlement to gain and from an entitlement to compensation for loss. It would seem to follow, therefore, that the entitlement to a reward for salvage similarly belongs in the residual miscellany. Judgment debts also arise without consent of the debtor and, since the judgment itself is neither a wrong nor an unjust enrichment, they too must belong in the residual miscellany. Unjust sacrifice, successful salvage, and judgments have to be left in the miscellany precisely because they cannot be analysed as unjust enrichments (or manifestations of consent, or wrongs). They are not like mistaken payments. They do not fit within the generic restatement of that paradigm.

There are a number of events the characterisation of which is problematic. Salvage may be one. It is exactly the same in the natural world. Great naturalists, without doubting the two categories, have disagreed as to whether a barnacle is a crustacean or a mollusc. Darwin showed, from its larval stage, that it is the former. Lawyers understand that kind of dispute very well. Laying aside that kind of difficulty, we may be sure that nobody ever intended to deny the existence of the residual miscellany. Nobody ever intended that there should be no causative events left in the fourth, residual category after unjust enrichment had been taken out.

C The Founders Made Two Kinds of Error

In the result what Mr Jackman has succeeded in drawing attention to, as also in England Mr Virgo, is the fact that Professors Scott and Seavey made two classificatory errors, an error of omission and an error of commission. As it happens, both these errors are repeated in the title of a recent book by Professor Andrew Burrows. I use this illustration with undiminished admiration for his work. He is one of the world’s leading authorities on the subject, and nobody pursues with more integrity the goal of transparent rationality. Nonetheless, his title does illustrate these two taxonomic errors. The book, it must be said, is not about all rights but only rights in personam (obligations) but, for the purpose of illustrating these two errors, that makes no difference. His title is Understanding the Law of Obligations: Essays on Contract, Tort and Restitution.[21] The first part of the title identifies the sub-class of entitlements of which he wishes to speak, namely the personal rights which correlate with obligations. The second part illustrates the two errors.

The error of omission is the failure to give notice that the three terms, contract, tort, and restitution, do not exhaust the whole law of obligations. He might reasonably say that it is not the business of a title to take points of that kind. But the fact remains that neither he, nor Goff & Jones, nor the Restatement, takes the essential step of warning of the existence of the fourth miscellaneous category beyond contract, tort and restitution. It is that omission which has left people thinking that there are only three classes of obligations and given the consequential impression that the law of restitution of unjust enrichment somehow sought to unify everything that was not contract and tort, an ambition that Professor Burrows certainly does not entertain and which would at all times have been little short of ludicrous. I do not think that it was an ambition ever entertained by anybody. Even Justinian’s commissioners in the sixth century thought that the miscellany beyond contract and wrongs required at least two further classes. It was in that conviction that they gave the world the useless categories of quasi-contract and quasi-delict. Almost meaningless as those categories were, they served as a warning of complexity. The modern error of omission consists in failing to give that warning, a failure to put up a sign warning the uninitiated against the danger of misconstruing their project conducted under the name ‘restitution’.

The error of commission is the acceptance of the risks inherent in a bent classification. ‘Contracts’ and ‘torts’ are events which trigger legal responses, while restitution, or more accurately the entitlement to restitution, is a response triggered by an event. Restitution belongs in the same series as compensation. When entitlements are classified according to the goal which they are designed to achieve, some are restitutionary, some are compensatory, and some pursue other goals. When they are classified according to their causative events, some are contractual, some tortious, and some arise from other events or, at a slightly higher level of generality, some arise from consent, some from wrongs, and some from other events. And, as we have seen, the miscellany can be made to yield up one more nominate genus, producing the fourfold classification according to which entitlements arise from consent, wrongs, unjust enrichments, and miscellaneous other events. A bent classification is one which turns a corner in the middle: animals are herbivores, carnivores, yellow, or eat other things. A classification according to which entitlements arise from consent, wrongs, restitution, or other events is bent. Just as yellow animals can be herbivores, carnivores, or eaters of other things, so restitutionary entitlements can arise from consent, wrongs, or other events.

A bent classification may be substantively or semantically bent. It is substantively bent when the odd term out is intended to have its natural meaning. It is semantically bent when the odd term out is not intended to have its natural meaning but rather a meaning which is in reality properly aligned with the other terms in the series. If it were true that all yellow animals were in fact insectivores, the example above which used the term ‘yellow’ would be semantically bent, for in this context ‘yellow’ would mean ‘eater of insects’. Similarly, when we say that trusts are express, implied, resulting, or constructive, the word ‘resulting’ is on its face the odd man out, for ‘resulting’ indicates that the beneficial interest resalit (jumps back), and the other terms are focused on the mode of creation, not the location of the beneficial interest. But again the bend is semantic, not substantive, for by ‘jumping back’ we really mean ‘presumed’; and ‘presumed’ aligns.

In the case in which we are primarily interested, the bend in the classification is likewise semantic. Nobody meant ‘restitution’ to denote all that the word naturally includes. Though they may have been uncertain about the precise borders of unjust enrichment, they meant ‘restitution’ to mean only that subject which lay within those borders. They meant ‘restitution of unjust enrichment’ or ‘restitution triggered by unjust enrichment’. And the categories so named are indeed nothing other than the law of unjust enrichment. In short, ‘restitution’ stands in this series as meaning ‘unjust enrichment’.

If we cure Professor Burrows’ error of omission, his series becomes Contract, Tort, Restitution, and Other Causative Events. The bend is semantic. He too means ‘restitution’ to stand for ‘unjust enrichment’. Almost immediately, he reveals that he is well aware of the risky inelegance of that nomenclature.[22] He thinks that the perpetuation of the usage of Professors Scott and Seavey and the American Law Institute, however inelegant, can do no harm.[23] In other words, everyone will know and understand that ‘restitution’ means ‘unjust enrichment’. The misdirected attacks on the project of the Restatement, the invalidity of which is supposed to be demonstrated through the multi-causality of restitution, show that that is not right. The only safe course is to call the law of unjust enrichment the law of unjust enrichment.

D Why Did We Get Into This Muddle?

The muddle is partly due to insufficient anxiety about taxonomy. But that is not the whole explanation. We must now call unjust enrichment unjust enrichment. Why was this not done from the beginning? Professor Seavey later wrote that the name ‘restitution’ was not happy and that ‘unjust enrichment’ might well have been better.[24] At the time all things German had fallen into disgrace. That may have been one reason. Another was probably that, in the words of Barry Nicholas, the language of unjust enrichment had been ‘withered by judicial scorn’.[25] That judicial revulsion rested on the fear of being drawn into theories of distributive justice and the competing analyses of political extremists. Nazis and communists occupied the centre of the stage. For whichever of these reasons, the American Law Institute preferred the tough sounding ‘restitution’ to the supposedly provocative but much more accurate ‘unjust enrichment’. In the end that choice appears to have done damage, but it is not to be denied that under the better name the project might have been torpedoed almost as soon as it was launched.

E Jackman’s Own Varieties

I have accepted Jackman’s principal thesis, namely the multi-causality of the law of restitution. But his own detailed picture of the varieties of restitution is actually not that which I have set out. It is somewhat idiosyncratic, even in some respects incoherent. It is not always easy to see precisely what he means by phrases such as ‘a distinct area of law’. He never makes his taxonomy explicit. So, for example, it is not unequivocally clear that he admits that restitution for wrongs should go in the law of wrongs. Though he constantly uses the expression ‘restitution for wrongs’, he also seems to want to put that variety of restitution in its own box, with the label ‘protection of facilitative institutions’.[26] But it is impossible to create any taxonomy of the law which will allow ‘protection of facilitative institutions’ to be a distinct area of law.

It is a difficult question which wrongs should be allowed to yield gain-based (restitutionary) awards. It is a question of the same order as that which asks which wrongs should be visited with punitive damages or indeed nominal damages. Jackman’s answer is that restitutionary damages should be awardable when such an award is necessary or desirable for the health of some valued facility, such as the trust or the obligation of confidence. If one envisages a diagram in which a classification of rights according to the goal achieved by their realisation (compensation, restitution, punishment, and so on) cuts across a classification of rights by their causative events, the square formed at each intersection asks a question: when, if ever, does this causative event trigger a right having this kind of goal? Jackman’s ‘protection of facilitative institutions’ is no more than a proposal for the answer, or an answer, to the question posed by one such square, namely that which is formed at the intersection of restitution and wrongs.

Jackman also expels from the specious unity of unjust enrichment almost all cases of claims made in respect of benefits in kind. These, he says, are all examples of restitution awarded on the basis of non-contractual promises.[27] In terms of the taxonomy which I have been using they have to go under consent, with contracts, conveyances, and wills. For example, Pavey & Matthews v Paul[28] cannot in his view be explained as restitution triggered by unjust enrichment. It has to be explained as restitution based on implied promise to pay, though the promise is ‘non-contractual’. Again, Craven-Ellis v Canons Ltd[29] cannot be explained on the same basis as the recovery of a mistaken payment. It has to be explained as based on an implied promise to pay.

Pavey & Matthews v Paul, it will be remembered, was the case in which the plaintiff builders did work for the defendant under a contract which was unenforceable for want of writing. The builders were allowed to recover its reasonable value. The High Court said that they recovered because they could make out a cause of action in unjust enrichment and did not have to have recourse to the contractual action which the statute said they could not have. But Jackman says the case has to be explained on the basis of implied non-contractual promise, a promise which, because it is non-contractual, is not caught by the statutory requirement that building contracts be in writing. Craven-Ellis v Canons Ltd was a 1936 case in which the English Court of Appeal allowed the managing director of a company to recover the reasonable value of his services, which he had rendered under the mistaken belief that he had a contract. Jackman says that that case too cannot be explained by treating mistakenly performed managerial services on the same basis as mistaken payments of money, the managerial services being the enrichment and the mistake being the unjust factor. Jackman insists that this can only be explained as restitution awarded on the ground of an implied non-contractual promise by the shareholders to pay the reasonable value of the services.

This is extremely difficult to follow. It seems to revive all the nightmares of implied and imputed promises from which the initiative of the American Law Institute and Goff & Jones was supposed to have freed us. Everybody knows that it is more difficult to establish the requirement of enrichment where what has been received is not money but some service or other benefit in kind, also that there are broader and narrower interpretations of what constitutes enrichment. Those who take a narrow view of enrichment are not infrequently driven to take some cases out of the law of unjust enrichment and, at the same time, out of the law of restitution. If there is no enrichment, the event in question cannot be unjust enrichment, and if there is no gain to the defendant that which the plaintiff wants cannot be restitution. Impossibly, Jackman turns out to be denying that restitution, in the sense in which it is used by the Restatement and by Goff & Jones, must entail gain-based recovery.

In order to understand Jackman’s position it is necessary, first, to illustrate two strategies for dealing with a case in which there is neither contract nor tort and where, in addition, it is doubtful whether there is any enrichment to the defendant. Take for example Sabemo Pty Ltd v North Sydney Municipal Council.[30] There North Sydney intended to build a massive civic centre. Sabemo won the tendering competition. Having won it, but still without a contract, Sabemo did an immense amount of preparatory work, much more than the sprat which all builders sacrifice to catch the hoped for mackerel. North Sydney then changed its mind and cancelled the project. Sheppard J held that the municipality had to pay Sabemo a substantial sum. North Sydney had to pay despite an express finding that Sabemo’s work did not enrich it.

If one thinks that the result of that case ought to be upheld, there are two ways of trying to explain it. One can challenge the finding that there was no enrichment. If one thinks one has successfully done that, one can proceed to explain it as a case of restitution. The next stage will be the identification of the causative event which generated the restitutionary claim. We have seen that, logically, that second stage of the restitutionary explanation could be found in any of the four genera of events. It could in theory rest on a manifestation of consent, a wrong, an unjust enrichment, or some other event. It will be a matter of making a reasoned choice between those possibilities. We need not pursue that second phase of this strategy. Suffice it to say that the conclusion that there is an enrichment allows the inquiry to proceed within the law of restitution.

The other mode of explanation of Sabemo accepts the finding that there was no enrichment. That immediately excludes any characterisation of the case as restitutionary. For if an entitlement to restitution means anything at all in this context, it means an entitlement to obtain a gain which has accrued to the defendant. The acceptance of the finding that there was no gain to North Sydney means that there was nothing in respect of which to seek restitution. A non-restitutionary explanation then has to be found. The commonest and most promising is ‘compensation for loss’. The jurist who accepts that North Sydney was not enriched will probably look for a compensatory explanation. Taking that line, the explanation might logically be found within any of the genera of causative events except unjust enrichment, because there can be no unjust enrichment without enrichment. Professor Stoljar thought he could find a compensatory entitlement independent of consent and wrongdoing, and necessarily of unjust enrichment, in the fourth miscellaneous category, which he then took out and named ‘unjust sacrifice’.[31]

Which of these strategies does Jackman use? On the face of his language it is the former. He insists that these claims in respect of services and other benefits of kind are restitutionary. The entitlement is a restitutionary entitlement. This means, or ought to mean, that he follows the first of the two strategies which have just been outlined. But if the defendants in Craven-Ellis v Canons Ltd and Pavey & Matthews v Paul were indeed enriched, there can be no objection to explaining them in unjust enrichment, just as one would explain restitution of a mistaken payment or payment made on a basis which fails. The facts disclose perfectly good unjust factors. Why transfer them to a curious world of non-contractual implied promises?

But in fact the simplest rules are being broken. Despite the use of the word ‘restitution’, Jackman’s position is that the defendants in these cases were not enriched.[32] It would indeed follow that it was impossible to explain the entitlements which they recognise as a response to unjust enrichment. But by the same token they are then also nothing to do with restitution. If the trouble lay in the field of the unjust factor, it would be possible to pursue the question whether these cases should be explained as restitutionary, albeit not as instances of unjust enrichment. But when the deficiency is in the enrichment, they cannot be cases of restitution at all. His position is incoherent. He says these claims are restitutionary, but still understands them as claims which are not gain-based. In other words he keeps them in restitution when they ought on his premises to be thrown out. His use of ‘restitutionary’ is perverse or, more kindly, reflects the error, discussed above,[33] according to which ‘restitution’ is assumed, without the least warrant, to include anything and everything which cannot be explained in contract or tort.

F What Would Survive of the Law of Unjust Enrichment?

Jackman’s technique is to reveal varieties of restitution by showing that some examples of restitution cannot be explained as responses to unjust enrichment. We have just seen that one of his examples slips up. It turns out that on the facts as he sees them the cases in question are not even instances of restitution. We have been assuming that various instances of unjust enrichment would still survive. But that turns out to be doubtfully correct. He seems to think that all that can remain is non-voluntary transfer of incontrovertible enrichments with corresponding impoverishment of another or, more shortly, non-voluntary enrichment at the expense of the plaintiff.[34] This is a lower-level generalisation of mistaken payments than unjust enrichment at the expense of another. It signifies that the only acceptable unjust factor is non-voluntariness, a generalisation which serves to align with mistake all other factors which, to a degree which the law regards as sufficient, impair or qualify the decision to transfer, such as pressure, undue influence, failure of consideration. In addition, enrichment, according to Jackman, is to be strictly limited to money and a narrow category of necessaries.[35] And ‘at the expense of the plaintiff’ is unequivocally committed to the plus-and-minus test.[36]

It is not entirely clear whether Jackman intends to assert that that is the only content of the law of unjust enrichment or wants to go further and say that the higher generalisation must never be used. I think he intends the latter, though in fact nobody can dictate the level of generality at which people choose to speak. I can say: ‘The animals are in the garden.’ Or I can say: ‘The dog and the cat are in the garden.’ No power on earth can compel me to speak at the lowest possible level of generality. A system could be said to have a law of unjust enrichment even if, when it comes to the point, the only discoverable case was the payment made by mistake of fact.

The reason why Jackman would prefer our system to speak only at the lower level of generality is that he takes the view that a category becomes incoherent if it relies on more than one conception of justice. Thus, non-voluntary transfer can be said to rely on one conception of justice, which in simple terms can be rendered as: ‘If I did not mean you to have it, you ought to give it back.’ However, the notion that a category is incoherent if it draws on two or more conceptions of justice ought not to go unchallenged. Take, for example, the category of wrongs or, rather narrower, torts. Every wrong is a wrong for a slightly different reason, which is as much as to say that each wrong rests on its own conception of justice. There are as many such conceptions as there are protected interests.

Borrowing from Lord Atkin we might say that the Biblical injunction to love one’s neighbour is restated in law, not in one, but in a series of particular legal duties, each of which reflects, albeit imperfectly or minimally, the neighbour principle: respect reputation, honour emotional and sexual autonomy, respect territory, renounce violence, keep secrets, and so on. The heterogeneous ideas which underpin defamation, harassment, nuisance, battery, abuse of confidential information, and so on, do not prevent us classifying them, with others, as wrongs. Even if it were possible to know when one had come to the boundaries of ‘a single conception of justice’ (as opposed to the limits of a sub-conception pitched at an unnecessarily low level of generality), the content of our law of civil wrongs would seem to prove, empirically, that a category can form a coherent unity even though it draws on different such conceptions.

In the great Woolwich case the House of Lords decided that the ground rule in England, in the absence of a statutory scheme, was that money obtained by a governmental body in pursuance of an ultra vires demand must be given back.[37] There are different ways of explaining that. But suppose, as may be correct, that the explanation is simply that respect for and confidence in the rule of law requires a public body to return money which it never had power to demand. Or suppose that the fact that a surety or other person secondarily liable has a claim to be indemnified by the primary debtor turns out not to be explicable by reference to the payment’s having been made under compulsion and requires instead to be explained by the maxim qui sentit commodum sentire debet et onus (one who takes the benefit ought also to bear the burden). These two examples are constructed so as to make the reason for restitution — the ‘unjust factor’ — a conception of justice quite different from: ‘If I did not mean you to have it, you ought to give it back’. I do not know where they could go in Jackman’s scheme. They cannot fit in his cut-down remnant of the causative event unjust enrichment at the expense of another. As stated they are not examples of non-voluntary transfer. They appear to have no place in his scheme. Yet they are only excluded because of his dogma that in every case the factor providing the reason for restitution must be the same.

That is unreasonable, even absurd. The truth is better stated by saying that the unjust factor, though very frequently the non-voluntary character of the transfer, may sometimes be of a different kind. It may sometimes be defendant-sided rather than plaintiff-sided, turning on the shabby character of the receipt. On other occasions the relevant factor may transcend plaintiff and defendant and consist simply in one of a number of overriding reasons why a benefit should be given back.[38]

In the result Jackman remains right that entitlements to restitution (the surrender of a defendant’s gains) are not invariably triggered by unjust enrichment. Restitution is multi-causal. But in splitting off restitution for wrongs he takes away nothing that was ever meant to belong within the law of unjust enrichment, and in trying to split off restitution of services and other benefits in kind he probably turns out to be saying nothing more than that where the defendant has not been enriched there can be no restitution on any ground at all, a proposition which no-one would dispute. Had he explicitly adopted the taxonomy of causative events which affirms that all rights arise from manifestations of consent, from wrongs, from unjust enrichment, or from miscellaneous other events, he could have discovered instances of restitution in the first and fourth categories too and would thus have strengthened his picture of the now indubitably multi-causal nature of restitution.

IV EQUITY AND CONSCIENCE

Mr Jackman’s book shows that it was a very bad idea to call the law of unjust enrichment the law of restitution. We can agree that there are varieties of restitution, the varieties being differentiated by the nature of the causative event which triggers that response. No injury has actually been inflicted on the law of unjust enrichment, which has lost nothing that it would wish to keep and continues to hold its place as one genus in the fourfold taxonomy of causative events: consent, wrongs, unjust enrichment, miscellaneous other events. However, that is not quite the end of the story. Mr Jackman identifies, though he never pursues, one more obstacle to the unified integrity of the law of unjust enrichment. There is the historical fact of the duality of common law and equity, and, seemingly, in his view equity cannot but go its own way:

The dualism of law and equity is a further obstacle to any unifying principle or concept of the law of restitution based on ‘unjust enrichment at the plaintiff’s expense’. Indeed, it is because the common law has developed only a limited number of concepts of injustice that the flexibility and subtlety of equitable principle are required to produce a mature body of law. Even if many of the dividing lines between common law and equity arose by historical accident, there are very real and profound conceptual differences between many of the concepts which each has developed ... Those conceptual differences would exist whether or not law and equity were fused in their substantive content, and the law would be no more explicable in terms of a single unifying principle or concept than at present.[39]

This statement supposes that, even if the common law could be admitted to have a law of unjust enrichment, equity would have nothing to do with it. That this is prima facie an unacceptable proposition may be seen from the curious consequences which a parallel suggestion would have for a more familiar field, as for instance for the law of contract. All the books about contract draw on both streams of case law. Their subject is compounded of both common law and equity. In relation to promises unsupported by consideration, in relation to vitiating factors, and in relation to remedies, the equitable contribution is very prominent. One might infer that in the same way the two streams would have no difficulty in contributing to the law of unjust enrichment.[40] In the passage which is quoted above, Mr Jackman makes the surprising contrary proposition through two different kinds of assertion. One is that equity is by comparison with the law more sophisticated, subtle, and flexible. The other is that equity is differently ordered and, by inference, must stick to its own ordering.

A The Rhetoric of Sophisticated Flexibility

Of these the first is mere rhetoric, either false or meaningless. Different judges and jurists have different styles. The rather loose notion of style is compounded from different notions of the nature of law and the judicial function and different intellectual attributes. Some judges are more dynamic in their interpretation than others, some are more learned than others, some more ingenious than others. Flexibility, subtlety, and sophistication are properties of the interpreter’s mind, not of historically determined bodies of case law. Bodies of case law, however defined, have the potential for interpretation which displays those qualities. Some of the most stubbornly conservative judges have been Chancery lawyers, while from Lord Mansfield to Lord Devlin the common law has produced legal minds lacking nothing of the flexibility and sophistication which Jackman claims for equity.

The case law of the Chancery has no claim whatever to greater sophistication or flexibility than that of the courts of common law. Occasionally the reverse might seem more true. ‘Equitable fraud’, for example, might be condemned as infantile and inarticulate, for want of precise exposition and analysis. Nocton v Lord Ashburton[41] is certainly no more sophisticated or flexible than Hedley Byrne & Co Ltd v Heller & Partners Ltd.[42] However, the result of running a competition between the two bodies of case law would only be to show that there are from time to time patches of incoherence or underdevelopment in both. These bad patches are repaired by the same people using the same juristic techniques.

B A Different Order

The second assertion is that equity is differently ordered, so differently that it cannot be integrated with the common law. I want to suggest that this too is false. The case of contract has already been mentioned. No difficulty has been experienced in integrating the equitable contribution to that subject. One day the law of torts (meaning the law of wrongs rooted in the common law) will be transformed into the law of civil wrongs, by the addition of wrongs rooted in the jurisdiction of the Court of Chancery such as abuse of confidential information and breach of fiduciary duty. No special difficulties impede that integration.[43] Why should there be any great difficulty in integrating the two halves of the law of unjust enrichment? Mr Jackman, reinforced by Justice Gummow, asserts that it just cannot be done.

The truth is quite to the contrary. Classification is indispensable. Neither the universal diversity in which we find ourselves, nor any one of the sub-diversities within it, of which the law forms a single example, can be made manageable without classification. Rational thought being impossible without taxonomy, the law must make its taxonomy explicit. It follows that equity has no choice but either to accept the taxonomy of the common law or to replace it. Every taxonomy is in the nature of a provisional hypothesis. The fourfold classification of rights by causative events is no exception. Equity must either accept it or show that it can be bettered. If it can be bettered, then of course it will be bettered for the whole law, not just for one wing of the ancient duality. In short, both law and equity must subscribe to the same taxonomy of events, and it must be the best taxonomy that taxonomic debate can generate.

In the natural world the classification which rested ultimately on the work of the great Linnaeus, exquisite as it was, is now being overthrown by the modern science of genetics. Since Watson and Crick discovered the structure of DNA it has become possible to show that, as all good scientists know of all orthodoxies, the Linnaean classifications were no more than the best available hypotheses; and that there are now better available hypotheses. It would be sheer madness wilfully to stick to a hypothesis which has been bettered, still madder to stick to it here and abandon it there, to stick to it in forestry while teaching in botany that it had been superseded. It is in the nature of competing classifications, like all competing hypotheses, to fight to the death. No less than every department of learning about the natural world, the law would stultify itself if it did not subscribe to the aspiration to use only the best taxonomy currently available.

C The First Cul-de-Sac: Intuitive Conscience

A third way might suggest itself. Could equity refuse outright to accept the necessity of classification? That would entail a rejection of rationality in favour of intuition. At this point in the development of our jurisprudence it ought not to be necessary to spend time showing that inscrutable intuition is the enemy of the rule of law. But because Mr Jackman’s view that equity cannot be tamed may be a veiled assertion that equity must be allowed to be intuitive, and because that thought does currently find a sympathetic echo in some of our law schools, we are obliged to spend a moment or two in that cul-de-sac.

Beginning law students are often driven to desperate guesswork. In solving problems they will be reduced to: ‘The fair result seems to be ...’ In other words, for want of having learned to analyse complex facts so as to expose issues on which to deploy legal authority, they fall back on their intuition. Some of them later persist in the same line of thought, learning only to clothe it in more grown-up words. The fashion at the moment seems to be to invoke the impressive-sounding language of conscience and unconscientiousness. Of those attracted to that usage, a few then attempt to make some sort of historical case for their approach. They think they find a warrant for it the Court of Chancery. Was not the Chancery a court of conscience?

Those who invoke the Chancery to legitimise the use of the language of conscience have to answer a crucial question as to their understanding of its meaning. By conscience do they really mean the intuitive understanding of the difference between good and evil, or do they mean the taxonomised and systematised understanding of that same difference, as taught by St Thomas Aquinas, reinforced by the authority of the church, and still expounded by serious natural lawyers such as John Finnis? Very few who want to deal in the language of conscience will turn out to belong in the Aquinas–Finnis camp. For that camp will have nothing whatever to do with the rejection of reason. Conscience in their sense calls for careful attention to classification and analysis, accurate discrimination between reliance on logic and reliance on other forms of argument, all the apparatus of reason. Only the intuitionists find themselves in a hopeless cul-de-sac, those whose appeal to conscience is intended to justify dispensing with all that troublesome apparatus.

There are two reasons why we may be sure that the intuitionists must either perish in their cul-de-sac or reverse out of it. One has nothing to do with history. It is that our society is now of such a nature as to have no faith in mere intuitions as to right and wrong, if only because, beyond a handful of simplicities, our intuitions do not all work alike. In the very early days of our law, when juries were given precious little guidance as to what the law might be, the tacit assumption of the system in both civil and criminal matters was that the intuition of right-thinking people would come up with the right answer. The premise was a monolithic moral solidarity. Our society has moved a million miles from that. We now have multi-dimensional pluralism, of culture, morals, and religion, and of experience in different socio-economic sectors. Our consciences are all loaded differently. The judge’s conscience must be taken to be loaded differently from the plaintiff’s, the plaintiff’s differently again from the defendant’s.

There is therefore no option. In a complex, plural society, the law, if it is to work and keep working, must be transparently articulated. It can perhaps never be perfectly autonomous. That is, it can never be perfectly detached from the judge’s own perception of right and wrong. But it must be as autonomous as it can be made. A judge must be able to say: ‘It is not me who does this to you, it is the law. Look, I will show you.’ It is the judgment which does the showing, and the judgment must be rational, intelligible, and consistent with others. There is no future for the gut reaction, nor for any form of mystical ‘experience’ which inarticulately claims the right to trump good intellectual order.

So, even if there were a historical warrant for intuitive decision-making in the name of conscience, there would be no room for it in the modern world. But the second objection is that there is no historical warrant. Conscience, undisciplined by the apparatus of reason, is an alias for the will of those in power. They have only to believe that what they are doing is right, and conscience will justify them, at the same time blinding them to the possibility of error.

I make no apology for repeating, what has been described to me by Professor Beatson as being in very bad taste and characterised by Justice Finn as ‘unhelpful’,[44] that conscience seemed to the perpetrators to justify the greatest wickedness the modern world has seen, namely the Nazi extermination of the Jews.[45] If unrestrained conscience could be mistaken in that degree, it can much more easily make every lesser error. It is only a matter of degree. If your intuition tells you that you are right, you will not be able to see that you may be wrong or, in a plural society, that others may think you wrong.

The great errors are mercifully rare; the lesser errors are of day to day concern. At that more mundane level conscience of the intuitive kind is nonetheless antithetical to the rule of law. Sir Edward Coke saw the Chancery under Lord Chancellor Ellesmere as an instrument of Stuart prerogative power, and the Court of Chancery came within a whisker of being swept away with the Star Chamber.[46] It escaped, and, having long forgotten Aquinas, it settled into a quest for a regularity indistinguishable from that of the common law. From the time of Lord Nottingham if not before, the value which served as equity’s guiding light, was legal certainty. The court’s principal concern was to keep wealth safe through all the vicissitudes of public and private life. Its anxiety for certainty and predictability was carried to extremes. Lord Eldon’s court, conservative and dilatory to the point of inertia, brought down on itself the cutting condemnation of Bleak House.[47] In the 300 years from the Restoration you could not find one equity judge to warrant the use of the language of conscience to legitimise intuitive decision-making.

Whatever the historical truth, the students who seek to solve every problem by directly applying their own sense of fairness are indeed rejecting the whole notion of an articulated taxonomy of the law. They think that conscience, alias intuition, alias gut reaction, can suffice. Every argument which rests on words of unanalysed approbation and disapprobation is in some degree a rejection of the rule of law.

D The Second Cul-de-Sac: Competing Taxonomy?

When Mr Jackman says that equity cannot acknowledge or be brought into line with a law of unjust enrichment, he cannot mean that it must be left to do intuitive justice undisciplined by any taxonomy. Such a proposition would be inappropriate in a plural society and has, besides, no historical warrant. Two possibilities remain: either equity must be allowed to use a different taxonomy, or it must overthrow and replace the taxonomy of the common law. We have already said that it is not in the nature of competing taxonomies to coexist. If they compete, they fight to the death.

This can be illustrated from the competition between the taxonomy of that large part of equity which is the law of trusts and the taxonomy of rights by causative events which was used earlier. No one will be unfamiliar with the classification of trusts which goes like this: ‘Every trust is express, implied, resulting, or constructive.’ The first question is whether these two taxonomies really compete. They do. They are trying to do the same thing. They are both trying to say how rights arise. One must therefore give way to the other. Why? Because it is almost impossible for different taxonomies to talk to one another.

Suppose that I ask the keeper of the trusts taxonomy a question which comes from the taxonomy of causative events. ‘Do trusts arise from unjust enrichment?’ The first answer will probably come in a form which is familiar in conversations between comparative lawyers: ‘Actually we do not think in quite those terms.’ After such an exchange it is customary for each side to lay out its cards — that is, to explain the terms which it does use. So here I will say: ‘My classification of rights supposes that every right arises from a manifestation of consent, from a wrong, from an unjust enrichment, or from some other kind of event.’ And the other must say something like: ‘My classification supposes that trusts are all express, implied, resulting, or constructive.’ The different languages once explained, we can try a more specific example: ‘Do you have any trusts which respond to failure of consideration, as where money is given on a particular basis and that basis fails?’ This should produce a positive result: ‘Yes, we do have a few of those, but over here they are called resulting trusts, in the sub-species Quistclose.’[48] Another shot: ‘Do you have any trusts which respond to mistaken payments?’ ‘Why yes, but here they are called constructive trusts, in the sub-species Chase Manhattan.’[49] Yet one more round: ‘Do you have any trusts which respond to wrongs?’ ‘Yes, we have lots of those, but they are also constructive trusts. We have constructive trusts of the proceeds of abuse of confidence, of bribes, of assets obtained in breach of fiduciary duty. But they are all constructive trusts, as in the case of mistake.’ A hesitation: ‘You say “as in the case of mistake”. How can the trusts which arise from wrongs be in the same class as those which arise from mistake? Besides, I understood that “resulting” meant “jumping back”. Does not the Chase Manhattan trust jump back to the payor?’ ‘Yes, it does. But we call it a constructive trust.’ ‘Would you mind very much if I say that you do have trusts which arise from consent, wrongs, unjust enrichment and other events?’ ‘It is true enough in your terms, but nobody here will understand you.’

If this were really a conversation at a conference on comparative law, both parties could go home feeling pleased with themselves, ready to write up, and no doubt publish, the insights they had gained. But this is a conversation within one system. A rational system cannot live with blocked synapses of this kind. There has to be a competition to the death, to choose one or other of the two classifications. The rights which arise under trusts (trust-rights) must be seen to arise from the events which create other kinds of rights. It is a question, first, of overcoming the barriers to communication, which means looking to see what is really going on beneath the labels, then of deciding which taxonomy is better.

The brilliant work of Robert Chambers has recently completed most of the first stage.[50] The remaining question will be whether, if there is no third possibility, we are going to move over to saying that trust-rights arise from consent, wrongs, unjust enrichment, and miscellaneous other events; or, rather, to saying that all entitlements are express, implied, resulting, or constructive. I hope there will be no movement in favour of the latter, which seems to me to suffer from three defects. First, ‘constructive’ is evasive, in being a clever-sounding way of giving no information at all. If one said ‘All birds are pigeons or constructive pigeons,’ one would only have said that every bird is a pigeon or not a pigeon. Secondly, ‘resulting’ creates what is prima facie a bent classification. However created, all trusts can jump back, just as both carnivores and herbivores can be yellow.[51] Thirdly, ‘implied’ is ambiguous between implied in fact and implied in law. It obscures the line between consent-based rights and those which are raised by operation of law.

In the Westdeutsche case, Lord Browne-Wilkinson evidently thought that an illegitimate sortie had been made by unjust enrichment into the alien territory of the law of property and, in particular, into the law of trusts, as though the law of trusts and the law of unjust enrichment were areas of law separated by clear water, and best kept that way. It is equally plain that he thought that that sortie was motivated by a preconceived desire to ensure that plaintiffs in unjust enrichment should be able to obtain proprietary interests and consequent advantages in insolvency.[52] That is not right.[53] The aim was never more than to try to determine, undistracted by traditional labels, which trusts were in fact triggered by unjust enrichment. The clear water between the two subjects is an illusion. It is an illusion accentuated by incompatible software. Even if one subdues the illusion, it remains impossible to think clearly across categories which, with generically identical content, are differently divided.

E A More Radical Chancery Victory?

It seems highly unlikely that we will ever go over to arranging the law according to a proposition that rights are express, implied, resulting, or constructive. But the possibility remains that equity might yet field a more radical competitor. There is certainly one distinguished judge and jurist who believes that it does. Justice Finn thinks that equity suggests an entirely different map.[54] And he would have it prevail. His map would give priority not to entitlement-engendering events but to entitlements which are responses to events. This is not his terminology, but it is used to maintain continuity in this discussion. It might immediately be objected that this would not compete with the classification of causative events, for it seems not to claim the same territory or do the same work. But on closer inspection it does. Because his scheme is premised on a refusal to classify events, indeed it would regard the classification of events as a serious error calculated only to impede the courts in their proper work.

Justice Finn wants to follow the model suggested by equity’s habitual focus on its ‘remedies’. He would like to see a complete and orderly list of the entitlements which are recognised and realised by the courts, whether of common law or equity: entitlements to money compensation, money restitution, payment of fixed sums, specific orders of performance, delivery, and prohibition, the taking of accounts, and so on. Then, on the basis of that taxonomy of possible responses and treating all causative events as belonging in one single category, the business of the law would be to evolve criteria of appropriateness for attaching particular entitlements to particular events. If I understand him correctly, this business of applying the criteria of appropriateness would be conducted on an instance-specific basis. The facts would be regarded as inviting the courts to make a selection from their armoury of responses, an exercise essentially of discretion, though moderated by criteria of appropriateness.[55]

Within the genus ‘wrongs’, the Finn approach would not be so very different from what already goes on, across the whole law. We know that wrongs can give rise to all manner of responses, loss based awards, gain based awards, trusts of proceeds, and so on. That reflects the underlying truth, subject to the operation of the authority of precedent, that commission of a wrong exposes the wrongdoer to whatever unpleasant consequence seems advisable, all things being considered. However, at present, precedent, and a fortiori statute where parliament has spoken, is regarded as determining which entitlements are triggered by which wrongs, and generally puts the plaintiff to an election if there is more than one. Many would react against the notion that the choice of response should belong to the court. The money value of different responses can differ enormously.[56] To leave such differences in the discretion of the court would weaken rights and make the risks of litigation difficult to calculate. A better rule, if one were starting from scratch, would be to allow the plaintiff a free choice, subject only to ensuring that she at no stage recovered the same item twice. Nevertheless, Justice Finn’s approach, however it might vary in detail, would be recognisably continuous with the present regime for wrongs, and it would become more so as the judicial discretion settled down.

It is, however, significant that in describing the scheme of things as he sees it he constantly uses the language of wrongs. The categories of consent, unjust enrichment, and miscellaneous other events are, ex hypothesi, not wrongs. A not-wrong does not licence the court to mistreat the defendant more or less as it pleases. Responses to wrongs, unless and until they are restricted by authority, are limited only by extrinsic considerations — humanity, utility, proportionality, and so on. Responses to not-wrongs are by contrast heavily restricted by the logic of the particular event itself. If I put in evidence nothing but a promise to pay money, the only entitlement that my evidence points to is an entitlement that you keep your promise. If you earn income, a taxable event, the only consequence is that the Inland Revenue is entitled to its tax. If I pay you money by mistake, the only consequence is that you should repay it. If I were to start saying that you should pay my consequential loss, I would be talking nonsense. Either that, or I would be inviting the court to invent a wrong of not returning a mistaken payment (strict liability) or knowingly not returning a mistaken payment (fault-based liability). Similarly, supposing I paid you money as a result of your totally innocent misrepresentation, if I maintained that I should recover not only the money but also damages for consequential loss (or equitable compensation), I would in effect be asking the court to class innocent misrepresentation as a wrong. Would a court be prepared to make innocent misrepresentation a wrong of strict liability? If not, I must continue to treat it as an unjust factor, not as a wrong, and confine myself to the logic of unjust enrichment, recovering the benefit and nothing else. It takes less to justify recovery of a benefit than it does to shift a loss and thus make another worse off than she was before.

The four genera of causative events have different implications. They imply different entitlements. A system which refused to differentiate them would be likely to create civil wrongs more or less by accident. That is, it would think that it was free to mistreat (make worse off than they would have been) defendants who had committed no wrong. Justice Finn’s scheme ought in the end not to be regarded as a competing taxonomy at all, for it can only function within the law of wrongs.[57] He has to make room for the not-wrongs. He has to acknowledge that there are certain causative events where criteria of appropriateness of response are totally inappropriate. Unjust enrichment gives rise to restitution. It has no other logic. Justice Finn says he is sceptical about the existence of a law of restitution of unjust enrichment.[58] But the law of unjust enrichment is no more than that category of not-wrongs which includes, and generalises, the mistaken payment and all other events of the same kind. One cannot be sceptical of the truth of the proposition that mistaken payments trigger an entitlement to restitution. And, if one believes in that central case, it is difficult to see how one can be sceptical of its generalisation.

Linnaeus knew nothing of DNA. There is no denying the hypothetical nature of every taxonomy. But, so far, I myself can see no challenger, certainly no challenger from equity, likely to overthrow the propositions that rights, however else they may be usefully classified, must be dominantly classified according to the events from which they arise, and, further, that those events are manifestations of consent, wrongs, unjust enrichment, and sundry others.

V CONCLUSION

Nearly half a century after the enactment of the German Civil Code, which affirmed the principle in statutory form, and at a time at which that particular system had descended into juridical psychopathy, Lord Wright famously observed that every civilised system must have a law of unjust enrichment.[59] A generous half-century after that, it has become possible to say that common law jurisdictions do have a law of unjust enrichment. This lecture has tried to resist the sceptics who say otherwise, in serious error as I myself believe.

The lecture has also had a deeper theme, much more important in my view than the growth pains of any one area of the law. That deeper theme has been the importance of legal taxonomy. Diversity is the constant challenge to human understanding. Lists and the classification of lists are our most basic tools in the struggle. The organisation of every university is a classification of the things which we think worth trying to understand, but the fact that different universities arrange themselves in different faculties and departments, though it undoubtedly does to some degree influence the pursuit of knowledge, does not constantly preoccupy the scholars whose calling it is to promote the understanding of their own particular fields. It is a difficult question at what level of generality it becomes essential to pay really close attention to the nature, accuracy, and utility of the classifications above one’s own immediate interest.

The habit of common lawyers has been to look down to the matter of immediate interest and to regard higher levels of classification as of little importance. Few pause to give a coherent account of the parts of which the whole law is comprised. Many, if put to the test, will only be able to answer with a list of topics which they themselves studied, in no particular order, unless perhaps alphabetical. There are many reasons encouraging this neglect of the foundations of legal rationality. Both in practice and in the universities lawyers are becoming more specialised. The massively increased output of parliaments, focused now on this problem and now on that, pays scant regard to systematic overview. The sheer quantity of material means that legal education is constantly a matter of trying to squeeze quarts into pint pots, so that time for reflection is reduced to vanishing point and subjects which encourage or facilitate reflection are driven to the rarely visited fringes of the syllabus. Jurisprudence, legal history, Roman law, comparative law — these subjects are now studied by very few. Yet it is precisely these subjects which allowed the legal mind to address larger questions.

The last straw may be modularity. All over the world tertiary educational practice is accepting that topics should be taught for a relatively short time and then immediately assessed. The module — short course and exam — easily becomes a sealed unit, isolated from all others. This fragmentation is a danger to the rationality of our law, and the law schools will have to do something to counterbalance it. The units, topics, or modules, call them what you wish, are categories of many different kinds. They cut into and across each other, as ‘mammals’ cuts into ‘vertebrates’ and both then cut across ‘carnivores’. If every fragment goes its own way, generating its own language, the result can only be the utmost confusion. And confusion is the archenemy of justice. Very few disputes come neatly slotted into a single module.

Since Darwin, most people would agree that recency of common ancestry is the supreme principle of biological classification. And since the decoding of the mechanisms of genetics, of which Darwin knew nothing at all, the precise application of that principle of classification, conceptually certain as it is, may no longer be evidentially impossible. The history of the classification of the natural world, from Aristotle to Linnaeus, from Linnaeus to Darwin, and from Darwin to Crick and Watson and beyond, will teach the lawyer a great deal, negatively that classifications which acquire a scriptural respect can perpetuate confusion, positively that accurate classification, and constant re-examination of classifications, are essential to, indeed the vehicle of, new understanding.

This university will shortly begin building a new law school. I wish it well in every way. Indeed I know that the past in one famous building already assures the success of the future in another. I venture a hope that the architect will lose no opportunity to celebrate the memory of the world’s great jurists and to anchor their achievements in the consciousness of the young. It always seems a shame to me when a seminar room is called 5-37B which might have borne the name of Grotius or sad Austin, who sacrificed his health and happiness in the struggle for a more rational law. The Ravenna mosaic of Justinian and Theodora must of course be reproduced. A sponsor would surely leap at that chance of immortality by association. But I myself would be inclined to give the centre of the principal courtyard to these simple-sounding words of Charles Darwin: ‘No one regards the external similarity of a mouse to a shrew, of a dugong to a whale, of a whale to a fish, as of any importance.’[60]

Few enough of us will ever have given much thought to the dugong. Those few who contemplated shrews will probably have fallen for their superficial resemblance to mice. Every one of us will have assumed, until instructed otherwise, that fishiness consisted in finny locomotion through an aquatic habitat. No sooner had one learned that the whale was more closely related to the shrew than to the trout, than one’s notion of a mammal was severely tested by Ornithorhynchus Anatinus, the egg-laying, milk-feeding, duck-billed platypus. For me these words from Darwin are a reminder of all the puzzles of taxonomy. Puzzlingly placed outside your new law school, I hope they would constantly remind the passer-by, not only the cupida legum iuventus[61] but maturer jurists too, to think deeply about the categories of legal thought, and boldly to replace those which misinform or are mismatched.


[*] Regius Professor of Civil Law, University of Oxford; Fellow of All Souls College, Oxford. This is the text of the annual Miegunyah lecture at The University of Melbourne, given on 3 September 1998. I would like to take this opportunity to thank The University of Melbourne and the Miegunyah Trustees for enabling me to spend six fruitful weeks at the Faculty of Law.

[1] The explicit recognition came earlier in Australia than in England. Pavey & Matthews Pty Ltd v Paul [1987] HCA 5; (1987) 162 CLR 221, underlined in David Securities Ltd v Commonwealth Bank of Australia [1992] HCA 48; (1992) 175 CLR 353, anticipated Lord Goff’s speech in Lipkin Gorman v Karpnale Ltd [1991] 2 AC 548, 568–81 (HL).

[2] The first jurist to create such a category may have been Grotius: Robert Feenstra, ‘Grotius’ Doctrine of Unjust Enrichment as a Source of Obligation: Its Origin and its Influence in Roman-Dutch Law’ in Eltjo Schrage (ed), Unjust Enrichment: The Comparative History of the Law of Restitution (1995) 197. But Grotius may have been standing on the shoulders of earlier scholars: Jan Hallebeek, ‘Develoments in Mediaeval Roman Law’ in Eltjo Schrage (ed), Unjust Enrichment: The Comparative History of the Law of Restitution (1995) 59 and Jan Hallebeek, The Concept of Unjust Enrichment in Late Scholasticism (1996).

[3] § 812(1):

Wer durch die Leistung eines anderen oder in sonstiger Weise auf dessen Kosten etwas ohne rechtlichen Grund erlangt, ist ihm zur Herausgabe verpflichtet. Diese Verpflichtung besteht auch dann, wenn der rechtliche Grund später wegfällt oder der mit einer Leistung nach dem Inhalte des Rechtsgeschäfts bezweckte Erfolg nicht eintritt.

[4] American Law Institute, Restatement of Restitution (1937) (‘Restatement’).

[5] Justice W M C Gummow, ‘Foreword’ in I M Jackman, The Varieties of Restitution (1998) iii.

[6] This complex phenomenon, partly no doubt the legacy of the Realists, is examined by J H Langbein, ‘The Later History of Restitution’ in W R Cornish et al (eds), Restitution: Past, Present and Future — Essays in Honour of Gareth Jones (1998) 57.

[7] Lord Wright, ‘Book Review: Restatement of the Law of Restitution(1937) 51 Harvard Law Review 369, reprinted in Lord Robert Alderson Wright, Legal Essays and Addresses (1939) 34; Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour [1942] UKHL 4; [1943] AC 32, 61; P H Winfield, ‘The American Restatement of the Law of Restitution’ (1938) 54 Law Quarterly Review 529.

[8] Robert Goff and Gareth Jones, The Law of Restitution (first published 1966, 5th ed 1998) (‘Goff & Jones’).

[9] Canada: G Klippert, Unjust Enrichment (1983); G H L Fridman, Restitution (2nd ed, 1992); Peter Maddaugh and John McCamus, The Law of Restitution (1990). Australia: Keith Mason and J W Carter, Restitution Law in Australia (1995); I M Jackman, The Varieties of Restitution (1998). New Zealand: Charles Cato, Restitution in Australia and New Zealand (1997).

[10] Jackman, above n 5.

[11] There is a view that the definition should be restricted to those givings up which consist in givings back: Lionel Smith, The Law of Tracing (1997) 297–8 and Lionel Smith, ‘The Province of the Law of Tracing’ (1992) 71 Canadian Bar Review 672. It is to be noted that the German law uses a word which is not so confined (herausgeben). This issue is not investigated here because, even if a distinction were taken between restitution and disgorgement (giving back and giving up) both would probably still be multi-causal.

[12] Graham Virgo (from Cambridge) has consistently taken this position: Graham Virgo, ‘Reconstructing Restitution’ (1996) 10 Trust Law International 20; more fully and more recently: Graham Virgo, ‘What is Restitution about?’ in Cornish et al, above n 6, 305. Cf Peter Birks, ‘Misnomer’ in Cornish et al, above n 6, 1, rejected by Andrew Tettenborn, ‘Misnomer: A Response to Professor Birks’ in Cornish et al, above n 6, 31.

[13] Edwards v Lee’s Administrator (1936) 96 SW 2d 1028 (‘Kentucky Cave Case’).

[14] Peter Birks, An Introduction to the Law of Restitution (1989) 26–7.

[15] Macmillan Inc v Bishopsgate Investment Trust plc [1995] EWCA Civ 55; [1996] 1 WLR 387 (CA) is ultimately one of the category four cases, restitution but not arising from consent, wrongs or unjust enrichment. Further discussion in Peter Birks, ‘Property and Unjust Enrichment: Categorical Truths’ [1997] New Zealand Law Review 623.

[16] Goff and Jones, above n 8, 3.

[17] There is, however, an unavoidable ambiguity in their attitude to profitable wrongs. The principle that nobody should profit from her wrong was definitely within their vision of the subject but, semble, on both sides of the Atlantic they were not thinking of restitution for wrongs qua wrongs but rather of restitution on the basis of alternative analysis dispensing with the wrong. It is equally possible that they never cleanly distinguished the two. Perhaps the best evidence for the reporters’ conception of the project is Warren Seavey and Austin Scott, ‘Restitution’ (1938) 54 Law Quarterly Review 29.

[18] Gummow, above n 5, iv.

[19] Oliver Holmes, The Common Law (first published 1881, 4th ed 1945) 1.

[20] Gummow, above n 5, iv.

[21] Andrew Burrows, Understanding the Law of Obligations: Essays on Contract, Tort and Restitution (1998).

[22] Ibid 8.

[23] Not dissimilar is Andrew Tettenborn in Cornish et al, above n 6, 31, 36. However, he is less willing to concede that restitution is, in this series, even prima facie dangerous or inappropriate.

[24] W A Seavey, ‘Problems in Restitution’ (1954) 7 Oklahoma Law Review 257.

[25] B Nicholas, ‘Unjustified Enrichment in Civil Law and Louisiana Law’ (1962) 36 Tulane Law Review 605, 605 citing Hamilton LJ in Baylis v Bishop of London [1913] 1 Ch 127.

[26] Jackman, above n 5, 1:

The general theme of this book is that the answers to these three questions relate to fundamentally distinct categories of legal thought. These are, in turn, the reversal of non-voluntary transactions, the fulfilment of non-contractual promises and the protection of facilitative institutions of private law. Because each of these concepts is distinct, it is not feasible to force uniformity on them in terms of the so-called unifying principle of ‘unjust enrichment at the plaintiff’s expense’.

[27] Ibid 3–9, 96–108.

[28] [1987] HCA 5; (1987) 162 CLR 221.

[29] [1936] 2 KB 403.

[30] [1977] 2 NSWLR 880 (‘Sabemo’).

[31] Samuel Stoljar, ‘Unjust Enrichment and Unjust Sacrifice’ (1987) 50 Modern Law Review 603.

[32] The key is to be found as early as Jackman, above n 5, 3 where he expressly commits himself to the proposition that the law of restitution must be kept wide enough to include cases in which the defendant has received no benefit. This is exactly the equivalent of saying that the law of compensation for loss must not be artificially restricted so as to exclude cases in which the plaintiff has suffered no loss. There are of course some cases which use the word ‘restitution’ as a synonym for ‘compensation’ (making good a loss), but they use the language of restitution in a sense totally alien to its usage in, say, the Restatement or Goff & Jones; these cases use ‘restitution of a person to a condition’ not ‘restitution of something to a person’. Perpetual vigilance is necessary against this ‘of a person to a condition’ usage. This is well discussed by Steven Elliott, ‘Restitutionary Compensatory Damages for Breach of Fiduciary Duty’ (1998) 6 Restitution Law Review 135, 138–43. It is not clear whether Jackman has crossed over these particular points to reach the conclusion that ‘restitution’ can be loss-based, but it is certain that the founders intended to stay on the ‘of something to a person’ side of the line.

[33] See above n 19 and accompanying text.

[34] Jackman, above n 5, 4–5, 13, 32, 47.

[35] Ibid 3–4, 96, 70–95 passim.

[36] Ibid 11, 180–2. So rigid is his adherence to this that when he finds cases saying, in relation to the defence of passing on, that no loss is required on the plaintiff’s side he concludes that they must therefore mean that the liability in question cannot be based on unjust enrichment, which is short for unjust enrichment at the expense of the plaintiff. But he has not noticed that in the civil law countries it is a bone of contention whether the plaintiff in unjust enrichment is or is not bound to identify herself as someone who has suffered a loss. In Germany, for example, most jurists say that it is not essential to establish such a loss. H G Weiling opens his discussion with this point, asserting that it would be a grave error to suppose that the plaintiff had to be impoverished in a manner corresponding to the defendant’s enrichment: H G Weiling, Bereicherungsrecht (1993) 1–3; cf H G Koppensteiner and E A Kramer, Ungerechtfertigte Bereicherung (2nd ed, 1988) 16–7, 84.

[37] Woolwich Equitable Building Society v Inland Revenue Commissioners [1993] AC 70 (HL).

[38] The families of unjust factors are diagrammatically represented in Peter Birks and Robert Chambers, The Restitution Research Resource (2nd ed, 1997) 3: non-voluntary transfer, unconscientious receipt, miscellaneous policy reasons requiring restitution. Neither of us feels any longer certain that unconscientious receipt deserves an independent place, for every case of unconscientious receipt seems to involve at least some degree of non-voluntariness.

[39] Jackman, above n 5, 11. This is approved by Justice Gummow in the foreword, at v, where he says:

It is not immediately apparent why the fiduciary institution (in particular the trust) may not stand beside the common law triptych of tort, contract and ‘quasi-contract’, and why equitable doctrines and remedies may not, in particular circumstances, operate on that triptych and themselves continue to develop whilst doing so. The wisdom of this arrangement is perceived by the present author, though he would follow fashion in eschewing the term ‘quasi-contract’.

I attempt below to show why trusts cannot stand outside the common law taxonomy (which is however not a ‘triptych’). Even Louisiana, proud of its civilian origins, has recently evicted the deceptive term ‘quasi-contract’ from its civil code, for very hard-headed reasons, not from fashion-slavery: chh 1 and 2 of Book III, Title 5 of the Louisianna Civil Code are reproduced at (1997) 5 Restitution Law Review 220.

[40] This cannot be admitted so long as equity and restitution are treated as operating in parallel and hence as being in competition with one another. John Glover’s contribution to Patrick Parkinson (ed), The Principles of Equity (1996) 92, 103 constantly flirts with that confusing view, eg: ‘Equity and restitution perform a similar function in the law. Both fill gaps in the civil law of obligations’, and ‘we will note a difference between equitable and restitutionary liability. ... Equitable liability ... is almost entirely based in fault. Restitution is not interested in the quality of the defendant’s conduct’. Running this kind of statement with ‘common law’ substituted for ‘equity’ immediately exposes the error. However a subject-matter is defined, whether by causative event, by response, or by context, in our kind of legal system, unless that matter is first artificially restricted to one or other side of the old duality, the substance of the law relating to that matter will come from both common law and equity. These are the sources on which subjects draw, not categories distinct from those sources. Logically, a law school which runs a course on equity, should also run a course on common law, and nothing else (unless perhaps admiralty). ‘Contract, tort, equity, and other courses’ is a good example of a bent classification: see above n 21 and accompanying text.

[41] [1914] AC 932.

[42] [1963] UKHL 4; [1964] AC 465.

[43] By ‘no special difficulties’ is meant only none over and above those which beset every integration of this kind. There is no denying the general difficulties. Professor Beatson has given a good account of these: J Beatson, ‘Unfinished Business: Integrating Equity’ in J Beatson, The Use and Abuse of Unjust Enrichment (1991) 244.

[44] Justice Paul Finn, ‘Equitable Doctrine and Discretion in Remedies’ in Cornish et al, above n 6, 251, 260. Can there be any event on which lawyers ought more to meditate? Committed as it was in what, only a short time before, would have been regarded as the best educated and most civilised country in the world, and being the greatest failure of law that the world has known, the Holocaust requires that we constantly ask ourselves, even when we are most sure that we could not possibly repeat its horrors, even chiefly then, whether law is or is not cultivating forms of thought which restrain the evil of which mankind is capable. The point of my allusion to the head of the Gestapo was the same point as that which was made by Selden more than 300 years ago, to the effect that to be ruled by the Chancellor’s conscience might be likened to being measured by the Chancellor’s foot: Frederick Pollock, Table Talk of John Selden (1927) 43.

[45] Peter Birks, ‘Equity in the Modern Law: An Exercise in Taxonomy’ [1996] UWALawRw 1; (1996) 26 University of Western Australia Law Review 1, 17 citing A H Campbell, ‘Fascism and Legality’ (1946) 62 Law Quarterly Review 141, 147.

[46] F W Maitland, The Constitutional History of England (1908) 312; J H Baker, An Introduction to English Legal History (3rd ed, 1990) 122–6.

[47] Charles Dickens, Bleak House (first published 1853).

[48] Barclays Bank v Quistclose Investments Ltd [1970] AC 567 (HL) definitively analysed by Robert Chambers, Resulting Trusts (1997) 68–92.

[49] Chase Manhattan Bank NA v Israel-British Bank (London) Ltd [1981] Ch 105.

[50] Chambers, above n 48. The first half of the book is an analysis of that which has traditionally been called a resulting trust, the second half relates that analysis to the taxonomy in which the category of unjust enrichment finds its place and to the internal taxonomy of unjust enrichment itself. In the closing pages the author looks forward to a day in which trusts, which means the entitlements under or entailed by trusts, will be classified in the same way as other entitlements.

[51] See above n 21 and accompanying text.

[52] Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] UKHL 12; [1996] AC 669 (HL) (‘Westdeutsche’), especially 716.

[53] The question, more urgent while Sinclair v Brougham [1914] AC 398 (HL) was in place, was whether the absence of proprietary consequences in the case of a failure of consideration consisting in a simple failure of contractual reciprocation (as where money had been paid for goods never delivered) was so obvious as to require no explanation or was a diversion from principle and as such in need of explanation and definition. See, in relation to Re Goldcorp Exchange Ltd [1995] 1 AC 74 (PC), Peter Birks, ‘Establishing a Proprietary Base’ (1995) 3 Restitution Law Review 83, 89–91. Note also that Chambers is able to explain the Westdeutsche outcome without altering his position on the nature of resulting trusts as central to equity’s response to unjust enrichment: Chambers, above n 48, 154–63.

[54] Finn, above n 44, 251.

[55] Ibid especially 264–273. Justice Finn’s view of the law belongs in the family of those which prefer all the law’s responses to dominate, rather than the events which trigger those responses (rather as though one would approach criminal law, not through crimes, but through possible sentences). A proponent of the latter kind of classification is Professor Jane Stapleton: Jane Stapleton, ‘A New “Seascape” for Obligations: Reclassification on the Basis of Measure of Damages’ in Peter Birks (ed), Classification of Obligations (1997) 193.

[56] Dramatically illustrated by the different ‘remedies’ contemplated in LAC Minerals Ltd v International Corona Resources Ltd (1989) 61 DLR (4th) 14. The inverted commas are intended to indicate that I do not know what this word means, or, more accurately, where the line is supposed to fall between ‘right’ and ‘remedy’. The immediate consequences of an abuse of confidence seem to me to be ‘rights’ (eg the ‘right in personam’ to the abuser’s profits and the ‘right in rem’ in those profits and the assets representing them).

[57] It is interesting that Derek Davies, whose position is not dissimilar to that of Justice Finn, takes the precaution of separating other matter, especially autonomous unjust enrichment, before expounding discretionary appropriateness in relation to wrongs: Derek Davies, ‘Restitution and Equitable Wrongs’ in F D Rose (ed), Consensus Ad Idem (1996) 158. I take this to be the correct understanding of 152–3 and 176.

[58] Finn, above n 44, 251:

It is only proper to confess at the outset that, while not a complete non-believer, I entertain a large degree of scepticism about some at least of the claims made for the subject ... I should indicate the cause of my scepticism. It is with the use made of the concept of ‘unjust enrichment’.

[59] Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour [1942] UKHL 4; [1943] AC 32, 61.

[60] Charles Darwin, The Origin of Species (Gillian Beer ed, 2nd ed, 1859) 335.

[61] [Latin] ‘keen young law students’, literally, ‘young eager for the law’, to whom on 21 November 533 the Emperor Justinian addressed the Pronouncement ‘Imperial Majesty’, which promulgated the Institutes, perhaps the most influence secular book in the history of European civilisation: Justinian’s Institutes (Peter Birks and Grant McLeod trans, 1987) 32–3.


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