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The reach of restitution

Published online by Cambridge University Press:  02 January 2018

G. H. L. Fridman
G. H. L. Fridman*
Affiliation:
University of Western Ontario
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Extract

Lord Diplock, in Orakpo v Manson Investments, used language that indicated that the range of restitution, or unjust enrichment, is limited. Lord Goff, on several occasions, has been more amenable to the idea that, should a remedy be desirable in the circumstances of a particular case, the concept of restitution could, and should be utilised in a creative manner. Canadian judges have been more inclined than those in England to adopt the latter approach. As one of them once said: ‘Just as the categories of negligence are never closed, neither can those of restitution’. In more recent judgments Canadian courts have continued to show their willingness to extend the scope of restitution in two ways: (i) by the enunciation of a general concept of unjust enrichment that underlies the idea of restitution; (ii) by a broader, more innovative use of the traditional doctrine of constructive trust. Both these developments stem from a fundamental premise as to the ‘equitable’ nature of restitution.

Type
Research Article
Information
Legal Studies , Volume 11 , Issue 3 , November 1991 , pp. 304 - 325
Copyright
Copyright © Society of Legal Scholars 1991

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References

1. [1978) AC 95 at 104.

2. BP Exploration Co (Libya) Ltd v Hunt (No 2) [1983] 2 AC 325; Barclays Bank Ltd v Simms, Sons & Cooke (Southern) Co Ltd (1984) I All ER 504 at 511; British Steel Corpn v Cleveland Bridge & Engineering Co (1984) I All ER 504.

3. Morden J in More (James) & Sons Ltd v University of Ottawa (1974) 49 DLR (3d) 666 at 676.

4. Roughly, but not completely, equivalent to the distinction drawn by Goff, & Jones, , Law of Restitution, 3rd edn, 1986 pp 55–56 Google Scholar between personal and proprietary claims.

5. Note, however, some ‘equitable’ elements, eg in the judgments of Parke and Rolfe BB in Kelly v Solon (1841) 9 M & W at 54 at 58–59: cf the earlier views of Lord Mansfield in Moses v Mcferlane (1760) 2 Burr 1005.

6. Eg Goff, & Jones, , op cit, pp 1–12 Google Scholar and authorities there cited: Fridman, & McLeod, , op cit, pp 6–15 Google Scholar. See also Birks & McLeod, ‘The Implied Contract Theory of Quasi-Contract: Civilian Opinion Current in the Century before Blackstone’ (1986) 6 Ox J Leg St 546. 7. Invalidly and inaccurately according to Holt CJ: Anon (1695) Holt 35: Shuttlcworth u Gamett (1689) 3 Lev 261; CiQ of York v Toun (1 700) 5 Mod 444; Smith v Aircy (1 700) 6 Mod 125; Hussy u Fiddall ( 1698) 12 Mod 324; Tomkyns u Bamet ( 1694) Skinner 41 1 ; Holmcs u Hall (1705) 6 Mod 161; Laminc v Dorell(l706) 2 Ld Raym 1216; Criiford v Berry (1709) 11 Mod 241.

7. Invalidly and inaccurately according to Holt CJ: Anon (1695) Holt 35: Shuttlcworth v Gamett (1689) 3 Lev 261; City of York v Toun (1 700) 5 Mod 444; Smith v Airey (1 700) 6 Mod 125; Hussy v Fiddall ( 1698) 12 Mod 324; Tomkyns v Bamet ( 1694) Skinner 411 ; Holmes v Hall (1705) 6 Mod 161; Lamine v Dorell (l706) 2 Ld Raym 1216; Crifford v Berry (1709) 11 Mod 241.

8. Goff, & Jones, , op cit, pp 605–606 Google Scholar. There is much controversy on the question whether waiver of tort is still possible and, if so, in respect of what conduct on the part of the defendant: Beatson, ‘The Nature of Waiver of Tort’ (1978–79) 17 UWOLR 1; Birks, ‘Restitution and Wrongs’ (1982) CLP 53; Hedley, ‘The Myth of “Waiver ofTort”’ (1984) 100 LQR 652; Friedmann, ‘Restitution of Benefits Obtained Through the Appropriation of Property or the Commission of a Wrong’ (1980) 80 Col LR 504. See also Klippert, ‘Restitutionary Claims for the Appropriation of Property’ (1981) 26 McGill LJ 506.

9. [1914) AC 398.

10. See, eg Scott v Pattison (1923) 2 KB 723; Craven-Ellis v Canons Ltd (1936) 2 KB 403; William Lacy (Hounslow) Ltd v Davis (1957) 1 WLR 932.

11. A contrary view is expressed, wrongly, it is submitted, by Goff, & Jones, , op cit, pp 12–23 Google Scholar. See also ibid, pp 23–55.

14. [1954] SCR 725.

13. (1760) 2 Burr 1005.

14. Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour [ 19431 AC 32 at 61.

15. Pomponius, Digest 23.3.6.2. ‘To the Romans, who were very practical people, restitution was a moral principle which found expression in various forms of action relating to particular situations’: Angus, ‘Restitution in Canada since the Deglman Case’ (1964) 42 Can BR 529 at 531. Cf. ibid, at 534; ‘Lord Mansfield's exposition of the principle in 1760 is more specific than that of Pomponius sixteen hundred years earlier’.

16. Fridman, , ‘The Foundations of Restitution: A Canadian Perspective’ (1989) 19 WALR 131, especially at 142-150Google Scholar.

17. Sometimes not distinguished from a constructive trust: see Denning, Lord in Hussy v Palmer [1972] 3 All ER 744 at 747Google Scholar: cf. Diplock, Lord in Gissing v Gissing [1971] AC 886 at 905Google Scholar. At other times carefully differentiated: see also Ritchie, and JJ, Pigeon in Rathwell u Rathwell (l978) 83 DLR (3d) 289 at 297Google Scholar; Martland, Beetz and Ritchie JJ in Pettkus v Becker (1981) 117 DLR (3d) 257 at 262, 265, 278.

18. (1726) Cas temp King 61.

19. Goff & Jones, op cit, chap 34; Finn, Fiduciary Obligations; Fridman & McLeod, Restitution chap 17; Shepherd, Law of Fiduciaries; Jones, , ‘Unjust Enrichment and the Fiduciary's Duty of Loyalty’ (1968) 84 LQR 472 Google Scholar.

20. [1967] 2 AC 46.

21. Ibid, at 104 per Lord Cohen.

22. Although the fiduciaries were held entitled to something for their efforts because they acted in good faith.

23. As in Hazel1 v Hazel1 (1972) 1 All ER 923; Re Cummins (1971) 3 All ER 782; Hargrove v Newton (1971) 3 All ER 866; Hussey v Palmer (1972) 3 All ER 744; Falconer v Falconer (1970) 3 All ER 449; Heseltine v Heseltine (1971) 1 All ER 992; Cook v Head (1972) 2 All ER 38. See also Binion v Evans (1972) 2 All ER 70.

24. But in Colendra v DA Cleaners and Acquaci (1980) 73 OR (2d) 429 the court refused to impose a constructive trust on an agent in breach of her fiduciary duty to her principal.

25. Eg Hussey v Palmer, supra.

26. [1980] 3 All ER 710 at 715.

27. Fridman, loccit, supra, note 16: Dewar, ‘The Development oftheRemedialConstructive Trust’ (1982) 60 Can BR 265

28. (1978) 83 DLR (3d) 289 at 298, referring to Delgman v Guaranly Trust Co of Canada [1954] SCR 725.

29. (1978) 83 DLR (3d) 289 at 305, citing Laskin J in Murdoch v Murdoch (1973) 41 DLR (3d) 367 at 388.

30. (1981) 117 DLR (3d) 257 at 273.

31. (1986) 29 DLR (4th) 1 at 5.

32. (1989) 57 DLR (4th) 321 at 348-349.

33. (1990) 65 DLR (4th) 161 at 184.

34. Supra, note 31.

35. (1989) 57 DLR (4th) 321. The case is also interesting on the subject of fundamental breach and its effect on an exclusion or similar clause

36. The dissentients were Wilson and L'Heureux-Dubé JJ.

37. Supra, note 35 at 345 per Dickson CJ.

38. (1985) 27 BLR 59.

39. (1986) 68 BCLR 367.

40. Supra, note 38 at 81-82.

41. (1980) 117 DLR (3d) 257.

42. Supra, note 35 at 348-355.

43. Ibid, at 349.

44. Ibid, at 350 per Dickson CJ; see also ibid, at 351.

45. Ibid, at 353.

46. (1989) 61 DLR (4th) 14: on which see Waters, Lac Minerals Ltd v International Corona Resources Ltd (1990) 69 Can BR 455.

47. Supra, note 35 at 349.

48. Ibid, at 353.

49. Ibid, at 383: citing Deglman v Guaranly Trust Co of Canada [ 19541 SCR 725.

50. (1987) 42 DLR (4th) 81.

51. Supra, note 46.

52. Supra, note 35 at 384.

53. Pettkus v Becker, supra, note 41.

54. Supra, note 35 at 384.

55. (1990) 68 DLR (4th) 161.

56. RSBC 1979, c 40, s 20.

57. (1988) 50 DLR (4th) 159

58. The subcontractors cross-appealed, successfully as it turned out, on the issue of interest. This, too, need not be considered here.

59. Viz; the Builders Lien Act, express trust, substantive constructive trust: supra, note 55 at 168-170.

60. Ibid, at 170.

61. Ibid, at 171.

62. Ibid.

63. Ibid.

64. Ibid, at 172.

65. Supra, note 49.

66. Supra, note 55 at 173.

67. As in Rawluk u Rawluk (1990) 65 DLR (4th) 161.

68. Supra, note 55 at 174. What are these other remedies? Presumably the learned judge was hinting at such possibilities as rescission, lien, accounting: Maddaugh & McCamus, The Law of Restitution, 1990, chapters 4, 5. See also ibid, chapters 6–9 on tracing, subrogation, contribution and indemnity (although the latter three ‘remedies’ seem to be more examples of instances of restitution than of remedies in cases of restitution: cf. Goff & Jones, op cit, chapters 12, 13, 27). The latter authors also consider such matters as relief for unconscionable bargains, maritime salvage, attornment, avoidance of fraudulent preferences and conveyances: GOB & Jones, op cit, chapters 11, 16, 26, 30.

69. Goff, & Jones, , op cit, pp 155, 177–181Google Scholar.

70. Supra, note 55 at 187.

71. Eg St John Tugboat Co Ltd v Irving Refinery Ltd (1964) SCR 614: cf British Steel Corpn v Cleveland Bridge & Engineering Co Ltd (1984) 1 All ER 504.

72. Ramsden v Dyson (1866) LR 1 HL 129; Glavatsky v Stadnick (1937) 1 DLR 477: cf B Liggett (Liverpool) Ltd v Barclay's Bank (1928) 1 KB 48.

73. [1943] AC 32.

74. Supra, note 55 at 194.

75. Ibid, at 196.

76. Greer v Douns Supply Co [I9271 2 KB 28.

77. Klippet, , Unjust Enrichment (1983) at p 197 Google Scholar; Goodhart, and Jones, , ‘The Infiltration of Equitable Doctrine Into English Commercial Law’ (1990) 43 Mod LR 489 CrossRefGoogle Scholar; Goode, ‘The Right to Trace and Its Impact in Commercial Transactions 11’ (1976) 92 LQR 528 at 568; Paciocco, ‘The Remedial Constructive Tort: A Principled Basis for Priorities over Creditors’ (1989) 68 Can VR 315 at 327–328.

78. Fridman, , Law of Agency, 6th edn, 1990 at pp 156–168 Google Scholar. But see Wardle, , ‘Post- Employment Competition - Canaero Revisited’ (1990) 69 Can BR 233 Google Scholar.

79. Supra, note 46.

80. Chase Manhattan Bank Ltd v Israel-British Bank (London) Ltd [1979] 3 All ER 1025a.

81. Phoenix Assurance Co v Toronto (1982) 35 OR (2d) 16.

82. Zaidan Group Ltd v City of London (1990) 71 OR (2d) 60, reversing (1987) 58 OR (2d) 667.

83. Waters, loc cit, supra, note 46 at 478-81

84. Eg, the Unfair Contract Terms Act 1977.

85. Fridman, , Law of Contract in Canada, 2d edn, 1986 at pp 303–311 Google Scholar; Cheshire, & Fifoot, , Law of contract, 11th edn, 1986, at pp 298–302 Google Scholar; National Westminster Bunk plc v Morgan (1985) AC 686.

86. Paciocco, loc cit, supra, note 77 at pp 227–328.

87. Supra, note 80 at 1029.

88. Paciocco, loc cit, supra, note 77 at 350.

89. Ibid.

90. Ibid.

91. Ibid, at 351.

92. See cases cited supra, notes 28–31.

93. (1990) 68 DLR (4th) 161.

94. Mc Lachlin, La Forest and Sopinka JJ.

95. Supra, note 93 at 190.

96. Ibid, at 190–191.

97. Ibid, at 191.

98. Ibid.

99. Ibid, at 181.

100. Ibid.

101. Birks, , An Introduction to the Law of Restitution, pp 89–90 Google Scholar.