BCL Law Notes Restitution of Unjust Enrichment Notes
A comprehensive guide to some of the key topics in the Restitution of Unjust Enrichment module taught on the BCL (but would also be useful for other similar courses).
It includes case summaries, various academic positions and a thorough analysis of some of the key debates within the topic in an easy digestible manner.
It focuses on contributions to this area of law from Andrew Burrows, Graham Virgo and Peter Birks, amongst others. ...
The following is a more accessible plain text extract of the PDF sample above, taken from our Restitution of Unjust Enrichment Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
DURESS
TWO-STAGE TEST
Leading HL cases on duress (The Universe Sentinel and The Evia Luck) show that there is a 2 stage test for restitution:
the pressure/threat was illegitimate. This is an objective inquiry into the quality of the threat; and
the payment (or rendering of a benefit in kind) was caused by that threat. This is a subjective investigation into the claimant’s state of mind
CLEARING UP A FEW BAD VIEWS
Relationship to Mistake
Birks saw duress as being similar to mistake in that they both relate to impaired consent. However, unlike mistake (which only consider’s the claimant), duress considers the conduct of the person exerting the duress as well as the effect on the claimant. In other words, as Burrows says, one cannot have ‘unilateral duress’
Defences that aren’t so
Sometimes suggested that it is a defence to restitution for duress that the claimant paid ‘in submission to an honest claim’ (Woolwich v IRC)
Burrows says that this is vague. Probably best viewed as synonymous with saying that causation has not been satisfied or that a threat to sue is not illegitimate
Duress has to be tortious
Despite what Lord Scarman said in The Universe Sentinel, duress doesn’t have to be tortious to constitute duress in the context of unjust enrichment AS CONFIRMED BY
Lord Goff in The Evia Luck
Duress Constitutes Overborne Will
The person under duress still intends D to have the money. So their will is not overborne. The objection is rather that C does not reach that decision freely but rather under illegitimate pressure
Third Parties
Burrows says that despite no cases confirming this, in principle duress can be invoked against a third party who has not itself exerted the duress
This makes it abundantly clear that restitution for duress is not concerned with reprehensible conduct of D
Benefits in Kind
Cases have only acknowledged so far where duress in relation to money HOWEVER
In principle can have duress for benefit in kind. Plus, the fact that D demanded it overcomes subjective devaluation
MAIN HEADS OF ILLEGITIMATE PRESSURE
Lord Goff said the categories are not closed.
But, these are the ones that have been recognised:
duress of the person
duress of goods
illegitimate threats (other than by a public authority ultra vires) to support a demand for payment above what is statutorily permitted
economic duress
illegitimate threats to prosecute or sue or publish information
illegitimate threats by public authorities made to support ultra vires demands (swallowed up by Woolwich principle though)
CLARIFYING TWO POINTS
Implied threat
Lord Goff in Woolwich Equitable Building Society stated that the ‘compulsion may be expressed or implied’ SO
Implied threats do count
Causation Test
Barton v Armstrong – test for illegitimate threat only has to be ‘a reason’ for C’s conduct (not necessarily the sole or main reason)
Even stated that the burden of proving a reason test was on the defendant BUT
Huyton v Peter – suggested that ‘but for’ test should apply to economic duress
CONTRACTS ENTERED INTO BY DURESS
Burrows essentially says there should be no separate rule for contracts entered into under duress as there are for non-contractual payments HIS REASON
Duress can have an impact on whether there was consideration, thus causing difficulties in determining whether there was a contract ALTHOUGH
REMEDIES: the restitutionary remedies are different though where payment was made under contract:
No contract = remedy is an action for money had and received
Contract = C’s remedy is rescission with a consequential repayment of the money
DURESS OF THE PERSON
Barton v Armstrong
FACTS: Claimant sought a declaration that the contract, which had been executed, was void on the ground that it had been induced by D threatening C with murder
DECISION (Privy Council) – granted the declaration because D’s threats had been a reason for C making the contract
Causation
In Barton Lord Cross (giving leading judgment) referred to the ‘a’ reason test. SIMILARLY
Lords Wilberforce and Simon said: ‘the illegitimate means was a reason (not the main reason, nor the predominant reason, nor the clinching reason)
Also said that burden of proof was on D to prove otherwise
DURESS OF GOODS
What?
Where D improperly threatens not to return C’s goods or to seize them, unless C pays him money, C can recover that money, assuming causation, in an action for money had and received
Astley v Reynolds
This case shows that primary focus is whether C has freely chosen to pay
ECONOMIC DURESS
GENERAL
Scope of doctrine is unsettled
Principally includes threats to break a contract or induce another to break a contract
The extent to which it extends to threatened lawful acts is uncertain
THREATS TO BREAK A CONTRACT
Old Approach
Pao On (Privy Council) – used to be that a threatened breach of contract was always regarded as illegitimate. Whether this constituted economic duress was then determined by considering whether C’s will was overborne. So, the old approach focused more on the causation question, rather than both illegitimate question and causation question now required
Problems with this overborne will Approach
C’s will isn’t overborne. He intends to give D the benefit – it’s just that he was forced into it
Burrows suggests that there are two possible interpretations of what is meant by this overborne will language. He takes issue with both.
Interpretation 1
It refers to a more stringent causation test ie. the predominant cause
Birks – critical of such a test, as its impossible to conduct such an inquiry into will
Burrows – this is true of most causation tests though he says? BUT
Huyton...
Buy the full version of these notes or essay plans and more in our Restitution of Unjust Enrichment Notes.
A comprehensive guide to some of the key topics in the Restitution of Unjust Enrichment module taught on the BCL (but would also be useful for other similar courses).
It includes case summaries, various academic positions and a thorough analysis of some of the key debates within the topic in an easy digestible manner.
It focuses on contributions to this area of law from Andrew Burrows, Graham Virgo and Peter Birks, amongst others. ...
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