Understanding Unjust Enrichment

What is Unjust Enrichment?

Unjust enrichment occurs when a party confers a benefit upon another party without receiving the proper restitution required by law. Unjust enrichment is a strict liability and faultless claim, meaning the plaintiff will only get back exactly what was transferred. The principle aims to reverse an unjustified transfer and restore the parties to their pre-enrichment status.

The Elements of a Successful Unjust Enrichment Claim

To successfully claim unjust enrichment, three key elements must be satisfied:

1. Objective Benefit to the Defendant: The defendant must have received a benefit, which can be anything of value, such as money, services, or property.
2. Corresponding Deprivation to the Plaintiff: The plaintiff must have suffered a loss or deprivation as a result of the benefit conferred on the defendant.
3. Absence of a Juristic Reason: There must be no legal justification for the defendant’s retention of the benefit. In other words, the benefit received by the defendant cannot be justified by a contract, a gift, or a legal obligation.

Defences Against Unjust Enrichment Claims

There are several defences that a defendant might use to counter a claim of unjust enrichment:

1. Subjective Devaluation: This defence may defeat the first element of the unjust enrichment claim when the defendant did not have a choice in accepting the benefit. More specifically, when the defendant did not voluntarily choose to assume financial responsibility for the benefit.

Rebutting Subjective Devaluation: The plaintiff can rebut the subjective devaluation if:

• The defendant requested or accepted the benefit with knowledge of the expectation of payment.
• The benefit was readily returnable, and the defendant did not return the benefit to the plaintiff.
• The defendant has received an incontrovertible benefit such as money, realized financial gain, or the saving of a necessary expense.

2. Change of Position: This defence applies if the defendant has spent or used the benefit they received in a way that means they no longer have it. To use this defence successfully, the defendant must prove:

• • Extraordinary Expenditure: The benefit was spent on something unusual or special, not regular expenses—for example, buying concert tickets instead of paying a credit card bill.
  • Relying on the Benefit: The defendant only spent the benefit because they believed they were entitled to it. For instance, they bought the concert tickets because they thought the benefit was theirs to keep.
  • Good Faith: The defendant must show they acted honestly. If they knew they weren’t entitled to the benefit, they couldn’t use this defence.

3. Public Policy and Reasonable Expectations: In some cases, the defendant may argue that retaining the benefit aligns with public policy or reasonable expectations. This defence is evaluated on a case-by-case basis.

Conclusion
Unjust enrichment is a complex area of law aimed at ensuring fairness when one party unfairly benefits at another’s expense. Whether you’re pursuing a claim or defending against one, grasping these principles is crucial to achieving a fair resolution.

If you suspect you’ve been subjected to a case of Unjust Enrichment and would like to book an appointment with one of our lawyers, call 1-866-753-2202 or drop us an email.