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I'm glad that you are all happy to agree with the blindingly obvious, at least I'm not completely stupid. I think what I was groping towards in a way which was obviously about as clear as mud is the question of whether you can extend the concept of things actually due anyway (natural obligations if you like, I apologise to purists but I think I do) to the Kleinwort Benson-ish situation where there is no policy reason for restitution.

In Kleinwort Benson of course there was a protective policy that justified rendering the contracts void (we wish to protect the good citizens of this country from local authorities gambling with our money). I cannot think of a particularly good real example off the top of my head but take a case where the House of Lords overrules a fictitious case, *Smith v Smith. The rule in *Smith v Smith is essentially arbitrary but all contracts entered into on the basis of it are now void. Presumably retrospectively. So we were all mistaken at the time that we entered into our contracts as to the existence of the contract. It was a mistake of law; we recover, or do we?

I accept Louis Joseph's point that authority on this is probably scanty. However, my question is this can we say that there is actually no good reason for restitution. Obviously people in the Birks camp would say that KB is wrong on this point and you shouldn't get restitution. I don't myself believe that; I think there is a mistake, which is where my nervous breakdown comes. I still don't want to give restitution.

However, I see potential light in the form of Larner v London County Council. There the Court of Appeal said that although the payments were unenforceable, they were given for good reason, whether that is seen as as a result of national policy in times of war or as I remember Graham Virgo suggesting in Principles of the Law of Restitution a moral obligation to keep one's promises (a natural obligation?). I can see a good argument for saying that notwithstanding the overruling of *Smith v Smith that we have an obligation to keep our promises anyway, so no restitution.

Thoughts, or this all of this absolutely barmy?

Duncan Sheehan

On Thu, 10 Feb 2000, Riegels, Colin wrote:

At the risk of stating the obvious (and/or going on a tangent of my own) should not the answer to the above question be predicated upon the answer to the following question: When does the limitation period begin to run?

I think that there is a danger of confusing two different limitation periods here: the limitation period in relation to the initial debt for the purchase of the desk and the limitation period in relation to any claim for restitution of the sums paid.

Under English law the limitation period in relation to the debt would have clearly expired, but (as the Limitation Act only bars the remedy and not the right) the debt still subsists and the sums paid would be a valid discharge of it. That the sums were paid in the discharge of a lawful debt should, I would think, be a total bar to restitution as it would be impossible to characterise the enrichment as "unjust".

COLIN RIEGELS
Barrister