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Sender:
Christoph Coen
Date:
Mon, 17 Jul 2000 15:24:38 +0300
Re:
Questions on Prof. Birks' "Equity, Conscience, and Unjust Enrichment"

 

I am grateful to Duncan Sheehan for raising a number of issues which have been on my mind recently, but which I would not have been able to express as clearly.

First of all, I agree that, for spontaneous gifts, "is a lot harder to see why having a two stage test is better than having a one stage test, where all we need to say is mistake therefore recovery, rather than mistake therefore void, therefore recovery", and this is certainly one of the advantages of the "unjust factors" approach over the "absence of legal ground" approach. I would add that the "unjust factors" approach may also be simpler in cases where there is pre-existing liability. Imagine, for example, that you are induced to enter into a contract by means of a fraudulent misrepresentation. Generally speaking, if you have not yet performed, you can rescind the contract and thus get out of the contract; if you have performed, you can rescind the contract and get back what you have paid. The symmetry is justified by the fact that, as Virgo says, the personal right of receiving performance under the (executory) contract is also a benefit which is subject to the restitutionary remedy of rescission. Under the German approach, two different remedies would be needed: para. 123 BGB to get out of the contract and para. 812 to get your money back once the contract is rescinded. Of course, the symmetry breaks down in the case of mistake because different criteria apply to whether you can get out of a contract by reason of a mistake or whether you can recover money paid under a mistake outside of a contractual relationship (and, not surprisingly, this is the area on which Meier and Zimmermann concentrate in their critique of English law). Nevertheless, it may serve to illustrate why I think the "unjust factors" approach is the more intuitive one.

I also agree with Duncan Sheehan that there is no metaphysical distinction between mistakes which affect our intention to give and those which do not, and in my view this is one of the major flaws in Meier's argument. Whether to allow recovery or not is a policy question which depends on many factors. I do not think that you can isolate distinct classes of mistake as grounding recovery or not; rather it seems to me that the distinction is made after the fact, after you have already decided on the question of recovery.

To put the same point more generally, I am skeptical about whether there is really any one single and simple formula to which the question of whether recovery will be granted can be reduced, and from it will then be possible to deduce solutions to all possible case scenarios. Such "Begriffsjurisprudenz" always seems to be a bit dangerous to me. In the end, I find it difficult to go beyond the fairly trivial proposition that whenever you pay anything to someone else, promise anything or perform any other kind of service, you run the risk that you may not achieve what you intended by it (and, of course, you will generally be pursuing a whole bundle of intentions). Some of the risk will be borne by you, but the law will place some of it on the shoulders of the recipient of whatever it was that you did. In the latter case, English law will speak of "unjust factors" whereas German law will speak of "ungerechtfertigte Bereicherung"; but really these are just shorthand terms for certain ways of allocating these risks. Different legal systems will agree in the allocation of certain risks (for example, you will generally be able to obtain relief for fraud under virtually all legal systems) but disagree elsewhere (for example, under German law you may rescind gifts if you happen to become impoverished within ten years of making them or if the recipient shows gross ingratitude, whereas English law places such risks squarely on the shoulders of the donor). Concepts such as "unjust factors" and "absence of legal ground" are important heuristically, as tools to organise the case law and to make it easy to find reasonable solutions to problems, but neither of them offers any privileged access to any higher reality, and if the law in this area is to develop (and perhaps even to achieve a certain degree of international unification) it would probably be more rewarding to concentrate on discussion of the underlying risk allocation. Or is this too wide and too unspecific a concept to serve any useful purpose in this context?

 

Christoph Coen
Freiburg University, Germany


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