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RDG
online Restitution Discussion Group Archives |
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Many congratulations
to Edwin on the new edition of Lewin. I await the next boat from London
carrying books ... meanwhile, with the arrival of the last one, we can also
say congratulations to Peter Birks on the magnificent achievement of English
Private Law (OUP 2000).
I would also join Edwin in the shameless plug camp to
say that Banner Homes is treated briefly in Kit Barker and Lionel Smith,
"Unjust Enrichment", ch 21 in David Hayton ed Law's Future(s) (Hart 2000),
428, 431, in which a large number of people try, under 22 headings, to
make predictions about where the law is going.
My own reaction upon reading Banner
Homes was mild astonishment that it was decided without noticing the
direction in Australian law towards protecting reliance. To be fair, proprietary
estoppel is mentioned as having something to do with something. We should
fear "Pallant v Morgan equity" because whenever we name something by a
case we are admitting intellectual defeat. I think in Banner Homes there
is no discussion of breach of fiduciary duty and so the holding cannot
be so explained.
Is there authority (in English law, in particular)
for a constructive trust based on advantage to the trustee, rather than
detriment by the beneficiary? I would have thought no trust could be based on that
alone, as generally we allow people to derive advantages. But if we ask
whether there are constructive trusts without detriment in the subtractive
sense, ie the plaintiff's loss of the property now the subject of the
trust (which is the sense in which there was no detriment in Banner Homes),
then I think there are a lot. Even if we put aside constructive trusts
based on wrongdoing, like Meinhard v. Salmon, AG Hong Kong v. Reid, and
Soulos
v. Korkontzilas, there are still a lot, namely every constructive
trust which perfects an intention or which is activated by detrimental
reliance. Into the former (perfecting intention) goes Re Rose. Into one
or the other of perfection or detrimental reliance might go mutual wills,
every secret trust if they are not express, and every trust which arises
when I promise to transfer or declare a trust of specified property and
value has been given for the promise (excepting a promise to transfer
ownership of goods). See generally R Chambers, "Constructive Trusts in
Canada" (1999) 37 Alta L Rev 173.
Peter Birks might fit Banner Homes into subtractive
unjust enrichment by saying that it is a case of interceptive subtraction.
The general difficulty with this angle is that if the plaintiff was entitled
to the asset in question, interceptive subtraction seems unnecessary (as
Peter points out in "At the Expense of the Claimant: Direct and Indirect
Enrichment in English Law" (2000) Oxford U Comparative L Forum 1 at ouclf.iuscomp.org,
at note 45, Re Rose can be understood just in this way, as making an equitable
entitlement out of an opportunity based on transferor's intention, so
making interceptive subtraction unnecessary). On the other hand, if the
plaintiff was not entitled, unjust enrichment/interceptive subtraction
cannot make him so without making a logical circle. The entitlement must
be justified independently.
Detrimental reliance seems to be a good candidate in
Banner Homes; the discussion of "advantage" to the defendant seems to
be nothing more than another way of talking about detrimental reliance,
ie the plaintiff's position now, as measured against what it would be
if the plaintiff had not relied on the defendant's words or actions:
"It is necessary that, in reliance on the arrangement
or understanding, the non-acquiring party should do (or omit to do) something
which confers an advantage on the acquiring party in relation to the acquisition
of the property; or is detrimental to the ability of the non-acquiring
party to acquire the property on equal terms. It is the existence of the
advantage to the one, or detriment to the other, gained or suffered as
a consequence of the arrangement or understanding, which leads to the
conclusion that it would be inequitable or unconscionable to allow the
acquiring party to retain the property for himself, in a manner inconsistent
with the arrangement or understanding which enabled him to acquire it."
"There was evidence, to which I have referred, that the
existence of the arrangement led Banner to regard the site as 'out of
play'; that is to say, the existence of the arrangement made it unnecessary,
and inappropriate, for Banner to consider the site as a potential acquisition
for its own commercial portfolio. But, as the judge himself recognised,
one of the reasons why Luff wanted Banner kept 'on board' -- and so did
not disclose its own doubts as to the future of the joint venture -- was
that, 'if dropped, Banner might emerge as a rival for the site'. In other
words, Luff saw it as an advantage that Banner's belief that the site
was out of play should be maintained. Luff wanted to keep Banner out of
the market."
Lionel <== Previous message Back to index Next message ==> |
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