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Sender:
Charles Mitchell
Date:
Mon, 16 Oct 2006 12:02:39 +0100
Re:
Charter plc v City Index Ltd [2006] EWHC 2508 (Ch)

 

Dear Andrew

I think there are 2 issues here. The first is whether we can meaningfully say, as a matter of everyday language, that a restitutionary claim grounded in UE is a claim 'in respect of damage'.

You say that we can, and I agree, since I subscribe to the view that the law of UE has a corresponding loss requirement - i.e. I don't believe that a claimant can recover on the ground of UE without showing a loss (or 'damage') in his hands which corresponds to the gain in the defendant's hands which is the subject matter of his claim.

Others disagree with this analysis (notably PB), but laying the point to one side, there is anyway a second issue in play, namely whether Parliament intended the 'same damage' requirement in the 1978 Act to bear the same meaning as its everyday meaning. You implicitly suggest that it did, but this is incorrect. The purpose of the 1978 Act was to widen out the scope of statutory contribution claims between wrongdoers, and Parliament, following the Law Commission, specifically excluded from the scope of the 1978 Act, claims in contract for debt, and claims in 'quasi-contract', which are not wrong-based claims. If your reading of the 'damage' requirement in the 1978 Act were correct, then a claim would lie between common debtors under the statute, since they could meaningfully be said to cause their creditor 'damage' if they failed to pay their debt. But we know that they are NOT covered by the statute, and this tells us that 'damage' has a specialised meaning in the context of the Act that enquiries into everyday usage will not help us discover.

 

Best wishes
Charles

 

Quoting Andrew Tettenborn:

I can't see the problem about City Index. Admittedly this is partly because I've always had difficulties with the idea that knowing receipt is about UE rather than wrongs. But even discounting this point, I don't think there's any doubt that a beneficiary suffering loss as a result of knowing receipt can recover that loss from the receiver. And if this is right, whyever not say that this is a liability for "damage?" The undeserving contribution claimant can always be dealt with as Morritt dealt with the claimant in City Index: but there may be situations where a receiver ought to get contribution (e.g. where there is a technical receipt but the receiver is then defrauded of whatever he received without having a chance to benefit from it).


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