========================================================================= Date: Wed, 4 Jul 2007 16:27:08 +1000 Reply-To: Fergus Farrow Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Fergus Farrow Subject: A Positive Law Theory of Contract MIME-Version: 1.0 Content-Type: multipart/alternative; boundary="----=_NextPart_000_0030_01C7BE58.2A617CE0" This is a multi-part message in MIME format. ------=_NextPart_000_0030_01C7BE58.2A617CE0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Dear List Members =20 =20 =20 SSRN Working Paper: "A Positive Law Theory of Contract" =20 May I draw to the attention of list members my paper "A Positive Law = Theory of Contract" which I have recently posted online on the Social = Science Research Network website. It can be downloaded from: = http://ssrn.com/abstract=3D998183 =20 The paper may be of interest to RDG members because, amongst other = things, the positive law theory of contract which I advance has a broad = application to cases involving alterations, contractual and = non-contractual, which parties make to their respective property rights; = and is able to explain conclusively, by reference to underlying legal = principles, the basis of the obligation upon a payee to repay a mistaken = payment. =20 Why a positive law theory of contract? To start with, because = conventional theories of contract, with their preoccupation with the = question as to the moral justification for the use of the force of the = state to enforce contractual obligations, have failed to explain many of = the decisions of the courts in cases involving contractual disputes. An = example of such a failure is the inability of conventional theories to = explain the basis of the decisions of the courts in implied terms cases, = especially in those cases where neither party turned its mind to the = subject matter of the implied term.=20 =20 A further reason to consider a positive law theory of contract is = because we have already replaced, in recent decades, a natural law based = theory of criminal law with a positive law theory of that body of law, = and perhaps a parallel development in contract law may be opportune.=20 =20 What is the ground for a positive law theory? The starting ground for = such a theory is the observation that property is not an inherent = characteristic of the world around us, but, rather, it is an abstract = legal construct. Because it happened millennia ago, we have tended to = forget, in relation to the institution of a regime of property, that the = institution of such a regime required the positive law action (of a = remote predecessor state) to bring such a regime into existence in the = first place.=20 =20 In carrying out that task, the predecessor state had to: (a) make a policy decision to institute a regime of private property; (b) promulgate a definition of the meaning of property; (c) make laws setting down what a person had to do if that person was = to become the first owner of an item of property which had not = previously been owned by any other person; and (d) appoint an adjudicative body with power to resolve disputes between = parties who had set about altering their property rights after becoming, = in accordance with law, the first acquirers of items of property. =20 It is not at all difficult to accept that the above steps involved the = predecessor state using its sovereignty to make practical, secular = positive laws along those lines.=20 =20 The more difficult problem in the development of a positive law theory = of contract is to provide an account of the basis upon which the courts = have acted when they exercised their power to resolve disputes about = whether, and in what manner, the parties had altered their respective = property rights.=20 =20 Natural law theories, of course, deal with that problem on the basis = that the courts have had regard to moral principles when resolving such = disputes. =20 However, in my positive law approach to this problem, I demonstrate that = the decisions of the courts in such cases can be explained on the basis = that the scope of the court's exercise of their power to resolve such = disputes has been constrained impliedly, if not expressly, by a body of = propositions, or principles (in the logical rather than moral sense), = which are logically entailed by the positive law meaning of property=20 =20 This is not to say that the courts have set down expressly the = principles in question, and have then applied those principles expressly = when deciding cases. Indeed, there is no evidence to suggest that they = have followed such a path. =20 However, it may be observed that if, broadly, the decisions of the = courts in relevant cases were not consistent with the meaning of = property, and of the propositions logically entailed by the meaning of = property, then the decisions of the courts in cases involving disputes = about property rights would become, over time, logically incoherent. = Such an outcome would, of course, have been unacceptable to commercial = entities, and, in turn, to the state. Therefore, to the extent that the = body of decisions in question are, on the whole logically coherent, it = follows that the courts have at least had an intuitive awareness of the = need to ensure that their decisions are consistent with the meaning of = property, and with the propositions entailed by that meaning, and have = made their decisions accordingly (in the precedent cases in particular). = =20 Thus, on this argument, the principal task of a positive law theory of = contract is to identify the propositions, or principles, entailed by the = meaning of property, and to test the explanatory value of those = principles by applying them in the examination of the decisions of the = courts in relevant cases.=20 =20 The positive law meaning given to private property, or rather the = meaning given to the ownership of property, is straightforward enough, = namely: an owner of an item of property holds an exclusive right, = recognised and protected by the courts, supported by the power of the = state, to the use and possession of that item of property, subject to = the operation of the law of the state otherwise (including, for example, = the revenue laws).=20 =20 In examining what is entailed by that meaning, it is noted that, in the = absence of a law to the contrary, an owner's exclusive right to the use = of her property extends to her having an exclusive power to alter her = property rights in whatever manner chosen by her.=20 =20 It may be further noted that an owner's exclusive power to alter her = property rights implies, as a matter of legal principle, the principle = that: A cannot alter, unilaterally, the respective property rights of A = and B.=20 =20 It further follows from that non-unilateral principle that if parties = are to alter their respective property rights, they must let each other = know what they are doing, and they must act mutually, resulting in the = principle that: if parties are to alter their respective property rights = in certain respects, then they must communicate, one to the other, the = mutual message that they are altering their property rights in those = respects.=20 =20 There is a corollary to the mutual messages principle, namely that: if = parties communicate, one to the other, the mutual message that they are = altering their respective property rights in certain respects, then they = have altered their rights in those respects (subject to the law = otherwise).=20 =20 There is further principle, namely that because an owner has been = provided by positive law with an exclusive power to alter her property = rights in whatever manner she chooses, then, in the absence of any = positive law authorisation to the contrary, the courts are precluded = from substituting their decision, for the owner's decision, as to how an = owner should have, or may have, altered her property rights.=20 =20 Those principles, once they have been identified, can be applied in the = examination of the decisions of the courts in cases involving disputes = as to whether, and in what manner, parties have altered their respective = property rights. =20 An example of one such class of case is where a court has found that the = contract made by the parties contains an implied term. However, on the = basis of one of the principles implied by the meaning of property, the = court itself is precluded from inserting, of its volition, such a term = into the contract. It therefore follows that the parties, by their = conduct, must have caused the implied term. However, the only way in = which that proposition can make sense is that the parties have = communicated an implied message that their contract contain the implied = term.=20 =20 For this reason my paper contains an examination of the admittedly = complex, and not at all self-evident, rules of social discourse = governing the use of implied messages. However, when those rules of = discourse are applied to the facts of implied terms cases, it can be = shown that the parties have indeed, in such cases, communicated a mutual = implied message that the subject contract is to contain an implied term. = =20 In a later part of the paper, the implied messages analysis is also = applied to cases involving a mistaken payment. Amongst other things, it = is shown that in such cases the parties, in accordance with the complex = rules governing the use of implied messages, have communicated a mutual = implied message that the ownership of the money paid to the payee passes = immediately to the payee, subject to the condition that, should the = payment be discovered subsequently to have been mistaken, the payee is = to hold from that moment onwards an undifferentiated portion of his = assets for the benefit of the payer, with that portion having a money's = worth equal to the amount of the mistaken payment; with, conversely, the = payer having a legally-enforceable claim to the payment to him of that = amount.=20 =20 On that basis, then, the situation of the payer and payee in a mistaken = payment case has parallels with the situation of a lender and borrower = under a loans contract caused by a mutual express contract-making = message communicated by the parties. Under such a loan contract, = ownership of the loan amount passes to the borrower when the loan is = taken down, subject to the condition that the borrower holds, as and = from the due date or due dates, an undifferentiated portion of his = assets for the benefit of the lender, with that portion having a money's = worth equal to the amount of interest and principal payable as and from = the due date, or due dates; with, conversely, the borrower having a = legally-enforceable claim to the amount payable on the due date, or due = dates.=20 =20 Of course, the unjust enrichment account of the basis of a mistaken = payee's obligation to repay is not entirely removed from the explanation = of the obligation grounded in the principles entailed by the meaning of = property. In particular, that unjust enrichment account has a = connotation that unless prevented by law, the mistaken payee would be = unjustly enriched, and hence the law should take the steps necessary to = prevent, or redress, such an injustice. However, such an account is = morally intuitive, rather than that it explains, by reference to = underlying legal principle, the decisions of the courts in mistaken = payment cases. =20 By contrast, the positive law account of the obligation to repay a = mistaken payment is grounded in the principle that a mistaken payee = cannot lay an unconditional claim to the payment made to him because the = parties have not communicated a mutual message, express or implied, that = he held an unconditional claim to the money. Conversely, the positive = law account of the obligation says that the parties communicated a = mutual implied message that the payment was conditional, with the payee = having a legal obligation to repay if, and when, it was discovered that = the payment was mistaken. to repay apy by him claim to=20 =20 If list members want to examine the argument on this issue in more = detail they may do so by downloading the paper in full from the SSRN = site. They may also find the broader application of the positive law = theory of contract to the decision in Smith v Hughes; the basis of = contractual obligation; the doctrine of consideration; and the doctrine = of promissory estoppel to be of interest as well.=20 =20 =20 Fergus Farrow Owen Dixon Chambers West.=20 =20 Fergus Farrow Barrister-at-Law C/- Clerk Green Owen Dixon Chambers West 525 Lonsdale St Melbourne Vic 3000 Australia=20 Phone: (61 3) 9225-6526 mobile: 0412-130-585 Fax: (61 3) 9225-7884 = DX 98 email: fefarrow@vicbar.com.au ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, . ------=_NextPart_000_0030_01C7BE58.2A617CE0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable

Dear List Members   

 

 

SSRN = Working=20 Paper:  =93A Positive Law = Theory of=20 Contract=94

 

May I draw to the attention of list members my paper =93A = Positive Law=20 Theory of Contract=94 which I have recently posted online on the Social = Science=20 Research Network website. It can be downloaded from: http://ssrn.com/abstract=3D998183

 

The paper may be of interest to RDG members because, amongst = other=20 things, the positive law theory of contract which I advance has a broad=20 application to cases involving alterations, contractual and = non-contractual,=20 which parties make to their respective property rights; and is able to = explain=20 conclusively, by reference to underlying legal principles, the basis of = the=20 obligation upon a payee to repay a mistaken payment.

 

Why a positive law theory of contract? To start with, because=20 conventional theories of contract, with their preoccupation with the = question as=20 to the moral justification for the use of the force of the state to = enforce=20 contractual obligations, have failed to explain many of the decisions of = the=20 courts in cases involving contractual disputes. An example of such a = failure is=20 the inability of conventional theories to explain the basis of the = decisions of=20 the courts in implied terms cases, especially in those cases where = neither party=20 turned its mind to the subject matter of the implied term.

 

A further reason to consider a positive law theory of contract = is because=20 we have already replaced, in recent decades, a natural law based theory = of=20 criminal law with a positive law theory of that body of law, and perhaps = a=20 parallel development in contract law may be opportune.

 

What is the ground for a positive law theory? The starting = ground for=20 such a theory is the observation that property is not an inherent = characteristic=20 of the world around us, but, rather, it is an abstract legal construct. = Because=20 it happened millennia ago, we have tended to forget, in relation to the=20 institution of a regime of property, that the institution of such a = regime=20 required the positive law = action (of=20 a remote predecessor state) to bring such a regime into existence in the = first=20 place.

 

In carrying out that task, the predecessor state had = to:

(a)  =20 make a policy decision to institute a regime of private=20 property;

(b) =20 promulgate a definition of the meaning of property;

(c)  =20 make laws setting down what a person had to do if that person was = to=20 become the first owner of an item of property which had not previously = been=20 owned by any other person; and

(d) =20 appoint an adjudicative body with power to resolve disputes = between=20 parties who had set about altering=20 their property rights after becoming, in accordance with law, the = first=20 acquirers of items of property.

 

It is not at all difficult to accept that the above steps = involved the=20 predecessor state using its sovereignty to make practical, secular = positive laws=20 along those lines.

 

The more difficult problem in the development of a positive law = theory of=20 contract is to provide an account of the basis upon which the courts = have acted=20 when they exercised their power to resolve disputes about whether, and = in what=20 manner, the parties had altered their respective property rights. =

 

Natural law theories, of course, deal with that problem on the = basis that=20 the courts have had regard to moral principles when resolving such=20 disputes.

 

However, in my positive law approach to this problem, I = demonstrate that=20 the decisions of the courts in such cases can be explained on the basis = that the=20 scope of the court=92s exercise of their power to resolve such disputes = has been=20 constrained impliedly, if not expressly, by a body of propositions, or=20 principles (in the logical rather than moral sense), which are logically = entailed by the positive law meaning=20 of property

 

This is not to say that the courts have set down expressly the = principles=20 in question, and have then applied those principles expressly when = deciding=20 cases. Indeed, there is no evidence to suggest that they have followed = such a=20 path.

 

However, it may be observed that if, broadly, the decisions of = the courts=20 in relevant cases were not consistent with the meaning of property, and = of the=20 propositions logically entailed by the meaning of property, then the = decisions=20 of the courts in cases involving disputes about property rights would = become, over=20 time, logically incoherent. Such an outcome would, of course, have been=20 unacceptable to commercial entities, and, in turn, to the state. = Therefore, to=20 the extent that the body of decisions in question are, on the whole = logically=20 coherent, it follows that the courts have at least had an intuitive = awareness of=20 the need to ensure that their decisions are consistent with the meaning = of=20 property, and with the propositions entailed by that meaning, and have = made=20 their decisions accordingly (in the precedent cases in particular). =

 

Thus, on this argument, the principal task of a positive law = theory of=20 contract is to identify the propositions, or principles, entailed by the = meaning=20 of property, and to test the explanatory value of those principles by = applying=20 them in the examination of the decisions of the courts in relevant = cases.=20

 

The positive law meaning given to private property, or rather = the meaning=20 given to the ownership of property, is straightforward enough, namely: = an owner=20 of an item of property holds an exclusive right, recognised and = protected by the=20 courts, supported by the power of the state, to the use and possession = of that=20 item of property, subject to the operation of the law of the state = otherwise=20 (including, for example, the revenue laws).

 

In examining what is entailed by that meaning, it is noted = that, in the=20 absence of a law to the contrary, an owner=92s exclusive right to the = use of her=20 property extends to her having an exclusive power to alter her property = rights=20 in whatever manner chosen by her.

 

It may be further noted that an owner=92s exclusive power to alter her = property=20 rights implies, as a matter of legal principle, the principle that: A = cannot=20 alter, unilaterally, the respective property rights of A and B. =

 

It further follows from that non-unilateral principle that if = parties are=20 to alter their respective property rights, they must let each other know = what=20 they are doing, and they must act mutually, resulting in the principle = that: if=20 parties are to alter their respective property rights in certain = respects, then=20 they must communicate, one to the other, the mutual message that they = are=20 altering their property rights in those respects.

 

There is a corollary to the mutual messages = principle,=20 namely that: if parties communicate, one to the other, the mutual = message that=20 they are altering their respective property rights in certain respects, = then=20 they have altered their = rights in=20 those respects (subject to the law otherwise). =

 

There is further principle, namely that because an owner has = been=20 provided by positive law with an exclusive power to alter her property = rights in=20 whatever manner she chooses, then, in the absence of any positive law=20 authorisation to the contrary, the courts are precluded from = substituting their=20 decision, for the owner=92s decision, as to how an owner should have, or = may have,=20 altered her property rights.

 

Those principles, once they have been identified, can be = applied in the=20 examination of the decisions of the courts in cases involving disputes = as to=20 whether, and in what manner, parties have altered their respective = property=20 rights.

 

An example of one such class of case is where a court has found = that the=20 contract made by the parties contains an implied term. However, on the = basis of=20 one of the principles implied by the meaning of property, the court = itself is=20 precluded from inserting, of its volition, such a term into the = contract. It=20 therefore follows that the parties, by their conduct, must have caused = the implied term. However, the = only way in=20 which that proposition can make sense is that the parties have = communicated an=20 implied message that their = contract=20 contain the implied term.

 

For this reason my paper contains an examination of the = admittedly=20 complex, and not at all self-evident, rules of social discourse = governing the=20 use of implied messages. However, when those rules of discourse are = applied to=20 the facts of implied terms cases, it can be shown that the parties have = indeed,=20 in such cases, communicated a mutual implied message that the = subject=20 contract is to contain an implied term.

 

In a later part of the paper, the implied messages analysis is = also=20 applied to cases involving a mistaken payment. Amongst other things, it = is shown=20 that in such cases the parties, in accordance with the complex rules = governing=20 the use of implied messages, have communicated a mutual implied message that the = ownership of=20 the money paid to the payee passes immediately to the payee, subject to = the=20 condition that, should the payment be discovered subsequently to have = been=20 mistaken, the payee is to hold from that moment onwards an = undifferentiated=20 portion of his assets for the benefit of the payer, with that portion = having a=20 money=92s worth equal to the amount of the mistaken payment; with, = conversely, the=20 payer having a legally-enforceable claim to the payment to him of that = amount.=20

 

On that basis, then, the situation of the payer and payee in a = mistaken=20 payment case has parallels with the situation of a lender and borrower = under a=20 loans contract caused by a mutual express contract-making message = communicated=20 by the parties. Under such a loan contract, ownership of the loan amount = passes=20 to the borrower when the loan is taken down, subject to the condition = that the=20 borrower holds, as and from the due date or due dates, an = undifferentiated=20 portion of his assets for the benefit of the lender, with that portion = having a=20 money=92s worth equal to the amount of interest and principal payable as = and from=20 the due date, or due dates; with, conversely, the borrower having a=20 legally-enforceable claim to the amount payable on the due date, or due = dates.=20

 

Of course, the unjust enrichment account of the basis of a = mistaken=20 payee=92s obligation to repay is not entirely removed from the = explanation of the=20 obligation grounded in the principles entailed by the meaning of = property. In=20 particular, that unjust enrichment account has a connotation that unless = prevented by law, the mistaken payee would be unjustly enriched, and = hence the=20 law should take the steps necessary to prevent, or redress, such an = injustice.=20 However, such an account is morally intuitive, rather than that it explains, by reference to = underlying=20 legal principle, the decisions of the courts in mistaken payment=20 cases.

 

By contrast, the positive law account of the obligation to = repay a=20 mistaken payment is grounded in the principle that a mistaken payee = cannot lay=20 an unconditional claim to the payment made to him because the parties = have not=20 communicated a mutual message, express or implied, that he held an = unconditional=20 claim to the money. Conversely, the positive law account of the = obligation says=20 that the parties communicated a mutual implied message that the payment = was=20 conditional, with the payee having a legal obligation to repay if, and = when, it=20 was discovered that the payment was mistaken. to repay apy by him claim = to=20

 

If list members want to examine the argument on = this=20 issue in more detail they may do so by downloading the paper in full = from the=20 SSRN site. They may also find the broader application of the positive = law theory=20 of contract to the decision in Smith v=20 Hughes; the basis of contractual obligation; the doctrine of = consideration;=20 and the doctrine of promissory estoppel to be of interest as well.=20

 

 

Fergus Farrow

Owen Dixon Chambers West. =

 

Fergus=20 Farrow
Barrister-at-Law
C/- Clerk Green
Owen = Dixon=20 Chambers West
525 Lonsdale St
 Melbourne=20 Vic=20 3000
Australia=20

Phone: (61 3) 9225-6526   mobile: 0412-130-585   Fax: (61 3) 9225-7884   DX 98
email: fefarrow@vicbar.com.au

____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to <listserv@lists.mcgill.ca>. To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to <enrichment@lists.mcgill.ca>. The list is run by Lionel Smith of McGill University, <lionel.smith@mcgill.ca>. ------=_NextPart_000_0030_01C7BE58.2A617CE0-- ========================================================================= Date: Fri, 6 Jul 2007 13:51:56 +0100 Reply-To: James Lee Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: James Lee Subject: Payment under Compulsion of Law MIME-Version: 1.0 Content-Type: multipart/alternative; boundary="----_=_NextPart_001_01C7BFCC.6CF9401C" This is a multi-part message in MIME format. ------_=_NextPart_001_01C7BFCC.6CF9401C Content-Type: text/plain; charset="us-ascii" Content-Transfer-Encoding: quoted-printable Dear All, =20 Members may wish to note this week's decision from the Court of Appeal in McCarthy v McCarthy & Stone Plc [2007] EWCA Civ 664: http://www.bailii.org/ew/cases/EWCA/Civ/2007/664.html =20 Of interest is the Company's counterclaim (para 32 and following), which was for the restitution of money paid under compulsion of law within the context of a Company's discharge of income tax and national insurance liabilities. The appeal against Peter Smith J's decision to grant summary judgment on the counterclaim was dismissed. =20 Best wishes, =20 James Lee =20 -- James Lee Teaching Fellow School of Law University of Reading Foxhill House, rm. 2.09 Whiteknights Road, Earley Reading RG6 7BA United Kingdom =20 Phone: +44 (0) 118 3785643 Fax: +44 (0) 118 3784543 Email: J.S.Lee@reading.ac.uk Web: www.reading.ac.uk/law =20 =20 ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, . ------_=_NextPart_001_01C7BFCC.6CF9401C Content-Type: text/html; charset="us-ascii" Content-Transfer-Encoding: quoted-printable

Dear All,

 

Members may wish to note this week's decision from = the Court of Appeal in McCarthy v McCarthy = & Stone Plc [2007] EWCA Civ 664: http://www= .bailii.org/ew/cases/EWCA/Civ/2007/664.html

 

Of interest is the Company’s counterclaim (para = 32 and following), which was for the restitution of money paid under compulsion = of law within the context of a Company’s discharge of income tax and = national insurance liabilities. The appeal against Peter Smith J’s decision = to grant summary judgment on the counterclaim was = dismissed.

 

Best wishes,

 

James Lee

 

--

James Lee

Teaching Fellow

School of Law

University of Reading

Foxhill House, rm. 2.09

Whiteknights Road, Earley

Reading RG6 7BA

United Kingdom

 

Phone: +44 (0) 118 3785643

Fax: +44 (0) 118 3784543

Email: J.S.Lee@reading.ac.uk

Web: www.reading.ac.uk/law

 

 

____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to <listserv@lists.mcgill.ca>. To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to <enrichment@lists.mcgill.ca>. The list is run by Lionel Smith of McGill University, <lionel.smith@mcgill.ca>. ------_=_NextPart_001_01C7BFCC.6CF9401C-- ========================================================================= Date: Thu, 19 Jul 2007 08:34:05 +0000 Reply-To: James Edelman Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: James Edelman Subject: Sempra Comments: cc: obligations@uwo.ca In-Reply-To: Mime-Version: 1.0 Content-Type: text/plain; format=flowed Content-Transfer-Encoding: quoted-printable Dear Neil and others I think the difference between Lords Hope, Nicholls and Walker (on the on= e=20 hand) and Lords Mance and Scott (on the other) is that the former recogni= ze=20 two different measures of benefit. It is particularly clear, especially f= rom=20 paragraphs [32], [117] and [178]-[180] that each of the former recognizes= =20 that the free use of an asset (here, money) obtained unjustly from anothe= r=20 is a benefit which is quite distinct from the actual profits derived from= =20 that use. The latter measure (an account of profits, or disgorgement) is= a=20 familiar measure when courts want to strip profits from a fiduciary or in= =20 cases of deliberately committed wrongdoing, such as breach of confidence.= =20 In my view such profit stripping is appropriate only in cases where=20 deterrence is needed (including for prophylactic or general deterrent=20 purposes). These three Lords are recognizing that the free use of an asse= t=20 obtained unjustly is a separate measure of benefit. Unlike actual profits= =20 (which might be far greater, or far less, than the cost of use, and which= =20 may depend on pure chance), this restitutionary measure is derived =91at = the=20 expense of=92 the claimant [179]. Although the free use of an asset (something which, in commerce, everyone= =20 has to pay for) is an enrichment, difficulties can arise. For instance, h= ow=20 should the market value of the benefit be measured? There is no single=20 market value for the use of money. Different people will pay different ra= tes=20 to borrow money. The majority fix upon the rate at which the Government=20 would have had to pay to borrow the money. That is the objective value of= =20 the money to a person in the defendant=92s position. The biggest concern, ventilated at the hearing of the case, was the=20 situation where the defendant obtains the free use of money but does not=20 employ the money productively. Either puts it under her pillow or in a=20 current account. Different labels are suggested: =93equitable defence=94,= =20 =93subjective devaluation=94. What seems to be common to a majority is th= at this=20 is (1) a matter for the defendant to prove; (2) it is not truly =91subjec= tive=92=20 in the sense that it does not depend on the defendant=92s particular,=20 idiosyncratic values (the defendant=92s personal opinions about the value= of=20 money are irrelevant); (3) it will not always be available (for instance,= if=20 the defendant knew that he or she was the recipient of a mistaken payment= ).=20 In my view, the elements of this defence that the Lords are describing ar= e=20 identical to the test for change of position. A defendant that has the=20 valuable benefit of the free use of money but, in good faith, dissipates = the=20 time value of that use by not employing the money productively, has chang= ed=20 her position just as a defendant who fails to seek more profitable=20 employment elsewhere following a mistaken payment (Commerzbank AG v Price= =20 Jones). Lord Nicholls seems to notice this point, but leaves it open at=20 [119]. James Edelman ________________________________________ From: owner-obligations@uwo.ca [mailto:owner-obligations@uwo.ca] On Behal= f=20 Of Neil Foster Sent: 19 July 2007 08:21 To: obligations@uwo.ca Subject: ODG: Restitution and Interest- House of Lords, Sempra Dear Colleagues; I'd be interested to see others' comments on the decision of the House of= =20 Lords in Sempra Metals Limited (formerly Metallgesellschaft Limited)=20 (Respondents) v. Her Majesty's Commissioners of Inland Revenue and anothe= r=20 (Appellants) [2007] UKHL 34=20 http://www.publications.parliament.uk/pa/ld200607/ldjudgmt/jd070718/sempr= a-1.htm=20 =2E The two main features of the judgement, on a quick reading, seem to be (1) over-ruling previous authority that no interest can be awarded at com= mon=20 law on damages for late payment of a debt or damages (a position, as the=20 House generally notes, reached some years ago by the High Court of Austra= lia=20 in Hungerfords v Walker (1989) 171 CLR 125); (2) comments on the awarding of interest in a claim for restitution based= on=20 mistake, rather than a tort. On the second issue there seems to be a 3-2 majority holding that where=20 someone has made a mistaken payment which can be recovered under the=20 principles of unjust enrichment, then when the money is recovered there w= ill=20 usually be a claim for payment of compound interest. If in fact the perso= n=20 who had the use of the money did not invest it or otherwise get value fro= m=20 it, then the court should have a discretion to depart from this figure in= a=20 "subjective devaluation" (see eg Lord Nicholls at [119], generally agreed= =20 with by Lords Hoffmann and Walker). The dissenters (Lords Scott and Mance) accept that compound interest may = be=20 OK where a restitutionary remedy is required for wrongdoing, but argue th= at=20 in a case of mistake all the defendant is required to do is to account fo= r=20 the benefit he or she in fact enjoyed, and hence compound interest will n= ot=20 always be appropriate. (If they put it under the bed- Lord Mance, [233],=20 then they are only required to pay back the actual principal.) I must say the fact that the majority have to resort to what my old=20 philosophy lecturer used to call the "arm-waving" notion of a case-by-cas= e=20 "subjective devaluation" makes me fairly sympathetic to the minority on t= his=20 point. Regards Neil Foster Neil Foster Newcastle Law School Faculty of Business & Law University of Newcastle Callaghan NSW 2308 AUSTRALIA ph 02 4921 7430 fax 02 4921 6931 _________________________________________________________________ Advertisement: Crowded House Time on Earth =96 catch them live in=A0the U= SA!=20 http://ninemsn.com.au/share/redir/adTrack.asp?mode=3Dclick&clientID=3D800= &referral=3Dhotmailtagline&URL=3Dhttp://music.ninemsn.com.au/compIntro.as= px?compId=3D2416 ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, . ========================================================================= Date: Thu, 19 Jul 2007 11:04:04 +0100 Reply-To: Elise Bant Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: Elise Bant Subject: Re: Sempra In-Reply-To: MIME-Version: 1.0 Content-Type: multipart/alternative; boundary="----=_Part_136648_26318253.1184839444370" ------=_Part_136648_26318253.1184839444370 Content-Type: text/plain; charset=WINDOWS-1252; format=flowed Content-Transfer-Encoding: quoted-printable Content-Disposition: inline I agree with James. I would add that it seems to have been assumed that the Government was an 'innocent' recipient and, on that basis, the change of position defence should be open. But there are two further, related issues, both of which raise a possible policy bar to the defence. The first is that the Government obtained the benefit in breach of statute. On the unjust enrichment claim, that breach is incidental to the action and so might be thought to be irrelevant to the application of the defence (the Government is only an 'incidental' wrongdoer and so the bar alluded to by Lord Goff is Lipkin Gorman should not apply.). The second is that one of the pleaded grounds for restitution - namely that the benefit was conferred pursuant to an unlawful demand - may not be the kind of claim to which the defence automatically applies. In both cases, I think it would be necessary to consider whether permitting the change of position defence would undermine the policy of the statute in question. Elise Bant On 7/19/07, James Edelman wrote: > > Dear Neil and others > > I think the difference between Lords Hope, Nicholls and Walker (on the on= e > hand) and Lords Mance and Scott (on the other) is that the former > recognize > two different measures of benefit. It is particularly clear, especially > from > paragraphs [32], [117] and [178]-[180] that each of the former recognizes > that the free use of an asset (here, money) obtained unjustly from anothe= r > is a benefit which is quite distinct from the actual profits derived from > that use. The latter measure (an account of profits, or disgorgement) is > a > familiar measure when courts want to strip profits from a fiduciary or in > cases of deliberately committed wrongdoing, such as breach of confidence. > In my view such profit stripping is appropriate only in cases where > deterrence is needed (including for prophylactic or general deterrent > purposes). These three Lords are recognizing that the free use of an asse= t > obtained unjustly is a separate measure of benefit. Unlike actual profits > (which might be far greater, or far less, than the cost of use, and which > may depend on pure chance), this restitutionary measure is derived 'at th= e > expense of' the claimant [179]. > > Although the free use of an asset (something which, in commerce, everyone > has to pay for) is an enrichment, difficulties can arise. For instance, > how > should the market value of the benefit be measured? There is no single > market value for the use of money. Different people will pay different > rates > to borrow money. The majority fix upon the rate at which the Government > would have had to pay to borrow the money. That is the objective value of > the money to a person in the defendant's position. > > The biggest concern, ventilated at the hearing of the case, was the > situation where the defendant obtains the free use of money but does not > employ the money productively. Either puts it under her pillow or in a > current account. Different labels are suggested: "equitable defence", > "subjective devaluation". What seems to be common to a majority is that > this > is (1) a matter for the defendant to prove; (2) it is not truly > 'subjective' > in the sense that it does not depend on the defendant's particular, > idiosyncratic values (the defendant's personal opinions about the value o= f > money are irrelevant); (3) it will not always be available (for instance, > if > the defendant knew that he or she was the recipient of a mistaken > payment). > In my view, the elements of this defence that the Lords are describing ar= e > identical to the test for change of position. A defendant that has the > valuable benefit of the free use of money but, in good faith, dissipates > the > time value of that use by not employing the money productively, has > changed > her position just as a defendant who fails to seek more profitable > employment elsewhere following a mistaken payment (Commerzbank AG v Price > Jones). Lord Nicholls seems to notice this point, but leaves it open at > [119]. > > James Edelman > ________________________________________ > From: owner-obligations@uwo.ca [mailto:owner-obligations@uwo.ca] On Behal= f > Of Neil Foster > Sent: 19 July 2007 08:21 > To: obligations@uwo.ca > Subject: ODG: Restitution and Interest- House of Lords, Sempra > > Dear Colleagues; > I'd be interested to see others' comments on the decision of the House of > Lords in Sempra Metals Limited (formerly Metallgesellschaft Limited) > (Respondents) v. Her Majesty's Commissioners of Inland Revenue and anothe= r > (Appellants) [2007] UKHL 34 > > http://www.publications.parliament.uk/pa/ld200607/ldjudgmt/jd070718/sempr= a-1.htm > . > The two main features of the judgement, on a quick reading, seem to be > (1) over-ruling previous authority that no interest can be awarded at > common > law on damages for late payment of a debt or damages (a position, as the > House generally notes, reached some years ago by the High Court of > Australia > in Hungerfords v Walker (1989) 171 CLR 125); > (2) comments on the awarding of interest in a claim for restitution based > on > mistake, rather than a tort. > On the second issue there seems to be a 3-2 majority holding that where > someone has made a mistaken payment which can be recovered under the > principles of unjust enrichment, then when the money is recovered there > will > usually be a claim for payment of compound interest. If in fact the perso= n > who had the use of the money did not invest it or otherwise get value fro= m > it, then the court should have a discretion to depart from this figure in > a > "subjective devaluation" (see eg Lord Nicholls at [119], generally agreed > with by Lords Hoffmann and Walker). > The dissenters (Lords Scott and Mance) accept that compound interest may > be > OK where a restitutionary remedy is required for wrongdoing, but argue > that > in a case of mistake all the defendant is required to do is to account fo= r > the benefit he or she in fact enjoyed, and hence compound interest will > not > always be appropriate. (If they put it under the bed- Lord Mance, [233], > then they are only required to pay back the actual principal.) > I must say the fact that the majority have to resort to what my old > philosophy lecturer used to call the "arm-waving" notion of a case-by- cas= e > "subjective devaluation" makes me fairly sympathetic to the minority on > this > point. > Regards > Neil Foster > > Neil Foster > Newcastle Law School > Faculty of Business & Law > University of Newcastle > Callaghan NSW 2308 > AUSTRALIA > ph 02 4921 7430 > fax 02 4921 6931 > > _________________________________________________________________ > Advertisement: Crowded House Time on Earth =96 catch them live inthe USA! > > http://ninemsn.com.au/share/redir/adTrack.asp?mode=3Dclick&clientID=3D800= &referral=3Dhotmailtagline&URL=3Dhttp://music.ninemsn.com.au/compIntro.aspx = ?compId=3D2416 > > ____________________________________________________________________ > This message was delivered through the Restitution Discussion Group, > an international internet LISTSERV devoted to all aspects of the law > of unjust enrichment. To subscribe, send "subscribe enrichment" in > the body of a message to . To unsubscribe, > send "signoff enrichment" to the same address. To make a posting to > all group members, send to . The list is > run by Lionel Smith of McGill University, . > ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, . ------=_Part_136648_26318253.1184839444370 Content-Type: text/html; charset=WINDOWS-1252 Content-Transfer-Encoding: quoted-printable Content-Disposition: inline
I agree with James. I would add that it seems to have been assumed tha= t the Government was an 'innocent' recipient and, on that basis, th= e change of position defence should be open. But there are two further, rel= ated issues, both of which raise a possible policy bar to the defence.= The first is that the Government obtained the benefit in breach of st= atute. On the unjust enrichment claim, that breach is incidental to the act= ion and so might be thought to be irrelevant to the application of the defe= nce (the Government is only an 'incidental' wrongdoer and so the ba= r alluded to by Lord Goff is Lipkin Gorman should not apply.). The sec= ond is that one of the pleaded grounds for restitution - namely that t= he benefit was conferred pursuant to an unlawful demand - may not be the ki= nd of claim to which the defence automatically applies. In both cases, I th= ink it would be necessary to consider whether permitting the change of posi= tion defence would undermine the policy of the statute in question.
 
Elise Bant

 
On 7/19/07, = James Edelman <james_ed= elman@hotmail.com> wrote:
Dear Neil and others

I th= ink the difference between Lords Hope, Nicholls and Walker (on the one
hand) and Lords Mance and Scott (on the other) is that the former recognize=
two different measures of benefit. It is particularly clear, especially= from
paragraphs [32], [117] and [178]-[180] that each of the former rec= ognizes
that the free use of an asset (here, money) obtained unjustly from anot= her
is a benefit which is quite distinct from the actual profits derived= from
that use.  The latter measure (an account of profits, or= disgorgement) is a
familiar measure when courts want to strip profits from a fiduciary or = in
cases of deliberately committed wrongdoing, such as breach of confide= nce.
In my view such profit stripping is appropriate only in cases where
deterrence is needed (including for prophylactic or general deterrentpurposes). These three Lords are recognizing that the free use of an asse= t
obtained unjustly is a separate measure of benefit. Unlike actual prof= its
(which might be far greater, or far less, than the cost of use, and whi= ch
may depend on pure chance), this restitutionary measure is derived 'a= t the
expense of' the claimant [179].

Although the free use of an= asset (something which, in commerce, everyone
has to pay for) is an enrichment, difficulties can arise. For instance,= how
should the market value of the benefit be measured? There is no sin= gle
market value for the use of money. Different people will pay differe= nt rates
to borrow money. The majority fix upon the rate at which the Government=
would have had to pay to borrow the money. That is the objective value = of
the money to a person in the defendant's position.

The biggest= concern, ventilated at the hearing of the case, was the
situation where the defendant obtains the free use of money but does no= t
employ the money productively.  Either puts it under her pil= low or in a
current account. Different labels are suggested: "equitable = defence",
"subjective devaluation". What seems to be common to a majority is that= this
is (1) a matter for the defendant to prove; (2) it is not truly 's= ubjective'
in the sense that it does not depend on the defendant's parti= cular,
idiosyncratic values (the defendant's personal opinions about the value= of
money are irrelevant); (3) it will not always be available (for inst= ance, if
the defendant knew that he or she was the recipient of a mistak= en payment).
In my view, the elements of this defence that the Lords are describing = are
identical to the test for change of position. A defendant that has t= he
valuable benefit of the free use of money but, in good faith, dissipa= tes the
time value of that use by not employing the money productively, has cha= nged
her position just as a defendant who fails to seek more profitable<= br>employment elsewhere following a mistaken payment (Commerzbank AG v Pric= e
Jones). Lord Nicholls seems to notice this point, but leaves it open at=
[119].

James Edelman
________________________________________=
From: owner- obligations@uwo= .ca [mailto:owner- obligations@= uwo.ca] On Behalf
Of Neil Foster
Sent: 19 July 2007 08:21
To: = obligations@uwo.ca
Subject: OD= G: Restitution and Interest- House of Lords, Sempra

Dear Colleagues;
I'd be interested to see others' commen= ts on the decision of the House of
Lords in Sempra Metals Limited (forme= rly Metallgesellschaft Limited)
(Respondents) v. Her Majesty's Commi= ssioners of Inland Revenue and another
(Appellants) [2007] UKHL 34
http://www.publication= s.parliament.uk/pa/ld200607/ldjudgmt/jd070718/sempra-1.htm
.
The = two main features of the judgement, on a quick reading, seem to be
(1) over-ruling previous authority that no interest can be awarded at c= ommon
law on damages for late payment of a debt or damages (a position, = as the
House generally notes, reached some years ago by the High Court o= f Australia
in Hungerfords v Walker (1989) 171 CLR 125);
(2) comments on the awa= rding of interest in a claim for restitution based on
mistake, rather th= an a tort.
On the second issue there seems to be a 3-2 majority holding = that where
someone has made a mistaken payment which can be recovered under theprinciples of unjust enrichment, then when the money is recovered there wi= ll
usually be a claim for payment of compound interest. If in fact the p= erson
who had the use of the money did not invest it or otherwise get value f= rom
it, then the court should have a discretion to depart from this figu= re in a
"subjective devaluation" (see eg Lord Nicholls at [119= ], generally agreed
with by Lords Hoffmann and Walker).
The dissenters (Lords Scott and = Mance) accept that compound interest may be
OK where a restitutionary re= medy is required for wrongdoing, but argue that
in a case of mistake all= the defendant is required to do is to account for
the benefit he or she in fact enjoyed, and hence compound interest will= not
always be appropriate. (If they put it under the bed- Lord Mance, [= 233],
then they are only required to pay back the actual principal.)
I must say the fact that the majority have to resort to what my old
= philosophy lecturer used to call the "arm-waving" notion of a cas= e-by-case
"subjective devaluation" makes me fairly sympathetic= to the minority on this
point.
Regards
Neil Foster

Neil Foster
Newcastle Law Sc= hool
Faculty of Business & Law
University of Newcastle
Callagh= an NSW 2308
AUSTRALIA
ph 02 4921 7430
fax 02 4921 6931

_________________________________________________________________
Advert = isement: Crowded House Time on Earth =96 catch them live inthe USA!
http://ninemsn.com.au/share/redir/adTrack.asp?mode=3Dclick&clientID=3D8= 00&referral=3Dhotmailtagline&URL=3Dhttp://music.ninemsn.com.au/comp = Intro.aspx?compId=3D2416

_______________________________________ = _____________________________
This message was delivered through the Restitution Discussion Group,an international internet LISTSERV devoted to all aspects of the law
of= unjust enrichment. To subscribe, send "subscribe enrichment" in
the body of a message to <listserv@lists.mcgill.ca>. To unsubscribe,
send "signoff e= nrichment" to the same address. To make a posting to
all group memb= ers, send to < enrichment@lists.mcgill.ca>. The list is
run by Lionel Smith of McGill University, <lionel.smith@mcgill.ca>.

____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to <listserv@lists.mcgill.ca>. To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to <enrichment@lists.mcgill.ca>. The list is run by Lionel Smith of McGill University, <lionel.smith@mcgill.ca>. ------=_Part_136648_26318253.1184839444370-- ========================================================================= Date: Thu, 19 Jul 2007 10:51:17 +0000 Reply-To: James Edelman Sender: Enrichment - Restitution & Unjust Enrichment Legal Issues From: James Edelman Subject: Re: Sempra Comments: To: elisebant@gmail.com In-Reply-To: <4540fd6a0707190304k43ac85ben80bc9ff1c281d781@mail.gmail.com> Mime-Version: 1.0 Content-Type: text/plain; format=flowed Content-Transfer-Encoding: quoted-printable I don't think any of this was assumed on the facts of the case. Indeed,=20 Sempra argued that if the Government had changed its position then bars,=20 such as the unlawful nature of the demand, would apply. But, just as it w= as=20 unnecessary to decide the appropriate label to put on this defence, it wa= s=20 also unnecessary to explore its scope because there was no evidence that = the=20 Government had dissipated the time value of the money. But, in future cas= es,=20 the scope of this defence (however it is labelled) will be of crucial=20 importance. JE >From: Elise Bant >Reply-To: Elise Bant >To: ENRICHMENT@LISTS.MCGILL.CA >Subject: Re: [RDG] Sempra >Date: Thu, 19 Jul 2007 11:04:04 +0100 > >I agree with James. I would add that it seems to have been assumed that = the >Government was an 'innocent' recipient and, on that basis, the change of >position defence should be open. But there are two further, related issu= es, >both of which raise a possible policy bar to the defence. The first is t= hat >the Government obtained the benefit in breach of statute. On the unjust >enrichment claim, that breach is incidental to the action and so might b= e >thought to be irrelevant to the application of the defence (the Governme= nt >is only an 'incidental' wrongdoer and so the bar alluded to by Lord Goff= is >Lipkin Gorman should not apply.). The second is that one of the pleaded >grounds for restitution - namely that the benefit was conferred pursuant= to >an unlawful demand - may not be the kind of claim to which the defence >automatically applies. In both cases, I think it would be necessary to >consider whether permitting the change of position defence would undermi= ne >the policy of the statute in question. > >Elise Bant > > >On 7/19/07, James Edelman wrote: >> >>Dear Neil and others >> >>I think the difference between Lords Hope, Nicholls and Walker (on the = one >>hand) and Lords Mance and Scott (on the other) is that the former >>recognize >>two different measures of benefit. It is particularly clear, especially >>from >>paragraphs [32], [117] and [178]-[180] that each of the former recogniz= es >>that the free use of an asset (here, money) obtained unjustly from anot= her >>is a benefit which is quite distinct from the actual profits derived fr= om >>that use. The latter measure (an account of profits, or disgorgement) = is >>a >>familiar measure when courts want to strip profits from a fiduciary or = in >>cases of deliberately committed wrongdoing, such as breach of confidenc= e. >>In my view such profit stripping is appropriate only in cases where >>deterrence is needed (including for prophylactic or general deterrent >>purposes). These three Lords are recognizing that the free use of an as= set >>obtained unjustly is a separate measure of benefit. Unlike actual profi= ts >>(which might be far greater, or far less, than the cost of use, and whi= ch >>may depend on pure chance), this restitutionary measure is derived 'at = the >>expense of' the claimant [179]. >> >>Although the free use of an asset (something which, in commerce, everyo= ne >>has to pay for) is an enrichment, difficulties can arise. For instance, >>how >>should the market value of the benefit be measured? There is no single >>market value for the use of money. Different people will pay different >>rates >>to borrow money. The majority fix upon the rate at which the Government >>would have had to pay to borrow the money. That is the objective value = of >>the money to a person in the defendant's position. >> >>The biggest concern, ventilated at the hearing of the case, was the >>situation where the defendant obtains the free use of money but does no= t >>employ the money productively. Either puts it under her pillow or in a >>current account. Different labels are suggested: "equitable defence", >>"subjective devaluation". What seems to be common to a majority is that >>this >>is (1) a matter for the defendant to prove; (2) it is not truly >>'subjective' >>in the sense that it does not depend on the defendant's particular, >>idiosyncratic values (the defendant's personal opinions about the value= of >>money are irrelevant); (3) it will not always be available (for instanc= e, >>if >>the defendant knew that he or she was the recipient of a mistaken >>payment). >>In my view, the elements of this defence that the Lords are describing = are >>identical to the test for change of position. A defendant that has the >>valuable benefit of the free use of money but, in good faith, dissipate= s >>the >>time value of that use by not employing the money productively, has >>changed >>her position just as a defendant who fails to seek more profitable >>employment elsewhere following a mistaken payment (Commerzbank AG v Pri= ce >>Jones). Lord Nicholls seems to notice this point, but leaves it open at >>[119]. >> >>James Edelman >>________________________________________ >>From: owner-obligations@uwo.ca [mailto:owner-obligations@uwo.ca] On Beh= alf >>Of Neil Foster >>Sent: 19 July 2007 08:21 >>To: obligations@uwo.ca >>Subject: ODG: Restitution and Interest- House of Lords, Sempra >> >>Dear Colleagues; >>I'd be interested to see others' comments on the decision of the House = of >>Lords in Sempra Metals Limited (formerly Metallgesellschaft Limited) >>(Respondents) v. Her Majesty's Commissioners of Inland Revenue and anot= her >>(Appellants) [2007] UKHL 34 >> >>http://www.publications.parliament.uk/pa/ld200607/ldjudgmt/jd070718/sem= pra-1.htm >>. >>The two main features of the judgement, on a quick reading, seem to be >>(1) over-ruling previous authority that no interest can be awarded at >>common >>law on damages for late payment of a debt or damages (a position, as th= e >>House generally notes, reached some years ago by the High Court of >>Australia >>in Hungerfords v Walker (1989) 171 CLR 125); >>(2) comments on the awarding of interest in a claim for restitution bas= ed >>on >>mistake, rather than a tort. >>On the second issue there seems to be a 3-2 majority holding that where >>someone has made a mistaken payment which can be recovered under the >>principles of unjust enrichment, then when the money is recovered there >>will >>usually be a claim for payment of compound interest. If in fact the per= son >>who had the use of the money did not invest it or otherwise get value f= rom >>it, then the court should have a discretion to depart from this figure = in >>a >>"subjective devaluation" (see eg Lord Nicholls at [119], generally agre= ed >>with by Lords Hoffmann and Walker). >>The dissenters (Lords Scott and Mance) accept that compound interest ma= y >>be >>OK where a restitutionary remedy is required for wrongdoing, but argue >>that >>in a case of mistake all the defendant is required to do is to account = for >>the benefit he or she in fact enjoyed, and hence compound interest will >>not >>always be appropriate. (If they put it under the bed- Lord Mance, [233]= , >>then they are only required to pay back the actual principal.) >>I must say the fact that the majority have to resort to what my old >>philosophy lecturer used to call the "arm-waving" notion of a case-by-c= ase >>"subjective devaluation" makes me fairly sympathetic to the minority on >>this >>point. >>Regards >>Neil Foster >> >>Neil Foster >>Newcastle Law School >>Faculty of Business & Law >>University of Newcastle >>Callaghan NSW 2308 >>AUSTRALIA >>ph 02 4921 7430 >>fax 02 4921 6931 >> >>_________________________________________________________________ >>Advertisement: Crowded House Time on Earth =96 catch them live inthe US= A! >> >>http://ninemsn.com.au/share/redir/adTrack.asp?mode=3Dclick&clientID=3D8= 00&referral=3Dhotmailtagline&URL=3Dhttp://music.ninemsn.com.au/compIntro.= aspx?compId=3D2416 >> >>____________________________________________________________________ >>This message was delivered through the Restitution Discussion Group, >>an international internet LISTSERV devoted to all aspects of the law >>of unjust enrichment. To subscribe, send "subscribe enrichment" in >>the body of a message to . To unsubscribe, >>send "signoff enrichment" to the same address. To make a posting to >>all group members, send to . The list is >>run by Lionel Smith of McGill University, . >> > >____________________________________________________________________ >This message was delivered through the Restitution Discussion Group, >an international internet LISTSERV devoted to all aspects of the law >of unjust enrichment. To subscribe, send "subscribe enrichment" in >the body of a message to . To unsubscribe, >send "signoff enrichment" to the same address. To make a posting to >all group members, send to . The list is >run by Lionel Smith of McGill University, . _________________________________________________________________ Advertisement: WIN new Jeep Compass & Off-Road Adventure with Trading Pos= t!=20 http://a.ninemsn.com.au/b.aspx?URL=3Dhttp%3A%2F%2Fwww%2Etradingpostcompet= ition%2Ecom%2Eau%2FOffRoadAdventure%2F%3Freferrer%3Dplace83&_t=3D76375681= 8&_r=3Dhotmail_email_tagline_July07&_m=3DEXT ____________________________________________________________________ This message was delivered through the Restitution Discussion Group, an international internet LISTSERV devoted to all aspects of the law of unjust enrichment. To subscribe, send "subscribe enrichment" in the body of a message to . To unsubscribe, send "signoff enrichment" to the same address. To make a posting to all group members, send to . The list is run by Lionel Smith of McGill University, .