Unjust Enrichment is a concept of common law that is sometimes alleged in County or High Court proceedings. The person bringing the claim (the Claimant) can seek damages from another party (the Defendant) if the Claimant can demonstrate that the Defendant has become unjustly enriched at the Claimant’s expense.
The term “enrichment” is interpreted broadly by the Court. It does not necessarily mean just receipt of money, and it can apply to any benefit a Defendant has received unfairly as a result of the Claimant’s efforts. There must have been some form of identifiable loss caused to the Claimant, whether that be financial, a loss of a benefit, or even the loss of the time spent by the Claimant. The loss suffered by the Claimant should also reflect the gain received by the Defendant. Any person seeking a remedy from the Court by way of unjust enrichment should also be aware they must bring a claim with “clean hands”, meaning they cannot bring the claim for a benefit that has arisen through illegal means, or if they themselves have acted dishonestly.
Mate v Mate and others
Case background
The recent case of Mate v Mate and others is a good example of a successful claim on the basis of unjust enrichment. This case concerned the Claimant’s work on the family farm land. The Claimant had worked with a planning consultant to remove the green belt restrictions on approximately 40 acres of land so it could be used for housing. The Claimant alleged the Defendant, being the Claimant’s mother, had promised when the land was sold that the proceeds of the sale would be shared between all children. This enabled the Claimant – or so it seemed – to bring a proprietary estoppel claim which means that he claimed he had relied on a promise of benefit, and acted to his detriment by investing time and effort in the expectation of reward. However, this argument was rejected by the Court on the basis that the “promise” was not sufficiently clear to be relied upon.
In the alternative, however, the Claimant also argued that the common law principle of unjust enrichment applied, on the grounds that the Defendant had benefited from work that the Claimant had undertaken and the Claimant would not see any benefit from his own work unless the Court made an award. The Court decided as follows:
- The Defendants had been enriched as a result of the Claimant removing the Green Belt Restrictions as planning permission had been granted for the building of houses;
- The time and effort involved in doing so did come at the Claimant’s expense; and
- The Defendants sought to “retain” the benefit, principally the uplift in value when the land was sold.
Having found the Defendants had been unjustly enriched, the Court then had to determine the appropriate remedy. Claims of unjust enrichment should be valued objectively and the Court looked at the market value of the land. In this case, the Court held the land had increased in value by £8,700,000 as a result of the removal of the Green Belt Restrictions and it was therefore considered just for the Claimant to receive damages equating to 7.5% of that increase.
Comment
This case demonstrates how a claim of unjust enrichment can succeed in relation to land and in relation to an individual giving up their time and effort. It could set a trend for more people to bring an argument of unjust enrichment as a possible alternative to a claim of proprietary estoppel.
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Stuart Parris is an Associate in our expert Dispute Resolution team.
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