Unjust Enrichment Cases

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  • Created by: k1016450
  • Created on: 25-04-14 13:00
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  • Unjust Enrichment
    • Fibrosa v Fairbairn 1943
      • Facts: A British company agreed business with a Polish company, with some money paid upfront and the rest on completion, however WWII broke out and it then became illegal to trade with Poland.
      • Principle: The contract was frustrated as it was no longer possible to perform. There was also a total failure of consideration even though some payment had been made.
      • Outcome: The money already paid had to be returned as it was a conditional payment and therefore amounted to a total failure of consideration.
    • Lipkin Gorman v Karpnale 1991
      • Facts: A partner of a law firm drew cheques on the firm's client account to fund his gambling problem.
      • Principles: The property could be traced at common law; there was no valuable consideration as the gambling chips were merely tokens and waging a bet is a gift with the casino honouring it. Change of position applied as it would be inequitable to not take into account any winnings.
      • Outcome: Money paid minus winnings was awarded to the solicitors firm.
    • Woolwich Equitable v IRC 1993
      • Facts: The building society was due a tax refund with interest, but the IRC refused to pay interest on the period between payment and when the trial judge said the tax was void.
      • Principle: Money paid to a public authority in the form of taxes or other levies pursuant to an ultra vires demand is prima facie recoverable as of a right. No public authority can retain money which it has no authority to receive.
      • Outcome: The questioned tax interest had to be paid to the building society.
    • Westdeutche Landesbank v Islington LBC 1996
      • Facts: Parties entered into an interest rate swap agreement, which later became ultra vires due to a separate court decision. The council stopped payments and the bank brought a claim for the remaining balance.
      • Principle: The bank could recover money with simple interest as it became a personal claim. Proprietary claims based on constructive trusts are only imposed where the defendant had knowledge of the imposition of the trust.
      • Outcome: The council paid simple interest. Argued by dissenting that this was unjust as it should have been compound interest.


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