CHAPTER 15 Unjust Enrichment

• Date: 07 April 2025

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CHAP TER 15

UNJUST ENRICHMENT

A. INTRODUCTION

The previous two chapters have considered the choice of law rules for

two well-known parts of the law of obligations, namely contract and tort.

Each of these areas of the law required little introductory explanation.

In contrast, unjust enrichment is less well understood, especially by law

students. One reason for this is that the law in this area developed much

more recently in the common law than did contract and tort. In addition,

claims in this area arise less frequently. Accordingly, a brief introduction

to the core concepts is required.1

In Canada, a claim to reverse an unjust enrichment requires the

plainti to show (1) that the defendant has been enriched; (2) that the

enrichment is at the plainti’s expense; and (3) that there is no “juris-

tic reason,” such as a contract or a gift, for the enrichment.2 A leading

example can be drawn from the area of mistaken payments. Consider

Anne, who thinks she owes Brian $100 and pays that amount to him. In

reality, Anne owed the $100 to Carrie. When Carrie demands payment,

Anne complies and then asks Brian for the f‌irst $100 back. If Brian

refuses, we must determine the legal basis on which Anne could recover

the $100. She has no contract with Brian, and his retention of the $100

1 A useful place to start is John D McCamus, An Introduction to the Canadian Law

of Restitution and Unjust Enrichment (Toronto: Thomson Reuters Canada Limited,

2020).

2 Pettkus v Becker, [1980] 2 SCR 834 at 848, Dickson J; Garland v Consumers’ Gas

Co, [2004] 1 SCR 629 at para 30, Iacobucci J; Kerr v Baranow, 2011 SCC 10 at

para 32, Cromwell J; Moore v Sweet, 2018 SCC 52 at para 37, Côté J.

Unjust Enrich ment 355

paid to him is not a tort, so those areas of the law are of no help. Anne’s

claim is in unjust enrichment. There is no juristic reason to which Brian

can point as basis for his retaining the enrichment. Anne paid him by

mistake, which vitiates the intent to transfer the money. This is a very

simple example, but it could easily be modif‌ied to involve a f‌inancial

institution mistakenly transferring millions of dollars.

If all of the factual connections in an unjust enrichment case are

with the jurisdiction hearing the dispute, there is no choice of law issue.

However, it is easy to envisage situations where some of the connections

will be with other jurisdictions. Staying with the mistaken payments

example, wire transfer payments can easily be made around the world. In

such cases, a choice of law rule for unjust enrichment becomes essential.

However, we are immediately confronted with a signif‌icant diculty.

Unlike for contract and tort, there is little clear authority for an unjust

enrichment choice of law rule. Several factors have combined to produce

this situation. First, unjust enrichment was recognized as a distinct area

of law in England only in the 1990s and in Canada there are few cases

prior to the 1980s. As a result, there was little opportunity to develop

a choice of law rule. Second, in light of the f‌irst factor, litigants chose

not to raise potential choice of law issues when they did arise. They

thought doing so would make the proceedings more complex and less

predictable. Third, in Canada the substantive law of unjust enrichment is

largely common law, and thus quite uniform across the country, reducing

the number of possible cases. Fourth, in the few cases that did arise,

there was a tendency to accept the choice of law rule proposed by leading

academics rather than litigating the issue further.

Unjust enrichment, therefore, is quite dierent from other areas of

choice of law. It is dicult to articulate the current rule with a high

degree of conf‌idence, which can be frustrating. Moving forward, Can-

adian courts, particularly at an appellate level, may be required to for-

mulate a more def‌initive choice of law rule for unjust enrichment. This

could provide an excellent opportunity to debate, using the core princi-

ples of choice of law, what the rule should be.

A f‌inal introductory point should be made about characterization.3

Because unjust enrichment is a developing area of the law of obliga-

tions, it is common to see disagreements about whether a claim is one

3 See Stephen GA Pitel, “Characterisation of Unjust Enrichment in the Conf‌lict of

Laws” in Jason Neyers, Mitchell McInnes, & Stephen GA Pitel, eds, Understanding

Unjust Enrichment (Oxford: Hart Publishing, 2004); Pattarapas Tudsri, “Character-

ization of Proprietary Restitution in the Conf‌lict of Laws” (2013) 44 Ottawa Law

Review 261.