Academic journal article Texas Law Review

Justifying the Law of Unjust Enrichment

Academic journal article Texas Law Review

Justifying the Law of Unjust Enrichment

Article excerpt

Justifying the Law of Unjust Enrichment^

That there is such a thing as "the law of unjust enrichment" or "the law of restitution" is still a matter for debate in the common law world. And amongst scholars who accept that there is such a body of law, there exist fundamental disagreements as to its scope and nature. In the United States, the ground-breaking Restatement was published in 1937,1 but since then only one treatise has been published on the subject2-now almost twenty-five years old-and courses on unjust enrichment or restitution are taught at only a handful of American law schools.3 In the United Kingdom and other Commonwealth countries, the subject has a more secure status,4 but this is a recent phenomenon that has not gone unchallenged.5 As for internal disagreement, the introduction to Peter Birks's article for this Symposium-"a schism divides the scholars who write on the modern law of restitution"6-is illustrative, but perhaps the clearest evidence is that even the subject's most ardent defenders cannot agree upon its proper name-whether it should be "restitution," "unjust enrichment," or "restitution and unjust enrichment."7

This Comment is intended as a three-part response to concerns noted above. In the first part, I suggest that the uncertainty surrounding the scope and status of unjust enrichment law (the name I prefer, for reasons explained below) is a reflection of the significant justificatory or normative problems that arise from the standard account8 of the subject. The standard account appears inconsistent with broadly held views about how private law should operate. In the second part, I examine what three articles in this Symposium (by Peter Birks, Lionel Smith, and Hanoch Dagan) say-or do not say-about these normative problems. Lastly, in the third part of this Comment, I outline an alternative solution to these normative problems.

1. Normative Problems in Unjust Enrichment Law and Why They Are Important

Questions regarding the existence and scope of an alleged source of legal liability are taxonomic questions. That is, they are questions about how to classify the rules that make up the law. Classification is sometimes thought to be a sterile, technical exercise, but nothing could be further from the truth. Classification, whether in respect of law, plants, or anything else, aims not merely to place the data under investigation into separate boxes, but to differentiate the data in a way that says something important. A good classification does not just fit the data, it gives the data meaning; it makes the data intelligible.9 When we classify, we classify with a point or a purpose in mind. In the case of a law, one, if not the, important question to ask is what, if anything, is the justification for the law. Because laws tell us how we should act, and because laws are backed up by the state's coercive powers, their justification is obviously something we care about very much. It is for this reason that most broadly accepted legal categories track broadly accepted moral categories: insofar as legal categories line up with moral categories, the law becomes more intelligible and the proposed categorization more illuminating. The widely accepted legal distinction between contract and tort tracks a widely accepted moral difference, not just a factual distinction, between failing to keep a promise and other ways of acting badly. The justification for why we have an obligation to drive carefully is different from the justification for why we have an obligation to deliver promised goods.

The flip side of the above is that deep taxonomic uncertainties in law usually indicate deep uncertainty about the existence or the distinctiveness of the assumed justification for the rules in question. Consider contract law. Like unjust enrichment law, contract law as a distinct source of liability was recognized relatively late in the common law world,10 and both its scope and distinctiveness have at times been seriously questioned. …

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