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What Are My Business’ Compensation Options Within an Unjust Enrichment Claim?

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As a business owner, you will likely enter many contracts with other companies as part of your commercial activity. When you do, you and the other business promise to each other that you will fulfil the contract. However, contractual disputes can arise. You may be familiar with damages as a compensation option for your business in English law. This is when a claimant claims the losses they suffer. However, there are other remedies for contractual disputes, such as restitutionary remedies. These may be more appropriate for the contractual breach, mainly due to a defendant’s enrichment due to an unjust factor. This article will explain your business’ compensation options for an unjust enrichment claim.

What is an Unjust Enrichment Claim?

Unjust enrichment in a business dispute refers to the unfair benefit a defendant receives at the claimant’s expense. The focus of unjust enrichment is to ensure that the benefit returns to the claimant from whom it originated. Therefore, an unjust enrichment claim focuses on this rather than traditional damages. It is a claim that can give rise to a restitutionary remedy. 

Two other types of circumstances result in restitution remedies, which are:

  • where the defendant receives a benefit but although not from the claimant but from a third party, they should account it to the claimant; and 
  • where the defendant engaged in wrongdoing and, as a result, received a benefit.

What Are My Business’ Compensation Options for an Unjust Enrichment Claim?

If you think you have an unjust enrichment claim against another business due to a business dispute, you may be able to get a restitutionary remedy. 

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However, to do so, you need to prove the following:

  • that the other party, the defendant, was enriched;
  • that the enrichment was unfair or unjust;
  • that the enrichment was at your expense as the claimant; and 
  • there are no bars to a restitutionary remedy or the circumstances, such as if you were acting violently. 

Compensation: Restitutionary Remedies

If you can prove that you have the compensation option of a restitutionary remedy made for an unjust enrichment claim, you must know the restitutionary remedy types. This will depend on the substance of the unjust enrichment.

A common restitutionary remedy for an unjust enrichment claim is a personal remedy. This means the defendant must return the unjust enrichment to you as the claimant.

Alternatively, you may be able to:

  • trace into the defendant’s asset, which is a proprietary remedy;
  • assert a lien over one of the defendant’s assets; or
  • legally pursue third-party rights against the other party.

Another compensation option for an unjust enrichment claim is the restitutionary remedy of an action for money. This is relevant where the defendant’s unfair enrichment arises from cash you pay. This can occur in various ways, such as where:

  • you pay money involuntarily;
  • there is no consideration for the money you pay, so there is nothing for you to gain in return; or
  • the law requires you to make a payment of money to to a third party, which then causes the defendant to gain unjustly. 

Restitutionary remedies as compensation options for unjust enrichment also vary depending on whether the enrichment was for goods or services. If it is for a service, it can be a reasonable amount that you deserve (quantum meruit claim). When the unjust enrichment was in the form of goods, your business compensation can be a reasonable price for the goods you lost (a quantum valebat claim).

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Key Takeaways

If your business falls into a commercial dispute, you may find that an unjust enrichment claim is relevant to resolve the issues. This is where the other party unfairly benefits at your expense. They are the defendant in the claim, and you are the claimant. Unjust enrichment claims focus on you getting the loss back, and therefore, restitutionary remedies are often compensation options. 

To have a restitutionary remedy for an unjust enrichment claim, there are certain criteria your dispute must meet. For example, setting a lien over the defendant’s assets. Common options can also depend on the form of enrichment. Where it was money, you could have an action for money. There are also compensation options where the form of enrichment is in goods or services. 

If you need help understanding your business’ compensation options for an unjust enrichment claim in the UK, LegalVision’s experienced disputes and litigation solicitors can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. So call us today on 0808 196 8584 or visit our membership page.

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Clare Farmer

Clare Farmer

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