Introduction
In civil law it is not unusual for a party (plaintiff) to make a claim or raise allegations of unjust or unjustified enrichment by or against the other party (defendant). In simple terms unjust enrichment at law refers to a situation where one party benefits at the expense of the other party in circumstances or situations which are considered to be unjust. In this article I look at unjust enrichment in legal proceedings.
Requirements to prove unjust enrichment
Many decided cases that I went through during my research make reference to the Supreme Court case of Gamanje (Pvt) Ltd v City of Bulawayo, case reference SC 94/04 (“Gamanje case”). For example, in the Supreme Court case of Silonda v Nkomo, case reference SC271/19, Judgment number SC 6/22, reference was made to the Gamanje case, which appears to be the locus classicus.
In the Gamanje case, Ziyambi JA set out the requirements for an action of unjust enrichment. These are that:
- Firstly, that the defendant has been enriched,
- Secondly, that the defendant has been so enriched at the expense of the plaintiff,
- Thirdly, that the enrichment is unjustified (in the sense that it would be unjust to allow the defendant to retain the benefit). In other words, the plaintiff will be claiming restitution from the defendant.
- Fourthly, the enrichment must not come within the scope of one of the classical enrichment actions,
- Fifthly, there must be no positive rule of law which refused an action to the impoverished person.
In the Silonda v Nkomo case (supra or above), reference was also made to Du Plessis in his seminal work “The South African Law of Unjustified Enrichment, Juta 2012 at p24”. Quoting the author, in order to succeed with a claim based on unjustified enrichment the plaintiff must meet the general requirements, or, as it is sometimes said, four general elements of enrichment liability.
- Firstly, the defendant must be enriched,
- Secondly, the plaintiff must be impoverished,
- Thirdly, the defendant’s enrichment must be at the plaintiff’s expense,
- Fourthly, the defendant’s enrichment must be unjustified, which means that it must be without legal ground (sine causa).
In common law, based on the Roman empire, according to various internet sources, some of the situations giving rise to unjustified enrichment include the following where the plaintiff had given a thing or money.
- In contemplation of a future result that did not follow,
- For a reason disapproved by law or repugnant to public policy,
- By mistake because payment was not actually due,
- Without a good cause for the transaction.
The whole idea of a claim for unjust enrichment is that the plaintiff will be claiming restitution of money or a thing from the defendant.
Real life situations
There are many instances encountered in everyday life where a party may claim unjustified enrichment. These include examples below.
- In the event of breach of contract where a party given a payment refuses to return the money. This may happen in the case where a purchaser fails to pay in terms of an agreement of sale resulting in termination of the agreement. The seller may refuse to give the purchase the amounts paid citing damages arising from breach.
- Breach may also happen where a supplier has been given an advance payment but fails to deliver the goods. The supplier may refuse to deliver the goods paid for or pay back the money to the purchaser.
- A contract may be declared illegal or contra bonos mores by a court. A party that was paid based on the nullified contract may refuse to return the funds.
- It may happen that a lessee who leases a property pays rent in advance for a long period. The lease may be terminated prematurely but the lessor refuses to refund the lessee rent paid for future periods where the property was not occupied due to the premature termination.
- It may very well happen that a supplier may be paid twice for the same obligation. If the supplier refuses to refund that is easily a case of unjust enrichment.
- Funds may be transferred accidentally or to a wrong person or account.
- A thing may be delivered to a wrong person or wrong address and the recipient refuses to release it.
Conclusion
Cases of unjust enrichment are not uncommon. An aggrieved person may take legal action in order to get the thing or money back.
Disclaimer
This simplified article is for general information purposes only and does not constitute the writer’s professional advice.
Godknows (GK) Hofisi, LLB(UNISA), B.Acc(UZ), Hons B.Compt (UNISA), CA(Z), ACCA (Business Valuations) MBA(EBS, Heriot- Watt, UK) is the Managing Partner of Hofisi & Partners Commercial Attorneys, chartered accountant, insolvency practitioner, registered tax accountant and advises on deals and transactions. He has extensive experience from industry and commerce and is a former World Bank staffer in the Resource Management Unit. He writes in his personal capacity. He can be contacted on +263 772 246 900 or ghofisi@hofisilaw.com or gohofisi@gmail.com. Visit www//:hofisilaw.com for more articles.
