(C) FREE ACCEPTANCE

Where the defendant had an opportunity to reject proferred services and failed to do so, knowing that the claimant expected to be paid for those services, the defendant can be considered to have freely accepted the benefit.^[1] Such a principle defeats the defendant’s reliance on the subjective devaluation principle since the defendant will have been exercising a voluntary choice in deciding not to reject the benefit. Consequently, the fact that the defendant freely accepted the benefit is consistent with the principle of the autonomy of the individual to decide that he or she wants the benefit which has been received. The defendant can be considered to have freely accepted a benefit even though he or she had not requested it, since it is sufficient that the defendant knowingly acquiesced in the provision of the benefit.^[2]

At the outset it is important to recognize that the doctrine of free acceptance is sometimes regarded as having a dual function in the law of restitution. This was at one stage the view of Birks,^[3] and Goff and Jones also agree.^[4] This dual function involves free acceptance operating both to establish an enrichment and as a ground of restitution in its own right. This dual function is highly controversial, but unfortunately it has been recognized judicially. ^[5] The preferable view, however, is that there is no role for free acceptance as a ground of restitution in its own right, since the ground of failure of basis adequately does the work which it is thought can be done by free acceptance and without incorporating any element of fault.^[6] But this does not affect the validity of free acceptance as an important principle to assist in the identification of whether or not the defendant has been enriched.

Although the principle of free acceptance has been recognized explicitly by the courts,^[7] the features of the principle were influential in a number of earlier decisions, even though that principle was not recognized by name. For example, some judges referred to the fact that the defendant stood by whilst the claimant was providing the benefit.^[8] In Leigh v Dickeson^[9] the claimant sought to recover rent from the defendant who was initially the claimant’s tenant but then became a co-owner with the claimant of a house. The defendant counterclaimed for money spent to the use of the claimant in respect of repairs to the house. The counterclaim failed, essentially because, although the claimant had received an objective benefit by virtue of the repairs, which were considered to be reasonable and proper, the defendant’s expenditure had been incurred voluntarily and it could not be shown that the claimant valued it. In other words, the claimant resorted to subjective devaluation which the defendant was unable to defeat. In reaching this conclusion, Brett MR identified the essence of free acceptance. He emphasized^[10] that if a person receives a benefit in circumstances where there is an option to adopt or decline it, and the recipient adopts the benefit, the expenditure incurred by the other party must be repaid. If the recipient declines the benefit, he or she will not be liable to make restitution to the other party. But if the recipient has no choice but to accept the benefit, the recipient will not be liable to the other party. Since on the facts the claimant had no choice but to accept the benefit, because she continued to live in the house, she was not liable to the defendant who had incurred the expenditure.^[11] This is a perfect example of a case where it was not possible to defeat reliance on subjective devaluation, simply because there was no evidence that the recipient of the benefit had chosen it and so it could not be concluded that the recipient valued the benefit.

In Falcke v Scottish Imperial Insurance Co^[12] the claimant, having paid premiums on a life assurance policy mistakenly believing that he had acquired an interest in it, sought to recover the expenditure from the defendant who did have an interest in the policy. Clearly the defendant had received an objective benefit, since the claimant’s payments preserved the policy,^[13] but there was insufficient evidence to defeat the defendant’s reliance on arguments of subjective devaluation. In particular, the defendant was unaware of the claimant’s payments, so she could not be regarded as having chosen to accept the benefit. But it was expressly recognized that, if the defendant had been aware of the payments and had then failed to intervene, she would have been liable to reimburse the claimant.^[14]

The free acceptance principle was explicitly recognized by Lightman J in Rowe v Vale of White Horse DC,^[15] although it could not be established on the facts. The defendant council had provided sewerage services for some of its tenants who occupied council houses. These tenants were not charged separately for these services, the cost of which was included in the rents paid by the tenants. Many tenants bought their council houses and, in some cases, no provision was made for the payment of sewerage charges and the defendant did not claim payment for these services. Eventually the council demanded payment for the provision of the services for the previous six years. Rowe challenged the legitimacy of this demand in judicial review proceedings and the council claimed restitution. The key question was whether the service could be considered to be an enrich- ment.^{[16] [17]} It was accepted that, if Rowe had freely accepted the services, the claim for restitution would have succeeded, but this could not be established on the facts because he did not reasonably expect to pay for them, since the council had perpetuated the belief that no payment was required, and because Rowe did not have an opportunity to reject them. In other words, he had not acquiesced in the supply of services. Even more significantly, in McDonald v Coys of Kensington¹⁶³ the Court of Appeal was willing to apply the free acceptance principle, although it did not do so in the end because it was possible to show that the receipt of the right to a personalized registration mark constituted an incontrovertible benefit.^[18] Mance LJ recognized that the defendant could not be considered to have freely accepted the Mark when the car was delivered, but he did suggest that the defendant might have freely accepted it when he registered the Mark in his own name, since at that point he was aware of the seller’s mistake and so acted unconscientiously or reprehensibly in registering it. But this argument can only be right if the benefit is considered to be the registration of the Mark in the defendant’s name, rather than the right to register the Mark which was received on delivery. This is a novel conclusion since it suggests that events subsequent to receipt may convert a benefit which has been legitimately subjectively devalued into an enrichment. This might be considered to undermine the principle that the enrichment is identified and valued when the unjust enrichment claim is crystallized,¹⁶⁵ which was presumably when the car was delivered to the defendant. Subsequent events are only relevant through the operation of defences, such as change of position. Nevertheless, if it is possible to recognize a realized benefit as an incontrovertible benefit after an objective enrichment has been received,^[19] there is no reason why free acceptance cannot operate in the same way. This does not undermine the rule about events occurring after crystallization of the cause of action, but is actually consistent with it. This is because the unjust enrichment claim should be considered to have crystallized only when the defendant has received an objective enrichment and a ground of restitution can be identified. It is then open to the defendant to plead the defence of subjective devaluation and, in order to defeat this defence, the claimant should be able to rely on facts arising after the enrichment has been received in order to defeat that defence.

• [1] This term was first coined by R Goff and G Jones, The Law of Restitution (1st edn, London: Sweet &Maxwell, 1966), 30. See also Birks, Unjust Enrichment (2nd edn), 56.
• [2] See Leigh v Dickeson (1884) 15 QBD 60; Falcke v Scottish Imperial Insurance (1886) 34 Ch D 234.
• [3] See, for example, PBH Birks, Restitution—The Future (Sydney: The Federation Press, 1992), 98-9.
• [4] C Mitchell, P Mitchell, and S Watterson (eds), Goff and Jones:The Law of Unjust Enrichment (8th edn,London: Sweet & Maxwell, 2011), Ch 17.
• [5] Rowe v Vale of White Horse DC [2003] EWHC 388 (Admin), [2003] 1 Lloyd’s Rep 418,422 (Lightman J).
• [6] See p 122, below. 152 See Chapter 6.
• [7] See especially Bridgewater v Griffiths [2000] 1 WLR 524; Rowe v Vale of White Horse DC [2003] EWHC388 (Admin), [2003] 1 Lloyd’s Rep 418; McDonald v Coys of Kensington [2004] EWCA Civ 47, [2004] 1 WLR2775; Constable of the Greater Manchester Police v Wigan Athletic AFC Ltd [2008] EWCA Civ 1449, [2009] 1WLR 1580. It has also been recognized in New Zealand: Van den Berg v Giles [1979] 2 NZLR 111, 120 (JeffriesJ). The principle is also implicitly recognized by certain statutory provisions. For example, s 30(3) of the Sale ofGoods Act 1979 states that, where a vendor delivers more goods to the purchaser than the vendor hadcontracted to sell and the purchaser accepts all of the goods delivered, the purchaser will be liable to pay for allof the goods.
• [8] See, for example, Weatherby v Banham (1832) 5 Car and P 228, 172 ER 950; Lamb v Bunce (1815) 4M and S 275, 105 ER 836; Paynter v Williams (1833) 1 C and M 810, 149 ER 626.
• [9] (1884) 15 QBD 60. 156 Ibid, 64.
• [10] 157 But since the repairs had been considered to be necessary and proper it could have been concluded that
• [11] the claimant had been incontrovertibly benefited since she had been saved a factually necessary expenditure.See p 80, above.
• [12] (1886) 34 Ch D 234.
• [13] Again, it could have been concluded that the defendant had been incontrovertibly benefited by theclaimant’s expenditure, which constituted a necessary expense to preserve the insurance policy.
• [14] Falcke v Scottish Imperial Insurance Co (1886) 34 Ch D 234, 249 (Bowen LJ).
• [15] [2003] EWHC 388 (Admin), [2003] 1 Lloyd’s Rep 418.
• [16] It was conceded that the service was an incontrovertible benefit, see p 81, above, but it was still necessaryto consider free acceptance to identify a ground of restitution. See p 122, below.
• [17] [2004] EWCA Civ 47, [2004] 1 WLR 2775.
• [18] See p 81, above. 165 See p 9, above.
• [19] See p 82, above.