(i) The Contract Price Should Operate as a Ceiling to the Valuation of the Benefit

In Taylor v Motability Finance Ltd,241 Cooke J, held, albeit obiter, that there is never a justification for the claimant to recover in excess of the contract price. He considered that allowing the claimant to recover more than the contractual ceiling ‘would be unjust since it would put the innocent party in a better position than he would have been if the contract had been fulfilled’.[1] [2] Similarly, in MacDonald Dickens and Macklin v Costello243 Etherton LJ recognized that it is appropriate that the contract price should operate as a ceiling on the valuation of the benefit, since the claimant should not be allowed to escape from a bad bargain by resorting to a claim in unjust enrichment.[3]

This emphasis on the contract price as being a ceiling on the value of the defendant’s benefit is consistent with the subjective devaluation principle when valuing benefits.245 Once it has been recognized that the defendant can argue that he or she did not value the benefit as much as its objective value, it is necessary for the defendant to produce evidence to support that valuation. The contract price as contained in the contract agreed by the parties is very strong evidence of the defendant’s own valuation.[4]

  • [1] Ibid. 243 [2011] EWCA Civ 930, [2012] QB 244, [31].
  • [2] 244 See also the relevance of a bad bargain when considering whether restitution should be available for a
  • [3] failure of basis. See p 326, below. 245 Birks, Unjust Enrichment (2nd edn), 59.
  • [4] See Benedetti v Sawiris [2013] UKSC 50, [2014] AC 938, [56] (Lord Clarke).
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