(D) RESTITUTION AND THIRD PARTIES

Although the usual case of unjust enrichment will involve the defendant having received a benefit from the claimant in circumstances where the ground of restitution operates between the claimant and the defendant, this is not necessarily the case. Although the defendant must have received the benefit from the claimant, either directly or exceptionally indirectly,^{[1] [2]} the ground of restitution may relate to a third party. It should be irrelevant that the defendant is not tainted by the ground of restitution, so long as the defendant has been enriched at the claimant’s expense and the claimant can establish that one of the grounds of restitution is applicable as regards the transfer of the enrichment to the defendant. So, for example, in Barclays Bank Ltd v WJ Simms, Son and Cooke (Southern) Ltd⁵⁰ the claimant paid money to the defendant in the mistaken belief that it had been authorized to do so by a third party. The claimant was able to recover the money from the defendant on the ground of mistake, even though the mistake related to the authorization by the third party. This principle is also applicable where the grounds of restitution are duress or undue influence. So, where the claimant was compelled or unduly influenced by a third party to transfer a benefit to the defendant, restitution founded on reversing the defendant’s unjust enrichment should be available.^[3] Similarly, where the claimant transfers a benefit to the defendant which is conditional on the performance of a third party, if this is not forthcoming the claimant will be able to recover from the defendant by virtue of the failure of basis. Where, however, the claimant provides a benefit to the defendant in the expectation of being paid by a third party and such payment is not forthcoming, the claimant will not be able to bring a restitutionary claim against the defendant on the ground of failure of basis, at least where the third party was contractually liable to pay the claimant, because the existence of the contract will defeat any claim against the defendant which is grounded on unjust enrichment.^[4]

• [1] 50 [1980] QB 677, see p 171, below.
• [2] 51 But, as regards undue influence by a third party, the defendant’s liability to make restitution will depend
• [3] on him or her having notice of the undue influence. See p 269, below. The same is true where the claimant hastransferred a benefit to the defendant as the result of a misrepresentation by the third party. See p 199, below.
• [4] MacDonald Dickens and Macklin v Costello [2011] EWCA Civ 930, [2012] QB 244, discussed at p 142,below.