(A) THE RELATIONSHIP BETWEEN RESTITUTION FOR WRONGS AND THE REVERSAL OF UNJUST ENRICHMENT

For those commentators^[1] and judges^[2] who have argued that the law of restitution is only concerned with the reversal of the defendant’s unjust enrichment, it is necessary to show how a defendant who has obtained benefits through the commission of a wrong can be considered to be unjustly enriched at the claimant’s expense. Clearly such a defendant can be shown to have been enriched and, because this arose from the commission of a wrong, it is possible to conclude that the enrichment was unjustly obtained, albeit that a distinct cause of action relating to the wrongdoing needs to be established to identify a separate cause of action in unjust enrichment. But the real difficulty arises in establishing that this enrichment was obtained at the claimant’s expense, because the defendant’s enrichment will not necessarily have been subtracted from the claimant. For this reason, if restitution for wrongs is to be explained by reference to the reversal of unjust enrichment principle, it is necessary to re-define the notion of ‘at the claimant’s expense’ where the claim is founded on the commission of a wrong, so that, rather than showing that the defendant’s benefit was subtracted from the claimant, it is sufficient that the benefit derived from the commission of a wrong which involved the breach of a duty owed to the claimant.^[3] It would follow that gain-based remedies are available to the claimant so long as the defendant’s benefit can be shown to have resulted from the commission of the wrong, even though the benefit was not subtracted from the claimant. This is consistent with the definition of the law of restitution which is adopted in this book, namely that body of law which is concerned with the award of gain-based remedies.^[4] It is, however, highly artificial to regard restitution for wrongdoing as founded on the principle of reversing unjust enrichment by reinterpretation of the ‘at the expense of ’ requirement.^[5] It is easier and more accurate simply to analyse restitution for wrongdoing in the following way.

• [1] PBH Birks originally treated restitution for wrongs as founded on the reversal of unjust enrichment (AnIntroduction to the Law of Restitution (rev edn, Oxford: Clarendon Press, 1989), 313), but he subsequentlychanged his mind: PBH Birks, ‘Misnomer’ in W Cornish, R Nolan, J O’Sullivan, and G Virgo (eds), Restitution:Past, Present and Future (Oxford: Hart Publishing, 1998), ch 1.
• [2] See, in particular, Peter Gibson LJ in Halifax Building Society v Thomas [1996] Ch 217, 224.
• [3] See Birks, An Introduction to the Law of Restitution, 42.
• [4] Compare the view that restitution is to be interpreted literally to restore to the claimant what has beensubtracted from him or her, with disgorgement being used to describe those remedies where a gain derivedfrom another party is transferred to the claimant. See p 4, above and p 418, below.
• [5] See p 11, above and Morris v Tarrant [1971] 2 QB 143, 162 (Lane J). That restitution for wrongs is notfounded on the unjust enrichment principle was recognized by Millett J in Macmillan Inc v BishopsgateInvestment Trust plc (No 3) [1995] 1 WLR 978, 988.