TORTS FOR WHICH GAIN-BASED REMEDIES ARE AVAILABLE

Once it is accepted that gain-based remedies are available in principle where the defendant commits a tort, it is necessary to determine which torts will trigger a restitutionary response. Those torts which are committed when the defendant interferes with the claimant’s property rights are most likely to trigger gain-based remedies,^[1] but there is some evidence that other torts which are not proprietary may trigger a similar response.

(A) TRESPASS TO LAND

The tort of trespass to land^{[2] [3]} can be committed in a variety of ways, including the temporary use of the claimant’s land without permission or the unlawful expropriation of the land. The nature of the trespass will have an effect on the nature of the remedy which is awarded. Whilst the typical remedy which is awarded is undoubtedly compensatory with reference to the loss suffered by the claimant, the award of literal restitutionary and even disgorgement remedies has been recognized. In Stadium Capital Holdings v St Marylebone Properties Co plc⁵⁴ Peter Smith J said:

there has been a development over a series of cases of awarding damages not on the basis of the land to be used by the plaintiff but the basis upon which the defendant has used the land, and this starts basically with the decision in Penarth Dock Engineering Co Ltd v Pounds... where Lord Denning MR says precisely that. The test of the measure of damages is not what the plaintiff had lost but what benefit the defendant obtained by having the use of the berth. This introduces a flexible basis for assessment because it requires the court to look at the use that was made. It is fair to say, in the case that we have been taken through, that the vast majority of those resolve it by charging a reasonable fee for the occupation of the land by the trespasser; but, in the light of these authorities, which end up in Attorney General v Blake . . . my view is that this area is flexible, and in an appropriate case it is possibly arguable that the measure of damages can represent 100%. It is equally possible that the measure of damages could be debated [sic] by the amount of expenditure the wrongdoer incurs in obtaining the benefit, and in between it is possible that damages could be assessed by a license fee that would be artificially negotiated by the parties in the lines of Wrotham Park above and succeeding authorities.

This is a very significant dictum since it indicates that there are a range of remedial options open to the court which can most certainly be restitutionary and may even involve depriving the defendant of all gains made from the commission of the trespass,^[4] although the latter remedy, in the form of account of profits, is only available in the most serious cases, particularly where the commission of the tort is considered to be especially cynical.⁵⁶

In determining how remedies for trespass to land are assessed, it is important to distinguish between trespass involving the temporary deprivation of land and the permanent expropriation of land. In the former case, the remedy is sometimes called ‘mesne profits’ and relates to the use of the land. In the latter case, the court may order the defendant to restore the land to the clamant, in which case an additional pecuniary remedy will be awarded relating to the use value of the land until it is restored to the claimant. The court may, however, decline to restore the land to the claimant, but will make an order for payment of the capital value of the land, as well as require the defendant to pay for the use of the land up until the order for payment of the capital value has been made, at which point the land will lawfully belong to the defendant. Whether the tortious claim arises from temporary deprivation of use or permanent exclusion from use of the land, the most common form of the remedy awarded is negotiation damages, assessed by reference to the fee which the parties would have negotiated for the defendant to interfere with the claimant’s proprietary right.^[5] Such a remedy may be characterized as compensatory,^[6] but it has been characterized as restitutionary.^[7] In fact, analysis of the leading authorities reveals that the remedy is properly characterized as hybrid, embodying loss and gain-based considerations.^[8]

• [1] See Devenish Nutrition Ltd v Sanofi-Aventis SA (France) [2008] EWCA Civ 1086, [2009] Ch 390, [39](Arden LJ).
• [2] See E Cooke, ‘Trespass, Mesne Profits and Restitution’ (1994) 110 LQR 420.
• [3] [2010] EWCA Civ 952. 4 Ibid, [14].
• [4] 56 Ramzan v Brookwide Ltd [2010] EWHC 2453 (Ch), [2011] 2 All ER 38. See p 454, below.
• [5] See Horsford v Bird [2006] UKPC 3, p 430, above; Field Common Ltd v Elmbridge BC [2008] EWHC 2079(Ch); Stadium Capital Holdings v St Marylebone Properties Coplc [2010] EWCA Civ 952; Ramzan v BrookwideLtd [2010] EWHC 2453 (Ch), [2011] 2 All ER 38; Jones v Ruth [2011] EWCA Civ 804.
• [6] Severn Trent Water Ltd v Barnes [2004] EWCA Civ 570; Ramzan v Brookwide Ltd [2010] EWHC 2453(Ch), [2011] 2 All ER 38.
• [7] Field Common Ltd v Elmbridge BC [2008] EWHC 2079 (Ch). 60 See p 431, above.
• [8] 61 [2010] EWHC 2453 (Ch), [2011] 2 All ER 38.