The law can help you in a number of ways when your rights have been violated.  When, for example, you pay for something and don’t get it delivered as agreed, or it isn’t what was agreed, or it is broken, you have contractual and statutory rights.

But what about a case where you have no basis in law to complain about someone you have given your money to?

Take a case where you owe $10,000 to Fred.  You send the $10,000 to Fred to satisfy the debt.  However, due to your mistake, you send the $10,000 to Joe instead.

Obviously, you would think, Joe has to hand the money over to Fred.  But what if Joe doesn’t see it that way? Perhaps Joe thinks you’ve given him a gift.  Perhaps Joe will say “Thanks a lot” and cease returning your calls.

The Law of Contract doesn’t help you in this case.  You have no contract with Joe.  Your only contract is with Fred, and he is busy reminding you of that, wanting his $10,000 (from you). He can’t go to Joe for the money.  He has no contract with Joe either.

You can’t sue Joe in contract therefore.  You can’t sue him in negligence either.  He wasn’t negligent.  You were, in sending him the money by mistake.

When someone uses your property or intentionally deprives you of your money, you can sue them in conversion. But you can’t sue Joe in conversion.  He has committed no intentional act to deprive you of $10,000.  You did that, by sending the money to the wrong man.

So, is that your bad luck?

Fortunately, the Law has a remedy for you.  It has various forms and names: Restitution, Unjust Enrichment, or an Action for Money had and received.  Essentially, the Courts will intervene if: Joe has had a windfall; that enrichment was at your expense; it would be, in the Court’s opinion, unjust or not a matter of good conscience to let Joe keep the money; and importantly, Joe has no other defence or proper claim on the money.

The Courts strive to reach a result according to legal principle and a result that is fair.  Bear in mind however that ‘fairness’ is like common sense (people can have different views) and also that the law of restitution or unjust enrichment can be mightily complicated.

For further information please contact Peter on 8362 6400 or email Peter JakobsenJoin our mailing list to receive updates and advice on current issues.

  • Peter Jakobsen

    About the author: Peter Jakobsen

    Peter has a wealth of experience in many areas of the law but practises primarily in the areas of civil and commercial litigation including employment matters, negligence, defamation, leasing and contractual disputes and debt collection.

    Peter is a skilled and clever advocate that brings all of his intelligence and significant Court room experience to each and every matter to achieve excellent results for his clients.

    Call on 8362 6400 or email Peter.

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