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UNJUST ENRICHMENT IN AUSTRALIA

Lloyd's Maritime and Commercial Law Quarterly

UNJUST ENRICHMENT IN AUSTRALIA

Kit Barker,* Penelope Bristow and Samuel Walpole

ANNUAL SUMMARY

Contrary to our expectations—and in contrast to the past two years—the last 12 months has seen little engagement with the law of unjust enrichment in the judgments of the High Court of Australia. Until close to the time of writing, we had been keenly anticipating a discussion of restitution for mistake and failure of consideration in the context of payments made to casual workers in the High Court’s judgment in WorkPac Pty Ltd v Rossato [2021] HCA 23, following on from last year’s decision of the Full Court of the Federal Court [2021] LMCLQ 198 § 40). In the end, this did not come to pass and the case was resolved in a way that did not require the restitutionary issues to be determined.
The High Court also recently declined to enter the field in Macquarie International (§32), which is the latest in a series of decisions in the same proceeding concerned with the principles governing the quantification of mesne profits for trespass (see, eg [2018] RLR §38). While we have sympathy for the High Court’s view that the case was an “inappropriate vehicle” for it to consider the principles governing the quantification of such awards more generally, this leaves the debate about their compensatory, restitutionary or “other” purpose formally unresolved. The debate, which is neatly sketched in the Court of Appeal’s judgment, but with which the High Court did not feel it necessary to engage, divided the same court in Bunnings Group Ltd v CHEP Australia Ltd (2011) 82 NSWLR 420; [2012] RLR §15. Bunnings involved a claim for damages for the wrongful “user” of personal property—not land—but it is closely analogous. The court in that case narrowly (2:1) favoured a compensatory analysis of the award made by stretching the concept of loss so as to include the “denial of [a plaintiff’s] rights”. The likely position, we suggest, is that mesne profits (in common with many other awards for the wrongful use of property) can be computed either to reflect a plaintiff’s loss or a defendant’s gain, and the plaintiff can freely elect between the two measures, with awards quite often leading to the same sum wherever there is a market for the property’s use. This was most likely the case on the facts of Macquarie itself and may explain the Court of Appeal’s reluctance to revisit the taxonomical issue. It also decreases the likelihood of the High Court being required to take up that issue in the future. In the meantime, Macquarie itself provides that the normal measure of mesne profits is the objective market rental rate for the actual use made of the property during the wrongful period of possession, with some deviations from that yardstick being possible to account for the parties’ respective positions, especially where there is no standard rental market for the property in question.

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