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Lloyd's Maritime and Commercial Law Quarterly

RETHINKING UNJUST ENRICHMENT: HISTORY, SOCIOLOGY AND THEORY―A Response to Professor Virgo

Lutz-Christian Wolff

Wei Lun Professor of Law
The Chinese University of Hong Kong
This book was reviewed by Professor Graham Virgo in in this Quarterly: [2025] LMCLQ 198. Professor Virgo rightly states that “it is important that there should be a constructive engagement with the disparate views about unjust enrichment” (p.198). In relation to my chapter of the said book, titled “Law of Unjust Enrichment or Law of Unjust De-Enrichment?”, he correctly notes that I propose to re-order unjust enrichment law “as being about Unjust De-Enrichment” (p.199). He further writes that, “in England at least, with the renewed focus on the need for there to be a transfer of value directly from claimant to defendant so that there is a correspondence of loss and gain, establishing a de-enrichment from the claimant is already implicit, so that nothing could usefully be gained from such a change of language and analysis” (ibid). In my chapter I have of course provided reasons why it is necessary to focus on the loss of the claimant rather than on the gain of the defendant as the conventional unjust enrichment doctrine suggests. I summarise my main points as follows.
First, as Professor Virgo explains (p.200), it has been argued that “no satisfactory justification for the award of restitutionary remedies for unjust enrichment can be identified”. I agree! As private law is not punitive in nature, “[a]sserting that the defendant is unjustly enriched does not give a reason for the liability, indeed is not even the beginning of a valid explanation” (Hedley (2016) 16 OUCLJ 333, 334). In contrast, the main reason for private law to provide a claim in cases which conventionally fall within the scope of the law of unjust enrichment must be that the claimant has lost something. It is the loss which needs to be remedied, not the gain! In other words, the “restitutionary” claim which unjust enrichment law provides is necessary because of the de-enrichment of the claimant and not because the defendant has obtained something.
Second, re-ordering the area under discussion as “the law of unjust de-enrichment” has significant doctrinal and practical consequences. Just pointing to the correlation between the loss of the claimant and the gain of the defendant while still regarding the gain as the main reason why a claim is awarded is insufficient to explain these consequences. Here follow two examples.
In cases where the defendant is no longer enriched, eg, because the object of the enrichment got lost or destroyed, current English law grants the defendant the change of position defence (cf Lipkin Gorman v Karpnale Ltd [1991] 2 AC 548, 579–580; Globenet Droid Ltd v Hong Kong Hang Lung Electronic Co [2016] 3 HKLRD 863). However, if the claimant’s restitutionary remedy is caused by the unjust enrichment of the defendant, then the loss of the enrichment means that such cause is gone. There should consequently be neither a claim nor a need for a defence. In contrast, if the remedy in question was loss-based, it would indeed be necessary to enable the defendant to “indicate a reason why the defendant should not be liable or the liability should be reduced in some way” (cf Virgo, The Principles of the Law of Unjust Enrichment, 3rd edn (Oxford, 2015), 60.) One may argue that this contradiction inherent in the idea of the change of position defence is only theoretical in nature or just an issue of terminology. However, inconsistent theory and unclear terminology lead to blurred doctrine and may even be the reason why there is hardly any aspect of the conventional law of unjust enrichment which is undisputed.

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