Monday, July 07, 2008

Is Quasi-Contract Really Dead?

Another book I have recently finished is the second edition of Peter Birks' Unjust Enrichment, which he completed just before he died. Professor Birks made a late conversion to what is now the Canadian approach to non-consent non-wrong based private causes of action -- namely, that we should treat every transaction in which D benefits and P loses as presumptively reversible to the lesser of the benefit or loss. Contract, gift and statutory transfer are all just exceptions to the borader rule. That is a departure from how the common law traditionally dealt with the same issues by presuming gains/losses fall where they lay, but using defined categories of "monies mistakenly paid and recieved", practical compulsion and so on to provide for exceptional reversal. Birks is also "Canadian" in separating out gain-based remedies that do not require any corresponding loss from the law of unjust enrichment.

In one respect, Birks is triumphalist about the success of civilian-style unjust enrichment. He says no one will ever again write a book entitled "Quasi-Contract" because liability for benefits provided under mistake, compulsion, necessity and so on has been completely liberated from implied contract theories.

I wonder. It seems to me that there are a number of reasons non-consent non-wrong based liability will always be closely tied to contract:

*We are always going to let defendants get out if the matter was something the parties could have contracted about. If I mow your lawn before I negotiate a price, you are never going to have to pay unless there was some good reason we couldn't agree to an express contract.

*Unless the benefit the defendant received was cash, we are always going to have to value it somehow, and the only way to do that is to think what would have been agreed to. That inevitably brings the implied or hypothetical contract back in.

*Contract law itself will always have to deal with implied or hypothetical bargains, as well as express ones. Think about any real contractual dispute. If the parties expressly agreed who was going to take on the risk or cost at issue, then you wouldn't expect litigation, other than merely for enforcement. If there is serious litigation, that is because the parties intentions are in doubt, and the judge/arbitrator is always going to be reasoning abut what they "would have" done if they had turned their mind to the eventuality. So inside every express contract is a million implied or hypothetical contracts. And the law of what we do when there is no contract at all should develop alongside what we do when there is a contract but it doesn't deal with the subject matter of litigation.

So Birks' triumphalism is premature. Implied/hypothetical contracts are as hard to banish from practical litigation as from political theory.

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