Unjust enrichment is a legal term that refers to a situation where one person is “unjustly enriched” at the cost of another person. “Unjust” describes a situation or transaction that is not in line with society’s accepted standards of fairness. “Enrichment” is when a person benefits or gains something from another person. Unjust enrichment usually arises under a contractual agreement where one person (party 1), grants a benefit to another person (party 2) with the agreement that party 1 will receive rightful compensation, without party 1 receiving rightful compensation.
Unjust Enrichment Vs. Gift
Distinguishing unjust enrichment from a gift is important. The law allows people to give and receive gifts without the expectation of receiving anything in return. Unlike a gift, which is given without the expectation of receiving something in return, unjust enrichment involves an imbalance where party 1 provides a benefit with the expectation of compensation. On the other hand, when party 1 offers a gift to party 2, no legal remedy exists for party 1 to demand reciprocation or compensation.
What Constitutes A Claim For Unjust Enrichment?
The elements of unjust enrichment vary from state to state, but generally there are four elements necessary to assert a claim of unjust enrichment:
- The defendant received a benefit;
- The benefit the defendant received was at the expense of the plaintiff;
- The defendant accepted and used that benefit under circumstances that would be unfair for the defendant to keep the benefit without payment or reciprocation;
- The absence of an express, written contract.
An example of unjust enrichment could be a situation where a landscaper maintains a homeowner’s garden and lawn by mowing, trimming, weeding, watering, and fertilizing. Here, the homeowner and landscaper orally agreed that the landscaper would do these things without signing any express, written contract.
The homeowner received a benefit. In essence, this element requires evidence that the homeowner derived a benefit from the services the landscaper rendered. In any unjust enrichment case, this evidence could come in the form of services provided, or in the form of the transfer of goods or property without proper payment. Here, it is clear that the landscaper offered a benefit to the homeowner in the form of improving and maintaining the homeowner’s land.
At the landscaper’s expense. This element requires showing that the benefit conferred resulted in costs for the landscaper. Here, the landscaper committed his time to provide these services and covered the cost of materials needed to provide these services.
It is unjust for the homeowner to retain the benefit conferred by the landscaper. The final element examines whether it would be unjust, or unfair, for the homeowner to retain the benefit without compensating the landscaper. Here, the landscaper would argue it is unfair for the homeowner to enjoy a maintained and enhanced yard while the landscaper incurred both financial and time related burdens. Thus, making it unjust for the homeowner to deny payment for the services provided.
Remedy for an unjust enrichment claim. The typical remedy for unjust enrichment usually involves the court ordering restitution to the party who suffered the loss. According to a trial lawyer, restitution can involve the court ordering the defendant to return something to its rightful owner, or an order to compensate the plaintiff by paying for the benefit they received. Here, the court would order the homeowner to pay the landscaper for services rendered and materials used. This would rectify the imbalance of fairness and deter the homeowner from unfairly benefiting at the plaintiff’s expense.
Thanks to Eglet Adams for their insight on unjust enrichment.
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