4/14/11 3:31 PM
I. Unjust Enrichment
A. Background Intro
· Unjust enrichment is a cause of action
o Aka “quasi-contract” and “contract implied law”
§ Found a contract just to apply remedies
o Benefit conferred on recipient
o Unjust to retain benefit without compensation
· “Officious intermeddler”
o Someone who does not have intent to confer a gift, person offering service intended to be compensated for service. Recipient might not request, but might also not want it.
§ Windshield washer.
o Confers the benefit with the intent to give a gift. Courts don’t always use these terms.
o No intention of being paid.
· Restitution=remedy for unjust enrichment
· Party must give benefit back
· Quantum merit= valuation method SERVICE
· Equal to market value of service conferred
· Quantum valebant= market value of goods conferred GOOD
· Enforceable rights even if there are no promises
· Manufacturing contract that was never created for sole purpose of creating a remedy
o Unconscious person never assented to consent. Assuming you consent for services rendered, ie ER, we know that it is the right thing to do.
E. What to do differently
· Get intentions in writing, make your intent very clear
· Void= as if contract never happened
· Voidable= one party has option to deem contract void
· Unenforceable= valid contract but no remedy
· Agreement is voidable if assent justifiably induced by fraudulent or material misrepresentation
· Savis, he mis-represented what he was really doing with his time
· Restatement §162
o Misrepresentation is fraudulent if the maker intends his assertion to induce a party to manifest his assent and the maker
§ A. knows or believes that the assertion is not in accord with the facts or
§ B. does not have the confidence that he states or implies in the truth of the assertion, or
§ C. knows that he does not have the basis that he states or implies for the assertion.
· Misrepresentation Continuum
. . .
Fraud Reckless Negligence
· Puffery= vague or ambiguous statements
A. Misunderstanding is when parties use same words but attach irreconcilably different meaning to them
o Parities have different meanings for the same word or words
o Neither party know the other’s meaning
o Words are material to the contract
o One party’s meaning is not more reasonable than the other’s
o Raffles case: two separate peerless ships from Bombay
o Fifty Six Twenty case
§ Did he have authority to do that? His understanding reasonable?
· Contracts rarely fail due to misunderstanding
o Facts exist at time of contract
o Parties of contract
o Fact relates to basic assumption underlying contract
o Mistake as a material effect on contract’s value
o Complaining party does not bear the risk.
o Risk allocations:
§ By contract
§ Reckless about lack knowledge
§ Reasonable for party to bear
o Impracticability= supervening fact that makes performance impractical … versus..
o Frustration of purpose= supervening fact makes performance moot
o Force majeure= act of God/ event outside parties’ reasonable control
· If force majeure affects basic contract assumption and makes performance impractical/moot, performance excused unless contract specifies otherwise
o Ex. Cruise or something where weather may permit and act
· Restatement § 261
o Where, after a contract is made, a party’s performance is made impracticable without his fault by the occurrence of an event the non-occurrence of which was a basic assumption on which the contact was made, his duty to render that performance is discharged, unless the language or the circumstances indicate the contrary.
§ Subjective: I cannot provide
§ Objective: It cannot be done
· All about who bore risks?
E. Frustration of Purpose
· Krell v. Henry
o Performance not impossible because he could have come and Henry could have still paid.. Court still decided to excuse performance because purpose of visit was frustrated.
· Restatement 265: Claim of Frustration of purpose
§ 1. Purpose that is frustrated must be have a principal purpose of that party
§ 2. Frustration must be substantial
§ 3. Non occurrence must have been a basic assumption