Hostname: page-component-848d4c4894-ndmmz Total loading time: 0 Render date: 2024-05-18T13:08:34.064Z Has data issue: false hasContentIssue false

Limitation of Actions in Restitution

Published online by Cambridge University Press:  16 January 2009

Get access

Extract

This article attempts to investigate an aspect of the English law on limitation of actions which has received little academic attention—its application to restitutionary claims. It will be suggested that, as the essence of a plaintiff's claim is the injustice of the defendant retaining a benefit gained at his expense, the running of time should be a defence to a restitutionary action where its passing has sufficiently eroded the injustice of that retention. In theory this should be a matter for decision purely on the facts of each case, but additionally the societal need to discourage stale litigation often requires an overall time bar based on the Limitation Act 1980. This perspective suggests a number of particular conclusions which are summarised at the end of the discussion.

Type
Articles
Copyright
Copyright © Cambridge Law Journal and Contributors 1989

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

page 472 note 1 Goff, Lord of Chieveley and Jones, G. H., The Law of Restitution (3d ed., 1986)Google Scholar. Hereafter referred to as Goff and Jones.

page 472 note 2 Birks, P., Introduction to the Law of Restitution (1985)Google Scholar. Hereafter referred to as Birks.

page 472 note 3 Treitel, G. H., The Law of Contract (7th ed., 1987)Google Scholar.

page 472 note 4 Cheshire, , Fifoot, and Furmston, , Law of Contract (11th ed. by Furmston, M. P., 1986)Google Scholar.

page 472 note 5 Salmond, and Heuston, , Law of Torts (19th ed. by Heuston, R. F. V. and Buckley, R. A., 1987)Google Scholar.

page 473 note 6 Ibid., p. 664, quoting from Pirelli General Cable Works Ltd. v. Oscar Faber & Partners [1983] A.C. 1 at 6.

page 473 note 7 Preston, and Newsom, , Limitation of Actions (3rd ed. by Preston, G. H. and Abel-Smith, L., 1953)Google Scholar.

page 473 note 8 Franks, M., Limitation of Actions (1959)Google Scholar.

page 473 note 9 Lightwood, J., Time Limit on Actions (1909)Google Scholar.

page 473 note 10 Doe d. Duroure v. Jones (1791) 4 T. R. 300, at p. 308, Cholmondeley v. Clinton (1820) 2 Jac. and W. 1, affd. Bligh 1 H. L., A'Court v. Cross [1825] 3 Bing. 329, Coburn v. Colledge [1897] 1 Q.B. 702, at p. 710.

page 473 note 11 (1767) 3 Bro. C.C. 639.

page 473 note 12 (1874) L.R. 5 P.C. 221.

page 473 note 13 Ibid., p. 239.

page 474 note 14 Goff and Jones, p. 16.

page 474 note 15 K. York, “Extension of Restitutional Remedies in the Tort Field” 4 U.C.L.A.L.R. 499, at p. 454.

page 474 note 16 Ibid.

page 474 note 17 Goff and Jones, pp. 691–699.

page 475 note 18 See note 12 supra.

page 475 note 19 Infra, p. 490.

page 475 note 20 [1948] Ch. 465.

page 476 note 21 Ibid., p. 514.

page 476 note 22 Goff and Jones, p. 722.

page 476 note 23 Gibbs v. Guild (1881) 8 Q.B.D. 296, per Field J. p. 302.

page 476 note 24 [1915] 3 K.B. 106.

page 477 note 25 Goff and Jones, p. 722.

page 477 note 26 (1987) 9 Con. L.R. 139.

page 477 note 27 Section 29(5) “… where any right of action has accrued to recover—(a) any debt or other liquidated pecuniary claim; … and the person liable or accountable for the claim acknowledges the claim or makes any payment in respect of it the right shall be treated as having accrued on and not before the date of the acknowledgement or payment.”

page 477 note 28 Op. cit., p. 145.

page 477 note 29 Sale of Goods Act 1979, s. 8(2) and Supply of Goods Act 1982, s. 15(1).

page 477 note 30 Way v. Latilla [1937] 3 All E.R. 759.

page 478 note 31 [1954] 1 Q.B. 428.

page 478 note 32 [1984] 1 All E.R. 504.

page 478 note 33 Op. cit., p. 146.

page 479 note 34 See Franks, op. cit., p. 217.

page 479 note 35 Section 32(1)(a).

page 479 note 36 Section 32(1)(c).

page 479 note 37 Section 32(1)(b).

page 479 note 38 [1910] 1 K.B. 56.

page 480 note 39 It is interesting to note that in 1909, a year before Baker v. Courage was decided, Lightwood wrote in his text on Limitations(op. cit., supra) p. 259, that, “The true principle seems to be that the cause of action accrues and the Statute runs, in the case of mistake, as soon as the mistake is, or with reasonable diligence could have been discovered; and in the case of failure of consideration, so soon as the failure has with certainty occurred.”

page 480 note 40 Op. cit., supra.

page 481 note 41 (1804) 9 Ves. 292.

page 481 note 42 Stoljar, S. J., The Law of Quasi-Contract (1964)Google Scholar.

page 481 note 43 Ibid., p. 30.

page 481 note 44 (1862) 11 C.B.N.S. 566.

page 481 note 45 Ibid., p. 578.

page 482 note 46 Re Pauling's Settlement Trusts No. 1 [1964] Ch. 303, Halsbury's Laws (4th Ed.) p. 998, para 1476.

page 482 note 47 Authority for the proposition, though clear, is sparse and ill explained. Both Snell's Principles of Equity (28th ed., by Barker and Langan) p. 35, and the Court of Appeal decision in Re Pauling (supra), rely on a short statement in Halsbury. Certainly where equitable claims have direct common law counterparts, or equitable relief is sought in aid of legal rights, the limitation rules should be the same. But actions for breach of trust, for example, have no common law counterparts, and it is difficult to see what policy is thwarted by continuing to operate the doctrine of laches, with the statutory period acting as an automatic bar at the end of 6 years delay.

page 482 note 48 Goff and Jones, p. 621.

page 482 note 49 “Waiver of Tort and Suit in Assumpsit” 19 Yale L.J. 221 p. 235.

page 482 note 50 Keener, W. A., Quasi-Contract (1893) p. 175Google Scholar.

page 483 note 51 E.g. J., Denning in Beaman v. A.R.T.S. Ltd. [1949] 1Google Scholar K.B. 550.

page 483 note 52 Supra, p. 175.

page 483 note 53 Ibid., p. 177.

page 483 note 54 Ames, Disseisin of Chattels, Essays in Anglo-American Legal History Vol. III p. 541.

page 483 note 55 Salmond and Heuston, supra, p. 125.

page 483 note 56 Corbin, supra, p. 237.

page 483 note 57 Keener, supra, p. 179.

page 484 note 58 Palmer, G. E., Law of Restitution (1978) p. 53Google Scholar.

page 484 note 59 Goff and Jones, p. 622.

page 484 note 60 Ibid., p. 610.

page 484 note 61 So does J. Beatson, in “The Nature of Waiver of Tort” 17 Univ. of Western Ontario L.R. 1

page 484 note 62 E.g. S. Hedley, “The Myth of Waiver of Tort” 100 L.Q.R. 653 p. 671. Cf. also Jackman, M., “Restitution for Wrongs” [1989]Google Scholar C.L.J. 302, in which he argues that restitution for wrongs involves inter alia the protection of private property and relationships of trust and confidence.

page 484 note 63 [1967] 1 Q.B. 407.

page 484 note 64 D. Friedmann, “Restitution of Benefits Obtained Through the Appropriation of Property Or the Commission of a Wrong” 80 Col. L.R. 504.

page 485 note 65 (1883) 24 Ch.D. 429

page 485 note 66 Ibid., p. 455.

page 485 note 67 Supra, p. 507.

page 485 note 68 Supra, p. 175.

page 485 note 69 Palmer, supra, p. 55.

page 485 note 70 Felder v. Reeth 34 F. 2d 744, (9th Circuit 1929), Los Angeles Drug Co. v. Superior Ct. 8 Cal 2d. 71 (1936).

page 485 note 71 (1776) 1 Cowp. 371.

page 486 note 72 Supra.

page 486 note 73 Palmer, supra, p. 56.

page 486 note 74 House, “Unjust Enrichment; The Applicable Statute of Limitations” 35 Cornell L.Q. 792.

page 487 note 75 [1967] 1 Q.B. 407.

page 487 note 76 Birks, p. 351. The point was raised, albeit obiter in Orakpo v. Manson Investments Ltd. [1978] A.C. 95. The question was whether an equitable restitutionary right of subrogation could be relied on to evade a statutory limitation period placed by section 13(1) of the Moneylenders Act 1927, on “proceedings … for the recovery … of money lent.” The majority of the House of Lords thought that the purpose of the statute was to enforce a short (12 month) limitation period on any attempt to recover the money, even though the alleged right of subrogation (rejected by the House, hence the obiter nature of the dicta), did not arise out of the contract of loan rendered unenforceable by the 1927 Act (Lord Edmund-Davies p. 115).

page 487 note 77 [1948] Ch. 465.

page 488 note 78 Goff and Jones, p. 62.

page 488 note 79 Birks, p. 15.

page 488 note 80 Goff and Jones, p. 62.

page 488 note 81 Birks, p. 67.

page 488 note 82 Goff and Jones, p. 78.

page 488 note 83 Birks, pp. 57–70. In particular, not all the examples of constructive trusts cited by Goff and Jones as restitutionary would necessarily satisfy Birks's criteria, as the interest granted was more related to the justice of the case than a precise equivalence with the benefit conferred. E.g. in Binions v. Evans [1972] Ch. 359, which Goff and Jones regard as restitutionary, the purchaser of a property who had bought it with notice that the vendor had promised to let the plaintiff live there for her lifetime, was bound to hold it as a constructive trustee until her death. This does not fulfil the Birks' criterion for a restitutionary right in rem as there appears to be no equivalence between the value of the life interest granted to the plaintiff and any enrichment of the purchaser at her expense.

page 488 note 84 Falconer v. Falconer [1970] 1 W.L.R. 1333, Hazell v. Hazell [1972] 1 W.L.R. 301, Cooke v. Head [1972] 1 W.L.R. 518, Eves v. Eves [1975] 1 W.L.R. Per contra Pettitt v. Pettit [1970] A.C. 777 and Gissing v. Gissing [1971] A.C. 886.

page 488 note 85 Goff and Jones, p. 735.

page 489 note 86 See infra, p. 495.

page 489 note 87 See supra, p. 475.

page 490 note 88 (1906) 94 L.T. 756.

page 491 note 89 Brunyate, J. W., Limitation of Actions in Equity (1932)Google Scholar, Chapter 1.

page 491 note 90 Clough v. London and North Western Railway (1871) L.R. 7 Ex. 26, 35 per curiam.

page 491 note 91 [1950] 2 K.B. 86 per Jenkins L.J. at p. 92.

page 492 note 92 In this context it is interesting to note that the case of Gardner v. Brooke [1897] 2 I.R. 6 is a rare example of restitutionary reasoning in a limitation case. There the issue was whether the fact that the defendant co-debtor's obligation in respect of the original creditor was statue barred should affect the plaintiff co-surety's right of contribution where the plaintiff had paid on the debt within the limitation period. O'Brien J. made it clear that in the absence of express contract between the debtors, the obligation to contribute arose both at law and in equity when the co-debtor was benefited by reduction of the debt burden.

page 492 note 93 Tito v. Waddell No. 2 [1977] Ch. 106, at pp. 246–250.

page 493 note 94 Hovenden v. Annesley (1806) 2 Sch. & Lef. 607.

page 493 note 95 Re Astley Coal Co. (1899) 80 L.T. 116, Re Robinson [1911] 1 Ch. 502, Re Mason [1928] Ch. 385.

page 493 note 96 Randall v. Errington (1805) 10 Ves. 423.

page 493 note 97 [1889] A.C. 351.

page 494 note 98 [1954] 1 Q.B. 411, p. 419.

page 494 note 99 See Goff and Jones, p. 725.

page 494 note 1 [1948] Ch. 465 at pp. 514–516.

page 494 note 2 See p. 480 supra.

page 495 note 3 See Franks, op. cit., p. 207.

page 495 note 4 See the discussion in Brunyate, op.cit. pp. 254–257.

page 495 note 5 Limitation Act 1980, s. 21(1) “No period of limitation prescribed by this Act shall apply to an action by a beneficiary under a trust, being an action—

(a) in respect of any fraud or fraudulent breach of trust to which the trustee was party or privy; or

(b) to recover from the trustee trust property or the proceeds of trust property in the possession of the trustee, or previously received by the trustee and converted to his use. … S. 21(3) subject to the preceding provisions of this section, an action by a beneficiary to recover trust property or in respect of any breach of trust, not being an action for which a period of limitation is prescribed by any other provision of this Act, shall not be brought after the expiration of six years from the date on which the right of action accrued.”

page 495 note 6 See section 38 of the Limitation Act 1980 which incorporates into the Act the extended definition of trust and trustee found in section 68(17) of the Trustee Act 1925, and which includes expressly or by construction, implied resulting and constructive trustees, personal representatives, fiduciary agents and trustees de son tort.

page 495 note 7 See p. 487.

page 496 note 8 Goff and Jones, p. 62.

page 496 note 9 Ibid., p. 63.

page 496 note 10 Ibid., p. 735.

page 496 note 11 [1981] Ch. 105.

page 496 note 12 [1914] A.C. 398.

page 496 note 13 Scott, A. W., The Law of Trusts (3rd ed., 1967) Vol. 5, p. 3428Google Scholar.

page 497 note 14 Re Tilley's Will Trusts [1967] Ch. 1179. However, Goff and Jones argue at pp. 78–79 that in the absence of dishonesty, only a lien to secure repayment of the original sum should be available.

page 497 note 15 [1978] Q.B. 428.

page 497 note 16 Baylis v. Bishop of London [1913] 1 Ch. 127, Re Diplock [1948] Ch. 465.

page 497 note 17 Re Bond Worth [1980] Ch. 228; [1979] 3 W.L.R. 629.

page 497 note 18 Re Diplock [1948] Ch. 465.

page 498 note 19 Mills v. Drewitt (1855) 20 Beav. 632 and Re Ashwell's Will (1859) Johns 112.

page 499 note 20 Re Swain [1891] 3 Ch. 293, Re Somerset [1894] 1 Ch. 231, Thorne v. Head [1894] 1 Ch. 599, affd. [1895] A.C. 495.

page 499 note 21 [1948] Ch. 465.

page 499 note 22 Re Leslie Engineers Co. Ltd. [1976] 1 W.L.R. 292.

page 499 note 23 G. L. Baker v. Medway Building and Supplies Ltd. [1958] 1 W.L.R. 1216.

page 499 note 24 [1911] 1 Ch. 502.

page 499 note 25 [1928] Ch. 385.

page 500 note 26 Ibid., p. 391.

page 500 note 27 [1948] Ch. 465, p. 482.

page 501 note 28 Goff and Jones, p. 371.

page 501 note 29 Birks, p. 323.

page 501 note 30 Goff and Jones, p. 634.

page 501 note 31 See note 6 supra.

page 501 note 32 Harpum, C., “The Stranger as Constructive Trustee” (1986) 102Google Scholar L.Q.R. 114 and 267.

page 501 note 33 Ibid., at pp. 115–116.

page 502 note 34 Boardman v. Phipps [1967] 2 A.C. 46.

page 502 note 35 E.g. Eaves v. Hickson (1861) 30 Beav. 136.

page 502 note 36 See Harpum, op. cit., pp. 120–127 el seq.

page 502 note 37 ibid., at pp. 288–289.

page 502 note 38 Re Gallard [1897] 2 Q.B. 8.

page 502 note 39 Brunyate, op. cit., note 89 supra.

page 502 note 40 Ibid., p. 108.

page 503 note 41 [1987] 2 W.L.R. 1192.

page 503 note 42 Ibid., p. 1211.

page 503 note 43 Belmont Finance Corp. Ltd. v. Williams Furniture Ltd. [1979] Ch. 250, 267, 275.

page 503 note 44 [1893] 2 Q.B. 390.

page 503 note 45 Ibid., p. 397.

page 504 note 46 [1929] 2 Ch. 213, p. 222.

page 504 note 47 [1977] Ch. 106.

page 504 note 48 Ibid., p. 249.