Unjust Enrichment: Definition, Example and Related Terms

Unjust enrichment is a legal principle that no person or entity should be allowed to profit at another's expense without offering compensation for the reasonable value of any property, services, or other benefits that have been unfairly acquired and retained. In essence, it's about restoring fairness when one party has gained at the expense of another without a valid legal reason.

For example, if a homeowner accidentally pays a contractor twice for the same work, the contractor keeping the extra payment would be considered unjust enrichment. The homeowner is entitled to restitution of the extra payment, ensuring that the contractor does not benefit unfairly from an oversight.

Unjust enrichment can arise in various situations, including mistaken payments, failure to perform services after receiving payment, or benefiting from someone else's properties without consent. The concept underpins many claims in restitution, forcing the return of the benefit or its value to the aggrieved party.

In commercial contracts, claims of unjust enrichment can help address situations where one party is unfairly enriched due to a breach or mistake, ensuring equitable outcomes. Understanding this concept can aid in both preventing and resolving disputes over misplaced benefits.

It's important to note, however, that the imposition of unjust enrichment does not apply where a legal basis such as a contract or statutory right provides for the benefit obtained. Acknowledging these boundaries is key to the equitable application of this principle.