Friends sharing house could found unjust enrichment case
A claim for unjust enrichment by one of two friends who bought a property together in order to benefit economically from living in the same house, through which one made transfers of money for the benefit of the other, which were not based on any underlying condition such as promise of cohabitation, was relevantly brought as an instance of the Roman law condictio ob causam finitam. This is recognised in Scots law despite the lack of case law to that effect.
Sheriff George Jamieson at Kilmarnock gave these rulings in an action of division and sale by Angela King against Yvonne Adam, in which the pursuer challenged the relevancy of the defender’s counterclaim. The parties had previously each owned their own properties; these had been sold and loan repayments made prior to the joint purchase of properties in which the parties resided until the pursuer “removed herself”.
The counterclaim was supported by averments relating to the property transactions, averments of a family gift of money to the defender, said to have been used to convert a garage into living space for the pursuer, and that the defender had been responsible for the monthly repayments on a loan secured over one property.
Sheriff Jamieson said that following the series of cases culminating in Shilliday v Smith (1998), it was no longer necessary to base a claim for unjustified enrichment on one of the condictiones of Roman law, though these remained relevant to considering categories of cases in which an obligation to redress unjustified enrichment might arise.
The condictio ob causam finitam required a valid basis for payment or transfer which had subsequently ceased to exist. It was referred to by Craig and Stair, but in modern times only in a footnote in Gloag and Henderson, and in Professor Whitty’s work on unjust enrichment in the Stair Encyclopedia, where it was argued strongly that it should be recognised. The sheriff saw no reason to depart from Professor Whitty’s arguments.
He observed: “In my opinion, the doubt is therefore not so much as to the application of a remedy for unjustified enrichment on cessation of cohabitation, but whether the remedy comes under the description of the condictio causa data causa non secuta or the description of the condictio ob causam finitam.
“There is, to my knowledge, no decided case in which the remedy for unjustified enrichment has been considered in the context of a situation where two friends lived together.
“However, I consider that the defender was correct to argue for the present case to be understood as an example of the condictio ob causam finitam and not the condictio causa data causa non secuta.
“… The transfers of money by the defender for the benefit of the pursuer in this case were… not based on any underlying condition, such as a promise of marriage or... cohabitation for life. The transfers were for the cause of the parties economically benefiting from living in the same house together. As soon as that state of affairs ceased to exist, so did the reason for the transfers of the money.”
The defender’s pleadings however had been poorly drafted, and proof before answer would be allowed, excluding the claims based on the use of the gift and on the loan monthly repayments.