| From: | Sheehan Duncan Dr (LAW) <Duncan.Sheehan@uea.ac.uk> |
| To: | Chaim Saiman <Saiman@law.villanova.edu> |
| obligations@uwo.ca | |
| Date: | 20/10/2011 12:22:52 UTC |
| Subject: | RE: UNJER/Property question |
Surely when F pays P he does so in settlement of P’s claim against him – and certainly in England it would be for F to prove he was not negligent rather than for P to prove he was; my instinct is that it does not matter whether he’s a fiduciary actually. If there’s no contract, then it is relatively easy to say that F pays on a basis that fails (the thing will never be found) and therefore P owes F the money F paid over. Since F pays purely to settle the claim against him I don’t see that any property rights move from P to F, so P keeps the uptick in value. In any case as a bailee F has a possessory interest in the asset to start with and therefore has a claim against the thief (The Winkfield). The bailee can recover in full as against the thief, subject to passing on an amount equivalent to P’s loss. If F has already paid P in settlement then I would think he has the right to keep the full award available against the thief. If that award is then paid to P or the asset returned to P that provides the reason to unravel the payments between F and P – is it a subrogation claim? As between F and P, I wouldn’t have said so.
Even if it were a contract between P and F, I would think it attackable on the grounds of a common mistake that the asset was irrecoverable.
Duncan
From: Chaim Saiman [mailto:Saiman@law.villanova.edu]
Sent: Wednesday, October 19, 2011 6:57 PM
To: obligations@uwo.ca
Subject: UNJER/Property question
Dear ODGers,
I was hoping to solicit expert opinion as to the common law approach to this question of unjust enrichment/property law.
P (principal) bails res with fiduciary (F). The res is then stolen from under F’s possession, and instead of litigating, F voluntarily pays (P) fair market value for the stolen res. The thief is then found, but the res has increased in value. Who gets the more valuable res? Assume no contract. Further, would it make a difference whether F was in breach of his duty of care or not?
I assume that in a more standard case, where the res was of equal value, F has a straightforward UJER/subrogation claim against P (if the res was returned directly to P), and we probably don’t care much about who “owns” the res. But when the res increases in value, we want to know whether in paying P, F acquired an interest in the res or not.
This issue (and variations of it) are debated in the Talmud. Under Jewish law a gratuitous F would have to take an oath that he has not breached his duty of care to be exempt. However, given the drastic theological consequences of taking oaths, many F’s are reluctant to do so, so that they pay P without a determination of liability. The question is who gets the res or the uptick in value?
The issue has increased salience in Jewish law since (at least in theory) a thief is required to pay a 100% fine to the Owner in addition to returning the res. Consistent with UJER law, the Talmud is clear that if he pays, F gets the (at least value of) the res, but in the absence of contractual language, the Talmud debates who is entitled to the fine. The Talmud’s medieval commentators then expand this debate to a case where the res increased in value.
But of course in this venue, I am asking for thoughts (and citations) in the common law dimension.
Thanks
Chaim
Chaim Saiman
Associate Professor
Villanova Law School
610.519.3296
saiman@law.villanova.edu