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Paul Matthews has just given me a copy of a case decided in the Royal Court of Jersey (Samedi Division), by B I LeMarquand, Greffier Substitute, on 25th November: _Planning and Environment Cttee of the States of Jersey_ v _Lesquende Ltd_. The case may be of interest to members of the group, for the Greffier Substitute's pre-Kleinwort response to an argument that D had been unjustly enriched because P had paid him a sum of money under a mistake of law.

The background to the case was that P had used its statutory powers of compulsory purchase to acquire certain land belonging to D, and paid it c £2.5 million for the land. Pursuant to the relevant statutory regime a board of arbitrators was also appointed to determine whether any further sum should additionally be paid, which board later held that a further £2.4 million (or thereabouts) should be paid by P to D, along with interest, bringing the total further sum payable up to approx £2.7 million. D accepted this sum without any reservation that it might wish to challenge the decision of the board of arbitrators.

However, D then launched proceedings seeking a judicial review of the board's award, and in response P admitted that the award should be set aside, but on different grounds. In these proceedings, both parties therefore asked the Royal Court to set the award aside, which it did, holding that the award should be quashed as being ultra vires, and remitting the arbitration back to the board. P then commenced the present proceedings, seeking an order that that D return the £2.7 million.

The Greffier Substitute held that the effect of the Royal Court's decision in the previous proceedings to quash the award and remit the arbitration was that the award ceased to exist. He also held that for this reason D should make restitution of the money to P.

P certainly seems to have argued the case as a case of UE, and the Greffier Substitute to have accepted it as such, but it is unclear from the judgment what unjust factor he thought to be operating here - possibly, he was feeling his way towards ordering restitution on the ground that the payment was made for 'no consideration'. Alternatively, though, it might perhaps be possible to explain the case as grounded in estoppel reasoning, since he laid great emphasis on the fact that it would be 'unjust for D to be permitted to keep the fruits of the Award (ie the sum whose return is now being sought) and at the same time to be able to continue to argue for a larger sum, having participated in setting aside the award'.

One thing which is clear, though, is that the Greffier Substitute did not think that P could recover on the ground of mistake - and his comments on this point are worth quoting in full, in the light of Lord B-W's subsequent misgivings in Kleinwort:

"Para 5(e) sets out an argument that repayment should not be ordered pursuant to the principle of unjust enrichment because D had been paid pursuant to an error of law. I asked Advocate Habin to explain to me what was the relevant error of law and he replied that it was that P had wrongly paid out the moneys on the basis that the Award was not ultra vires and therefore void. I immediately dismissed this line of argument. At the time when the payment was made, the Award had been registered and when payment was made, it was accepted without any reservation. That would normally have brought the matter to an end. It cannot possibly be argued that an award which has been registered in the Royal Court can be void ab initio. At the most it is capable of being set aside by action. At the time when the payment was made there was no such action in existence."

Charles

______________________________
Dr Charles Mitchell
Lecturer in Law
School of Law
King's College London
Strand
LONDON WC2R 2LS

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