James Barr Ames and the early modern history of unjust enrichment

Oxford Journal of Legal Studies

Volumn 25, Issue 2, 2005, Pages 297-319

  Kull, Andrew ^a  

^a BOSTON UNIVERSITY   (United States)

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EID: 27844612027     PISSN: 01436503     EISSN: None     Source Type: Journal    
DOI: 10.1093/ojls/gqi015     Document Type: Article

References (102)

1. Laycock, 'The Scope & Significance of Restitution', 67 Tex. L. Rev. 1277, 1277-78 (1989).
2. Compare Sherwin, 'Restitution and Equity', 79 Tex. L. Rev. 2083 (2001) ("The law of restitution, as we know it, was invented in 1937.... The reporters...assembled a variety of doctrinal rules-not previously linked-...connected by the principle of unjust enrichment").
3. R. Goff & G. Jones, Law of Restitution v, (1966) 11-12. A restitution sceptic like Steve Hedley is similarly content to let the American Law Institute take the credit-such as it is-for originating what he calls "the current view of the subject." "First in line should perhaps be Seavey and Scott, who as reporters...began to popularise the idea that there was such a subject as restitution, and that unjust enrichment was the key to it."
4. S. Hedley, A Critical Introduction to Restitution (2001) 8-9.
5. P. Birks, Unjust Enrichment (2003) 4.
6. See, e.g., D. J. Ibbetson, A Historical Introduction to the Law of Obligations (1999) 284-87.
7. W. A. Keener, A Treatise on the Law of Quasi-Contracts (1893) 19.
8. F. C. Woodward, The Law of Quasi Contracts (1913).
9. James Brown Scott, Cases on Quasi-Contracts (1905);
10. Edwin Woodruff, Selected Cases on the Law of Quasi-Contracts (1905).
11. A third casebook, Edward Thurston, Cases in Quasi-Contract, was first published in 1916. The most interesting of the three books-unfortunately difficult to find-is the compilation edited by Scott, a law professor at Illinois and Columbia who left teaching shortly thereafter for a distinguished career in public international law. On this early period of Scott's career
12. see Cassidy, 'James Brown Scott: A Citizen of the World', 9 N.Y.U. LQR. 49, 52-53 (1931).
13. Wilgus, 'Legal Education in the United States', 6 Mich. L. Rev. 647, Table VI (following page 678) (1908).
14. American Law Institute, Restatement of Trusts, Preliminary Draft No. 1 (Sept. 29, 1928).
15. See also Restatement of Trusts, Tentative Draft No. 1, §5 (March 10, 1930) (referring to a future "Tentative Draft of a Chapter on Constructive Trusts").
16. 9 ALI Proc 58 (1931).
17. 10 ALI Proc 41 (1932).
18. 11 ALI Proc 44 (1933).
19. 11 ALI Proc 335 (1934).
20. Id.
21. It is a claim that Seavey and Scott essentially made for themselves. "It so happens," they wrote, sketching the theory of the new Restatement for the readers of the Law Quarterly Review, "that because of the way in which the English law developed, a group of situations having distinct unity has never been dealt with as a unit....It was for the purposes of making clear the principles underlying this group...that the Restatement of this subject was undertaken." Seavey & Scott, 'Restitution', 54 LQR (1938) 29.
22. Warren A. Seavey & Donald B. King, A Harvard Law School Professor: Warren A. Seavey's Life and the World of Legal Education (2005) 67.
23. Wright, 'Book Review (Restatement of the Law of Restitution)', 51 Harv. L. Rev. 369, 380 (1937).
24. Winfield, 'The American Restatement of the Law of Restitution', 54 LQR 529, 532 (1938).
25. Jackson, 'The Restatement of Restitution', 10 Miss. LJ 95, 95-96 (1938).
26. Id. at 102.
27. See also Logan, Book Review (Restatement on Restitution), 2 MLR 153, 155 (1938) ("This linking of constructive trusts and quasi-contract will seem rather strange to most English lawyers, though it is something of a commonplace in America").
28. Williston, Life and Law: An Autobiography (1941) 73.
29. Ames, 'Purchase for Value Without Notice', 1 Harv. LR 1, 3 (1887).
30. Ames, 'Implied Assumpsit', 2 Harv. L. Rev. 53, 64 (1888).
31. "From the Lecture Room," 1 Harv. LR 103-04 (1887).
32. See, e.g., Re Omegas Group Inc, 16 F3d 1443 (6th Cir 1994); [1995] RLR §294.
33. See, e.g., Ames, 'The Failure of the "Tilden Trust"' 5 Harv. LR 389, 395 (1891) (function of constructive trust in preventing unjust enrichment);
34. Ames, 'Can a Murderer Acquire Title by His Crime and Keep It?', 36 Am. L. Reg. 225, 237-28 (1897) (extent of constructive trust limited by extent of wrongdoer's enrichment);
35. Ames, Following Misappropriated Property Into Its Product, 19 Harv. L. Rev. 511 (1905) (claimant's claim in substitute property measured by principles of unjust enrichment);
36. Ames, 'Constructive Trusts Based Upon the Breach of an Express Oral Trust of Land', 20 Harv. LR 549, 550 (1907) (arguing that defaulting grantee should not "make the statute [of frauds] a source of profit to himself at the expense of the promisee");
37. Ames, 'Law and Morals', 22 Harv. LR 99, 107-08 (1908) (principles of unjust enrichment shape equitable remedies against defaulting trustees and their subsequent grantees).
38. Keener, 'Recovery of Money Paid Under Mistake of Fact', 1 Harv LR 211 (1887).
39. 1 Keener, Selection of Cases on the Law of Quasi-Contracts v (1888).
40. Williston, supra note 21, at 135.
41. Harvard Law School Association, The Harvard Law School: 1817-1917 40-41 (1917).
42. See, e.g., S. W. [Samuel Williston], Book Review (Keener, Treatise on the Law of Quasi-Contracts), 7 Harv. L. Rev. 245 (1893) ("Professor Keener, following the division suggested by Professor Ames...");
43. James Brown Scott, Cases on Quasi-Contracts v (1905) ("The present collection follows, and necessarily, Mr. Ames's classification of the nature and extent of quasi-contract, as did Judge Keener, both in his Cases and Treatise");
44. Wald, 'The Law of Quasi-Contract', 14 LQR 253, 257 (1898).
45. Following the publication of his treatise on quasi-contract, Keener produced three more casebooks (on contracts, equity, and corporations); edited a collection of "selections on the elements of jurisprudence"; and published a single law review article-seemingly undertaken as a matter of duty-for the introductory number of the Columbia Law Review in 1901. Keener gave up the Columbia deanship in 1902 to accept an appointment to the unexpired term of a deceased judge of the New York Supreme Court: "his career as a judge was brief and on the whole uneventful," since he failed to win election to a full term the following year. Keener thereafter returned to private practice "and continued in it, with only inconspicuous success," until his death in 1913. 5 Dictionary of American Biography 285 (1933).
46. See, e.g., Costigan, 'The Classification of Trusts as Express, Resulting, and Constructive', 27 Harv. LR 437, 449-50 n.31, 453 (1913) ("a resulting trust is implied in fact [while] a constructive trust is an equitable quasi-contract," both being enforced "for the very same fundamental reason...namely, to prevent the unjust enrichment of the fraudulent retainer of the property");
47. Pound, 'The Progress of the Law - Equity', 33 Harv. LR 420, 421 (1919) (describing "what we have come to think the typical case of constructive trust, namely, specific restitution of a received benefit in order to prevent unjust enrichment");
48. Scott, 'Resulting Trusts Arising Upon the Purchase of Land', 40 Harv. LR 669, 674 (1927) (arguing that the extent of relief available on a theory of resulting trust depends on the extent of unjust enrichment to be prevented thereby).
49. The pioneering "restitution" casebook was published in 1924 by Walter Wheeler Cook of the Yale Law School, as volume 3 of his three-volume Cases and Other Authorities on Equity. As Cook explained in the preface: The collection of cases in the present volume represents an attempt to combine the material usually presented in advanced equity courses dealing with reformation, rescission, and restitution with that contained in the course commonly called quasi-contracts. Asked a number of years ago to teach both courses, the editor soon found that to a very large extent the two courses dealt with the same, or at least very similar, situations; one being limited to a discussion of the common-law remedies available, chiefly by way of an action leading to a money judgment, the other to equitable remedies. Underlying a large part of both was the principle forbidding so-called "unjust enrichment." 3 Cook, Cases on Equity ix (1924). Like the reviews that followed the publication of the Restatement itself in 1937, the contemporary response to Cook's Cases on Equity indicates that the idea of combining legal and equitable responses to unjust enrichment was not altogether a novelty. "The third volume is even more praiseworthy," wrote Edwin Patterson of Columbia: Here the editor had no beloved theory to thrust in one's face - unless it be the theory that quasi-contract can be successfully taught along with the similar "equity" cases, and that to the present reviewer is no longer a theory, but a fact. Two years' experience in teaching such a combination course with Professor Cook's materials in mimeographed form, has been sufficient to convince one who was, to say the least, mildly skeptical. The course has proved to be the most interesting one which the present writer has the good fortune to teach. The "conflict" between "law" and "equity" is subordinated to the underlying ethical problems of the "substantive" law.
50. Patterson, Book Review (Cook, Cases on Equity, volumes I and III), 23 Mich. L. Rev. 813, 815 (1924). Patterson's comments are of interest primarily because Patterson was a member of the ALI Committee on Restitution and Unjust Enrichment organized in 1933. Even more interesting in view of its date - eight years before the commencement of the ALI restitution project - is a review by E. Merrick Dodd, Jr., a law professor who is remembered today as a student of business corporations. Dodd had been a member of the first class to matriculate at Harvard Law School after Ames's death, and his confident comments on unjust enrichment presumably reflect the orthodox Harvard view at the time: Despite the analogy to the common law of contract suggested by the use of the term "quasi-contract" or "contract implied in law," it has long been recognized that so-called quasi-contracts are not contracts at all, differing therefrom both in the nature of the obligation, which in quasi-contracts is non-consensual, and in the nature of the relief granted, which is not based on the theory of compensation for wrong but of prevention of what would, were no recovery allowed, constitute unjust enrichment. The prevention of unjust enrichment is, however, one of the fundamental purposes of equity and, especially, of the equitable doctrines of rescission and reformation of contracts induced by misrepresentation or mistake....[In such cases] an equitable suit for rescission...is a suit for the restitution to the plaintiff of property which it would be unjust for him to retain, the principle being the same as that underlying quasi-contract actions based on mistake or fraud.... ...[O]ther similar branches of equity...can best be dealt with in connection with quasi-contract....An effective argument can also be made for linking up, as Professor Cook has done, the equitable doctrine of imposing a constructive trust upon a tort-feasor who has profited by his tort with the quasi-contract remedy of waiver of the tort and suit in assumpsit.... [Given the similarity of the relevant principles of law and equity,] the substantive law will be better understood if two forms of relief resting on the same fundamental theories and applicable to the same or similar subject-matter be studied in one place....
51. Dodd, Book Review (Cook, Cases and Other Authorities on Equity, Volume 3), 11 Cornell LQ 132, 132-33 (1925).
52. Shaler v. Trowbridge, 28 N.J. Eq. 595, 602 (1877).
53. Prior to Ames, the standard explanation of constructive trust in American law was that it was an equitable remedy for actual or constructive fraud. See 1 Perry, Trusts and Trustees §166 (3d ed. 1882) ("If a person obtains the legal title to property by...circumvention, imposition, or fraud, or [otherwise] under such circumstances that he ought not, according to the rules of equity and good conscience as administered in chancery, to hold and enjoy the beneficial interest of the property, courts of equity, in order to administer complete justice between the parties, will raise a trust by construction out of such circumstances...").
54. The first appearance of the new explanation in a work directed at practitioners appears to be Bogert, Law of Trusts §35 (1921) (stating that constructive trust is available "[w]henever equity finds that one has obtained or now retains the legal title to property, real or personal, by any kind of wrongdoing, actual or constructive, so that a retention of such title will result in his unjust enrichment").
55. In re Ennis, 187 F. 720, 725 (2d Cir. 1911) ("The proceeds of the claimant's bonds constituted trust funds, which were traced into the Mechanics' Bank and have unjustly enriched the bankrupts' estate");
56. Bremer v. Williams, 210 Mass. 256, 257, 96 N.E. 687 (1911) ("The principle is that where a trustee of several estates steals money from one, with which to pay the debts of another, the latter, having been unjustly enriched at the expense of the former, may be required in equity to make restitution").
57. A New Jersey chancery judge, writing in 1912, referred explicitly to the new terminology: "These cases present two theories, one that of 'unjust enrichment' (to use the nomenclature now coming into vogue), on which the action for money had and received and what are now called 'quasi-contracts,' rest......" Peterson v. Reid, 80 N.J. Eq. 450, 458, 85 A. 250, 253 (Err. & App. 1912).
58. More elaborate references to unjust enrichment as the basis of various equitable remedies appear in the opinions of Benjamin Cardozo, ten years before the commencement of the ALI's restitution project. See, e.g., Whiting v. Hudson Trust Co., 234 N.Y. 394, 408, 138 N.E. 33, 38 (1923).
59. A two-volume treatise on Equitable Remedies, appended in 1905 by John Norton Pomeroy, Jr., to his late father's treatise on Equity Jurisprudence, included the following explanation of the overall doctrine of subrogation: The same equity which seeks to prevent the unearned enrichment of one party, at the expense of another, by actions for reimbursement, contribution, and exoneration, operates here, by creating a relation somewhat analogous to a constructive trust...in all legal rights held by the creditor.
60. 2 John Norton Pomeroy, Jr., Equitable Remedies §920 (1905). The son's work was published (and frequently cited) as volumes 5 and 6 of a six-volume third edition (1905) of the elder Pomeroy's Equity Jurisprudence.
61. Williston ("S.W."], Book Review, 7 Harv. LR 245 (1893) (emphasis added).
62. Because the original Harvard casebooks contain little or no editorial commentary, it is impossible to prove ex silentio that a given idea, nowhere mentioned in a particular book, had not yet occurred to the editor. Still it may be noted that Ames's earliest published casebooks contain no reference to unjust enrichment as an explanatory principle, even at those points where he would later emphasize the idea. For example, Ames's Selection of Cases on the Law of Trusts (1881) contains no mention of unjust enrichment in its treatment of constructive trusts (321-52).
63. In the same work, editorial notes on "Purchase for Value Without Notice" (531-33) and "What Interest in Trust Property Passes to the Assignee of a Bankrupt Trustee" (560) likewise make no reference to any explanation in terms of unjust enrichment; whereas in treating these topics six years later, Ames - as we have already seen - seemingly went out of his way to mention unjust enrichment as a source of the relevant legal doctrines.
64. See the texts cited at nn. 22-23, supra. By contrast, Ames's Selection of Cases on the Law of Partnership (1881-87) does contain, at 544, a brief editorial note that unmistakably reflects his new interest in the theory of unjust enrichment. The topic is the liability of former partners for debts ostensibly contracted by the partnership subsequent to its formal dissolution: Equitable Claim for the Consideration Furnished to the Firm. If the money, goods, or other consideration furnished by a creditor has been actually applied for the benefit of the firm in the winding up of the partnership affairs, and the creditor is precluded by knowledge or public notice from charging the partners upon the express contract, he ought to be allowed to recover what he has furnished or its equivalent, upon the equitable principle that no one shall be permitted dishonestly to enrich himself at the expense of another. This principle was recognized in Prudhomme v. Henry, 5 La. Ann. 700 (see also Boguereau v. Guéringer, 14 La. An. 478, 479);
65. White v. Tudor, 32 Tex. 758.
66. But see, contra, Abel v. Sutton, 3 Esp. 108 (semble);
67. Kilgour v. Finleyson, 1 H. Bl. 155
68. Bowman v. Blodgett, 2 Met. 308
69. Haven v. Goodel, 1 Disney, 26
70. McCowin v. Cubbison, 72 Pa. 358.-Ed. Judging from the title page of the bound volume, the Cases on Partnership were originally published in fascicles from 1881 to 1887; though the copyright notice on the verso of the title page gives a date of 1893. The section toward the end of the book in which the quoted material appears (Chapter VIII, Section III, pp. 535-58) appears in fact to have been prepared in 1887: Ames's citations in this section (in notes similar to the passage just quoted) include at least one case decided in that year, and none apparently decided thereafter. The evidence of the casebooks ultimately proves nothing, for the reasons already stated; but it is consistent with the surmise that Ames became persuaded of the explanatory power of "unjust enrichment" at some point after 1881 and before 1887.
71. In a letter to Ames, referring to "a course of lectures I have been giving at Oxford on the early history of Contract," Pollock reported that "This caused me to go carefully through your articles on Assumpsit, and I was confirmed in agreement with you." Pollock to Ames, Dec. 7, 1889 (James Barr Ames Correspondence, Harvard Law School Library). It is interesting to note that Ames's observations about the equitable basis of indebitatus assumpsit did not persuade Pollock to alter by so much as a word the accurate but comparatively old-fashioned account of quasi-contractual obligations that already figured in his Contracts treatise. Distinguishing such obligations from those based on genuine but tacit assent, Pollock explained that there are cases in which it is just and expedient that an obligation analogous to contract should be imposed upon the person receiving the benefit....[A]s the forms of our law do not recognise quasi-contracts in any distinct manner, these cases are dealt with by the fiction of an implied previous request, which often has to be supplemented (as in the action for money had and received) by an equally fictitious promise....In this as in many other instances the modern state of the law represents a compromise between the forms of pleading and the convenience of mankind. But we do not further pursue this topic.
72. F. Pollock, Principles of Contract (1876) 29. The tenth edition of the same work (the last prepared by Pollock) advised that the use of the term "constructive contract" (in place of quasi-contract) was "now generally recognized," while repeating in substance the discussion of the first edition, published sixty years before.
73. F. Pollock, Principles of Contract (10th ed. 1936) 13.
74. Moses v. Macferlan, 2 Burr. 1005, 1012, 97 Eng. Rep. 676, 681 (K.B. 1760).
75. Williston, 'James Barr Ames - His Services to Legal Education', 23 Harv. LR 330-32 (1910). The anonymous Memoir published in 1913 as a preface to Ames's collected lectures recalled that Ames loved to evolve and apply a legal principle. Once satisfied that a certain principle was sound, he would look for applications of it in all branches of the law, and his enthusiasm would lead him to believe that judges had acted on the principle in deciding certain cases where (in all probability) the judges had been profoundly unconscious of any such principle.
76. Ames' Lectures on Legal History (1913) 17.
77. Blewett Lee to Francis S. Philbrick (Feb. 18, 1926) (copy in Harvard Law School Library) (emphasis added).
78. One interesting example is England v. Clark, 5 III. 486 (1843). The plaintiff had purchased a horse at an execution sale. The horse was not in fact the property of the debtor, and its owner later recovered it from the plaintiff. The plaintiff (represented before the Illinois Supreme Court by Abraham Lincoln) sought to recover the price of the horse from the execution creditor, to whom the money had been paid by the sheriff;
79. Lincoln cited Moses v. Macferlan for the proposition that this was money the creditor could not in equity and good conscience retain. The court rejected the plaintiffs claim, remarking that Lord Mansfield's "latitudinous reasoning" in Moses v. Macferlan had been "doubted, questioned, shaken, overruled." Id. at 490. It did not apply to the present case in any event, inasmuch as the judgment creditor had "received no more than he was legally entitled to." Id. at 493.
80. Cf. Metamorphoses ii.5.
81. Kirklan & Hickson v. Brown's Adm'rs, 23 Tenn. 174, 175 (1843).
82. Carter v. First Ecclesiastical Soc'y of Canterbury, 3 Conn. 455, 461 (1820).
83. See the memoir of Nisbet (by Judge Joseph Rucker Lamar) in 4 Great American Lawyers (William Draper Lewis ed. 1980) 331, 359 (describing the decision in the case as Nisbet's "greatest opinion, accorrding to the general estimate of the Georgia Bar").
84. Culbreath v. Culbreath, 7 Ga. 64, 67-68 (1849).
85. La. Civ. Code arts. 1958-1962 (1825). The text was carried forward as Articles 1963-1967 of the Revised Civil Code of 1870.
86. La. Civ. Code art. 1960 (1825).
87. In a section entitled, "De l'interprétation, pour déterminer les suites naturelles des conventions, quoique non exprimées dans l'acte," Toullier observes that: Les conventions obligent non seulement à ce qui est exprimé, mais à toutes les suites que l'équité, l'usage ou la loi, donnent à l'obligation d'après sa nature... Les obligations accessoires à l'obligation principale, et qui la suivent toujours, quoique non exprimées dans le contrat: l'equité, l'usage, la loi. 6 C.-B.-M. Toullier, Le droit civil français, suivant l'ordre du code, ¶334, at 367 (4th ed. 1824). Explaining the meaning of equite in this context, Toullier refers principally to an implied obligation of good faith in the negotiation, drafting, and execution of contracts. Among further examples he mentions the following, which is evidently the source of the Louisiana text: C'est sur l'equite que sont fondées ces règles de droit que nous a transmises la sagesse des jurisconsultes romains, et qui ne sont pour la plupart que des développements de ce grand précepte de la sagesse divine, ne fais pas à autrui ce que to ne veux pas qu'on to fasse à toi-même. Il est contraire au droit naturel de s'enrichir au détriment d'autrui. Jure naturae aequum est neminem cum alterius detrimento et injuriâ fieri locupletiorem [citing Pomponius D.50.17.206].
88. Id. ¶338, at 371. As a footnote to the maxim of Pomponius, Toullier appends a quotation that he attributes to Cicero, though his immediate source is somewhere in the canon-law tradition of the lus commune: "Alteri aliquid detrahere, et suum augere commodum cum alterius incommodo, magis est contra naturam quam ipsa mors, dolor et paupertas......" The classical original is at De Officiis iii. 21.
89. The principle was much more frequently invoked in the context of what we would recognize as restitution claims than in connection with the interpretation of express contracts. See, e.g., Police Jury v. Hampton, 5 Mart. (n.s.) 389, 397 (La. 1827) ("He should, therefore, pay for the labour by which he was benefited; and it would be unjust that, in this manner, he should enrich himself at the expense of others");
90. Nolan v. Danks, 1 Rob. 332, 334 (La. 1842) ("little consonant to equity that such a fault [on the part of the employee] should have a retrospective effect, and deprive him of the wages he had up to that time faithfully earned, and that the employer should enrich himself at the expense and by the sweat of his brow");
91. Powell v. Kellar, 5 Rob. 272, 274 (La. 1843) ("Equity forbids, that he should recover of the Sheriff, who has released the mortgages, money which has been applied to the payment of his just debts, and thus enrich himself at the expense of that officer");
92. Calvit v. Mulhollan, 12 Rob. 266, 272 (La. 1845) ("they should not be permitted to enrich themselves at the expense of the defendants, who are clearly entitled to the reimbursement of the sums paid for the benefit of the community"). Many similar examples might be cited.
93. Bright v. Boyd, 4 F. Cas. 127, 132-33 (C.C.D. Maine 1841).
94. Whitney v. Richardson, 31 Vt. 300, 306-07 (1858) (emphasis added).
95. Effinger v. Hall, 81 Va. 94, 101-02 (1885).
96. Williston, supra note 21, at 73.
97. Beale, 'James Barr Ames - His Life and Character', 23 Harv. LR 325, 328 (1910).
98. Schmelzle, Book Review (Restatement of the Law of Restitution), 13 Notre Dame LR 151, 151-52 (1937).
99. Patterson, Book Review (American Law Institute, Restatement of Restitution and Unjust Enrichment), 47 Yale LJ 1420, 1421 (1938).
100. Writing just before the completion of the project, Patterson had complained about the "unwieldy and unfamiliar" title of the forthcoming Restatement, predicting that it might hinder professional acceptance and suggesting that "[t]here is much to be said for limiting the title to 'Restitution.' "Patterson, 'The Scope of Restitution and Unjust Enrichment', 1 MLR 223, 230 (1936).
101. Holt v. Markham, [1923] 1 K.B. 504, 513 (C.A. 1922).
102. Dawson, Unjust Enrichment (1951) 8.