Unjustified enrichment’s evolution in mixed legal systems: Confronting McCarthy Retail Ltd

• Jurisdiction: South Africa
• Author: Fischer, M.
• Pages: 395-417
• Date: 24 December 2019
• Citation: 2019 Acta Juridica 395
• Published date: 24 December 2019

395

Unjustied enrichment’s evolution

in mixed legal systems: Confronting

McCarthy Retail Ltd*

ROBIN EVANS-JONES† AND MARTIN FISCHER‡

Scotland has taken major steps towards the full recognition and

development of a free-standing law of unjustied enrichment. It has

been called a ‘revolution’. This essay briey examines the content of the

Scottish enrichment revolution. However, its main concern is modern

South African law, with which aspects of the Scottish revolution

resonate, particularly in relation to a general enrichment action. The

examination of the Scottish and South African case law reveals that

applying the standards of one category of enrichment claim to another

category has its pitfalls. It is argued that the various established causes of

action are signicantly dierent from each other in important respects,

and that they are much more than just historical mounds in the

topography of unjustied enrichment. Therefore it remains to be seen

whether the recognition of general principle in unjustied enrichment

is capable of giving rise to a coherent, unied structure for the subject.

I INTRODUCTION

In the last 20 years Scotland has taken major steps towards the full

recognition and development of a free-standing law of unjustied

enrichment. This has been called a ‘revolution’1 that is attributed

to the judiciary because its direct expression appeared in three

leading decisions in the Court of Session and the House of Lords:

Morgan Guaranty Trust Company of New York v Lothian Regional

* We are grateful to Tracey Pharoah for her comments. Martin Fischer is

grateful to the Max Planck Institute for Comparative and International Private

Law in Hamburg for its support of his research.

† LLB (Aberdeen) PhD (Edinburgh); Emeritus Professor, University of Aberdeen.

‡ B Bus Sci LLB LLM (UCT) BCL (Oxon); PhD candidate, University College

London.

1 N Whitty ‘The Scottish enrichment revolution’ (2001) 6 Scottish Law and

Practice Quarterly 167.

2019 ACTA 395

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396 PRIVATE LAW IN A CHANGING WORLD

Council,2 Shilliday v Smith3 and Dollar Land (Cumbernauld) Ltd

v CIN Properties Ltd.4 The stimulus for the revolution was Peter

Birks, notwithstanding that the focus of his work was mainly on

English law.5 In Shilliday the leading judgment was given by Lord

Rodger who said that ‘[a]nyone who tries to glimpse the underlying

realities [of unjustied enrichment in Scots law] must start from the

work of Professor Peter Birks, Regius Professor of Civil Law at the

University of Oxford … .’6

Scottish academic writers like Niall Whitty have also developed

the law in signicant ways, as, for example, in their understanding

that unjustied enrichment comprises dierent groups of cases that

are best distinguished from one another according to the manner in

which the enrichment was acquired.7

This essay briey examines the content of the Scottish enrichment

revolution. However, its main concern is modern South African law,

with which aspects of the Scottish revolution resonate, particularly

in relation to a general enrichment action. Perhaps curiously,

because these kinds of enrichment claims are relatively rare, the

issue of the general action has arisen most prominently in the

context of the improvement of another’s property. For this reason,

the chapter examines the background to the current South African

law on improvements, which in turn explains the approach taken

by the South African Supreme Court of Appeal in McCarthy Retail

Ltd v Shortdistance Carriers CC.8 The court identied a paradigm

in McCarthy that enabled it to dispose of the challenging facts as a

‘typical’ improvements claim. The decision has received universal

academic approbation. Whether this is justied will be questioned,

partly by reference to developments in Scots law in the course of

its revolution.

2 1995 SC 151.

3 1998 SC 725.

4 1996 SC 331; 1998 SC (HL) 90.

5 P Birks ‘Six questions in search of a subject – Unjust enrichment in a crisis

of identity’ (1985) Juridical Review 227; P Birks ‘Restitution: A view of Scots law’

(1985) 38 Current Legal Problems 57.

6 Shilliday (n 3) 727A–B. The direction of development in Scots law has not

been that argued for by Birks.

7 Whitty (n 1).

8 2001 (3) SA 482 (SCA).

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