OBLIGATIONS ARISING AS THOUGH FROM A CONTRACT (QUASI EX CONTRACTU)

The obligations arising as though from a contract form a category where the obligations arise without agreement between the parties, but nonetheless the basis of the obligation is seen as being closer to contract than to delict.

Justinian considers various types of obligation as falling under this head. This chapter looks at two of these, negotiorum gestio and the condictio indebiti, which falls under the more general heading of unjustified enrichment.

Negotiorum gestio

Negotiorum gestio is concerned with the situation where a person, the negotiorum gestor, interferes in the affairs of another, the principal, without the latter’s consent. An example might be where the negotiorum gestor instructs or carries out necessary repairs to a neighbour’s property. As long as the negotiorum gestor did not intend to act gratuitously, and provided that the other requirements for negotiorum gestio are met, he will be entitled to be compensated for his expenses. This is the case even though the acts of the negotiorum gestor are carried out without the knowledge or authorisation of the principal.

Liability to a negotiorum gestor will arise only where the principal is unable to act personally. For example, the principal might be absent or insane. The assumption is that he would have acted had he been able to. It is necessary, though, for the interference to be reasonable, for example where the situation is an emergency. If the matter could quite happily have waited for the principal’s return, there will be no liability to the gestor. Indeed, the gestor himself may be liable for interfering with the principal’s property if it is subsequently decided that the interference was not reasonable. Even if the interference is reasonable, the negotiorum gestor will be liable to the highest standard of care for any loss caused to the principal by the fault of the gestor.

In addition to the requirement that it be reasonable to interfere, the in­terference must also be objectively useful to the principal. Usefulness is, however, measured at the time of the interference. The negotiorum gestor will still be entitled to compensation if the benefit to the principal has been superseded. An example might be the case of accidental destruction of property after it has been repaired by the negotiorum gestor in circumstances where it was reasonable for him to interfere. The negotiorum gestor would be entitled to normal compensation despite the subsequent destruction of the property.

Unjustified enrichment

How does the law respond to the situation in which a person receives a benefit to which he is not entitled? In the modern law, that person will be said to be unjustly enriched, and will be compelled to restore the enrich­ment. The purpose of the law of unjustified enrichment can broadly be said to be to rectify injustices caused by the application of the law of property. Property law, as we have seen, tends to take an objective approach to parties’ rights — properly so, as a real right binds everyone. Hence, for example, the need for an act of delivery in the transfer of ownership. If third parties are to be bound by a person’s real right in property, it seems only fair that it should not be possible to create or transfer the real right in secret, by intention alone. However, there remains the possibility that there is some unfairness in the parties’ relationship. Suppose, for example, that by fraudulent means A induces B to transfer ownership to him. One option open to a legal system in this situation is to deny ownership to A. However, that would mean that B could recover the property even from a third party acquiring it from A with no knowledge of the fraud. An alternative is to give A ownership (a real right), but to give B a claim against A in unjustified enrichment (a personal right). This means that B has a remedy, but anyone acquiring ownership in good faith from A is not affected by the fraud.

Roman law took the latter approach. However, there was no general ground of unjustified enrichment. Instead, various distinct grounds of enrichment were developed, called condictiones. The term condictio itself is derived from the earlier system of procedure, the legis actiones (see Chapter 10). In that system of procedure, the legis actio per condictionem gave notice to the other party of what was being claimed. The condictio, however, did not state the basis of the claim. It merely alleged that a particular thing or a particular sum of money was owed. The model was carried over to the formulary procedure and, because it did not state the basis of the claim, it was found to be capable of use in a wide variety of situations, both contrac­tual and delictual. One such situation was the contract of mutuum, which we saw in Chapter 7. It will be remembered that, in this contract, the delivery of a thing gave rise to an obligation to restore its equivalent. In mutuum, the intention was to make a loan. The view developed, though, that delivery of a thing believing it to be due was an analogous situation, and similarly gave rise to an obligation to restore its equivalent. Gaius considers the two situations together, even though he admits that in the latter case the party who delivers the thing “intends to extinguish an obligation rather than to contract one” (G.3.91).

In Justinianic law, the situation outlined here — the claim for return of money or property transferred in the erroneous belief that it was due — took the name condictio indebiti. Various other grounds of unjustified enrichment were recognised. For example, the condictio causa data causa non secuta allowed recovery of money or property given in anticipation of an event that did not come to pass. An example might be an engagement ring. If the marriage did not come to pass, an obligation to return the ring arose. The condictio ob turpem vel iniustam causam allowed recovery where the money or property had been given for an immoral purpose, though only where the parties were not equal in immorality. Thus, money paid to a kidnapper as a ransom could be recovered, but money paid to a prostitute for her services could not. The right of a good faith possessor to be compensated for improvements to property (see Chapter 4) and the right to compensation arising when ownership is lost due to the operation of specificatio (see Chapter 5) could also be considered under the heading of unjustified enrichment.