In recent weeks, our Vancouver estate lawyers have discussed the Supreme Court of Canada’s decision in Moore v. Sweet, 2018 SCC 52, where a disappointed beneficiary succeeded in using the doctrine of unjust enrichment to establish her entitlement to insurance proceeds of $250,000. Once a claim in unjust enrichment has been established, the court must then consider the question of remedy. Vancouver estate lawyers are often asked: if my unjust enrichment claim is successful, what remedy will I get?
Vancouver estate lawyers discuss remedies
As discussed by the Court in Moore v. Sweet,the remedy for unjust enrichment is restitutionary in nature and can take one of two forms:
- PERSONAL: A personal remedy is essentially a debt or a monetary obligation — i.e., an order to pay damages — that may be enforced by the plaintiff against the defendant. In most cases, this remedy will be sufficient to achieve restitution, and it can therefore be viewed as the “default” remedy for unjust enrichment.
- PROPRIETARY: a remedy of a proprietary nature is an entitlement to enforce rights against a particular piece of property. The most pervasive and important proprietary remedy for unjust enrichment is the constructive trust.
The onus rests on the plaintiff to show that a monetary award would be insufficient.
Constructive trust is a powerful remedy
The proprietary remedy of a constructive trust is imposed without reference to intention to create a trust, and its purpose is to remedy a result otherwise unjust. It is a broad and flexible equitable tool which permits courts to gauge all the circumstances of the case, including the respective contributions of the parties, and to determine beneficial entitlement.While the constructive trust is a powerful remedial tool, it is not available in all circumstances where a plaintiff establishes his or her claim in unjust enrichment. Rather, courts will impress the disputed property with a constructive trust only if the plaintiff can establish two things: first, that a personal remedy would be inadequate; and second, that the plaintiff’s contribution that founds the action is linked or causally connected to the property over which a constructive trust is claimed. Even where the court finds that a constructive trust would be an appropriate remedy, it will be imposed only to the extent of the plaintiff’s proportionate contribution (direct or indirect) to the acquisition, preservation, maintenance or improvement of the property.
Insurance proceeds impressed with constructive trust
On the facts in Moore v. Sweet, the Court was satisfied that a remedial constructive trust was the appropriate remedy. Ordinarily, a monetary award would be adequate in cases where the property at stake is money. In Moore v. Sweet, however, the disputed insurance money had already been paid into court and was readily available to be impressed with a constructive trust. Furthermore, ordering that the money be paid out of court to the unsuccessful party, and then requiring the successful party to enforce the judgment against her personally, would unnecessarily complicate the process through which the successful party could obtain the relief to which she is entitled. It would also create a risk that the money might be spent by the unsuccessful party or accessed by other creditors in the interim.
Vancouver estate lawyers’ take-home point on remedies
If unjust enrichment is established, the successful claimant may be entitled to a monetary or a proprietary award. The first remedy to consider is always a monetary award (i.e., an award for damages). The onus rests on the plaintiff to show that a monetary award would be insufficient. Where the proprietary remedy of a constructive trust is granted, the extent of the constructive trust should be proportionate to the plaintiff’s contributions. The bottom line is that the doctrine of unjust enrichment is a broad and flexible equitable tool which permits courts to gauge all the circumstances of the case, including the respective contributions of the parties, and to determine beneficial entitlement. It has been applied not just in disappointed beneficiary claims like Moore v. Sweet, but also in family law matters. Contact Onyx Law Group’s team of Vancouver estate lawyers and family lawyers at (604) 900-2538 to discuss how unjust enrichment may apply to your claim and to obtain advice on the nature of the remedy you should seek.