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What is Unjust Enrichment?

Mary McMahon
By
Updated May 17, 2024
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Unjust enrichment is a situation in which someone enjoys benefits at the expense of someone else. When someone is unjustly enriched, she or he does not pay or otherwise compensate for the benefits experienced. This is deemed unfair in eyes of the law and the person who receives the benefits may be ordered to pay restitution. This is usually accomplished by filing a civil suit on the grounds of unjust enrichment, with the court awarding damages if the case is judged in favor of the person who provided the benefits.

Several characteristics must be present in a case for it to be considered unjust enrichment. The first must be a demonstration of some sort of benefits received from someone else, which could include anything from economic benefits to property improvements. The person who receives the benefits must also acknowledge them, making it clear that they are viewed as benefits. Finally, deprivation must be present, with the person who receives the benefits not providing any compensation in exchange.

In a somewhat simplistic example of unjust enrichment, if someone hires a contractor to build a swimming pool and the contractor notices a problem with the plumbing and fixes it without pay, this could be considered unjust enrichment. The property owner is receiving a benefit as a result of something the contractor did and the property owner did not have to expend any money or effort to receive it. The contractor could bill for the work and if the property owner refused to pay, a suit could be filed.

The circumstances surrounding unjust enrichment can vary considerably. For example, people may feel manipulated or forced into providing benefits for others, as for example when employees are pressured to work overtime without clocking in so that their employers do not have to pay. Likewise, people may embark upon an activity with an expectation of being compensated, only to learn that the beneficiary does not intend to pay.

It is important to distinguish unjust enrichment from charity. Someone who receives charity is indeed benefiting from the actions of someone else, but the person who donates is also receiving benefits, not least of which is a tax deduction for charitable donations. For a situation to be deemed unjust enrichment, it must be shown that the person providing the benefits received no compensation or consideration for his or her work or efforts, and that the person who received the benefits was aware of this fact.

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Mary McMahon
By Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a WiseGeek researcher and writer. Mary has a liberal arts degree from Goddard College and spends her free time reading, cooking, and exploring the great outdoors.

Discussion Comments

By anon345402 — On Aug 19, 2013

I don't believe any of these comments even touch on the principles of "Unjust Enrichment." Just my opinion.

By BoniJ — On Nov 15, 2011

I wonder if there has to be a written contract for unjust enrichment to be applied. There must be a lot of cases in families or small family businesses, where money is given to a family member with only oral stipulations given. For example, grandparents give a grandson a sum of money to invest and to pay for four years of college.

The grandson quits school, buys a new car, travels around with no goals in mind. Can the grandparents sue their grandchild for unjust enrichment?

By Misscoco — On Nov 14, 2011

In the swimming pool example, I can see where there may be problems in determining if unjust enrichment happened. Say, part of the contract included plumbing for the swimming pool and the contractor noticed a problem. And say, there was a good possibility that the plumbing problem was, at least partially, caused by negligence.

The contractor, then, fixed the problem. The owner received some unjust enrichment. If he was billed, but wouldn't pay, the case would be taken to court. The case would be complicated because some of the problem might be due to the contractor's negligence. How much would be unjust enrichment?

By GreenWeaver — On Nov 14, 2011

@Icecream17- You know this happens even when there is an implied contract in a family business. The son or daughter of the owner might have certain obligations to the family business and have to perform their job in order to receive compensation.

The problem arises when the son or daughter takes the position for granted and does not do the work at the right level of productivity that a typical worker would, but still collects their regular compensation although their work was inferior.

What happens in a situation like this is that the employee morale goes down because these people are not pulling their weight, but everyone else has to pick up their slack.

It really is not a fair situation, but it does happen a lot in family businesses.

By icecream17 — On Nov 13, 2011

I think that you can define unjust enrichment in family relationships as well. I was watching a program the other day about a man that was 34 years old and was still living with his parents and did not work.

His parents paid his car payment and his student loans. I think that this situation clearly shows that the son is unjustly enriched because he does not pay his own bills and he is living in his parent’s home without paying rent.

This man also was not actively looking for work which just adds to the injustice of the situation.

The problem was that the parents felt guilty about the situation that their son was in and did not ask him to contribute anything or look for work.

I think that there are parents that might not classify this as unjust enrichment, but in reality it is because their parental obligation tends to end when the child becomes an adult.

Mary McMahon

Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a...

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