Unjustified Enrichment: Key Issues in Comparative Part 8 pps

P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 direct and indirect enrichment in english law 517 (b) Is this genuine leapfrogging? Supposing that there is a sufficient proprietary connection, is the leapfrog- ging apparent or real? Even those who believe strongly in a requirement of privity or directness are content to accept the long reach of the propri- etary argument. 74 Underlying this consensus is the fact that, like agency, this is not a genuine example of leapfrogging. A remote recipient of an- other’s money is as direct a recipient from that other as the first recipient. Thus, if I find your wallet it makes no difference whether I am the first recipient or the second or the twenty-second. Suppose a pickpocket took it and, in alarm, threw it down, and then I found it. My position in that case would be the same as in the case in which your wallet fell from your pocket into the road without your noticing its loss. The mechanism does not matter: a receipt of your money is a receipt directly from you. Similarly, if I use your bicycle for a month, it does not matter whether you were or were not in possession immediately before me. My user is taken from you, because the bicycle is yours. The model from which their Lordships worked in Lipkin Gorman v. Karpnale cannot be used to support the proposition that true leapfrogging is permissible. The prop- erty argument looks as though it supports leapfrogging the first direct recipient but it actually only establishes what might be called sequential directness. These conclusions can be confirmed from German law, where benefits acquired by the use or consumption of property belonging to another provide the central case for the Eingriffskondiktion, the claim in respect of enrichment obtained by encroachment on the rights of another. This claim is likewise indifferent to the number of hands between claimant and defendant. In one case cattle were stolen from their owner. They were later sold to the defendant. No exception to nemo dat operated. The cattle remained the property of the claimant until the buyer slaughtered and processed them, at which point, by specificatio, he became the owner of the resulting manufactured products. The owner was allowed to leapfrog the thief and recover their value from the innocent buyer. For the reasons just given, this was a factual leapfrog but in the eye of the law the buyer was immediately enriched from the owner, by his Eingriff upon the latter’s 74 Burrows, Law of Restitution, 48–9; Tettenborn, ‘Lawful Receipt’, 5; Virgo, Principles, 108, where, true to the structure produced by his analysis, he says this is vindication of property, not unjust enrichment, and therefore not a true exception to the privity rule which applies in the law of unjust enrichment. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 518 peter birks property rights. 75 Again, on facts essentially identical to those of Lipkin Gorman v. Karpnale, the Federal Court held that a casino which had bona fide received money that had been misappropriated from the claimants was bound to make restitution to the claimants. In that case the facts were such that the casino did acquire title to the claimants’ money but, because it could not be regarded as having given value for the money and therefore had to be regarded as having received gratuitously, it was bound to make restitution. 76 3. The causation argument The causation argument, if it works, does support genuine leapfrogging. There is genuine leapfrogging when the plaintiff can make out his case in unjust enrichment against a first recipient but wants to leap over that first recipient to attack a second or subsequent recipient. The causal argument cuts in at that point: but for the unjust enrichment of the first recipient, the second would not have received the thing. Andrew Tettenborn puts this case: C inadvertently overpays his creditor A by £1000; A, pleasantly surprised on reading his next bank statement but entirely unsuspicious, proceeds to give £1000 from his other account to his son B A can almost certainly plead change of position as a defence. Hence the potential significance of a direct claim by C against B; can C say (in effect): ‘I have paid money by mistake; but for this B would not have been enriched; therefore B has been unjustifiably enriched at my expense and ought to refund.’ 77 Ought he to refund? His answer is no. In German law it is certainly yes, at least in this very case, which is provided for in the second sentence of § 816(1) BGB. It would be somewhat shocking if the answer were not yes in English law too and, with great respect to Professor Tettenborn, I think it is yes. 75 BGHZ 55, 176; English translation in Markesinis et al., Law of Contracts, 786. It is noteworthy that in holding the buyer liable in unjust enrichment for their value, the Federal Court declined to take into account his outlay in acquiring the cattle, which the Court said was recoverable by the buyer only from the thief. Cf. Dawson, ‘Indirect Enrichment’, 815: ‘This is not usually thought to infringe the requirement of directness.’ 76 BGH 37, 363, 366. Here the contract between the dishonest gambler and the casino was illegal and void because the law debarred local residents from gambling in the casino. Contrast the otherwise identical BGHZ 47, 393, where the gambling contract was valid and the claim against the casino was defeated. For a full discussion of these cases, see Carsten Z ¨ ulch, ‘Bona fide Purchase, Property and Restitution: Lipkin Gorman v. Karpnale in German Law’, in: Swadling, Limits of Restitutionary Claims, 106–40. 77 Tettenborn, ‘Lawful Receipt’, 1–2. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 direct and indirect enrichment in english law 519 The validity of the proposition that a second or subsequent recipient can be reached on the basis of the causal argument rests partly on the real state of things in Lipkin Gorman v. Karpnale, which differed from the model on which their Lordships relied. The House of Lords tried to bring the facts within the model of a proprietary connection between the firm and the casino. A proprietary connection satisfies and does not infringe the requirement of directness. However, the real situation in that case was quite different. (a) The true situation in Lipkin Gorman v. Karpnale The money which the gambling solicitor gave to the casino was his own, not the firm’s. He was an authorised signatory to draw on the client ac- count and it was expressly decided that the money which he drew out became his. The property had passed to him. The firm was indeed con- templated as having a power to revest it, and such a power may, as seen, suffice to create a proprietary connection. However, unless the title in the gambler was from the beginning voidable, which was not said but may have been assumed, it is difficult to explain how they acquired that power. Traceability does not in itself confer rights. 78 Suppose I give you a gold coin which you sell for £500, with which you buy a painting. Through these substitutions I can trace the value of the gold coin into the paint- ing. But if, at the moment you received the gold coin, I had no propri- etary interest in it whatever, the successful tracing exercise will give me no rights in the painting. Let it be that I gave you the coin for your birth- day. I can trace to satisfy my curiosity, but successful tracing will give me no rights. It would be utterly absurd to assert that the mere fact of substitution could create property rights in the substitute greater than and unrelated to property rights in the original. So here, to explain the firm’s power to revest the money which traceably went into the coffers of the casino, it is necessary to know that it had a proprietary interest in the money at the moment at which the gambler received it. And that is not said. It may therefore be that this case will ultimately be seen as explicable only on the basis that it is possible to reach a secondary recipient on a purely causal basis: the casino would not have received the money but for the enrichment by subtraction from the firm of the primary recipient, the gambling solicitor. 78 L. D. Smith, The Law of Tracing (1997), 10–14, 299–300. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 520 peter birks (b) Supporting case law A reinterpretation of one major case would not suffice if the causal argu- ment were not rooted in other decisions too. It has a good root, though somewhat overgrown with weeds. There is a group of cases, lucidly ex- plained by Charles Mitchell, 79 in which mistaken payments have been recovered from subsequent recipients on proof that the enrichment did come through to them. Where these cases are difficult, it is usually not because the doctrine is itself suspect, but because of doubts as to whether the second recipient has indeed been enriched. The particular problem is generally the question whether money employed by the first recipient to discharge the obligations of the second recipient has indeed effected a le- gal discharge, for without that discharge it cannot be said that the money has been, in the Latin phrase, in rem versum, turned to his advantage. A more general difficulty has been the want of understanding of the law of unjust enrichment. As Mitchell shows, some cases have taken wrong turnings, for want of any map. In Bannatyne v. D. & C. MacIver the London agents of the defendant firm borrowed money for them without authority. The plaintiff lenders mis- takenly believed that they did have authority. The Court of Appeal upheld the claim against the firm to the extent that the money had been turned to their advantage. Romer LJ said: Where money is borrowed on behalf of a principal by an agent, the lender believing that the agent has authority, though it turns out that his act has not been authorised, or ratified, or adopted by the principal, then, although the principal cannot be sued at law, yet in equity, to the extent to which the money borrowed has in fact been applied in paying legal debts and obligations of the principal, the lender is entitled to stand in the same position as if the money had originally been borrowed by the principal. 80 This is the same doctrine as underlies B. Liggett (Liverpool) Ltd v. Barclays Bank Ltd, 81 a decision of Wright J which was interpreted by the Court of Appeal in Re Cleadon Trust Ltd. 82 In that case a bank had laid out money believing that it had the authority of a company which was its customer, when in fact it had only the authority of one director of the company. It 79 Charles Mitchell, The Law of Subrogation (1994), chap. 9, especially 124–9, 133–5. Cf. Whitty, ‘Indirect Enrichment’, 215, 251–2. 80 [1906] 1 KB 103 (CA) at 109. In Reid v. Rigby & Co. [1894] 2 QB 40 recovery was allowed at law, the facts being materially identical. 81 [1928] 1 KB 48. 82 [1939] Ch 286 (CA), discussed by Mitchell, Law of Subrogation, 127–8, 162–5. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 direct and indirect enrichment in english law 521 was allowed to debit the company’s account. The explanation of the case, in the reinterpreted version later offered by the majority of the Court of Appeal, was that the money must be regarded as a mistaken advance to that one director applied by him to the discharge of the company’s debts, which were indeed discharged because, though the director had no authority to draw on the company’s account, yet he did have authority to discharge the company’s debts. 83 Butler v. Rice, 84 though in some respects confusing, is factually more straightforward. Butler, who had been misled by Mr Rice, mistakenly thought that Mr Rice owned a house subject to a charge and made a loan to him thinking he was lending to discharge that charge. Mr Rice had no such interest and in fact used the money to discharge a mortgage on property belonging to his wife. Mrs Rice, who had not known of her husband’s doings, regarded herself as entitled to a windfall, leaving Butler to his remedy against her husband. But Warrington J held that Butler was entitled to be subrogated to the claim and security which had been paid off. In other words Mrs Rice, as second recipient, had to surrender the enrichment which she would not have received but for the unjust enrich- ment of the first recipient. In Agip (Africa) Ltd v. Jackson 85 the plaintiff company’s account with a bank in Tunisia was debited with large sums on the basis of forged payment warrants. The defendants were accountants who were ultimately made liable for the wrong of assisting the fraud. Another claim against the remote recipients as recipients rather than wrongdoers ultimately fell foul of a defence, but it was held in principle to lie. It is difficult to see why Agip was allowed to maintain this restitutionary claim. 86 The bank would appear to have lost its own money. However, if the bank is treated as hav- ing enriched itself without Agip’s consent by insisting on debiting Agip’s account, the rest follows: because of that enrichment of the first recipient, Agip was able to go after those who, but for that receipt, would not themselves have been enriched. Just possibly Ministry of Health v. Simpson (Re Diplock in the courts below) 87 might also be explained in this way. 83 [1939] Ch 286 at 318 (Scott LJ) and 326 (Clauson LJ). 84 [1910] 2 Ch 277. 85 [1990] Ch 265, affirmed [1991] Ch 547 (CA). 86 E. McKendrick, ‘Tracing Misdirected Funds’, [1991] Lloyd’s Maritime and Commercial Law Quarterly 378–90 observes that no adequate explanation was given, the courts having accepted, somewhat mysteriously, that, the bank being Agip’s agent, Agip could avail itself of its mistake. 87 [1948] Ch 465 (CA); [1951] AC 251 (HL). P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 522 peter birks (c) Restrictions Bearing in mind the operation of defences, one should not jump to the conclusion that the causal argument needs to be heavily restricted. How- ever, the largely illusory requirement of ‘privity’ inevitably encourages a suspicious or at best restrictive attitude to it. Tettenborn’s example from which this discussion began turned on a situation in which the claimant’s rights against the first recipient had been extinguished as a matter of law, for to the extent that the immediate enrichee had in turn enriched the remoter payee he himself had an indubitable defence of change of po- sition. Identical in this respect is the case covered in the German Civil Code. 88 A requirement of extinction of the immediate enrichee’s liability would be extreme. A milder requirement would be that remedies against the first recipient must have been exhausted. In Agip (Africa) Ltd v. Jackson it appears that Agip had tried and failed to get its bank to reinstate its account. 89 It is impossible at the moment to say whether some such restrictive pre- condition will be insisted upon. A different and very severe precondition would be traceability. This can be ruled out, except in an evidential role. Successful tracing can certainly sometimes support the difficult factual finding that the remoter recipient would not have received but for the earlier receipt by the first recipient. The fact that the gambler traceably gave the casino the money which he obtained from the firm can be seen as helping to show that there was no other way that he could have indulged his habit. 90 However, traceability cannot be a necessary precondition of leapfrogging on the basis of the causation argument. Tettenborn’s exam- ple is carefully constructed to exclude it. The father’s gift to his son came from a separate account; the money that went to the son was definitely not traceably the money which the father mistakenly received. (d) Where leapfrogging is not allowed, and why It is necessary at the end to revisit the cases that were looked at earlier where C validly contracts with X to confer a benefit on D. 91 For example, C, a bank, contracts with its customer to lend the customer money and to send that money to D; or C, a garage, agrees with an insurance company to repair D’s car at the insurance company’s expense. In those cases C cannot leapfrog its contractual counterparty in order to bring a claim in 88 Above, 518. 89 Above, n. 85. 90 The invocation of tracing in Baroness Wenlock v. River Dee Co. (1887) 19 QBD 155 should be explained in the same way. 91 Above, 502. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 direct and indirect enrichment in english law 523 unjust enrichment against D. The valid contract between C and X makes the crucial difference. It will be observed that in these cases C has a cause of action against the contractual counterparty X not only in contract but also in unjust enrichment. The reason why C wants to leapfrog X is precisely that he has suffered a repudiatory breach and a failure of consideration. It might at first be supposed that C must therefore be within the doctrine which allows him to show that the remote D would not have received but for the unjust enrichment of the immediate enrichee. The doctrine says that one who has a cause of action in unjust enrichment against the first recipient is, subject to unsettled restrictions as to exhaustion of remedies against that first recipient, entitled to proceed in unjust enrichment against such subsequent recipients as (a) would not have received but for the enrich- ment and (b) are not protected by the defences of bona fide purchase or change of position. However, there is no question of allowing C to leapfrog his contractual counterparty. C, having dealt validly with X, has to take the risk of X’s bad behaviour or insolvency. The point made earlier was that C cannot say that D is a direct or first recipient because in these cases it is not at C’s immediate expense that D receives. C is the means chosen by X, and D receives immediately at the expense of X. At this point the concern is with the different question whether D can none the less be attacked as a subsequent recipient. He cannot. D is, remotely, enriched at C’s expense, but he cannot on these facts be reached by C. The policy reason still stands in the background: C must accept the risks of dealing with his chosen contractual counterparty. The insolvency regime would be subverted if C could find ways of leapfrogging an insol- vent X. However, it might also be argued that C is anyhow not strictly within the causal doctrine which reaches remote recipients. That argu- ment requires that the second or subsequent recipient would not have been enriched but for the unjust enrichment of the first recipient. In these cases that causal requirement might be said not to be satisfied. For here D, as second or remoter recipient, would have received anyway. The contract between C and X envisaged a benefit conferred on D. It is only by reason of a later breakdown in the relationship between C and X that D appears ex post in the guise of a subsequent recipient of an unjust en- richment. If this is right, there is no second avenue of attack. D is not a first recipient, and he is not a second recipient either. That is, he is not a person who would not have been enriched but for the unjust enrichment of the first recipient. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 524 peter birks Peter Watts says that the best explanation of the denial of the leapfrog- ging claim against D in these cases is that, vis- ` a-vis D, C can point to no unjust factor. In performing the contract with X he voluntarily – neither mistakenly nor conditionally – confers the benefit on D. 92 Although that is true, it misses the point of the causation argument. The causation ar- gument does not require the claimant to establish an unjust factor in relation to the remote recipient. It merely asserts that, subject to bona fide purchase and change of position, an unjust enrichment in the imme- diate recipient is an unjust enrichment in one who received through the immediate recipient and because of his receipt. That being the ground rule allowing recovery from the remote recipient, one needs a different kind of reason to explain why a claimant sometimes cannot rely on it. He cannot rely on it to leapfrog an initially valid contract. Why? Putting aside the technical causal deficiency just noticed, Burrows comes nearer to the mark when he says that the law of unjust enrich- ment must not be allowed to undermine contracts. 93 That has to be filled out by repetition of the points on which German writers always insist, namely that nobody should be allowed to evade either defences arising in relation to a contract or the consequences of the insolvency of the cho- sen contractual counterparty. 94 It is for these reasons that there can be no leapfrogging over contractual counterparties. The remote recipient in such cases is enriched, and he is enriched at the expense of the claimant, but he is beyond reach. V. Conclusion This has been an exploration of the range of the law of unjust enrichment, as controlled by the phrase ‘at the expense of the plaintiff’. In English law this means pushing out on almost unknown seas. A summary of the posi- tion is essentially this. In the law of unjust enrichment it cannot be used in the sense of ‘by doing a wrong to’. It has to be used in the subtractive sense – the ‘from’ sense. ‘From’ might be understood narrowly or broadly. It looks as though English law is moving to a broad interpretation. That 92 P. Watts, ‘Does a Subcontractor have Restitutionary Rights against the Employer?’, [1995] Lloyd’s Maritime and Commercial Law Quarterly 398, 401. 93 A. S. Burrows, ‘Restitution from Assignees’, [1994] Restitution LR 52, 55–6. 94 Meier, ‘Mistaken Payments’, 571. The last paragraph of her article appears to suggest that leapfrogging in this situation might after all be possible, as though Re Diplock [1948] Ch 465 provided a springboard. Whatever else it might support, that case cannot dent the absolute bar against leapfrogging contractual counterparties. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston chap-18 October 11, 2001 0:9 Char Count= 0 direct and indirect enrichment in english law 525 means not insisting on a minus to the plaintiff and, broader still, accept- ing the possibility of interceptive subtraction freed from that restrictive requirement. Interceptive subtraction shorn of a requirement of loss and based on a logical extension of the attribution theory used in German law gives the law of unjust enrichment a range which the common law has not fully explored but to which it appears to have committed itself. Finally, it is not true to say that the defendant’s enrichment must be directly from the plaintiff, whether interceptively or otherwise. In differ- ent and more unsuitable language, it is not true that there is a strict requirement of privity between the parties. On the contrary, it is possible to reach over an immediate enrichee to others who would not have re- ceived if the immediate enrichee had not been unjustly enriched at the expense of the claimant. It cannot yet be said whether the courts will encourage leapfrogging claims, nor can it be foreseen what restrictions they will place on them if they do. But the foundations are in place, and the anxieties that inhibit the development are less substantial than has at times been thought. The remoter recipients who are vulnerable are, however, rather few. They will not be bona fide purchasers or claimants through bona fide pur- chasers, and they will not have innocently disenriched themselves because of their receipt. Furthermore, one kind of leapfrogging which will never be allowed is the attempt to jump over a party to a valid contract with a view to attacking someone who received a benefit from the performance of that contract. The valid contract makes all the difference. One who makes a contract with another has to take the risk of that other’s insolvency. Otherwise the statutory insolvency regime would be seriously eroded, and its impact would become open to the charge of needless arbitrariness. P1: FCH/FYX P2: FCH/FYX QC: FCH/UKS T1: FCH CU074-Johnston CU074-19 February 5, 2002 10:42 Char Count= 0 19 Searches for silver bullets: enrichment in three-party situations Daniel Visser I. Introduction The approach to ‘indirect’ or ‘three-party’ enrichment situations differs greatly from country to country. There is no clear fault-line between civil- ian and common-law systems, but generally speaking it seems to have emerged more patently as a problem in civilian systems. At the one end of the spectrum is Germany, where Peter Schlechtriem has called them the ‘nightmare of the law of enrichment’, 1 while Reinhard Zimmermann and Jacques du Plessis noted that they constitute ‘an almost impenetrable jungle of dispute and uncertainty’. 2 At the other end is England, where Peter Birks’s remark that it is hard even ‘to discover the English equiv- alent to the “triangular relationship” and “indirect enrichment”’, illus- trates how utterly differently legal systems are able to view the same fact situations. 3 Between these extremities there are a number of legal sys- tems where the problems associated with these situations are recognised, but where the solutions are far too simplistic or, at best, not fully de- veloped. Among these we may count, aptly, the mixed jurisdictions of 1 P. Schlechtriem, Schuldrecht: Besonderer Teil (1987), n. 685. 2 R. Zimmermann and J. du Plessis, ‘Basic Features of the German Law of Unjustified Enrichment’, [1994] Restitution LR 14, 31. 3 See his paper in the present volume. See generally in regard to third-party enrichment in English law, Kit Barker, ‘Restitution and Third Parties’, [1994] Lloyd’s Maritime and Commercial Law Quarterly 305; R. J. Sutton, ‘What Should be Done for Mistaken Improvers’, in: P. D. Finn (ed.), Essays on Restitution (1990), 241; Lionel D. Smith, ‘Three-party Restitution: A Critique of Birks’s Theory of Interceptive Subtraction’, (1991) 11 Oxford JLS 481 and Peter Watts, ‘Does a Sub-contractor have Restitutionary Rights against the Employer?’, [1995] Lloyd’s Maritime and Commercial Law Quarterly 398. 526 [...]... to progress to a proper understanding of three-party enrichment, there needs to be a reversal of the trend not to examine separately the individual elements of enrichment liability in each case For in the principled application of these elements lies, I believe, the key to solving (though rarely without hard thinking) the many problems that arise in this context.15 In my attempt to demonstrate that... Commerce .84 The issue that arose was whether Commerce could present evidence about amounts that it had 81 82 83 84 See Kemper, ‘Building and Construction Contracts’, § 2 (294–5); Guldberg v Greenfield (1966) 259 Iowa 87 3; 146 NW 2d 2 98; Bishop v Flood 133 Ga App 80 4; 212 SE 2d 443; Crockett v Sampson (1969) 439 SW 2d 355 (Texas Civil Appeals); Commerce Partnership 80 98 LP v Equity Contracting Co (1997)... payment by the bank would discharge the debt and therefore does not assume a continuing intention to pay on the part of the payer Thus any attempt by the payer to stop the payment is irrelevant as far as the extinguishing of the debt is concerned The policy behind this thinking may be summarised in the following way First, since a cheque itself is discharged when a bank pays that cheque – even if the... finding the path’.52 In all the jurisdictions considered above, the decisions in cases of threeparty enrichment involving payments by banks in spite of a countermand can be said to revolve around the element of enrichment That does not mean that the other elements cannot ever be determinative in this kind of situation It merely indicates that this type of factual situation primarily 49 50 51 52 In this... pertaining to this situation subsumes the inquiries as to whether the enrichment is unjustified and whether a causal link exists under the alternative inquiry into whether the purpose of the sub-contractor’s performance has been fulfilled In regard to Scots law, too, it is understandable: in all three-party situations the inquiries into the elements of enrichment and unjustifiedness often shade into one... where T induces C’s performance by fraud and D benefits gratuitously or in bad faith (Whitty, ‘Indirect Enrichment’, 245) A central difficulty that J C Sonnekus would have with this approach is that it would, in his view, give C two claims He argues thus (‘Ongeregverdigde verryking en ongeregverdigde verarming vir kondikering in drieparty-verhoudings’, 1996 TSAR 8; my translation of the Afrikaans original):... such as where the instrument had been forged), the condition can obviously no longer be fulfilled because there is no mandate to obey A prerequisite for a valid payment of a debt is that there has to be a valid debt-extinguishing agreement, which presupposes a continuing intention to pay on the part of the drawer and a continuing intention to receive payment on the part of the payee Since the countermand... Count= 0 daniel visser (ii) Flowing from this basic consideration are a number of related policy factors, namely: (a) that a contracting party should normally bear the business risks of entering into a contract; (b) that a party should not run the risk of having to pay a debt twice; (c) that a party should not be in a position to claim twice for the same debt; (d) that a party to a contract should not... as follows A cheque for R16,0 48 was drawn on First National Bank by its client, Sapco, in favour of the defendant When drawing the cheque Sapco’s intention was to pay for certain goods manufactured for it by B & H Engineering, but subsequently it countermanded payment of the cheque by written notice However, it did so without signing an indemnity in favour of the bank in case the latter should fail... A Reply’, (1969) 86 SALJ 227–30; also his Verrykingsaanspreeklikheid in die Suid-Afrikaanse Reg (3rd edn, 1 987 ), 339–53; also his ‘Aspekte van Verrykingsaanspreeklikheid’, [1970] Acta Juridica 231, 236–41; also his ‘Retensieregte weens Verryking’, (1970) 33 Tydskrif vir Hedendaagse Romeins-Hollandse Reg 357– 68 See here the groundbreaking study of Niall R Whitty, ‘Indirect Enrichment in Scots Law’, [1994] . coin into the paint- ing. But if, at the moment you received the gold coin, I had no propri- etary interest in it whatever, the successful tracing exercise will give me no rights in the painting with an insurance company to repair D’s car at the insurance company’s expense. In those cases C cannot leapfrog its contractual counterparty in order to bring a claim in 88 Above, 5 18. 89 Above,. valid debt-extinguishing agree- ment, which presupposes a continuing intention to pay on the part of the drawer and a continuing intention to receive payment on the part of the payee. Since the countermand