Executors fail in £150,000 ‘unjustified enrichment’ claim against deceased’s former cohabitee

A judge in the Court of Session refused the claim for payment after ruling that the deceased had failed to pursue the statutory recourse available to him within the 12-month time-limit and there were no “special circumstances” to enable the executors to claim an “equitable remedy”.

Lord Beckett heard that the pursuers, Jan Igoe and Dominic Macari, sued the defender Yvonne Campbell as the executors of the late Robert Nisbet Courtney for £150,000 as a result of what was averred to be unjustified enrichment said to arise from his having made certain payments and contributions to the benefit of the defender in the course of their relationship.

The court was told that the deceased and the defender commenced a relationship in 2009 and that a property in Glenrothes was purchased by the defender for £195,000 with the intention that she would live there with the deceased, but with title in her own name only.

However, the relationship ended by May 2013 and that the deceased moved out, but the pursuers claimed that the defender’s son, on her behalf, asked him to leave, while the defenders insisted that the deceased left of his own volition.

The pursuers averred that deceased believed the property was in effect his and the defender’s property, regardless of the title position, and that he “expected to remain in the property and living with the defender there for the rest of his life”.

The executors sought payment of £100,000 to reverse two sums of £50,000 paid by the deceased to the defender, and a further £50,000 as recompense for benefits gained by the defender as a result of the deceased making payments towards the cost of materials and labour for renovations and contributing his own joinery skills.

The pursuers maintained that the defender disclosed “no legal basis” upon which she was entitled to retain the sums paid and no legal basis on which it would be inequitable to repay at least half of the sums contributed by the deceased.

However, the defender maintained that the claim for unjustified enrichment was “irrelevant”, on the basis that there had been available to the deceased a remedy under section 28 of the Family Law (Scotland) Act 2006, thus excluding any equitable remedy.

Counsel for the defender submitted that in section 28(8) of the 2006 Act, Parliament had provided a time limit to be strictly adhered to, meaning a remedy had been available but it was not used in time, which was “fatal” to the claim.

It was also argued that it was established in case law that recompense was available only where no other remedy was provided by statute or the common law and that failure to act timeously did not open up the possibility of an equitable remedy.

Counsel for the pursuers’ submissions proceeded on an acceptance that the principle of “subsidiarity” would apply unless the court accepted that the deceased had not had an alternative remedy because he did not know of the implications of section 28 of the 2006 Act or found special circumstances to allow the action to proceed notwithstanding that section 28 had provided the deceased with a remedy.

It was argued that the purpose of section 28 of the 2006 Act was to introduce “fairness” between cohabitants and it would not serve that purpose if an action based on unjustified enrichment was thereby excluded.

The payments of at least £100,000 were “substantial” and had benefited the defender where they were “not intended as a gift”, and it would be a “breach of natural justice” and “inequitable” if the pursuers did not have redress.

This was not a situation where the deceased had failed to exhaust his remedies, as he “lost the opportunity to make a claim before he knew of his rights under statute”.

The deceased had not sought advice immediately following his leaving the home in 2013 as the defender’s son was ill and later died, and by the time he sought legal advice in August 2014, the statutory remedy was “no longer available” to him.

However, the judge observed that while it was is true, as counsel for the pursuers noted, that the 2006 Act did not explicitly exclude an action based on unjustified enrichment being raised after the period specified in section 28(8), he was not persuaded that it followed that an equitable remedy would always remain open following the expiry of the 12-month period.

In a written opinion, Lord Beckett said: “Parliament did not provide for any relaxation of the time limit and plainly intended that any action under the Act would be raised quickly.

“Whilst one can understand the deceased’s reluctance to make demands of the defender when her son was ill, his benevolent motivation need not have prevented him from taking legal advice if he felt that he was entitled to payments from her. The remaining factors are likely to be present in many cases where the time limit has not been complied with and I am not persuaded that even viewed in combination they can be regarded as special and strong circumstances.

“Accordingly, on the basis that the deceased had a remedy under the 2006 Act which he failed to pursue, and not being satisfied that there are special and strong circumstances, I conclude that the pursuers have not pled a case which entitles them to the remedy they seek and sustain the plea to the relevancy in so far as based on subsidiarity and for this reason dismiss the action.”