What are considered conferred benefits for unjust enrichment?
Direct Answer:
A conferred benefit for the purpose of unjust enrichment is any measurable advantage, financial or otherwise, that the defendant receives from the plaintiff, which would be inequitable to retain without compensating the plaintiff. Examples include overpayments, services rendered, improvements made to property, or goods delivered without corresponding payment.
Legal Definition and Elements
Under Maryland law and other common-law frameworks, unjust enrichment requires: (1) a benefit conferred by the plaintiff on the defendant; (2) the defendant’s knowledge or appreciation of the benefit; and (3) the defendant’s acceptance or retention of the benefit under circumstances that make it inequitable to retain it without payment. See Hill v. Cross Country Settlements, LLC, 402 Md. 281, 295 (2007).[2]
The first element—benefit conferred—is broadly defined. According to the LII Wex dictionary, unjust enrichment arises when “Party A confers a benefit upon Party B without receiving proper restitution required by law.”[1] This may occur even where no contract exists between the parties, so long as retention would be unjust.
What Counts as a Conferred Benefit
A conferred benefit can take many forms, including tangible and intangible advantages. Courts and scholars generally recognize the following categories:
-
Money or Overpayments:
Example: In Monterey Mushrooms v. HealthCare Strategies, the court found a conferred benefit where the plaintiff alleged it had made overpayments to the defendant, who accepted and retained those funds without rendering services in return. This was sufficient to support an unjust enrichment claim.[2] -
Services Rendered:
Labor or professional services provided to a defendant constitute a conferred benefit if accepted with knowledge. For instance, if a contractor performs authorized work that the defendant benefits from but for which the contractor is not paid, that service constitutes a benefit. -
Goods Delivered or Improvements:
Delivering goods or making valuable improvements to another’s property (e.g., repairs, landscaping) can amount to a conferred benefit, provided it was not intended as a gift and the defendant had an opportunity to accept or reject it.[1] -
Discharge of Defendant’s Obligations:
Paying another’s debt or obligation can also be a conferred benefit, since it relieves the defendant of a burden. This is recognized across Restatement and state common-law formulations.[3]
Limits on Conferred Benefits
The LII Wex entry identifies two limiting principles:
- Gift Principle: No unjust enrichment arises when a benefit was intended as a gift.
- Choice Principle: A plaintiff cannot unilaterally confer a benefit without giving the recipient a chance to refuse it and then claim restitution (e.g., painting someone’s house without consent and demanding payment).[1]
Additionally, per the Harvard Law Review, transfer with valid consent or legal basis (e.g., a contract, gift, or trust) means no unjust enrichment occurs, even if one party benefits.[3]
Illustrative Examples:
| Type of Benefit | Illustration | Legally Cognizable? |
|---|---|---|
| Overpayment | Company A accidentally pays Vendor B twice for services. | Yes – monetary benefit retained unjustly. |
| Unauthorized Services | Painter refurbishes a house without owner’s consent. | No – violates “choice principle.” |
| Improved Property | Tenant builds a deck increasing property value after landlord breaches renewal agreement. | Yes – if benefiting the landlord. |
| Debt Payment | Friend pays another’s medical bill expecting reimbursement. | Yes – financial enrichment occurs. |
| Gift | Person gives a car as a birthday present. | No – voluntary gift, not unjust. |
In summary: A conferred benefit under unjust enrichment includes money, labor, goods, or any measurable advantage accepted by the defendant with knowledge, under circumstances making retention inequitable. The key inquiry is whether the enrichment was received without a legal basis—such as valid consent, contract, or donative intent.