Unjust Enrichment in Canadian Law

The three-element test

Pettkus v Becker (1980) established the framework adopted in every Canadian unjust-enrichment case:

• Enrichment of the defendant.
• Corresponding deprivation of the plaintiff.
• Absence of juristic reason for the enrichment.

Enrichment and deprivation

Enrichment is broadly construed: receipt of money, property, services, or release from a liability. Deprivation matches the enrichment — the plaintiff has parted with something of value (money, time, services).

Juristic reason

The third element is the most analytically demanding. Garland v Consumers Gas (2004) restated the analysis:

• Step 1: Is there an established category of juristic reason? (Contract, donative intent, statute, court order.)
• Step 2: If not, the plaintiff has a prima facie case. The defendant may rebut by showing the parties'' reasonable expectations and public-policy considerations support letting the enrichment stand.

Remedy

The default remedy is a monetary award. Constructive trust is reserved for cases where:

• A monetary remedy is inadequate; AND
• The contribution can be linked to specific property.

Cohabitation cases — Kerr v Baranow

Kerr v Baranow (2011) restated unjust enrichment in cohabitation cases. Where the parties engaged in a joint family venture, the appropriate remedy is a monetary award proportionate to contributions to the accumulation of wealth, calculated on a value-survived (not quantum-meruit) basis.

Indicia of joint family venture:

• Mutual effort.
• Economic integration.
• Actual intent.
• Priority of the family.

Where all are present, the relationship is treated as a joint enterprise; the contributions are valued by reference to the wealth accumulated during the relationship.

Common errors

• Conflating the enrichment and deprivation. They are separate elements; the enrichment must correspond to the plaintiff''s deprivation.
• Treating juristic reason as a single inquiry. It is two-step (Garland).
• Defaulting to constructive trust. Monetary remedy is the default; constructive trust requires linkage to specific property.
• Ignoring statutory regimes. In jurisdictions with cohabitee property statutes (BC FLA, Alberta FLA), statutory regimes may apply alongside or instead of common-law unjust enrichment.