Semblance and Separation: Comparing the Law of Unjust Enrichment in Hong Kong and England

Abstract

This article provides a comparative overview of the current law of unjust enrichment in Hong Kong, examining how this body of law developed and diverged from its original English roots. Unjust enrichment law in Hong Kong largely mirrors that in England, retaining its nature as a subsidiary cause of action and the four-stage framework for unjust enrichment: (i) enrichment of the defendant; (ii) at the expense of the claimant; (iii) unjust factor; and (iv) defences. Most of the elements of the four-stage framework also follow the English approach, apart from defences to unjust enrichment. In this regard, the legal position in Hong Kong differs from that of England in several ways. The ‘wrongdoer’ and ‘bad faith’ bars to the change of position defence are interpreted far more broadly in Hong Kong. This divergence is unfortunately problematic, as it involves a misreading of previous English jurisprudence, leads to harsh results, and significantly limits the ability of the change of position defence to support the development of the law of restitution. The illegality defence in Hong Kong also differs by following the previous ‘reliance principle’ in Tinsley v Milligan, rather than the ‘range of factors’ approach in Patel v Mirza, especially due to the uncertainty engineered by the latter approach.

Keywords: Unjust Enrichment, At the expense of, Unjust factors, Change of Position, Illegality

JEL Classification: K39