Restitution law: Interesting and useful to the few who understand it

Eugene has kindly invited me to blog a bit this week about a new book I've written on the law of restitution - a little-studied area of law that every litigator should understand, because it can lead to high-stakes recoveries. If you're not involved in litigation but you find law interesting, you are likely to find restitution interesting, too. It is full of fascinating puzzles.

Consider what the following three episodes have in common. (a) I steal a hundred dollars from you, bet it at a casino, and win $100,000. Can you collect the $100,000? (b) You pay a judge to secure a favorable result in your case, he doesn't do what he promised, and you want your money back. Can you get it? (c) I watch you mistakenly build a house on my land, which you think is yours; then I thank you for your generosity and start moving in. Can I get away with it?

To most lawyers and law students these vignettes look unrelated. The first seems to involve a crime or tort, the second a case perhaps from the law of contract, and the third a problem for discussion in a course on property law. But in fact they all are cases where your best bet is a restitution claim. ("Best bet" might seem too strong to describe your prospects for recovery from the judge; but if the payment was his idea, so that it might be described as extortion, your restitution claim is likely a good one.)

Restitution is the mirror image of tort law. You sue in tort to recover for losses that you have suffered. You bring a restitution claim to recover gains that another party has obtained. In some cases it makes no difference which claim you bring, because your losses and the other side's gains are the same. Or you might prefer a tort claim because your losses are bigger than the defendant's gains, as usually is true when you suffer damage in an accident. But sometimes going after the defendant's gains will allow a much bigger recovery, or is the plaintiff's only way to recover at all.

Restitution is the great overlooked topic in American private law. In this country most students can't learn about it even if they want to; few schools teach the subject. Students only hear about restitution as the name of an occasional remedy in contract cases. But restitution is the name of a claim, not just a remedy. So lawyers often overlook restitution and sometimes try to use tort and contract to solve problems that restitution law would handle better. Missing or misunderstanding the right to go after a defendant's gains can be a very expensive oversight. And for the general student of the legal system, you are missing out on some lively fun if you don't understand how gain-based recoveries work.

Tomorrow I'll come back to one of those problems mentioned at the start of this entry, and some others.