CLASSIFICATION OF OBLIGATIONS. By H. W. BALLANTYNE, (Continued from June Issue.) B. PRESCRIBED OBLIGATIONS. In contrast with consensual obligations we come now to consider those which are constructive, i.e., defined and prescribed without reference to the will or assent or declaration of the obligor. Agreement and promise are not the only sources of obligation. There is a great variety of prescribed obligations, many of them of a remedial character, some legal and some equitable. It will be possible only to refer to the sources of some of the leading varieties. 1. Quasi contracts: It has been customary to include under quasi contracts all non-contractual legal obligations which are enforced by contractual forms of action. It seems preferable, however, as Woodward suggests, to confine this class of obligations to those arising from the receipt of a benefit, the retention of which is unjust, or the imposition of an unjustified burden. Judgments, customary and statutory obligations are better treated as different species, since they arise from transactions and sources of a diverse nature. Quasi contracts will then become a homogeneous class instead of being a general receptacle for all non-contractual obligations. 51 In People v. Dummer,52 Justice Cartwright in holding that a suit in debt for taxes is not an action on a contract express or implied under section 2a of the Municipal Court Act, clearly points out the difference between contracts implied in fact and quasi contracts, which are constructive contracts created by implication of law. "They are not contract obligations in the true sense because there is no agreement of the parties. The idea of contract is purely fictitious.' 51 See, also. Street, "Foundations of Legal Liability," II., p. 206. 82 274 Ill. 637. The source of obligation is commonly the receipt of a benefit at another's expense under circumstances in which compensation is justly due. The law compels the defendant to disgorge his unjust gain.53 It is sometimes said that quasi contracts arise from unjust enrichment at the expense of the plaintiff, but it seems better to say that the obligation arises from the receipt of a benefit, because in some cases there may be no actual enrichment. It is the receipt of the benefit and not the use or enjoyment of it which is essential to quasi contractual obligation. The loss of the benefit after it has been received, as by fire or robbery, is no defence." Professor G. P. Costigan has recently pointed out in an article entitled "Implied-in-Fact Contracts'"55 that there is a class of "no-meeting-of-the-mind-implied-in-fact contracts." In these cases a debt arises from the receipt of a quid pro quo to pay the reasonable value of what is done by the plaintiff at the defendant's request, rather than merely the enrichment or benefit received by the defendant, although the express contract intended did not come into existence.56 A contractual measure of damages is allowed in these cases rather than a quasi contractual, because on the whole the obligation is more consensual than non-consensual. It will not be possible here to attempt a subdivision of quasi contracts, which arise from a variety of transactions, such as the receipt of money or benefits under mistake of fact, or under a contract which is invalid or which bcomes non-enforcible; also benefits procured by fraud or undue influence or wrongful appropriation; and also, but rarely, services rendered in great emergency. The law rather strictly enforces the principle that a man is to be made a debtor only by his consent and not by officious intermeddling. Where one wrongfully takes the goods of another and applies 5 See, also, Highways Commissioners v. Bloomington, 253 Ill. 164, 171; 26 Ann. Cas. 471. 66 66 54 Woodward, Quasi Contracts," sec. 76; Cf. note, What Constitutes Receipt of Benefit in Quasi Contract?" Col. L. Rev., XX., p. 602. Fay v. Slaughter (1901), 194 Ill. 167, 168; 62 N. E. 592. 5 Harv. L. Rev., XXXIII., p. 376. 5 See Vickery v. Ritchie, 202 Mass. 247. them to his own use the owner may "waive the tort" and sue in assumpsit on the common counts for the value received without proof of conversion into money." It is in truth not a case of "waiving a tort," but of electing an alternative remedy upon an obligation based on enrichment of the defendant by the receipt of an unjustified benefit.58 Obligations arising quasi ex contractu are closely related to tort liability. They are obligations to make reparation or restitution. Many quasi contracts might no doubt have been regarded as torts, or as obligations quasi ex delicto, rather than quasi ex contractu.5" Thus if A., under mistake of fact, pays money to B., which he does not owe him, B. might be regarded as guilty of a wrong or tort in withholding money which does not honestly belong to him. Quasi contracts may, however, be regarded as obligations in the nature of debt from the fact that they usually arise from the receipt of value and are a duty to pay the value of what has been received. Quasi contracts are not as universally based on unjust enrichment, or receipt of material benefit or value, as is usually assumed. Unjustifiable prejudice or burden, as well as unjustified benefit, would seem to be a source of quasi contractual claims. Quasi contracts may be looked at from the point of view of the plaintiff as obligations to rectify an unjust appropriation of property or labour, or an unjust impoverishment or deprivation of the plaintiff, as well as that of unjust retention or enrichment of the defendant. Thus, where plaintiff has a right to rescind a contract because of defendant's wrong, fraud, or breach, the defendant may be under a quasi contractual duty to restore the plaintiff to his former status and not merely to surrender the benefit which the defendant has received. The amount of defendant's enrichment may not always be identical with the amount necessary to restore plaintiff to his former condition.60 City of Elgin v. Joslyn, 136 Ill. 525, 532. 50 Jenks, "Digest of English Civil Law," p. 315, note. 60 66 Williston, Contracts," I., sec. 3, sec. 1478. Costigan, Harv. L. Rev., XXIII., sec. 95, n. 30. Newhall Engr. Co. v. Daly, 116 Wis. 256, 61 If one is compelled to pay a debt which another in justice ought to have paid, he is entitled to be relieved. of this burden. Such is the nature of general average, which is an obligation arising from the sacrifice of part of the cargo to save the ship or passengers from extreme peril. The burden is to be shared by contribution of all concerned.62 2. Resulting and Constructive Trusts: Constructive trusts may be described as "remedial obligations to compel specific restitution of a received benefit in order to prevent unjust enrichment. ''63 They are closely related to quasi contracts and are raised by equity in cases where property has been obtained by fraud, mistake, or abuse of confidence, or under circumstances in which honesty and the policy of the law require that it be restored to the true proprietor. Such is the source of the equity of redemption of the mortgagor, where equity creates the obligation in the teeth of the express agreement of the parties that the land shall be forfeited, on the ground that the mortgagee is entitled in justice only to repayment of the mortgage debt with interest, and that a forfeiture is a dishonest acquisition which he ought not to hold." It has been suggested that "resulting trusts" should, if possible, be confined to those which may be described as implied in fact in contrast to constructive trusts, which are fraud-rectifying and implied in law. At the present time some so-called resulting trusts are really constructive as where the intended trust fails.65 Where A. pays the purchase money to X. and has the conveyance made to B., who agrees orally to hold in trust for A., or to convey to him, it may be 263, 93 N. W. 12 (1903); Mooney v. York Iron Co., 82 Mich. 263, 265, 46 N. W. 376; Kempton v. Floribel Land Co., 189 Pac. 478 (Cal. App.); Welch v. Lawson, 32 Miss. 170. 61 Harvey v. Drew, 82 Ill. 606; Farwell v Becker, 129 Ill. 261. 63 Dean Pound, Progress of the Law: Equity," Harv. L. Rev., XXXIII., 420, 421. 64 Langdell," Survey of Equity Jurisdiction," p. 14. 65 See G. P. Costigan, Jr., Classification of T usts." Harv. L. Rev., XXVII., 437, 462; "Constructive Trusts," Harv. L. Rev., XXVII., 237 366; 39 Cyc. 27; Stone, "Resulting Trusts," Col. L. Rev., VI., 326; Costigan. Constructive Trusts," Mich. L. Rev., XII., 435, 515; Ill. L. Rev., VIII., 68, 73. 66 said that a resulting trust arises in spite of the Statute of Frauds from the intention which is presumed from the facts. In the case of a wife or child of the payer, there is a presumption that a gift or advancement is intended. A resulting trust is then, sometimes at least, a "presumed intention trust," implied in fact and based on a rebuttable presumption from circumstances. Resulting trusts ordinarily arise in accordance with actual intent. But the intent is inferred or assumed from the accompanying facts or circumstances that the beneficial interest is not to go with the legal title. In the language of the Illinois Supreme Court, however, a resulting trust is often spoken of as not arising out of the contract of the parties, but by mere operation and implication of law like a constructive trust.67 An interesting question is presented in cases where the heir murders the ancestor, or the devisee murders the testator, or the beneficiary murders the insured. Will the law allow the murderer to retain or acquire the fruits of his crime? Can a constructive trust be raised in favour of beneficiaries who were not deprived of anything, at whose expense the murderer was not enriched? Must you find an enrichment at some one's expense, who is to be beneficiary of the trust? Dean Pound says it is simply a question of exclusion by a remedial device."8 In Wall v. Pfanschmidt," the Illinois Supreme Court held that there was no room to raise a constructive trust in a case where the heir had caused the death of the ancestor; and the fact that the heir caused the death does not deprive him of his inheritance or limit his title to a naked trust for the benefit of other heirs. This went on the ground that the laws of descent depend entirely on the provisions of statute. It has been pointed out, however, that the court fails Cook v. Patrick, 135 Ill. 499; McCarthy v. McCarthy, 289 Ill. 365; Roche v. Roche, 286 Ill. 336, 350. 239. Monson v. Hutchin, 194 Ill. 431; Hinshaw v. Russell, 280 Ill. 235, 68" Equity," Harv. L. Rev., XXXIII., pp. 422, 423 |