#6890 - Kiriri Cotton V. Dewani - Restitution of Unjust Enrichment BCL

Kiriri Cotton v. Dewani

Facts

The plaintiff came to Kampala in March, 1953, and looked for somewhere to live. At the end of May, 1953, he took a flat in Salisbury Road, but he had to pay 10,000 shillings premium. He now said that that premium was illegal because it was in contravention of the Rent Restriction Ordinance, and he claimed the return of it.

It was apparent from that evidence, as the trial judge said, that during the negotiations for the flat the plaintiff was at a disadvantage. He was having difficulty in obtaining accommodation - and he only got the flat by paying a premium of 10,000 shillings, which he borrowed for the purpose. He took it under a sublease dated September 17, 1953. This was prepared by lawyers. It contained provisions whereby the defendant company, in consideration of the sum of 10,000/- paid by the plaintiff by way of premium, subleased to him Flat No. 1 on the first floor for residence only, having three rooms, one kitchen, one bathroom and one lavatory.

The Rent Restriction Ordinance, 1949, of Uganda, provided by section 3(2): “Any person whether the owner of the property or not who in consideration of the letting or subletting of a dwelling-house ... to a person asks for, solicits or receives any sum of money other than rent ... shall be guilty of an offence and liable to a fine not exceeding Shs. 10,000 or imprisonment for a period not exceeding six months or to both such fine and imprisonment...”

Their Lordships desire to point out at once that neither party thought they were doing anything illegal. The lease was for more than seven years and it was thought that, on a lease for that length of time, there was nothing wrong in asking for a premium or receiving it.

Holding

Nevertheless, no matter whether the mistake was excusable or inexcusable, or the premium fair or extortionate, the fact remains that the landlord received a premium contrary to the provisions of the Ordinance: and the question is whether the tenant can recover it back - remembering always that there is nothing in the Uganda Ordinance, comparable to the English Acts, enabling a premium to be recovered back.

Were the parties in pari delicto?

Mr. Elwyn Jones, for the appellant, said they were both in pari delicto. The payment was, he said, made voluntarily, under no mistake of fact, and without any extortion, oppression or imposition, and could not be recovered back. True, it was paid under a mistake of law, but that was a mistake common to them both. They were both equally supposed to know the law. They both equally mistook it and were thus in pari delicto.

Their Lordships cannot accept this argument. It is not correct to say that everyone is presumed to know the law. The true proposition is that no man can excuse himself from doing his duty by saying that he did not know the law on the matter. Ignorantia juris neminem excusat. Nor is it correct to say that money paid under a mistake of law can never be recovered back. The true proposition is that money paid under a mistake of law, by itself and without more, cannot be recovered back.

Thus, if as between the two of them the duty of observing the law is placed on the shoulders of the one rather than the other - it being imposed on him specially for the protection of the other then they are not in pari delicto and the money can be recovered back; see Browning v. Morris, by Lord Mansfield. Likewise, if the responsibility for the mistake lies more on the one than the other - because he has misled the other...