Community Savings Credit Union v. Bodnar
Page 16
law, equitable or statutory obligations (Garland, at para. 44; Kerr, at para. 41).
If any of these categories applies, the analysis ends; the plaintiff’s claim must
fail because the defendant will be justified in retaining the disputed benefit.
For example, a plaintiff will be denied recovery in circumstances where he or
she conferred a benefit on a defendant by way of gift, since there is nothing
unjust about a defendant retaining a gift of money that was made to him or
her by (and that resulted in the corresponding deprivation of) the plaintiff. In
this way, these established categories limit the subjectivity and discretion
inherent in the unjust enrichment analysis and help to delineate the
boundaries of this cause of action (Garland, at para. 43).
[58]
If the plaintiff successfully demonstrates that none of the established
categories of juristic reasons applies, then he or she has established a prima
facie case and the analysis proceeds to the second stage. At this stage, the
defendant has an opportunity to rebut the plaintiff’s prima facie case by
showing that there is some residual reason to deny recovery (Garland, at
para. 45). The de facto burden of proof falls on the defendant to show why
the enrichment should be retained. In determining whether this may be the
case, the court should have regard to two considerations: the parties’
reasonable expectations and public policy (Garland, at para. 46; Kerr, at
para. 43).
[59]
This two-stage approach to juristic reason was designed to strike a
balance between the need for predictability and stability on the one hand, and
the importance of applying the doctrine of unjust enrichment flexibly, and in a
manner that reflects our evolving perception of justice, on the other.
The First Stage of the Analysis – Established Categories
[37] In respect of the first stage of the juristic reason analysis, the “established
category” of juristic reason in this case is contract. The overdraft charges were, in all
cases, imposed pursuant to the terms of the credit unions’ account agreements with
its members. The difficulty, of course, is that the agreements provided for overdraft
charges that, in many cases, resulted in violations of the Criminal Code. A
contractual provision that is inoperative because it conflicts with the criminal law is
not a juristic reason for enrichment: see Kilroy v. A OK Payday Loans Inc., 2006
BCSC 1213 at paras. 26–27, aff’d. 2007 BCCA 231; and Garland at para. 51.
[38] The fact that the contracts contravened the Criminal Code, however, does not
preclude them from furnishing a juristic reason for at least part of the enrichment.
Canadian courts have long since abandoned the proposition that contractual
provisions that violate statutory enactments are necessarily void ab initio. In
Transport North American Express Inc. v. New Solutions Financial Corp., 2004 SCC