Pavey & Matthews Pty Ltd v Paul
High Court of Australia · 1987
Pavey & Matthews Pty Ltd v Paul [1987] HCA 5; (1987) 162 CLR 221
A builder did the work under an oral contract the statute would not enforce. Is there any claim left once the contract is out of reach?
What happened?
A builder carried out work for a homeowner under an oral agreement. The Builders Licensing Act 1971 (NSW) provided that a building contract was not enforceable against the owner unless it was in writing. The work was done; the contract could not be sued on. The builder claimed reasonable remuneration for what had been done instead.
What did the Court decide?
The appeal was allowed: the writing requirement did not bar the builder's claim for reasonable remuneration. A claim of that kind does not depend on finding a contract the statute has put out of reach. The amount, and the other issues in the case, were left to be determined.
Proposition
What is the principle?
A claim for reasonable remuneration for work requested and accepted is not an action on an implied contract; it rests on the defendant's receipt of the benefit, so the claim is not necessarily defeated by the contract being unenforceable.
Why does this case matter?
It is the case that makes a whole branch of the remedies syllabus possible: a great deal of what students now learn about unjust enrichment descends from the room this decision opened, and it is cited constantly in litigation about work done under arrangements that went wrong.
Two later cases mark out how far it goes, and both are commonly overstated in the other direction. Lumbers is emphatic that this case did not settle that merely receiving a benefit is enough, and that "unjust enrichment" is not itself a test to be applied directly. Equuscorp shows that a statute whose purpose would be defeated by recovery still defeats it. Cite this case for what it opened, not for a general principle that whoever holds a benefit must give it up.
Exam and application relevance
Where a contract is unenforceable, do not stop at "no contract, no claim". Ask what was requested and accepted, and then what the statute was for — a writing requirement of the kind in this case is a different thing from a statute whose policy would be undone by ordering restitution. Keep termination separate: there, accrued contractual rights do much of the work and the contract price may govern or cap what is recoverable. Naming the claim as an implied contract is the error this case removed.
Check your understanding
The statute made the contract unenforceable against the owner. Why did that not dispose of the builder's claim, when a different statute might have?