The doctrine of unjust enrichment applies the principles of restitution to disputes that are not governed by a contract between the parties. It characterizes the result of a failure to make restitution under circumstances that give rise to an implied or quasi-contractual obligation to return those benefits.
The courts describe this claim in general principles. For example, courts have stated that a claim for unjust enrichment seeks to restore money where equity and good conscience require restitution; it is not premised on wrongdoing, but seeks to determine to which party, in equity, justice, and law, the money belongs; and it seeks to prevent unconscionable loss to the payor and unjust enrichment to the payee.
Because recovery based on unjust enrichment of another party relies on the court's sense of fairness or equity rather than the law, it is often referred to as the equitable doctrine of unjust enrichment.
In Kentucky, the doctrine of unjust enrichment is recognized and applied by courts when one party has received a benefit unjustly at the expense of another, and there is no valid contract governing the transaction between the parties. This doctrine is rooted in principles of equity, aiming to prevent one party from being unjustly enriched at the expense of another. Kentucky courts will consider an unjust enrichment claim when a party has received a benefit that it would be inequitable to retain without paying for it, and there is an implied obligation to return or pay for the benefit. The claim is not based on the existence of wrongdoing but is focused on the fairness of the situation. The courts will look at the circumstances to determine whether, in equity, justice, and law, the recipient of the benefit should be compelled to provide restitution to the party who has suffered a loss. This equitable remedy is discretionary and will be applied by the court to prevent an unconscionable loss to the payor and to ensure that the payee does not retain a benefit to which they are not justly entitled.