High Court determines principle of restitution law

13 March 2024

Today the High Court handed down an important decision in the law of restitution. In Redland City Council v Kozik [2024] HCA 7, the Council had invalidly levied special rates on waterfront land holders for the purpose of carrying out works on canals and waterways. The Council claimed an entitlement to retain parts of the invalid rates which it had spent on the works.

The High Court, by a 3-2 majority, held that the land holders were entitled to recover the invalid rates in full in restitution. The majority rejected the Council’s claim that it had a defence of “good consideration”, for three reasons: (1) the Council had an obligation to carry out the works, independent of the levying of special rates; (2) the works did not confer a relevant “benefit” on the land holders, because any “benefit” was not one which the land holders had requested, freely accepted, or could reasonably reject; and (3) the defence would stultify the operation of the regulatory regime which the Council had breached through the invalid levies.

The majority also rejected an attempt to introduce a broader defence of “no unjust enrichment” into Australian restitution law, on the basis of principles developed in some United States cases.

Justin Gleeson SC and Adam Hochroth appeared for the land holders, instructed by Vicky Antzoulatos of Shine Lawyers. Ruth Higgins SC appeared for the Commonwealth Attorney-General, intervening in the case.

Link to judgment