This article considers the restitutionary claim for failure of consideration with particular reference to the recent High Court of Australia decision in Roxborough v. Rothmans. It is suggested that failure of consideration focuses on performance rather than promise and is therefore better labelled ‘‘failure of basis’’. It is further argued that restitution should be available for partial failure of consideration where counter-restitution is relatively simple. Finally, it is asserted that the traditional bar against restitution under subsisting contracts is stated too widely. Instead, in circumstances where there is a gap in the contractual allocation of risk, restitution should be allowed. In Roxborough there was such a gap in the contractual allocation of risk but the payments made were paid in exchange for the agreed quantity of tobacco—a basis that did not fail .

Failure of consideration is one of the most important and hotly debated grounds for restitution. In the past half century there has been a commendable drive to see failure of consideration broken free from the shackles of the old common counts and the implied contract fiction. The landmark case of Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd ,1 clarified the meaning of failure of consideration and distinguished consideration in the formation of a contract from restitutionary failure of consideration. The case also overruled Chandler v. Webster 2 and the fiction that a claim for total failure of consideration required the contract to be rescinded ab initio . More recently the ‘‘total failure’’ requirement has been called into question,3 as has the requirement that the

234