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Lloyd's Maritime and Commercial Law Quarterly

Natural obligations in English law

Duncan Sheehan *

In the late 18th century English law recognized a concept of natural obligation, or obligations binding only in honour. These had the effect of barring recovery of money paid by mistake, almost invariably mistake of law, and also often could act as consideration for a contract. During the 19th century two trends emerged. First, recovery of money paid by mistake of law was barred, removing one major effect of natural obligations. Secondly, a trend emerged restricting the effect of moral consideration. Few modern lawyers therefore know what natural obligations are. However, after the abolition of the mistake of law bar in Kleinwort Benson v. Lincoln City Council the importance of natural obligations has increased, as a means of barring recovery of money paid by mistake. The remnants of moral consideration can be fitted into the revival of the concept, and it is tentatively suggested that there are three types of natural obligation .
* Lecturer in Law, University of East Anglia. This paper was given at the Restitution Section of the SLS conference, Oxford 2003. I am grateful to those attending for their comments, and to Peter Birks for supervising the doctorate from which this is partially derived. All errors remain my own.
The following abbreviations are used:
Anson : J. Beatson (ed), Anson’s Law of Contract, 28th edn (Oxford, 2002).
Atiyah, Introduction : P.S. Atiyah, An Introduction to the Law of Contract , 5th edn (Oxford, 1995).
Atiyah, Rise and Fall : P.S. Atiyah, The Rise and Fall of Freedom of Contract (Oxford, 1979).
Bankton : Lord Bankton, An Institute of the Law of Scotland .
Birks, Introduction : P.B.H. Birks, An Introduction to the Law of Restitution , revised edn (Oxford, 1989).
Buckland : P. Stein (ed), W.W. Buckland, Textbook on Roman Law , 3rd edn (Cambridge, 1975).
Chitty : H. Beale (ed), Chitty’s Law of Contract , 28th edn (London, 2001).
Collins : H. Collins, The Law of Contract , 4th edn (London, 2003).
Corbin : J. Perillo (ed), Corbin on Contracts , revised edn (St Paul, 1996).
Gloag : Gloag’s Law of Contract , 2nd edn (Edinburgh, 1923).
Goff & Jones : G. Jones (ed), Lord Goff of Chieveley and G. Jones, The Law of Restitution , 6th edn (London, 2002).
Krebs : T. Krebs, Restitution at the Crossroads (London, 2001).
Litvinoff : S. Litvinoff, The Law of Obligations: Louisiana Civil Law Treatise , vol 5, 2nd edn (St Paul, 2001).
Meier : S. Meier, ‘‘Restitution after executed void contracts’’, ch 6 of P. Birks & F.D. Rose (eds), Lessons of the Swaps Litigation (London, 2000) 165.
Palandt : O. Palandt, Büurgerliches Gesetzbuch 62. Auflage (Müunchen, 2003).
Palmer : G. E. Palmer, The Law of Restitution (Boston, 1978).
Pothier : Sir W. Evans (trans), R. Pothier, A Treatise on the Law of Obligations or Contracts (1806).
Scot Law Com DP 95: Scottish Law Commission, Recovery of Benefits Conferred under Error of Law : Scot Law Com DP No. 95 (1993), vol 2.
Simpson : A.W.B. Simpson, A History of Contract at Common Law (Oxford, 1975).
Treitel : Sir G. Treitel, The Law of Contract , 11th edn (London, 2003).
Virgo : G. Virgo, The Principles of the Law of Restitution , (Oxford, 1999).
Zimmermann : R. Zimmermann, The Law of Obligations: Roman Law Foundations of the Civilian Tradition (Cape Town, 1996).

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