Other Sources of Obligations

Overview

The Civil Code of Quebec (Code civil du Québec, CCQ) recognizes two broad categories of obligation sources: contract and all acts or facts to which the law attaches obligatory effects by its own authority (art. 1372 CCQ). Among the non-contractual sources, beyond extra-contractual liability (responsabilité extracontractuelle) under art. 1457 CCQ, three additional mechanisms generate obligations without any agreement between the parties. These are management of the business of another (gestion d'affaires), governed by art. 1482 to 1490 CCQ; reception of a payment not due (réception de l'indu), governed by art. 1491 and 1492 CCQ; and unjustified enrichment (enrichissement injustifié), governed by art. 1493 to 1496 CCQ. Formerly grouped under the label "quasi-contracts" (quasi-contrats), these three institutions share a common corrective logic: they address situations of unjust enrichment arising from lawful activity where no contractual relationship exists between the parties.

Learning Objectives

After studying this lesson, the reader should be able to:

Identify and distinguish the three non-contractual, non-delictual sources of obligations under the CCQ
Explain the conditions, obligations, and effects of management of the business of another
Apply the rules governing the reception of a payment not due to common fact patterns
Analyze the elements required for an action in unjustified enrichment, including the subsidiarity requirement
Distinguish these quasi-contractual sources from true contracts, extra-contractual liability, and liberalities
Determine the limitations on recovery under each of the three mechanisms

Key Concepts and Definitions

Quasi-contract (quasi-contrat): A traditional doctrinal term for obligations that arise from lawful conduct without an agreement between the parties. The CCQ does not use this label, but it remains useful for classification purposes.

Management of the business of another (gestion d'affaires): A voluntary, spontaneous intervention by one person (the manager, gérant) for the benefit of another (the principal, géré) who is unable to attend to their own interests.

Reception of a payment not due (réception de l'indu): The obligation to return what was received when a person pays another by error or without being legally or contractually bound to do so.

Unjustified enrichment (enrichissement injustifié): A residual mechanism permitting a person who has been impoverished (appauvri) to recover from one who has been enriched (enrichi) at their expense, where no legal justification for the transfer exists.

Subsidiarity (subsidiarité): The principle that the action in unjustified enrichment is available only when the impoverished person has no other legal remedy against the enriched party.

Sources of Obligations Beyond Contract

Art. 1372 CCQ structures the law of obligations (droit des obligations) around two poles. On one side stands the contract (contrat), where obligations arise from a meeting of wills. On the other side stand all acts or facts to which the law attaches obligatory effects by its own authority. This second category includes extra-contractual liability under art. 1457 CCQ, which arises from unlawful activity (activité illicite), and the three "other sources" of obligations, which arise from lawful activity (activité licite).

The distinction between unlawful and lawful activity is central to the structure of the CCQ. Extra-contractual liability requires a fault (faute), causation (lien de causalité), and injury (préjudice). The three other sources do not require fault. They rest instead on the principle that no person should be unjustly enriched at the expense of another, even when no wrongdoing has occurred. Although each mechanism involves some element of voluntary conduct, they differ from contracts because no agreement exists between the parties involved.

A common structural thread runs through all three quasi-contractual institutions: one party holds a benefit that, in fairness, belongs to or should be restored to another, and the law provides a corrective mechanism. These three mechanisms occupy a middle ground between the consensual domain of contract and the fault-based domain of extra-contractual liability.

Management of the Business of Another

Definition and Rationale of Management

Management of the business of another occurs when a person, the manager (gérant), spontaneously performs an act or undertakes a task for the benefit of another person, the principal (géré), without being legally, judicially, or conventionally required to do so (art. 1482 CCQ). The principal must be unable to attend to their own interests at the time of the intervention.

The intervention may be material or juridical in nature. Material acts include towing a stranded vehicle, storing and repairing an abandoned boat, or preserving goods left behind by a third party. Juridical acts include managing the property of a deceased person before a liquidator of the succession (liquidateur de la succession) is appointed, administering the property of a minor, or managing the affairs of an incapable person before a protective regime (régime de protection) is established.

The institution serves a practical function: the law encourages individuals to act in the interest of others who cannot protect their own affairs, provided the intervention is timely and reasonable, and provides for reimbursement and indemnification.

Illustrative example: A neighbour discovers that a pipe has burst in the home of an absent property owner during winter. The neighbour arranges for emergency plumbing repairs to prevent flooding damage. This neighbour qualifies as a manager under art. 1482 CCQ and may seek reimbursement for the repair costs from the property owner upon the owner's return.

Conditions for a Valid Management

Several conditions must be satisfied for the rules of management of the business of another to apply:

Spontaneity. The manager must act on their own initiative. No contract (contrat) may exist between the manager and the principal. If a contractual relationship governs the situation, the rules of mandate (mandat), service contracts, or another relevant contract apply instead.
No legal obligation to act. The manager must not be legally required to intervene. Tutors, curators, trustees in bankruptcy, liquidators, and administrators of the property of others cannot qualify as managers because they act under a pre-existing legal duty.
Intention to manage for another. The manager must intend to act for the principal's benefit, not for personal gain. This intention distinguishes management of the business of another from unjustified enrichment. At the same time, management is not a gratuitous act, which distinguishes it from a liberality (libéralité).
Timeliness. The management must be timely (opportune) (art. 1490 CCQ). An inopportune intervention reduces the principal's obligation to the extent of enrichment only.
Ignorance of the principal. In principle, the principal must be unaware of the manager's intervention at the time it occurs. The principal may, however, know of the management if they were unable to appoint a mandatary (mandataire) or otherwise provide for their affairs, for example, due to illness or physical distance (art. 1482 CCQ).
Notification. The manager must inform the principal of the management as soon as possible (art. 1483 CCQ).

Obligations of the Manager

The manager's obligations operate on two levels: towards third parties and towards the principal.

Towards third parties. If third parties with whom the manager contracted in the course of the management are unaware of the real situation, the manager is personally bound to them. The manager may then seek reimbursement from the principal (art. 1489, para. 1 CCQ). Where third parties know of the management situation, the manager functions as a mandatary. In that case, the manager bears no personal liability for acts performed in conformity with the conditions of management, and third parties have a direct action against the principal (art. 1489 CCQ). If, however, the principal is not bound towards the third parties because the conditions of management were not met, the manager remains personally liable. Third parties may address themselves to the manager when they cannot pursue the principal (art. 1489, para. 2 CCQ).

Towards the principal. The manager must carry the management through to completion (art. 1484 CCQ). If the principal dies, the manager must continue the administration until the heirs assume responsibility. The manager is also subject to the general obligations of an administrator of the property of others charged with simple administration (simple administration) (art. 1484, para. 2 and art. 1299 et seq. CCQ).

Obligations of the Principal

The principal bears obligations towards both third parties and the manager.

Towards third parties. The principal must honour the necessary or useful commitments made by the manager in the principal's name or for the principal's benefit (art. 1486, para. 2 CCQ).

Towards the manager. The principal must indemnify the manager for all commitments the manager contracted in their own personal name (art. 1486, para. 1 CCQ). The principal must also reimburse the manager for useful or necessary expenses incurred in the course of the management. The utility or necessity of these expenses is assessed at the time they were made (art. 1487 CCQ).

The scope of the principal's obligation depends directly on whether the management was timely. If the management was timely, the principal owes full reimbursement and indemnification. If the management was inopportune (inopportune), the principal is bound towards the manager only to the extent of the principal's actual enrichment (art. 1490 CCQ).

The prescriptive period (délai de prescription) for an action relating to management of the business of another is three years (art. 2925 CCQ).

Reception of a Payment Not Due

Definition and Scope of Payment Not Due

The reception of a payment not due arises when a person (the recipient, bénéficiaire) receives something by error from another person (the payer, payeur) who was not legally or contractually bound to make the payment (art. 1491 CCQ). Common situations include payment of a non-existent debt, overpayment, or payment to someone other than the true creditor.

The CCQ expanded the scope of this institution beyond cases of simple error. Payment made voluntarily to avoid a prejudice is also covered. A person threatened with legal proceedings may pay under protest (sous protêt) while awaiting the court's decision. By paying under protest, that person avoids their payment being treated as a tacit or express acknowledgment of the debt, provided they indicate at the time of payment that they owe nothing.

Illustrative example: A tenant mistakenly makes a double rent payment for the same month. The landlord who received the duplicate payment is bound to return the excess. The tenant may recover the overpayment through an action in restitution under art. 1491 CCQ.

Conditions for Restitution

Three conditions govern the obligation to restore a payment not due:

A payment must have occurred. The payment may take various forms, including the delivery of money, goods, or the provision of services (art. 1553 CCQ).
Absence of a genuine obligation. The payer must not be the true debtor of the recipient under any contractual or legal relationship. If the payer was bound to make the payment, no restitution arises because the payment was due.
Error or protest. The payment must result from an error of law (erreur de droit) or of fact (erreur de fait). An inexcusable error within the meaning of art. 1401 CCQ does not bar restitution. A payment made knowingly and without protest is treated as a liberality; the burden of proving the liberality rests on the recipient.

The Supreme Court of Canada broadened the scope of the action in restitution (action en répétition de l'indu) to include cases where a payment was valid when made but subsequently became undue. In such cases, the payer paid what was owed under a contract or court judgment, but the cause of the payment later disappeared with retroactive effect. The payment then becomes undue even though no error existed at the time of payment. The recipient must restore what was received to prevent an unjust enrichment of the recipient at the payer's expense.

Effects of the Payment Not Due

The payer recovers the object of the payment through a judicial action, and the rules governing the restitution of prestations (restitution des prestations) apply (art. 1492 and art. 1699 et seq. CCQ).

To protect a recipient acting in good faith (bonne foi), art. 1491, para. 2 CCQ excludes restitution in three circumstances: where the underlying claim is prescribed, where the title of obligation has been destroyed, or where the recipient has been deprived of a security (sûreté). In those situations, the payer may pursue the recipient's true debtor, if one exists, rather than the recipient.

The prescriptive period for this action is three years from the day of payment or from the day the payer becomes aware of the error that led to the payment (art. 2925 CCQ).

Unjustified Enrichment

Definition and Legal Basis

Unjustified enrichment, now codified at art. 1493 to 1496 CCQ, was originally developed by case law (jurisprudence) to correct situations not adequately addressed by management of the business of another or the reception of a payment not due. The Supreme Court of Canada recognized its principle and conditions of application in Cie immobilière Viger c. L. Giguère Inc.

The CCQ adopted the term "unjustified" (injustifié) rather than "without cause" (sans cause) and requires an absence of "justification" rather than an absence of "cause." This terminological choice prevents confusion with the distinct concept of cause of the obligation (cause de l'obligation).

Unjustified enrichment occurs when one person is enriched at the expense of another, who is correspondingly impoverished, and no justification exists for the enrichment or the impoverishment (art. 1493 CCQ). The impoverished party (appauvri) may seek indemnification through the action in unjustified enrichment, known in Latin as the action de in rem verso.

Illustrative example: A son works without pay for several years on the family farm, expecting to inherit the property. The father transfers the farm to another child. The son who worked without remuneration may bring an action under art. 1493 CCQ for indemnification of his years of uncompensated labour that enriched his father's patrimony. Similarly, following the breakdown of a de facto union (union de fait), a former partner may be indemnified through the action in unjustified enrichment for having contributed to child care and domestic tasks that enriched the other partner.

Conditions for the Action

Five conditions must be met for the action in unjustified enrichment to succeed:

Enrichment of the defendant. The defendant must have been enriched, and the enrichment must still exist at the time the action is brought, except where the enriched party acted in bad faith (mauvaise foi) (art. 1495 CCQ). The enrichment may consist of an increase in patrimony or the benefit of having avoided a loss or other prejudice.
Correlative impoverishment of the plaintiff. The plaintiff must have been impoverished in a manner that corresponds to the defendant's enrichment, such as non-payment for services rendered.
Connexity between enrichment and impoverishment. The impoverished party must demonstrate a connection (connexité) between their impoverishment and the defendant's enrichment. This is not the strict causal link required in extra-contractual liability, but rather a simple correlation between the two movements of value.
Absence of justification. No justification for the enrichment may exist (art. 1494 CCQ). The enrichment must not be explained by a particular legal obligation, a natural obligation (obligation naturelle), or a juridical act. The enrichment must also not originate from an act performed by the impoverished person exclusively in their own personal interest. For instance, a property owner who constructs a dike that incidentally benefits neighbouring properties cannot claim unjustified enrichment against those neighbours, because the owner built the dike primarily for personal advantage. The enrichment must also not result from a consistent intention to confer a liberality.
Subsidiarity. The impoverished person must not have another available remedy, nor must they have deprived themselves of another remedy, against the enriched party for indemnification of the impoverishment. A buyer who could exercise an action for forced transfer of title (action en passation de titre) cannot bring an action in unjustified enrichment instead. An impoverished person who allowed the prescriptive period on an available remedy to expire cannot fall back on this action as a substitute (art. 1495 CCQ).

The subsidiarity condition gives unjustified enrichment its distinctive residual character as a corrective mechanism for situations where no specific legal instrument addresses the unjust transfer of value between two patrimonies.

Effects of Unjustified Enrichment

The impoverished party receives indemnification (indemnisation) from the enriched party. The amount recoverable can never exceed the lesser of the enrichment and the impoverishment (art. 1493 CCQ). Both values are assessed as of the date of the judicial demand (demande en justice). This statutory cap ensures that the corrective mechanism does not itself produce a windfall for the impoverished party.

The rules governing the restitution of prestations (art. 1699 et seq. CCQ) do not apply to the action in unjustified enrichment. Art. 1493 CCQ specifies that the remedy is indemnification, not restitution.

Where the enriched party acted in bad faith, the enrichment is assessed at the time the enriched person benefited from it rather than at the date of the demand (art. 1495 CCQ).

The impoverished party may also exercise a direct recourse against a third-party beneficiary who knew of the impoverishment, where the enriched party gratuitously disposed of the enrichment without acting in bad faith (art. 1496 CCQ).

The prescriptive period for this action is three years from the day the impoverished person became aware of the circumstances giving rise to the right to bring the action (art. 2925 CCQ).

Practice Checklist

Use this checklist to identify and analyze other sources of obligations in a fact pattern:

Initial Classification

Does the situation involve lawful conduct without a contract between the parties?
Is extra-contractual liability excluded because no fault, causation, or injury is at issue?
Does the fact pattern suggest unjust enrichment of one party at the expense of another?

Management of the Business of Another

Did a person spontaneously intervene for the benefit of another?
Was no contract, legal duty, or judicial order compelling the intervention?
Did the manager intend to act for the principal's benefit, not personal gain?
Was the management timely and opportune?
Did the manager notify the principal as soon as possible?
Verify: reimbursement and indemnification are owed if conditions are met

Reception of a Payment Not Due

Did a payment occur (money, goods, or services)?
Was the payer not the true debtor of the recipient?
Was the payment made in error, or under protest to avoid a prejudice?
Check for defences: prescribed claim, destroyed title, or loss of security by the recipient

Unjustified Enrichment

Is there an enrichment of the defendant that still exists at the date of the demand?
Is there a correlative impoverishment of the plaintiff?
Is there a connection between the enrichment and the impoverishment?
Is there no legal justification for the enrichment?
Does the plaintiff lack any other legal remedy against the enriched party (subsidiarity)?
Calculate: recovery is limited to the lesser of the enrichment and the impoverishment

Glossary

Action de in rem verso: The action in unjustified enrichment; a Latin designation for the remedy available to the impoverished party under art. 1493 CCQ.
Appauvrissement: Impoverishment; the diminution of a person's patrimony corresponding to another's enrichment.
Bénéficiaire: Recipient; the person who received a payment not due under art. 1491 CCQ.
Connexité: Connexity; the required correlation between the enrichment and the impoverishment in the action for unjustified enrichment.
Enrichissement injustifié: Unjustified enrichment; enrichment of one person at the expense of another without legal justification (art. 1493 CCQ).
Gérant: Manager; the person who voluntarily undertakes the management of another's affairs under art. 1482 CCQ.
Géré: Principal; the person whose affairs are managed by the gérant.
Gestion d'affaires: Management of the business of another; a voluntary, spontaneous intervention for the benefit of a person unable to attend to their own interests (art. 1482 to 1490 CCQ).
Libéralité: Liberality; a gratuitous disposition made with the intention to confer a benefit without consideration.
Obligation naturelle: Natural obligation; a moral duty recognized by law that does not give rise to a right of action for enforcement.
Payeur: Payer; the person who made a payment not due under art. 1491 CCQ.
Quasi-contrat: Quasi-contract; a traditional doctrinal term for obligations arising from lawful conduct without agreement between the parties.
Réception de l'indu: Reception of a payment not due; the obligation to restore payment received without legal entitlement (art. 1491 and 1492 CCQ).
Sous protêt: Under protest; a payment made to preserve rights while contesting the underlying debt.
Subsidiarité: Subsidiarity; the requirement that the action in unjustified enrichment is available only as a residual remedy when no other recourse exists.

References

Civil Code of Quebec (Code civil du Québec), CQLR c CCQ-1991, art. 1372, 1401, 1457, 1482 to 1496, 1553, 1699 et seq., 2925.
Cie immobilière Viger c. L. Giguère Inc., [1977] 2 SCR 67.

This article is provided for educational purposes and does not constitute legal advice. For guidance on specific legal matters, consult a qualified Quebec legal professional.

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