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Subsidiarity in Private Law?

Document Cited authorities 6 Cited in Related
Vincent
DOI10.3366/elr.2020.0597
Pages1-25
Published date01 January 2020
Date01 January 2020
INTRODUCTION

As in law generally,1 clarity, certainty, and predictability are important to private law.2 By extension, there is value in an improved understanding of how different private law rules, regimes, and institutions interrelate.3 The utility of subsidiarity to the pursuit of this aim has not been explored by anglophone private lawyers. To date, the only substantial discussion of subsidiarity in anglophone private law scholarship has taken place in the realm of unjust enrichment.4 Even then, this material is relatively thin; and outwith that particular context, lawyers are yet to debate more broadly about, say, the meaning of subsidiarity in private law.5 By contrast, subsidiarity's basic meaning and function have been extensively analysed in English outside the private law sphere. And in France, a small but significant general discourse about subsidiarity from a private law perspective does exist. The French literature shows that subsidiarity in private law need not, by any means, be confined to the context of unjust enrichment.6 Subsidiarity could one day transcend the unjust enrichment setting in anglophone private law discourse, too.

This state of affairs prompts the attempt in this article to stir debate by offering six propositions about what it might mean to designate a rule or relationship (between legal regimes, say) as one of subsidiarity.7 The object is pre-emptively to provide some first and – necessarily – non-exhaustive general thoughts about subsidiarity, suitable for evaluating its worth to private law, in which it might be used to understand legal rules, or the interaction of different kinds of claim.

Given the lack of material on which to build in English, and which is specific to private law, this article casts a wide net for consensus. Its six propositions are formulated by reference, principally, to thinking about subsidiarity in other contexts; and, secondarily, to (i) miscellaneous literature about subsidiarity, (ii) the general French private law literature about subsidiarity, and (iii) what abstract points can be gleaned from relevant unjust enrichment discourse.8 The state of play in that discourse is summarised, before the choice of Roman Catholic social teaching, European Union law, and European human rights law as settings to examine for their conceptions of subsidiarity is explained, and subsidiarity in each of these contexts is sketched out. Succeeding sections then outline each proposition and clarify how it may be derived from the sources. The article concludes by reflecting on the potential of subsidiarity in private law as a way to model the interrelation of private law claims and doctrines.

 SUBSIDIARITY IN UNJUST ENRICHMENT

Sources endorsing the subsidiarity of unjust enrichment commonly agree that it involves the conditional constraint of enrichment claims as subsidiary to others.9 Several variations on this theme exist.10 These are canvassed to provide clarity during later discussion, before some more general observations.

Sometimes, subsidiarity entails that enrichment claims are barred in the presence of another claim or legal institution, i.e. where another route to redress is available at the same time as an enrichment claim.11 This first kind of rule is supported in South Africa, for example, where the eventual recognition of a general enrichment action has been embraced, but on the basis that it could only be invoked if established enrichment actions (such as the condictiones) would not avail a plaintiff.12 So, too, in Scotland. In Transco Plc v Glasgow City Council13 the pursuer performed the defender's obligation to keep up a bridge, and an enrichment claim in respect of the expense saved was barred, because a statutory action for the performance of the defender's statutory duty was available.14

Subsidiarity may also entail that enrichment claims are barred in the absence of another claim or legal institution, i.e. where another route to redress is itself barred, and an enrichment claim might otherwise arise, or where another legal regime expressly or impliedly excludes the operation of unjust enrichment. This second kind of rule has been endorsed in Scots law. In Courtney's Executors v Campbell15 an enrichment claim by a cohabitant's estate against the deceased's former partner was barred because, at the material time, the one year time limit on a statutory action for financial redress following cohabitation breakdown had expired.16

Other legal systems endorse both kinds of rule, as does France,17 in the Code civil's article 1303–3, which provides: “The impoverished person has no action on this basis [i.e. in enrichissement injustifié] where another action is open to him or is barred by an obstacle of law, such as prescription.” So, where a delictual action is available on a given set of facts,18 or where its conditions cannot be established (an obstacle of law),19 an action in enrichissement injustifié will be barred on those facts. The position is a little more complex, however. French courts do not rigidly apply their version of the second kind of rule identified here.20 There is also a third rule of subsidiarity,21 that where an action other than one based on enrichissement injustifié is practically useless due to an obstacle of fact,22 then an enrichment action will be allowed. The standard example of this is where A's contractual claim against B is useless because of B's insolvency, which fact will open the way to an enrichment action against C, where C has been unjustifiably enriched by A's contractual performance.23 This rule is not confined to cases in which B is contractually obliged to A;24 it can also apply in two party cases;25 and obstacles of fact other than insolvency have been recognised by the courts.26

On top of this diversity among systems which adopt subsidiarity to explain unjust enrichment's relations with other areas of law, there exist different approaches to the use of language by common law scholars. Some have imposed the vocabulary of subsidiarity on judicial decisions from which it is absent,27 or where it appears only in a judge's footnotes.28 Others, by contrast, have avoided this practice.29 Thus, a cautious survey in 2002 noted that unjust enrichment in the common law “does not know ‘subsidiarity’ by that name, but elements of that relationship appear to be embedded in the law”.30 Common law judges have not yet decided whether subsidiarity is indeed relevant to unjust enrichment, as some commentators consider.

The above patchwork cannot be criticised in itself: it is axiomatic that difference is not necessarily a bad thing. It does, however, spark interest in the possibility of clarifying our understanding of subsidiarity before it migrates to other private law contexts. This article seeks to identify consensus for the future. In this regard, the divergent unjust enrichment sources are of limited use. But reference can still be made below to points at which unjust enrichment discourse aligns with material from the other contexts under consideration. As well as supporting the propositions put forward, this may give an idea of the maturity of anglophone discourse about subsidiarity in unjust enrichment, seemingly the only private law arena in which it has been addressed at any length. From the unjust enrichment sources, we can also surmise that the potential use of subsidiarity to private lawyers in general is in understanding legal rules, and in modelling relations between different kinds of claim, doctrine, or legal institution.31

 SELECTING AND SUMMARISING SUBSIDIARITIES IN THE WORLD ELSEWHERE

To avoid repetition below, basic features of subsidiarity in Roman Catholic social doctrine, European Union Law, and European human rights law are outlined here, after three preliminary points. First, these contexts are the maximum manageable in the space available, taking account of other material cited. Catholic teaching has been selected because, whilst such luminaries as Aristotle, Aquinas, and Althusius are generally regarded as earlier mediators of thought about subsidiarity, the Church has long made “deliberate efforts to systematise” it.32 European Union law and European human rights law are included because their conceptions of subsidiarity have been the subject of much analysis, and, at least for the purposes of this article, appear well settled.33

Secondly, one omission should be explained. The idea of a subsidiary entity in corporate law does not assist the present analysis. Taking the current United Kingdom companies legislation as an example, we may juxtapose subsidiary and holding companies, and subsidiary and parent undertakings.34 But the general meaning of subsidiarity merely implies assistance or supplement. It does not carry with it the idea of control of a subsidiary entity by a non-subsidiary one, which inheres in the corporate law usage. This usage therefore stands out as a “special” one, according to the Oxford English Dictionary.35 As such, it is best overlooked in this discussion, which seeks to build from generally accepted notions, rather than exceptions to orthodoxy. This choice perhaps derives further support from the fact that the equivalent commercial entity in French law is simply called a société contrôlée.36

Thirdly, it is helpful to illustrate from a neutral context a consistent theme in what follows: subsidiarity is fundamentally about the allocation of competence or authority among entities, or groups of entities, on a conditional basis.37 This appears from the following observation by a majority of the Supreme Court of Canada. Subsidiarity is:38

[T]he proposition that law-making and implementation are often best achieved at a level of government that is not only effective, but also closest to the citizens affected and thus most responsive to their needs, to local distinctiveness, and to population diversity […]; there is a fine line between laws that legitimately complement each...

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