Unjust Enrichment: Its Resemblance under Indonesian Civil Code

• The Emergence of Unjust Enrichment
• The Concept of Unjust Enrichment
• The General Practice of Unjust Enrichment
• Unjust Enrichment under Indonesian Civil Code
• Jurisprudence on Article 1359 of ICC
  • Jurisprudence No. 1749 K/Pdt/2010: Taking Non-Mandatory Payments
  • Judgment No. 253 /Pdt.P/2014/PN Skt: Erroneous Payment Due to Transfer Address Error
• Unjust Enrichment: An Unwritten Rule that Exists in a Limited Sense

The Emergence of Unjust Enrichment

Legal debates on contract law, as part of civil law, have focused in recent decades on finding new grounds for methods of restitution or compensation for losses arising from situations where there is no contractual relationship between the parties. To date, claims for restitution or compensation in civil law, including in Indonesia, have been dominated by two bases for claims, namely claims based on contractual relationships and claims based on unlawful acts (Rosa Agustina, et. al, 2018: 3).

Most legal scholars however consider that both grounds for claims and their development still do not meet the demands of progress and developments in the world.

The demand for a new grounds for filing a claim for restitution in order to achieve the objective of legal justice has given rise to a concept known as unjust enrichment (Faizal Kurniawan, et.al, 2016: 21). In certain circumstances, where there is no contractual relationship between the parties and no fault from the party benefited from such a situation, claims based on contractual relationships or claims based on unlawful acts cannot be brought. Thus, in such a situation, unjust enrichment serves as the basis for the claim (Richard Stone, 2000: 341).

The Concept of Unjust Enrichment

The concept of unjust enrichment itself is based on the principle that “one shall not be allowed to unjustly enrich himself at the expense of another,” as stated by Keener in an article published in the Harvard Law Review in 1887.

Furthermore, Black’s Law Dictionary defines unjust enrichment as, “The retention of a benefit conferred by another, without offering compensation, in circumstances where compensation is reasonably expected; A benefit obtained from another, not intended as a gift and not legally justifiable, for which the beneficiary must take restitution or recompense”.

The General Practice of Unjust Enrichment

The doctrine of unjust enrichment in private law is recognized in various countries, both those that apply the common law system and those that apply the civil law system. For example, the Netherlands has regulated the concept of unjust enrichment in Article 212 Book 6 NBW, which essentially stipulates that, “a person who has been unjustifiably enriched at the expense of another is obliged, insofar as reasonable, to make good the other’s loss up to the amount of his enrichment”.

Then, in the United States, the Restatement of the Law (Third) Restitution and Unjust Enrichment has regulated the criteria for unjust enrichment, as follows:

• a benefit which has been unjustly received (the “enrichment”);
• a loss or detriment suffered, usually by the plaintiff;
• a rule of law which deems the enrichment (or the retention of it) “unjust”;
• a prima facie duty to make restitution;
• absence of a valid legal basis for the payment or transaction (including voluntariness or election); and
• absence of a defence.

In the case of Everhart v. Miles, the judge’s consideration affirmed that there are three elements or components to determine the occurrence of unjust enrichment, namely:

• there is a benefit or advantage given or done by the plaintiff to the defendant,
• the benefit or advantage is valuable or understood by the defendant or in other words, it has the economic value, and
• the defendant receives or retains the benefit and it is improper (unjust) if it is not accompanied by the payment.

The above elements are similar to the elements used by judges in the Australian High Court in the Pavey & Matthew case, namely:

• the defendant was enriched,
• the defendant’s enrichment was at the plaintiff’s expense, and
• the enrichment was unjust.

(Eddy Neuman: 2018)

The distinction between claims based on contract, unlawful acts, and unjust enrichment can be observed from the relief sought in the claim. The relief sought in a claim based on a contract is compensation for failure to perform. Meanwhile, the relief sought in a claim based on an unlawful act is compensation for losses arising from a violation of the law, whether positive law, propriety, morality, or a violation of the principle of prudence. The relief sought in a claim based on unjust enrichment is not in the form of compensation or damages, but rather restitution or the restoration of benefits obtained unlawfully (Gunawan Widjaja, et al., 2018: 257).

It shall be emphasized that unjust enrichment requires the absence of an obligation in the granting of benefits, so that unjust enrichment cannot apply if there is an agreement between the parties, unless that agreement has been terminated or declared null and void (Burrows: 1997, 108). Furthermore, the same view is explained in the House of Lords decision in the case of Westdeutsche Landesbank Girozentrale v. Islington LBC, where the House of Lords stated that an unjust enrichment claim will succeed if it does not imply a contract between the parties, as unjust enrichment occurs without the need of a contract (Graham Virgo: 2015, 90).

In the common law approach, an act of enrichment is declared unjust based on factors known as unjust factors. This means that the plaintiff must provide and prove that there are unjust factors to justify their claim for restitution. In English law, an act is declared unjust if it meets at least one of the following elements:

• Mistake of fact;
• Mistake of law;
• Duress;
• Undue influence;
• Total failure of consideration;
• Miscellaneous policy-based unjust factors;
• Ignorance/powerlessness;
• Unconscionability;
• Partial failure of consideration;
• Absence of consideration.

(Faizal Kurniawan, 2025: 175)

Krebs explains that where the claimant was mistaken in making the payment, as in Barclays Bank v Simms, where a bank honoured a check which had been countermanded, or in Chase Manhattan Bank v Israel-British Bank, where a payment had, by mistake, been made twice, it is readily apparent that the defendant’s enrichment is unjust and should be reversed. In case where the claimant is forced to part with his money because of the defendant’s illegitimate pressure, the latter’s enrichment will be considered “unjust” by the law – this time, “duress” is the unjust factor (Krebs, 2000).

Unlike civil law, the approach to unjust enrichment in civil law countries generally focuses on the question: is there a legal basis for the enrichment of one party? The legal basis may be an agreement or a gift. Therefore, if there is no legal basis, the enrichment constitutes unjust enrichment. This is known as the absence of basis approach (Smith, 2009: 208).

However, several opinions state that the doctrine of unjust enrichment only adds a slight variation to general civil law; that the concept of unjust enrichment is partly inseparable from other existing grounds for claims (Ernest J. Weinrib, 2013).

Unjust Enrichment under Indonesian Civil Code

In Indonesian civil law, unjust enrichment is not expressive verbis included in the Indonesian Civil Code (“ICC”). Concerning legal practice in Indonesia, the doctrine of unjust enrichment has not developed as extensively as in the Netherlands and the United States. This is because in Indonesia, understanding of a doctrine similar to the doctrine of unjust enrichment has only emerged in studies of criminal law on corruption related to the illegal accumulation of wealth by individuals or legal entities involved in the management of state funds, which in Indonesian criminal law is known as “illicit enrichment” (Faizal Kurniawan, et.al, 2018: 26).

Some literature state that the doctrine of unjust enrichment can be considered equivalent to the provisions of Article 1359 paragraph (1) of the ICC, which states, “Each payment presumes a debt; each payment which was not made pursuant to a debt may be reclaimed” (Faizal Kurniawan, et al., 2018: 29).

According to Faizal Kurniawan in his book titled “Doktrin Unjust Enrichment: Karakteristik dan Penerapannya dalam Tuntutan Ganti Rugi”, Article 1359 paragraph (1) of the ICC cannot be equated with unjust enrichment.  Referring to Article 1359 paragraph (1) of the ICC, there are several elements that can be observed, namely:

• there is a payment;
• the payment is based on the assumption of the paying party that they have a debt;
• in fact, the debt does not exist (there is no obligation); and
• the payment made can be reclaimed.

Referring to the practice in the Netherlands based on the NBW (Nieuw Burgerlijk Wetboek/Dutch Civil Code), unobligated payments as stipulated in Article 1359 paragraph (1) of the ICC are known as performance not due (Articles 203-211 Book 6 NBW). NBW regulates “unjust enrichment” as a separate rule from “performance not due,” which is governed by Article 212 of Book 6 of the NBW, as explained in the preceding section (Faizal, 2025: 254).

Faizal further explains that the provision of Article 1359 paragraph (1) of the ICC appears to limit that an unobligated payment is only based on a mistake of fact, namely because of the assumption that the paying party has a debt, which in fact does not exist. This narrows the criteria for unjust enrichment, which can also be based on mistake of law, duress, and other factors. Thus, it can be concluded that Article 1359 paragraph (1) of the ICC cannot be equated with unjust enrichment, but only constitutes a small part of the scope of unjust enrichment (Faizal, 2025: 253). Or, based on the Faizal’s opinion, Article 1359 paragraph (1) of ICC may resemble as an unjust enrichment but on a narrow view or limited view. One may say it as a limited unjust enrichment concept.

Jurisprudence on Article 1359 of ICC

The following decisions are examples of decisions based on Article 1359 paragraph (1) of the ICC.

Jurisprudence No. 1749 K/Pdt/2010: Taking Non-Mandatory Payments

Two persons (“the Plaintiffs/Cassation Appellees”) purchased an item advertised in the Kompas newspaper, namely a Becho brand excavator, and paid a down payment of Rp205,000,000, which was transferred to the account number provided by the advertiser. When the item never arrived at the Plaintiffs’ address, it was discovered that the bank account number belonged to another person (“the Defendant/Cassation Appellant”) and not to the advertiser. The Defendant argued that he was unaware of the transaction between the Plaintiffs and the advertiser using his bank account number, and that the amount he received was the proceeds from his business, namely, a jewelry store.

The Plaintiffs claimed the Defendant on the grounds that the Plaintiffs had made payments that were not required to the Defendant, as stipulated in Article 1359 paragraph (1) of the ICC.

The panel of judges rejected the defendant’s request for cassation on the grounds that, according to the invoice, the Plaintiffs had sent his money to the Defendant through his account at Bank BCA in the amount of Rp205,000,000.00. Furthermore, based on the Kompas newspaper advertisement (Plaintiff’s evidence), the reason for the money transfer was clearly stated as the purchase of an excavator (becho), but it turned out to be false (a lie), therefore the money must be returned to the Plaintiff.

This case shows that a wrong transfer was made since the bank account was mistakenly written. This can be seen as a “mistake of fact” case which serves as part of “unjust factors” under the unjust enrichment doctrine. As outlined above and as argued by Faizal, Article 1359 of ICC only relates to a “mistake of fact” but avoid any other “unjust factors” that may occur in the unjust enrichment doctrine. Thus, even though Article 1359 paragraph (1) of ICC is not regulating the unjust enrichment doctrine but it can be seen as providing a limited unjust enrichment concept under the ICC. Let us look to another case law.

Judgment No. 253 /Pdt.P/2014/PN Skt: Erroneous Payment Due to Transfer Address Error

Unlike the previous case, this case does not involve a claim against the defendant, but rather a stipulation on the applicant’s request to the court. The case began when a person (“Applicant”), a customer of Bank BCA, accidentally transferred Rp12,500,000 to the wrong account in the name of AP, when it should have been sent to an account in the name of PK. The error occurred on 29 October  2014, via internet banking services. Upon realizing the mistake, the Applicant immediately reported it to the bank and requested cancellation and refund of the transferred funds. Bank BCA responded to the report and blocked the recipient’s account, but was unable to process the refund directly without the account holder’s consent or a court order, as stipulated in Article 45 of Law No. 3 of 2011 on Fund Transfers. Since the recipient named AP could not be located, the Applicant filed a request with the court to obtain a legal stipulation to recover the funds.

The judge granted the Applicant’s request on the grounds that the Applicant had taken steps and procedures to revoke the transfer in accordance with Law No. 3 of 2011 on Fund Transfer, so that the judge ruled that the transfer was erroneous and ordered PT Bank Central Asia Tbk to debit the amount of Rp12,500,000 from AP’s account and return it to the Applicant’s account.

In this case, the judge implicitly acknowledged that the receipt of funds by AP arose from the plaintiff’s mistake, and therefore must be returned. Despite no arguments on Article 1359 paragraph (1) of ICC by the judge, the situation was very similar to the first case law where there was a wrong transfer made by the applicant. This is again a “mistake of fact” that may occur and included as part of Article 1359 paragraph (1) of ICC

Unjust Enrichment: An Unwritten Rule that Exists in a Limited Sense

The doctrine of unjust enrichment was originally intended as a new ground for civil claims to meet the demands of developments in civil law, where claims based on contracts and unlawful acts were deemed insufficient to address the evolving issues. To date, there are no specific regulations or norms regarding unjust enrichment in Indonesian civil law.

However, some literature argues that the doctrine of unjust enrichment can be equated with the provisions of Article 1359 paragraph (1) of the ICC, which provides that “Each payment presumes a debt; each payment which was not made pursuant to a debt may be reclaimed”. However, it turns out that Article 1359 paragraph (1) of the ICC cannot be equated with the concept of unjust enrichment, because the provisions of Article 1359, paragraph (1) only cover “mistake of fact” as the unjust factor. This narrows the criteria for unjust enrichment, which can also be based on the existence of a mistake of law, duress, and other factors. Therefore, it can be concluded that Article 1359 paragraph (1) of the ICC cannot be equated with unjust enrichment, but rather constitutes only a small part of the scope of the concept of unjust enrichment.

Nevertheless, the principle of unjust enrichment was found to exist in a limited sense in Decision No. 1749 K/Pdt/2010 and Determination No. 253/Pdt.P/2014/PN Skt, which fulfilled the “mistake of fact” as an unjust factor therein.

---

Author

---

Editor

---

---

Sources:

Law and Jurisprudence

• Indonesian Civil Code.
• Nieuw Burgerlijk Wetboek.
• Restatement of the Law (Third) Restitution and Unjust Enrichment.
• Decision No. 1749 K/Pdt/2010.
• Judgment No. 253/Pdt.P/2014/PN Skt.
• Everhart v. Miles, 47 Md. App. 131, 422 A.2d 28 (Md. Ct. Spec. App. 1980).

Others

• Agustina, Rosa, et. al. 2012. Hukum Perikatan, Bali: Pustaka Larasan.
• Burrows. 1997. Contract, Tort, and Restitution-A satisfactory or not?, 99 L.Q.R.
• Cornish, et. al. 1998. Restitution: Past, Present and Future, Oxford: Hart Publishing.
• Campbell, Henry. 1990. Black’s Law Dictionary, West Publishing Co.
• Gunawan Widjaja, et. al. 2018. Unjust Enrichment, Cross-Border: Volume 1 No. 1.
• Krebs, Thomas. 2000. In Defence of Unjust Factors. Oxford U Comparative L Forum 3 at ouclf.law.ox.ac.uk.
• Kurniawan, Faizal, et. al. 2018. Unsur Kerugian dalam Unjustified Enrichment untuk Mewujudkan Keadilan Korektif (Corrective Justice), Jurnal Yuridika: Volume 33 No. 1.
• Kurniawan, Faizal. 2025. Doktrin Unjust Enrichment: Karakteristik dan Penerapannya dalam Tuntutan Ganti Rugi. Jakarta: Kencana.
• Neumann, Eddy. 2018. Equity and Trust-Unjust Enrichment.
• Smith, Stephen A. 2009. Unjust Enrichment: Nearer to Tort than Contract. Oxford University Press.
• Stone, Richard. 2000. Principles of Contractual Law, Cavendish Publishing Limited.
• Virgo, Graham. 2015. The Principles of Law and Restitution, United Kingdom: Oxford University Press.
• Weirnib, Ernest J. 2013. Unjust Enrichment Corrective Justice.