Measurement of Restitution: Coordinating Restitution with Compensatory Damages and Punitive Damages

And whence they came and whither they shall go the dew upon their feet shall manifest.Wallace Stevens, Sunday MorningTable of ContentsI. Introduction 974II. Civil Remedies 975III. Restitution Confusion 977IV. Distinctions 979V. Compensatory Damages and Restitution 981VI. Freestanding Restitution 982VII. Restitution for Defendant's Substantive Breach 985VIII. The Role of Defendant's Intent 989IX. Equitable Restitution 991A. Constructive Trust and Equitable Lien 991B. Equitable Accounting 994X. Punitive Damages and Restitution 998XI. Conclusion 1005I. IntroductionThe completion of the Restatement (Third) of Restitution & Unjust Enrichment in 2010 and its publication in 2011 provide me with this opportunity to situate restitution within the broader continuum of remedies. My goal is to use examples, many of them well known, to locate the way a court will measure a plaintiffs restitution within the broader spectrum of compensatory damages and punitive damages.II. Civil RemediesA court's remedy is what it does on behalf of a successful claimant. The court's remedies include, first, a personal order telling the defendant to perform or refrain from something, an order that may be restitution, and, second, money that may also include compensatory damages, restitution, and punitive damages.A court's personal order may be a constructive trust or an equitable lien, equitable restitution that this Article will return to below. The court's other principal personal orders are an injunction and a specific performance order.A court may award a plaintiff money for several purposes. The major headings of a plaintiffs money recovery that this Article examines are compensatory damages, restitution, and punitive damages. Examples of money recovery that we are not examining are nominal damages and attorney fees-costs.A court will view compensatory damages as money granted to put the plaintiff, so far as money can, where the plaintiff would have been without the defendant's breach or invasion. The court will base the plaintiffs recovery of compensatory damages on her loss. The compensation principle is strong and deeply entrenched in the professional psyche.1 For example, the strength of the compensation principle is the underlying basis for a recent attack on Rule 23(b)(3) damages-class cy pres remedies.2A court will respond to a defendant's unjust enrichment by granting the plaintiff restitution. The court will measure a plaintiffs money restitution to prevent or reverse the defendant's unjust enrichment. The court's baseline guide to restitution is the defendant's gain, not the plaintiffs loss. This Article will not examine restitution in specie - the defendant's return of the plaintiffs actual property.A court will grant a plaintiff punitive damages to punish the defendant for its aggravated misconduct and to deter that defendant and other potential defendants from similar misconduct.A skeptical observer may refer to a plaintiffs money recovery of restitution or punitive damages that exceed the plaintiffs loss as a "windfall," an epithet that means the writer thinks the plaintiff is receiving too much. …