U.S. DEPARTMENT OF LABOR
Office of Administrative Law Judges
Heritage Plaza, Suite 530
111 Veterans Memorial Blvd.
Metairie, LA 70005
(504) 589-6201
DATE: JUL 12 1994
CASE NO.: 88-ERA-9
IN THE MATTER OF:
JOHN A. CORDER,
Complainant,
v.
BECHTEL ENERGY CORPORATION,
Respondent.
ORDER GRANTING RESPONDENT'S MOTION
TO STAY PROCEEDINGS
On the 17th of May, 1994, a hearing was held in Houston, Texas on
Respondent's Motion to Stay Proceedings Pending Return of Settlement Monies. Respondent filed
a brief June 12, 1994. Complainant also filed its brief June 11,1994. The briefs have been considered
prior to the entry of this Order.
The Secretary's February 9, 1994 Order disapproved the prior settlement
(hereinafter the "Agreement") and no party has an enforceable obligation under that
agreement. Accordingly, the parties are in the same position they were prior to their execution of
the Agreement in October, 1988, with one important exception -- Complainant continues to enjoy
the benefit of settlement monies which he has not earned and has no right to possess.
[Page 2]
Irrespective of the enforceability of the Agreement, if Complainant wishes
to continue with this claim he must return the $67,500.00, with interest from February 9, 1994, and
restore the parties to the status quo ante.
Respondent conferred a benefit of $67,500.00 upon Claimant in exchange for
a full and final settlement of this claim and release of all claims against Bechtel Energy Corporation.
Although Respondent paid Complainant the money and performed all of its duties under the
Agreement, it did not receive the dismissal of this case that both parties had contemplated. Where
one has been unjustly enriched by the receipt of a benefit to which he is not entitled, equity will
intervene to restore the benefit to its rightful owner. See Klein v. Jones, 980 F.2d 521, 527
(8th Cir. 1992) (equitable doctrine of unjust enrichment prohibits one from unfairly profiting at the
expense of another); Hercules, Inc. v. Pages, 814 F.Supp. 74, 80 (M.D. Fla. 1993) (unjust
enrichment occurs where a benefit is conferred upon and retained by a defendant under
circumstances where it would be inequitable for him not to pay for it). See also Harker Heights
v. Sun Mellows Land, 830 S.W.2d 313, 319 (Text App. 1992) ("principle of unjust
enrichment suggests that restitution is an appropriate remedy in circumstances where the agreement
contemplated is unenforceable, impossible, not fully performed, thwarted by mutual mistake or void
for other legal reasons."). Under the circumstances, Respondent is entitled to the return of its
money. See generally Restatement of Restitution, §1 (1937) ("a person who has
been unjustly enriched at the expense of another is required to make restitution to the other".1
1It is well established that
restitution awards include prejudgment interest. See Union Bank of Benton v. First
National Bank, 677 F.2d 1074, 1077-78 (5th Cir. 1982) (under Texas law, equitable
grounds underlying remedy of restitution broadens scope of recovery; award of prejudgment
interest proper). See generally Restatement of Restitution, §156 (duty to pay
interest arises if the benefit was a sum certain and payment is necessary to avoid injustice).
2Texas law provides that, where
one pays money to another in anticipation of an agreement which fails to materialize, equity
requires that the money be returned. King v. Tubb, 551S.W.2d 436, 442-443
(Text App. 1977); Acoustical Screens, 524 S.W.2d 346, 350 (Tex. App. 1975). In
light of the Secretary's conclusion that no agreement existed for purposes of dismissal until he
approved the Agreement, return of the money is appropriate in the present case.