309 N.Y. 103, 127 N.E.2d 832 (N.Y. 1955)
Bartle v. Home Owners Cooperative, Inc.
May a contractor's bankruptcy trustee recover in unjust enrichment from the cooperative's individual members (or otherwise disregard the corporate form) merely because those members benefited from the contractor's performance under a valid contract with the cooperative, absent fraud, statute, or an agreement imposing personal liability?
Where a valid and enforceable contract governs the subject matter, a party performing under that contract cannot obtain quasi-contract or unjust enrichment recovery against nonparties who incidentally benefit from the performance. Members or shareholders of a corporation are not personally liable for corporate obligations absent a statutory basis, an express assumption of liability, or circumstances warranting veil-piercing (e.g., fraud or misuse of the corporate form). Unjust enrichment requires not only a benefit but its unjust retention; mere receipt of a bargained-for benefit under a proper contractual and corporate structure is insufficient.
No. The contractor's trustee cannot recover in unjust enrichment from the cooperative's members, nor can the court disregard the corporate form to impose personal liability. The members' receipt of the benefit did not render them unjustly enriched, and there was no statutory, contractual, or equitable basis to pierce the corporate veil.
Bartle is a cornerstone case for understanding the limits of unjust enrichment when a valid contract exists and third parties receive derivative benefits. It teaches that quasi-contract is not a mechanism to avoid a bad bargain or insolvency consequences and that corporate form is respected absent misconduct. For law students, it sharpens doctrine on: (1) the Restatement principle disallowing restitution from third-party beneficiaries of someone else's contract; (2) the requirement that enrichment be unjust, not merely beneficial; and (3) the insulation of corporate members from personal liability without grounds for veil-piercing.