Bernstein v. Nemeyer
Connecticut Supreme Court
570 A.2d 164 (1990)
Bernstein (plaintiff) was a limited partner with Nemeyer (defendant) in a partnership formed to buy and renovate two apartment complexes. Nemeyer agreed to cover any funding gap between the partnership's expenses and its profits, later recouping those loans from income or sale proceeds. Nemeyer loaned the partnership $3,000,000 in good faith before defaulting on further loans; the properties were foreclosed on, and both partners lost their entire investment. Bernstein sued for rescission and restitution of his original investment. The trial court found Nemeyer's breach immaterial and denied recovery; the appellate court found the breach material and went on to consider whether restitution was owed.
Whether restitution is designed to avoid unjust enrichment of the breaching party by putting that party back in the position it would have occupied had the contract never been made.