R2d § 370
Requirement That Benefit Be Conferred
A party is entitled to restitution under the rules stated in this Restatement only to the extent that he has conferred a benefit on the other party by way of part performance or reliance.
Professor's notes
Threshold requirement. Restitution requires a benefit conferred on the other party, measured either by what the other party received in part performance or by reliance that enriched the other party. No benefit, no restitution. The measure looks at the defendant's gain, not the plaintiff's loss.
Common misunderstanding: students conflate restitution with reliance. Reliance damages (§ 349) measure the plaintiff's out-of-pocket cost; restitution measures the defendant's benefit. The two diverge sharply when the plaintiff spent heavily on preparation that did not enrich the defendant: reliance recovers the spending, restitution recovers nothing.
This is the gateway rule. Sections 371 and 373 supply the measure once § 370's threshold is met. The doctrine fills the gap where the contract has been avoided, rescinded, or excused: the parties must be returned to a status quo measured by exchanged benefits, not by promised performance.
Section 370 sets the threshold for restitution: there must be a benefit conferred on the other party. Restitution measures the value of what the defendant received, not what the plaintiff lost. This distinguishes restitution from reliance damages, which measure the plaintiff’s out-of-pocket loss without regard to whether the defendant gained from it.