Francis v Lyon.

High Court of Australia|1907-07-01|Before: Higgins J, Misins J, Power J

means of knowledge to the public as to enable anyone of ordinary competence to reproduce the article." I accept this finding as correct, and I regard it as sufficient to justify the judgment for the defendant, if knowledge or means of knowledge should be treated as an element in the defence of prior user.

Solicitor, for appellant, C. J. Macfarlane, Melbourne. Solicitors, for respondents, Hodgson «& Finlayson, Melbourne.

B. L. (HIGH COURT OF AUSTRALIA.] CHARLES DECIMUS FRANCIS . 3 . APPELLANT; PLAINTIFE, AND JOHN LYON. i : : ' : . RESPONDENT. DEFENDANT,

Contract of sale - Sale of sheep - Right of purchaser to refuse to accept sheep H.C. or A. " unfit to travel" - Refusal to accept others which were fit to travel - Provisional 1907.

: refusal - Measure of damages - Repudiation by vendor - Sale of Goods Act ae (Q.) 1896 (60 Vict. No. 6), secs. 14 (2), 39, 52. BRISBANE, April 26, 29,

By a contract for the sale of a specific flock of sheep of a specified number at 39 ; May, 4. 'a certain price per head of those delivered and accepted, it was provided that the sheep should be delivered at a place between 200 and 300 miles from beset where the sheep then were, and to which the sheep would have to travel on Misins J. foot, and that the purchaser should have the option of rejecting all sheep unfit to travel. By the law of Queensland travelling sheep are required to travel at the rate of six miles per day. 'The destination of the sheep was unknown to the vendor, but it was within the contemplation of the parties

that they would have to travel a considerable distance. The purchaser a deposit of £250. In an action by the purchaser for return of the d

and for damages for non-delivery of the sheep, it appeared that the refused to deliver any of the sheep unless the purchaser would agree to ace and pay for sheep which were in fact unfit to travel move than one day's

Held, also, that a refusal by the purchaser to accept some of the which he should have accepted, which refusal the jury found the p was willing to reconsider, did not entitle the vendor to refuse to deliver th sheep which the purchaser was willing to accept.

Held, also, that, even had the refusal been absolute and unjustifiab provided that it was not of such a number as to go to the foundation of th contract, the vendor would not have been entitled to refuse to deliver sheep which the purchaser was willing to accept, his remedy being under sec, 30 of the Sale of Goods Act 1896 (Q.).

the place of delivery, but that the value of the sheep at that place was more than the price agreed to be paid for them : Held (Griffith C.J. di ing), that the purchaser was only entitled to nominal damages.

events from the sale in breach of contract (Sale of Goods Act, sec, 52 (: and that the defendant was entitled to a re-assessment of damages.

Decision of Supreme Court, Francis v. Lyon, (1906) St. R. Qd., reversed.

PLawtirr (the appellant) agreed in July 1905, to buy defendant (the respondent) 6,600 specific wether hoggets, to delivered at Barcaldine in October 1905, at 6s. per head, right to reject all sheep lame, diseased, or unfit to travel; was to be paid at once by the plaintiff into the defendant's b account, the balance of the purchase money to be paid when the sheep were delivered, and delivery to be treated as " conditional" delivery until full payment. The place of delivery was alte by agreement to Ilfracombe, and the £250 was duly paid. the date for delivery 6,183 sheep were mustered at Ilfracombe, and a sample draft of 663 submitted for the plaintiff's inspection He proposed to reject 78 as being "unfit to travel"; but

defendant insisted that the plaintiff was bound to accept and pay H- ©. or A.

for all sheep that were "fit to travel" for one day's stage, and absolutely refused to deliver any of the sheep except on that condition. The plaintiff refused to accede to this interpretation of the meaning of the contract, whereupon the defendant declared the contract at an end, and no inspection was made of any more of the sheep. Shortly afterwards he resold the sheep at a con- siderable profit. The plaintiff brought an action for damages for non-delivery of the sheep and for recovery of his deposit. The defendant paid £250 into Court, with a denial of liability. In answer to 46 questions submitted to them by Power J., the jury found, inter alia, that the plaintiff rejected more of the sample draft of sheep than he was properly entitled to reject, on the interpretation of "unfit to travel" most favourable to him- self; but that this rejection was only provisional. The value of the sheep refused was found to be the same as the contract price. _ The jury were also asked to find what profit or loss the plaintiff would have made if he had obtained delivery and travelled the sheep and sold them at Charleville in March 1906 ; but answered that there was no evidence upon which to make an estimate. Judgment was then entered for the defendant on both of plain- tiff's claims, and this decision was sustained by the Full Court (1). The further material facts appear in the judgments. The plaintiff appealed to the High Court.

Ryan and Walsh, for the appellant. This action was for the ven- dor's breach of contract to deliver sheep in accordance with the terms of the agreement for sale. The appellant interpreted the term "unfit to travel," in accordance with the Land Act 1897 (61 Vict. No. 25), sec. 230, as meaning all sheep unable to proceed towards their destination at a rate of at least six miles a day. The 78 sheep he excluded from the sample draft of 663 were only a pro- visional rejection ; but the vendor insisted that "unfit to travel" must only apply to sheep that were unable to travel for one day at that rate; and, upon the appellant objecting to have this inter- pretation of the contract forced upon him, the vendor wrongfully repudiated the contract. The jury should have been asked whether

the appellant was willing to accept of the sheep offered to him a that were reasonably "fit to travel"; they were only asked t question as to sheep "fit to travel" for one day; this was a mis direction which resulted in no proper trial of the question atiss

for a counter-claim or action, not for total repudiation by vendor. The appellant on his part never repudiated the agreem the jury found that he was "ready and willing to accept 5, sheep," which was their proportionate estimate of the numberwhieh would have been accepted from the whole flock, after rejectior such as were in his judgment " unfit to travel," in the terms of th agreement. The rejection that he in fact made was only pi sional, and could not amount to a repudiation: Mersey Steel Iron Co. v. Naylor, Benzon & Co.(1); Rhymney Railway vy, Brecon and Merthyr Tydfil Junction Railway (2). This does not only apply to contracts where delivery is made by instal ments: Howes Bros. v. Queensland Milling Oo. (3); Johns v. Milling (4). The appellant's claim to reject certain doubt sheep did not go to the root of the contract; the vendor's re to deliver any sheep unless the appellant submitted to take all amounted to a wrongful repudiation : Prendergast v. Lee (5)

Bradley & Son v. Bertoumieux (6); Oxford vy. Provand (i 3 Freeth v. Burr (8).

There was no proper trial on the question of damages.

taken delivery ; his purpose was to hold these sheep to sell after wards, and he is entitled to substantial damages for the profits h would have made, of which there was sufficient evidence: Sale Goods Act 1896 (60 Vict. No. 6), secs. 39, 52 (2); Greaves v. Ashlin (9); Buckland & Co. v. Crombie & Co. (10). The £250 was not a deposit but a part payment, and the respondent was not entitle to retain it except on an absolute repudiation by the appe Palmer v. Temple (11); Ex parte Burrell; In ve Parnell (

(1) 9 App. Cas., 434. (2) 69 L.J. Ch., 813. (3) 8 Q.L. J 388

Howe v. Smith (1); Levy v. Stogdon (2); Cornwall v. Henson (3); H. ©. or A.

Benjamin on Sales, 5th ed., pp. 954, 955; Sale of Goods Act 1896 (60 Vict. No. 6), sees. 54,55.

Lukin and E. A. Douglas, for the respondent. This appeal is merely a fight as to whether the appellant is entitled to 1s. damages or nothing; he could have taken out the £250 paid into Court: Order XXVI, vr. 6; Wilson and Grahame's Practice of Supreme Court of Queensland. p. 113.

[Isaacs J. - The breach of this contract entitles the plaintiff to claim two things, damages and return of deposit ; are not these two causes of action 7]

The appellant was not ready and willing to take delivery of the full number of sheep which he was bound to take, when offered in accordance with the terms of the agreement. The jury found that only 90 were "unfit to travel" by rail, and only 400 "unfit to travel" by road for one day's journey ; but the appellant rejected a much greater proportion. The respondent was right in treating this arbitrary refusal as a repudiation of the agree- ment. The contract was indivisible; it was no fulfilment of the contract on the part of the appellant to accept only such sheep as it suited him to take: Kingdom v. Cox (4); Chalmers on Sale of Goods Act, sec. 30 (1), 6th ed., p. 72; Reuter v. Sala (5); Logan v. Mesurier (6); Benjamin on Sales. 5th ed., pp. 323, 698.

[Isaacs J. - If, as you say, the contract is indivisible, the wrongful rejection of one sheep goes to the root of the contract. There must be some margin where a right of rejection is given.]

The contract required the appellant to perform two concurrent acts, namely to take the full number of sheep offered to him in the stipulated condition, and to be ready'and willing to pay for that number: Bishop v. Shillito (7); Loeschman vy. Williams (8); Forrestt & Son Ltd. v. Aramayo (9); Caleutta and Burmah Steam Navigation Co. v. De Mattos (10), The right to reject does not affect the essence of the contract if it is unfairly restricted by the

(1) 27 Ch. D., 89. (6) 6 Moo. P.C.C., 116. (2) (1898) 1 Ch., 478. (7) 2B. & A. n., 329. (3) (1900) 2 Ch., 298. (8) 4 Camp., 181.

(5) 4.C.P.D., 239, at p. 247. (19) 32 L.J.Q.B., 322, at p. 335.

appellant to throw up the contract as he did; he should hay accepted all the sheep offered, and sued for breach of warranty Davis v. Hedges (1. (Grirriru C.J. referred to Mondel v. Steel (2).] If this case depends entirely on the Sale of Goods Act 1896 (6 Vict. No. 6), the only question is whether there was repudiatio on either side. 'The respondent never repudiated the contract he insisted upon its complete fulfilment: Mersey Steel and Iron Co. v. Naylor, Benzon & Co. (3); Whitcher v. Hall (4); Romberg v. Gilbert (5). " Fit to travel" means fit to travel by any reasonable means; and on the evidence the intention of the parties was apparent that the sheep were brought to Ilfracombe, a railway station, order to be travelled by train. The jury found that all bubany at 100 of the whole 6,183 were fit to travel by rail to spshaal country. On the question of damages, the appellant cannot claim what he might have made by a sale of the sheep in March, when they sold for 10s. 6d. a head. At the time, and under the cireumstane surrounding the breach of the contract, the appellant would hay lost money on the sheep; the evidence was that he would have been lucky to get rid of them at a loss: Mayne on Damages, 7th ed., p. 19; Thompson v. Marshall (6); Roth & Co. v. Tays Townsend & Oo. (7). The appellant in fact did not prove an damages to the satisfaction of the jury, and no new trial can b ordered where he is only entitled at most to nominal damages: Macfarlune v. Lecluive (8); Rich v. Strelitz Bros. & Moss (9) Allan v. Pratt (10). In any case, having caused the breach contract, the appellant is not entitled to recover the £250: Fitt v. Cassanet (11); Levy v. Stogdon (12). The appellant canno succeed either in trover or breach of contract: Benjamin 0 Sales, 5th ed., p. 932; the property and right to possession were

(2) 8 M. & W., 858. (8) 15 Moo, P.C.C., 181 (3) 9 App. Cas., 434, at p. 439. (9) 4C.L.

(4) 5B. & C., 269. (10) 13 Aj . 780. (5) 11 QL. (11) 12 L.J.C.P., 70.

"not to pass until complete payment: Blackbwrn on Sale, 2nd ed., pp. 143, 493. The contract was clearly framed to reserve the right of disposition in the vendor: Sale of Goods Act, Eng. (56 & 57 Vict. c. 71), sec. 19; the contract being at an end, neither side had any claim: Atkinson v. Smith (1); Ex parte Chalmers; In re Edwards (2); Sale of Goods Act (Qd.) 1896 (60 Viet. No. 6), sec. 41 (2); Ogg v. Shuter (3); Mirabita v. Imperial Ottoman Bank (4). It does not matter that the appellant bond fide claimed a certain rejection ; the rejection he exercised was so extensive as to go to the root of the contract: Ebbw Vale Steel, Iron and Coal Co. vy. Blaina Iron Co. (5).

As to costs: The appellant should have taken out, when he could, the £250 paid into Court by respondent, and is not entitled

_ to costs on that count, nor to interest, as the jury did not give it:

Williams v. Ward (6).

x [Isaacs J. referred to Forster v. Farquhar (7).].

Nominal damages on the other count do not entitle the appellant _ to costs: Bewwmont v. Greathead (8); Tettey v. Wanless (9).

E [Isaacs J. referred to London, Chatham and Dover Railway Co. vy. South Bastern Railway Co. (10).]

The £250 in any ease swallows up the 1s. for nominal damages, and no separate costs should be awarded in such a case: Order XXVL, r. 6; Order XCL, r. 3 of Queensland Supreme Court Practice.

Ryan in reply. There has been no serious contention by the respondent that the appellant's claim of rejection went to the root of the contract: Sale of Goods Act 1896 (60 Vict. No. 7), sees. 13, 14, The property in the goods passed when the sale was made : Calcutta und Burmah Steam Navigation Co. vy. De Mattos (11). 'The appellant's claim for damages is for what he might reason- ly have made from the sale of these sheep. The jury were wrongly limited by being asked to find what profits could have been made by sale at Charleville six months later.

(1) 14 M. & W., 695. (7) (1893) 1 Q.B., 564. (2) LR. 8Ch., 289. (8) 2G.B., 454. (3) 1 C.P.D., 47. (9) LR. 2 Ex. (4) 3Ex. D., 164, (10) (1893) A. (5) 6 Com, Cas., 33. (11) 32 L.J.Q.B., 322, ar p, 328, (6) 55 L.J.Q.B., 566.

(GrirritH C.J. referred to Greaves v. Ashlin (1). Isaacs J. referred to Mayne on Damages, p. 218; Hngell_ Fitch (2); Robinson v. Harman (3).] 4 The appellant suffered substantial damage from the fact that these were specific sheep of a particular class; he could not g into the market and obtain similar sheep when refused tl There should be a new trial for reassessment of damages. jury never found that appellant was entitled only to nomin damages, and that cannot be inferred from their finding. [Hicciss J - There was, upon the evidence, no differenc between the market price of these sheep, on or about the day for delivery, and the price the appellant had to pay.] The appellant is at least entitled to the extra price he would have to pay to obtain similar sheep at the place of delivery. Sale of Goods Act 1896 (60 Vict. No. 7) lays down a broader principl than that the current value is the measure of damages : Benjai on Sales, 5th ed., pp. 986 (note 3), 987. {Lukin mentioned Thol v. Henderson (4).] , That case is only a decision that the appellant would not b entitled to special damages for loss of profits on a contemplated resale known to both parties if the jury found he is only enti to nominal damages on the market value ; also it is of no authorit, in face of Hammond vy. Bussey (5). ' The appellant is entitled to the full costs in the Court belo having obtained £250 and 1s. damages: Baylis y. Lintott (6) Powell v. Vickers, Sons & Maaim Ltd. (7); Tipping v. Jepson (8); Wood v. Cox (9); Brilliant G. M. Co. v. Craven (10) ; O'Con- nor vy. Star Newspaper Co. (11); Queensland Supreme Cou Practice, Order XXVLI., rv. 6.

GrirritH C.J. This is an action brought by a purcha against a vendor, claiming damages for non-delivery of sheep

(1) 3 Camp., 426. (7) (1907) 1 K.B., 71. (2) L.R. 4Q.B., 659. (8) 22 T.L.R., 743. (3) 1 Ex., 850. (9) 5 T.L.R. in (4) 8 Q.B.D., 457. (10) 9 Q.

(5) 20 Q.B.D., 79. (1D 68 L.T., 146. (6) LR. 8 C.P., 345,

dated 8th July 1905, described the subject matter of it as 6600 wether weaners, 8 to 10 months old, then depasturing on defend- ant's run, Glenlyon, and lately inspected by the purchaser. The sale was, therefore, of specific chattels. The sheep were to be shorn at Richmond in Northern Queensland, and were to be delivered in the following October at Barcaldine, which is a town upon the Central Railway, distant from Richmond by ordinary roads available for travelling stock between 200 and 300 miles. The contract contained the following words: " Rejections: lame, diseased, and sheep unfit to travel." A sum of £250 was to be, and was, paid to the vendor at once as part of the price, and the balance was to be paid immediately after delivery, which was to be considered as " conditional delivery" until actual payment of the balance. The price was 6s. per head, i. of all sheep delivered and accepted. The place of delivery was afterwards altered by mutual consent to Ilfracombe, another town on the Central Railway. 'The flock, then consisting of 6183 sheep, arrived at Ilfracombe in October, and it was arranged that delivery should be given on the 15th of that month. It appeared that at this time grass and water were scarce in that part of Queensland, and in consequence some of the sheep were in weak condition on arrival at Ilfracombe. By the law of Queensland travelling sheep are required to travel at the rate of at least six miles a day.

The vendor claimed that the purchaser was bound to accept and pay for all sheep in such a condition as to be able to travel one day's stage of six miles, although they would then be unable to go any further. Having regard to the condition of that part of Queensland, it must, I think, be taken that the contract was made in contemplation of the fact that the sheep could not

remain at the place of delivery, but would have to be removed to

some distance. The plaintiff's residence was near Charleville, between 200 and 300 miles further south, but there was nothing in the facts to show that the vendor had any reason to suppose that that particular locality was to be their destination. It must, therefore, I think, be taken to have been in the contempla-

accordance with the contract of sale. The contract, which was H. ©. or A.

tion of both parties that the sheep would have to travel for a considerable, though indefinite, distance. The whole flock was not examined by the plaintiff; About

of them were first submitted for his inspection, of which he proposed to reject 78. The jury found that, of these 78, 10 were unfit to travel even 6 miles, 26 were unfit to travel for th ee days, and 48 were unfit to travel 100 miles. 'The residue, th thought, were fit to travel 100 miles or more. These upon any construction of the words "fit to travel" were within the contrac It appears, therefore, that the plaintiff claimed to reject more sheep than he was entitled to do out of the first batch of 663. The jury, however, found that this rejection was provisional only, and that the plaintiff was willing to review his decision. The defendant's agent, on the other hand, insisted that the plaintiff was bound to aceept and pay for all sheep fit to travel for one day's stage, and absolutely refused to deliver any sheep unless the plaintiff would accept this interpretation of the contract. The plaintiff would not accept it, whereupon the defendant refused to deliver the sheep. The first question for determination is whether the defendant was justified in this refusal. This depends upon the meaning of the words " fit to travel." In my opinion these words mean fit at the time and place of delivery to travel on foot at the rate of six miles a day for a reasonable distance under ordinary conditions of country. Sheep only able to walk six miles and then unable to move further do not, in my opinion, answer this description. I think, therefore, that the defendant's refusal was a breach of the - contract. It was argued that the right of rejection was to be exercised at the place from which the sheep were to start for delivery. But, as the amount of the price to be paid depended upon the number of sheep delivered and accepted, and as that number could not be ascertained until the right of rejection had been exercised, I think that this construction is untenable. The defendant, however, contends that, even if this be so, the plaintiff cannot maintain the action, because he was not ready and willing to perform the contract on his part, i.e. to accept and pay for all the sheep which were fit to travel within the meaning of the contract. In fact, the plaintiff insisted on performance of

the contract as he understood it, but it appears, as already said, H.C. or A.

that he had made a mistake as to the fitness of some of the sheep.

The defendant having taken up the position already stated, no further examination of the rest of the flock was made by the plaintiff. The jury, apparently on the assumption that the 663 sheep examined were a fair average of the whole flock, found that 243 of the 6,183 sheep were not fit to travel for three days, that 205 more were not fit to travel for 100 miles, while the sheep which the plaintiff provisionally refused to accept would on the same assumption have been 728 in number, as compared with 448. It is contended for the defendant that this pro- visional refusal affords a defence to the action. I am disposed to think that the refusal, being provisional only, was irrelevant, and that the defendant's wrongful and absolute refusal to per- form the contract at that stage of the proceedings dispensed with any further obligation on the part of the plaintiff to show his willingness to perform the contract on his part. But I will deal with the case on the assumption that the plaintiff's refusal to accept some sheep which, as it now turns out, he ought to have accepted was definite.

The defendant's contention is not only that the plaintiff was bound to accept and pay for every individual sheep which was in fact "fit to travel," but that his doing so was a condition of the contract, a breach of which entitled the vendor to treat the con- tract as repudiated, and not a mere breach of an incidental term of the contract, to be compensated in damages.

See, 14, sub-see. (2), of the (Queensland) Sule of Goods Act 1896 expressly provides that : - " Whether a stipulation in a contract of sale is a condition the breach of which may give rise to a right to treat the contract as repudiated, or a warranty the breach of which may give rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated, depends in each case on the construction of the contract: a stipulation may be a condition, though called a warranty in the contract."

This subsection does not in terms apply to the rights of sellers, but the rules as to the construction of contracts are the same as

regards both buyer and seller. This is, indeed, assumed by " 39 which provides that : - ' When the seller is ready and willing to deliver the goods, and requests the buyer to take delivery, and the buyer does not within a reasonable time after such request take delivery of the goods, he is liable to the seller for any loss" occasioned by his neglect or refusal to take delivery, and also for a reasonable charge for the care and custody of the goods: This section does not affect the rights of the seller if the neglect or refusal of the buyer to take delivery amounts to a repudiation of | the contract."

The question, then, is whether upon a proper construction of this contract it was the intention of the parties that the right of the purchaser to delivery of any sheep should depend upon his _ not making the mistake of erroneously rejecting one or more sheep which a jury might afterwards think he should have accepted. In Bentsen v. Taylor, Sons & Co. (1), Bowen LJ. referring to this question said: - *Of course it is often very difficult to decide as a matter of construction whether a repre- sentation which contains a promise, and which can only be explained on the ground that it is in itself a substantive part of the contract, amounts to a condition precedent, or is only a warranty. There is no way of deciding that question except by looking at the contract in the light of the surrounding circum- stances, and then making up one's mind whether the intention of the parties, as gathered from the instrument itself, will best carried out by treating the promise as a warranty sounding only in damages, or as a condition precedent by the failure to perform which the other party is relieved of his liability. In order decide this question of construction, one of the first things you would look to is, to what extent the accuracy of the statement - the truth of which is promised - would be likely to affect the substance and foundation of the adventure which the contract intended to carry out."

In the present case it was, no doubt, an implied term of the contract that the purchaser should accept every sheep "fit to travel," and that he would not exercise his right of rejection in respect of any such sheep. But did a breach of this stipulation

contract is intended to carry out?" The sale was of a specific

flock of sheep. The stipulation as to rejection was to be observed at a future time, and at a distant place, when the vicissitudes of climate might render it very difficult to ascertain exactly whether a particular animal was or was not fit to travel, which is in any case more or less a matter of opinion. I think it is impossible to _ say, after looking at the contract by the light of the surrounding circumstances, that the intention of the parties would best be carried out by treating this promise as a condition precedent by _ the failure to perform which the other party was to be relieved of his liability. I adopt what Lord Blackburn said in Mersey Steel and Ivon Co. v. Naylor, Benzon & Co. (1): - * The rule of Jaw, as I always understood it, is that where there is a contract: in which there are two parties, each side having to do something (it is so laid down in the notes to Pordage v. Cole (2) ), if you see
that the failure to perform one part of it goes to the root of the contract, goes to the foundation of the whole, it is a good defence to say, 'I am not going on to perform my part of it when that which is the root of the whole and the substantial consideration for my performance is defeated by your misconduct' " Tam therefore of opinion that, even if the plaintiff absolutely and unjustifiably refused to accept some sheep (not being of such
anumber as to go to the foundation of the contract), the defendant _ was not entitled to refuse to deliver the sheep which the plaintiff ~ was willing to accept. Complete redress for the breach of this stipulation would have been afforded by the rule laid down in sec. 39 of the Sule of Goods Act. The case falls, I think, within the third of the well-known rules formulated in the notes to Pordage vy. Cole (3). "When a covenant goes only to part of the consideration on both sides, and a breach of such covenant may be paid for in damages, it is an independent covenant, and an action may be-maintained for the breach of the covenant on
the part of the defendant, without averring performance in the declaration." I am therefore of opinion that the defence that the plain-

(1) 9 App. Cas., 434, at p. 443, (3) 1 Wms, Saund., 548 (ed. 1871), (2) 1 Wins. Saund., 548 (ed. 1871). at p. 552.

"affect the substance and foundation of the adventure which the H. ©. or Ax

tiff was not ready and willing to perform the contract on hi part was not established, and the plaintiff was entitled to jud ment upon the findings of the jury. : The defendant, as to his deposit of £250, paid £250 into Cour with a denial of liability, and the plaintiff went on with aie action claiming substantial damages in addition. The questi of damages remains to be determined. The plaintiff is, of course, entitled to repayment of the £250, and probably with interest, if the jury had thought fit to give it. He contends that he is also entitled to substantial da for loss of the bargain. The rule of damages prescribed by 52 of the Sule of Goods Act in the ease of wrongful refusal deliver is as follows : - "(2.) The measure of damages is the estimated loss dire

and naturally resulting, in the ordinary course of event

"(3.) When there is an available market for the goods in question the measure of damages is primd facie to b ascertained by the difference between the contract prie

time or times when they ought to have been delivere

or, if no time was fixed, then at the time of the refusal

I understand the term "available market" to mean that circumstances, including conditions of time and place, are such that a purchaser having the purchase money in his hands then and there, if he so desires, buy other goods of the sa quality. In the case of a specific flock of sheep, of particular and quality, and to be delivered in a particular spot in the v pastoral districts of Western Queensland, it must often, I sh think generally, happen that these conditions do not exist. jury found in effect that there was no such available market which the plaintiff could have bought other sheep of the sam quality at that time. Recourse must therefore be had to thi general rule of sub-sec. (2). 'The jury found in answer to a specific question that the of the sheep which the defendant refused to deliver was not | 15th October more than the agreed price. It appeared that i

flock, so far as it had not been reduced by death, at a price which, if the plaintiff had had the sheep and sold them at the same price, would have left him a considerable profit.

The jury were also asked : - * What amount (if any) would the plaintiff have made or lost over and above his expenses and _ probable losses if the sheep had been travelled by him to Charle- ville and sold during the month of March 1906?" to which they d replied : - " No evidence of the market price of similar sheep to the Glenlyon sheep in the month of March 1906 being offered, we are unable to estimate the profit or loss that the plaintiff would have made had he travelled such sheep to Charleville."

There was evidence that in October the plaintiff could have bought a flock of sheep of quality not very different from the Glenlyon sheep, but not for less than 6s. 6d. per head. I think that in the application of the statutory rule regard must be had to the subject matter of the contract and the purpose to which, according to the conditions of time and place and the usual course of business in such matters, the sheep would probably be put.

Tt is suggested that the value of the goods at the time of breach involves all these elements. No doubt, in estimating the economic value of a thing at any particular time all these things may and should be taken into consideration. But I think that the statutory measure of damages is not synonymous with the difference between the contract price and the value at the time of breach as that term is ordinarily understood. That is the measure of damages prescribed by the third sub-section, but only applies in its entirety when there is an available market. In my opinion the jury would understand the question "what was the value of the sheep," &. as meaning "What was the price at which the plaintiff could on that day have sold them?" But he was not under any obligation to sell them on that day. It appears to me that, if the Court treats the answer to this _ question as an answer to the question involved in the rule in sub-sec, (2), it is substituting for the rule prescribed by the legis- lature a rule which is not the same, although its application may in many cases give the same answer. See Bank of England v.

the following March the defendant himself sold the identical 4- ©. or A-

H.C. or A. Vagliano Brothers (1). There is no suggestion that the jury

received any direction as to the measure of damages except as was implied in the questions themselves. If the jury had properly directed, they might, in my opinion, upon the evide to which I have referred, have awarded a substantial sum damages. I think, therefore, that he is entitled to a fresh ass ment of damages. :

I understand, however, that my learned brothers are of different opinion. In this view the plaintiff is entitled judgment for £250 and perhaps 1s. in addition. He is a entitled to the costs of the action up to payment into Court, a to the costs of the issues as to breach of contract.

I think that under the circumstances of this ease, and having regard to the form of the pleadings, the claim for damages addition to the return of the deposit should be regarded as separate cause of action from that to which payment into Cou was pleaded, and that the plaintiff is therefore entitled to si costs as he would be entitled to on receiving 1s. upon a distinct cause of action, unless the Court for good cause shown thinks fi to deprive him of them. In my opinion, even if the plaintiff would otherwise be entitled to the general costs of the action, having only recovered 1s. on his separate claim for damages, that _ fact affords good cause for depriving him of costs exeept such costs as he is entitled to in respect of the claim for the deposit.

I think, therefore, that the judgment appealed from should b : reversed, and that judgment should be entered for the plaintiff for £250 1s. with costs up to payment into Court, and the costs of the trial of the issues as to breach of contract decided in his favour (but not the general costs of the action), and also the ¢ of the motion for judgment after verdict, and the costs of the motion to the Full Court. The respondent must pay the costs of the appeal. coe

Isaacs J. By see. 29 of the Sale of Goods Act 1896 it is vided : - It is the duty of the seller to deliver the goods, and of

the buyer to accept and pay for them, in accordance with the terms of the contract of sale."

defendant's obligation to deliver in accordance with his contract. 'The defendant's answer is that he was ready and willing to deliver, but that the plaintiff was not ready and willing to accept and pay for the sheep, that he refused to accept delivery of them and wholly exonerated the defendant from his obligation of delivering.

See. 39 of the code provides as follows : - * When the seller is ready and willing to deliver the goods, and requests the buyer to take delivery, and the buyer does not within a reasonable time after such request take delivery of the goods, he is liable to the seller for any loss occasioned by his neglect or refusal to take delivery, and also for a reasonable charge for the care and custody of the goods: This section does not affect the rights of the seller if the neglect or refusal of the buyer to take delivery amounts to a repudiation of the contract."

Assuming, therefore, that the plaintiff committed a breach of his obligation to accept sheep, it is plain that unless the defendant can show that the plaintiff's conduct amounted to a repudiation of the contract, the defendant was not entitled to rescind it by wholly refusing to deliver any of the sheep at all, and there- upon taking thei away, selling them as his own, and retaining the proceeds. The seller by sec. 49, sub-sec. (3), is invested with all necessary power to protect himself by re-sale after notice of intention to re-sell if a buyer does not within a reasonable time pay or tender the price. But this is not the provision acted upon by the defendant here. In Rhymney Railway Co. v. Brecon and Merthyr Tydfil Junction Railway Co. (1) the Court of Appeal laid down the tests for determining when a party to a contract is at liberty to treat it as at an end. Lord Alverstone M.R. said : - "Tt will be well to consider in the first instance what conduct on the part of one party to a contract justifies the other party in treating it as at an end. If there is a distinct refusal by one party to be bound by the terms of a contract in the future, the other party may, in our opinion, treat the contract as at an end. - See Withers v. Reynolds (2); Hochster v. De la Tour (3); and

(1) 69 L.J. Ch., 813, at p. 818. (3) 22 L.J.Q.B., 455; 2 El. & BL, (2) 1 L.J.K.B., 30; 2B. & Ad., 882. 678.

H.C. or A. the judgment of Lord blackburn in Mersey Steel and Iron Co. v.

'goes to the root of the contract, goes to the foundation of the

Naylor (1). Short of such refusal, we think the true principle to _ be deduced from all the cases is that you must ascertain whether - the conduct of the party who has broken the contract is such that the other party is entitled to conclude that the party breaking the contract no longer intends to be bound by its provisions. This part of the rule was laid down by Lord Blackburn in the same judgment, where he says that the rule of law is that where there is a contract between two parties, each side having to do something, 'if you see that the failure to perform one part of it _

whole, it is a good defence to say, I am not going to perform my part of it when that which is the root of the whole and the substantial consideration for my performance is defeated by your misconduct.'" The same view has been recently acted upon - by the Privy Council in George D. Emery Co. vy. Wells (2) where Sir Andrew Wilson in delivering the judgment of the Judicial Committee, said: - " Then it was contended that the learned Judge was not justified in himself deciding that the breach of the contract on the part of the company went to the root of the contract, so as to eutitle Wells to treat the contract as repudiated, and that a finding of the jury on the point was necessary. No doubt, in many cases which can be imagined, such a question would probably be left to the jury. But where the question depends, as it does here? upon the construction of a written contract, their Lordships can see no reason why the Judge should not decide it as he would any other question so ising. In the familiar case of Withers v. Reynolds (3), always cited when this class of question arises, the point was made the ground of a nonsuit." In case of conduct amounting to a refusal to accept according to the contract but not amounting to repudia- tion by the plaintiff, the defendant could, if he thought fit, have continued to hold such sheep as were wrongfully rejected at the risk and expense of the plaintiff, or he could as to them have taken the plaintiff at his word and retained them for himself. But in the absence of conduct going to the root of the contract,

() 53 L.J.Q.B., at p. 501; 9 App. (2) (1906) A.C., 515, at p. 524. Cas., 434, at p. 442. (3) 2 B. & Ad., 882.

his own will rescind it for a mere refusal to accept some of the sheep.

There has been no finding that the plaintiff's conduct amounted to repudiation, nor would the facts, in my opinion, warrant such a finding or conclusion. It is clear upon the evidence that the plaintiff did not at any time refuse to accept sheep that were fit to travel. The utmost he did was to provisionally reject 78 from a lot of 663, but according to the jury's tenth finding, which is unchallenged, he was willing to reconsider even these. That was, in the words of Lord Campbell in Hochster v. De la Tour (1), 'a passing intention on the part of the (plaintiff) which he may repent of."

What he did insist on, and very properly in my opinion, was

that he would not accept the defendant's erroneous definition of the expression " fit to travel," and merely because he would not accept that definition as the standard of rejection, the defendant by his drover acting under the direct instructions of the defend- ant himself definitely and finally broke off all business relations, took away the sheep, and refused to deliver any of them. : Although the jury by a process of proportional calculation arrived at a finding that the plaintiff was willing to accept only 5,455 sheep, that cannot be relied on, because, in the first place, the rejection of the 78 was not final, and that was the basis of the whole calculation; and next they have assumed that the plaintiff's judgment and estimate of the balance of the sheep would necessarily have been the same as their own. Assuming, contrary to the fact, that the rejection of the 78 was final, the "rejection of the rest of the 5,735 or 6,090 which the jury thought ought to have been accepted is purely problematical and imaginary. The plaintiff had no opportunity of deciding how many he would reject because the defendant's representative would not allow him to further inspect. The result is that the _ defendant did fail to deliver, and the plaintiff was entitled to recover whatever damages he sustained: see sec. 52 (1).

The Act by section 52 (2) gives him as damages the estimated loss directly and naturally resulting in the ordinary course of (1) 2 EL. & BL, 678.

in other words in repudiation of the agreement, he could not of H.C. or A.

events from the seller's breach of contract. This and the ne sub-section are substantially the first part of the rule in Hadl v. Baxendale (1) (see Agius v. Great Western Colliery Compa (2). Ido not understand that the Statute has in any way. altered the law as to damages. Special damages are provided fi in sec. 55 of the Act. Primd fucie, this is the difference betw the contract price and the market or current price on the when the sheep might have been delivered if there was an a able market, see, 52 (3), but as the jury have found that, assumi that such a market existed, and the sheep were procurable, market price was less than the contract price, he cannot recov substantial damages on the basis of an available market. In absence of a market he is entitled to recover as general damages the difference between the contract price and the value of sheep on the day when and at the place where they should ha been delivered. See Elbinger Actien-Gesellschagt v. Armstron, (3); Hinde v. Liddell (4).

The value of the sheep there and then depends on the who of the surrounding cireumstances. 'They are to be assumed be on the day of delivery at Ilfracombe with the country as feed and water and otherwise as it then actually existed. Futu prospects as to condition, market, wool and so forth, ineh the chances of sale in the ordinary course of business as th would then present themselves to a reasonable man, are propel elements for consideration in arriving at the then value of sheep; but, after all these factors have been duly weighed, net result as to general damages must be a sum representi that value.

The jury have fixed the value of the sheep as follows were worth 5s. 4d., 5,455 worth 6s., and they have shown, appreciation of the various elements to be considered by stati how they arrived at their values in the following terms : - * ing regard to the condition of the sheep, the condition of district and the roads, and the circumstances in which the s were then placed."

(1) 9 Exch., 341 (4) L.R., 10 Q.B., 265, at pp. 269, (2) (1899) 1 Q. 413, at p. 419. 270. (3) L.R. 9 Q.B., 473, at pp. 476-7.

If this be taken as determining the value of the sheep, it is H.C. or A.

clear that, apart from the £250 handed in part payment, the plaintiff is not entitled to more than nominal damages.

There was, in my opinion, abundant evidence upon which the finding can rest.

It has been urged that question 44 ought to have been answered, namely us to the plaintiff's probable profit or loss if he had travelled the sheep to Charleville and sold them in March 1906. I think the question in that form is quite irrelevant. No foundation for any special damage is laid, and there is no more reason for selecting March than any other period. The prospects of a sale, whether in March or any other time, is only one of the elements to be taken into account in arriving at the value of the sheep.

There was considerable evidence both ways as to value. The only other sheep to consider as to value were Coxon's. The plaintiff said that the Glenlyon sheep were a good class of sheep, better than Coxon's, and that he offered Coxon 5s. 6d. for his sheep but the offer was refused. Coxon offered them a month later at 6s. but they were not taken. Coxon said he had a flock of about 3,600 sheep a long way better than the Glenlyon sheep, and about the middle of October he wanted 6s. 6d. for them and refused 6s. No one purchased them and the offer of 6s. was not renewed. He sold them on November 21st for 5s. 9d. after con- siderable expense because he felt foreed to. He gave his opinion that the Glenlyon sheep were worth in October about 4s. unless somebody had good grass and water that they could get them to, and then they might give a little more for them. Under these circumstances it seems to me the jury were eatitled, if they thought fit, to come to the conclusion they did.

If that finding stands the plaintiff is entitled to recover the sum of £250 which was part payment of the price, and perhaps 1s. more. It does not signify whether the £250 was a deposit or a part payment only, because in either view it is impossible in the circumstances of this ease that the defendant should be allowed to keep it.

The defendant paid the £250 into Court without admitting liability. The plaintiff might have taken it out and had all his

costs without the expense of a trial, which lasted about 20 days, -

The defendant has urged that there was good cause of depriving me the plaintiff of costs. I think, acting upon the case of Forster y, Farquhar (1) there is good cause for making a special order as - to costs, and I agree with the order as to costs pronounced by the learned Chief Justice.

Hicaiys J. I have come to the same conclusion - that the defen- dant is liable. I propose, however, not to commit myself to any precise definition of the meaning of the words " unfit to travel." It is not necessary to do so; inasmuch as, even if the plaintiff did - reject some sheep that he was not entitled to reject, the defendant was not entitled to refuse to deliver the rest. My learned - colleagues have amply shown in their judgments that a wrongful - rejection of some of the sheep is not a matter going to the rootof - the contract. There was no repudiation of the contract by the - plaintiff; and if the defendant thought that the plaintiff was rejecting sheep that he had no right to reject, he had his remedy _ in an action for non-acceptance (see. 51 (1) ). On the question of a) damages, I coneur in the view that the findings of the jury - sufliciently establish that the plaintiff had suffered no substantial - damage from the refusal of the defendant to deliver. By their answer to question 41, the jury have found that the value of the Glenlyon sheep was, on the 16th October 1905, 5s. 4d. per head, if - you take the full number of 6,183 sheep, or 6s. if you take about 5,000 or more (the sheep which were fit to be delivered). There- fore, if the plaintiff lost these sheep, he lost an amount equivalent - to not more than 6s. per head ; and as he would have had to pay 6s. per head for them, he lost nothing in the net result. The value must be based on what a purchaser would give on that date, at that place - having regard to the place, the time, the weather, the prospects, the distance from market or from - probable repurchasers, the probable length of time before re-sale, _ the probable price, the probable profit - and all the circumstances. _ The probability of increased price, of profit, would be taken into account. I had thought that perhaps there was a mis- direction when the jury returned into Court to ask a question as

to issue 44. But on looking closely at the question, and at the H.C. or A.

answer of the learned Judge, I have come to the conclusion that there was no misdirection. The jury, in effect, asked : - « We have heard the evidence as to the actual sale of the Glenlyon sheep in March 1906, and the evidence as to the transactions with regard to Coxon's sheep in October 1905; but is there any evidence aliwnde as to the market price of similar sheep at these times?" The Judge answered that there was no such evidence as to March 1906, but that there was evidence as to decrease in market values from August to October 1905.

As to the costs of the action, I agree with the proposed order. The action was owing to the wrongul act of defendant; the bulk of the evidence related to the issue, was the defendant guilty or not of this wrongful act. The plaintiff, it is true, has failed to show substantial damages ; but the damages rested so much on opinion, that the plaintiff cannot be treated as having brought this action wantonly or frivolously. For the proceedings subsequent to the trial the defendant is responsible.

Appeal allowed. Judgment for defendant discharged. Judgment to be entered for plaintif for £250 1s. with costs wp to payment into Court, and the costs of the issues as to breach of contract (but not including the general costs of the action). Respondent to pay the costs of the motion for judgment after verdict, and costs of the motion to the Full Court. Respondent to pay costs of appeal.

Solicitors, for appellant, LZ. Z. Hobler, Rockhampton, for J. F. Lockett, Charleville. Solicitors, for respondent, J. Pattison, Rockhampton, for 0. R. Cusack, Richmond. NG. P.

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Judgment (119 paragraphs)

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