Martin v Hogan [1917] HCA 75

Martin v Hogan [1917] HCA 75 | Case summary | Zoe

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the merits in fact, which are all against them. Their attitude shows that if the strict law which they invoke brings about the ~ failure of their defences, there will be no cause for regret - -except on their part. There is no question that the documents actually tendered were 'refused. They were refused more than once. (A duplicate invoice led had been sent on the previous day, and the defendants accepted it.) The documents tendered, which are all in Exhibit C, did not include the ordinary bill of lading. What they included in its place, together with the invoice and the required certificate, was a contract of carriage. It was called in the evidence a shipping receipt, and

its purport was an acknowledgment by the carriers, the steamship owners, of the receipt of the goods mentioned in it for shipment _ subject to certain stipulations which are not here material. The document called itself a bill of lading. It was indorsed to order by 'Field & Royds, the New Zealand firm who had shipped the chaff. On the close of the case for the plaintiff, counsel for the defendants, _ moving for a nonsuit, argued that the document referred to, though called in the evidence a bill of lading, was not really one, and that ; actual bill of lading ought to have been tendered, made out in wour of the defendants. Instead of that, Field & Royds, who ere strangers to the contract, had the bill of lading made out to own order. Up to that point the case had been conducted the assumption that the document in question amounted to a of lading, or at any rate that there was no question raised on hat point. In view of this contention on behalf of the defendants, _ the learned Judge allowed the plaintiff to reopen his case so as to give ; wvidence that the document was the one contemplated by the con- ract, and was the usual contract of cavriage in such cases. In Wimble, & Co. v. Rosenberg & Sons (1) Hamilton LJ. spoke of "a reason- 4 ible and ordinary bill of lading or other contract of carriage," and

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consensual document, Exhibit C, even if accepted, does not pass the goods as a bill of lading does. Apart from legislation - and thy is none in New South Wales affecting this case - the common law attribute of a bill of lading is that upon assignment of the document the goods to which it refers are constructively delivered. No other document has this attribute at common law. Learned counsel relied on this in support of his contention that the price was not payable, the property not having passed. He still maintained th as a good reason in the Full Court, and failed. In this Court, both on the first argument and on the present argument (and it is quite as efficacious to raise it on the reargument as if it had been the only _ point raised on the original argument), appellants' counsel added a further reason for their central view, namely, that plaintiff's own evidence showed incontestably that the property had never passed, because the goods had never been put on board on the defendant account, conditionally or unconditionally, and also that the document Exhibit C was not a document which would transfer the goods, as true bill of lading would. And so it was contended that the pri was not payable, and that damages were not claimed and, if claimed, were not recoverable. - (4) Objection incurable - So long as a Court is supposed to exist for the purposes of securing justice, as measured by the law, so long, - in our view, must it strive to see that litigants are not to be regarded. as playing a game where a momentary oversight of counsel is to be _ necessarily fatal. If his oversight has prejudiced the opponent, - his client may have to abide by it; but if not, then the penalty if - any is costs, not deprivation of substantial rights. If, as here, the plaintiff, who sets up a claim, himself discloses his radical failure to observe his contract and exhibits an incurable defect in his case, the defendant, however late he points out the defect, ought not to be denied its recognition. For that there is the express authority of the Privy Council in Connecticut Fire Insurance Co. v. Kavanagh (1). Lord Watson speaking for the Judicial Committee says: - " When a question of law is raised for the first time in a Court of last resort, upon the construction of a document, or upon facts either -

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a please. They may, if they please, run the risk from the moment Rich J." shipment of their goods, or may cover the risk from the moment of shipment of their goods. That is, of course, inconsistent with custom deposed to by Johnson, that the original shipper, whoey he may be, insures his own goods, and on every resale that insurance and the obligation to pay for it, necessarily pass on. There are, therefore, in our view three questions : - (1) Was tl plaintiff bound in order to fulfil his contract to ship (either by him- self or some person on his behalf) the goods on the defendants' account, either unconditionally or else conditionally on payment against documents? (2) Did he do so on his own evidence? an (3) If he did, is he entitled to contract price, or to damages; and, if to damages only, should there be a new trial? . (5) Construction of Contract. - As to the first question, the contract reads to us in this way : - It was made in war time, when unexpected events might reasonably be guarded against by a seller so as to. avoid an absolute undertaking to deliver at all events. First, the - bare normal f.o.b. terms are inserted. Then, in order to prevent difficulties in performance, certain express stipulations are agreed to, viz. : (a) disputes as to quality are avoided, by providing for the finality of the New Zealand Government certificate showing that the quality when put on board, and not when arriving at Sydney, - was to govern ; (b) the buyers' primary duty and right in ordinary - circumstances of nominating a ship to any destination is determined by the provision as to " delivery " ; (c) terms of payment are agre to, viz. - that the sellers are to hold the " documents " until pay ment, and to be entitled to payment when, besides sending the goods, _ they present the documents; (d) the sellers undertake to insure for the buyers as instructed, thus connoting that the goods are at_ the buyers' risk from the time of shipment, and, if lost, the latter : would still be bound to pay on delivery of "' documents." Apart ' from those special stipulations, the contract is subject to the ordinary ¥ well-established meaning of an f.0.b. contract.

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itions precedent (other than tender) does not affect this point ; the admission goes only to the fulfilment of all conditions pre- ent to a right of action - it does not go to the nature of the emedy which the Courts will grant. The plaintiff's count treats the ment of the full price of the goods as being the proper remedy for the breach of the contract; but it is wrong. The admission hat all conditions precedent had been fulfilled is not an admission at the damages sought were proper. Damages are always in sue without express words in defence or plea - are in issue both to character and as to amount. The position is clearly set forth the English Rules of Court (Order XXI., r. 4); and the English merely declare the position which was accepted in the Courts common law before the Judicature Act (Wilby v. Elston (1) ). On the pleadings and the verdict of the jury, the plaintiff must be as having performed his part of the contract until the defen- nts failed to perform their part ; and it is important to see clearly 'in what point the defendants failed. The documents, including the shipping receipt, were clearly tendered to the defendants on oth August, if not before; and the defendants refused to accept even left the envelope unopened. They offered to give a lower price, the market having collapsed. In effect, they refused to carry out their agreement, refused to pay the price, because they refused to accept the goods. The Sale of Goods Act 1893 (British) has not been adopted by the New South Wales Parliament, but counsel on both sides appeal to the Act as correctly stating the law of New South Wales. In sec. 50 of this Act it is provided as fol- lor "Where the buyer wrongfully . . . refuses to accept nd pay for the goods, the seller may maintain an action against n for damages for non-acceptance " ; and the measure of damages the estimated loss resulting from the breach of contract - that to say, primd facie, the difference between the contract price ind the market price at the time that the goods ought to have been epted. But here the verdict of the jury and the claim of the plaintiff for the full price of the chaff: on what ground? There are two s in which, according to the Act, the full price is recoverable (1) 8 C.B., 142.

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There is, however, a second case in which, according to this Act, "the full price is recoverable. It is the rare case where, under the agreement, the price is payable "on a day certain irrespective of "delivery " although the property in the goods has not passed and the goods have not been appropriated to the contract (sec. 49 (2) ). Now, in this case the contract fixed no " day certain irrespective of delivery." At the time of the contract, it could not be said that 'the price was to be paid on 9th August or any other particular "day, delivery or no delivery. The words of the section are not "at a definite time," but " on a day certain irrespective of delivery." 'The ease on which the learned draughtsman of the Act based the exception (see Sale of Goods Act 1893, by Judge Chalmers) is the case of Dunlop v. Grote (2). In that case the defendants had on 3rd March 1845 bought of the plaintiffs 1,000 tons of a certain kind of pig-iron to be delivered to the defendants ; delivery was to be taken on or before 30th April; and if delivery were not required by the defendants on or before 30th April, the defendants promised never- theless to pay on that day. The defendants presently got 600 tons and paid for it; but they did not require delivery of the remaining 400 tons on or before 30th April. Under these circumstances, the defendants were held bound by their contract to pay on 30th April, That was the day for payment, delivery or no delivery, before that day. It was as if the seller had said: " We shall not 'Promise to give you at your price 1,000 tons of our pig-iron to be 'delivered as you require unless you promise to let us have all the money not later than 30th April." There is no such exceptional provision in this case, and therefore the ordinary rule would apply of payment when the goods are appropriated by the seller with the consent of the buyer, payment when the property passes. It is true that in the contract these words are used: '" Terms, - Cash against documents"; but these words are consistent with the ordinary condition that, previously or simultaneously, the goods (1) 16 M. & W., 119, (2) 2 Car. & K., 153.

At a glance

Court

Decision date

Before

Source

Judgment (214 paragraphs)

(5) 3 Ex. D., 164, at pp. 170, 172. (11) (1917) 1 K.B., 337.