Mills v Stokman

Mills v Stokman - [1967] HCA 15 - HCA 1967 case summary — Zoe

[10]

Between some date in 1960, as to which there is conflicting evidence, when according to the appellant she first saw a person removing slate from the land, and 23rd January 1961 the respondent Stokman from time to time entered the land and removed slate from the heap. However, shortly before 23rd January 1961 the appellant, through her husband, Victor Albert Mills, disputed the respondent's right to remove slate. According to the evidence, the appellant, again through her husband, complained that she was "not getting any money out of the slate". After conversations, the details of which are in dispute, an agreement dated 23rd January 1961 was signed between the appellant and the respondent Stokman which, after reciting that that respondent was the owner by purchase of all the slate on and in (sic) the said land, provided that that respondent would employ Victor Albert Mills, or a person nominated by the appellant, to assist in the selection and loading of slate to be removed from the land and would pay to the appellant £1 per load in respect of which such assistance was given. Clause 3 of this agreement is in the following terms: "(3) That Mrs. Mills on behalf of herself her heirs executors and assigns acknowledges and agrees that Mr. Stokman is the owner of all the slate situated on or in the land hereinbefore referred to and further acknowledges and agrees that she will not by herself her servants agents or workmen give bargain sell exchange bequeath or otherwise dispose of any part of the said slate without the prior written consent of Mr. Stokman. Mrs. Mills further acknowledges and agrees that Mr. Stokman has full and free power and authority for himself his servants agents and workmen to go to and return from the said lands upon which the said slate is situated from the Middle Arm Road for the purpose of cutting or sawing up or carrying away the said slate at all times and also for any of the purposes aforesaid to employ horses wagons motor traction and other mechanical contrivances which may be necessary or convenient for the said purposes but any road used for this purpose shall be maintained by Mr. Stokman at his expense."

[29]

I am of the opinion that the transaction between the first appellant's predecessors in title and the second respondent was not a contract for the sale of goods. The slate the subject matter of the transaction was, on the evidence, part of the land where it was deposited. The effect of the evidence is that by the transaction the second respondent bought a mass of pieces of the earth's crust, mined from the quarry in the vicinity, which the quarrying company returned to the earth. As the vendors entered into the transaction for value, it created a valid equitable profit à prendre. The next transaction between the second respondent and the first respondent was not an assignment of the whole of his interest by the former to the latter. This transaction purported to be a sale of what then remained of the mass of pieces of slate but the second respondent did not assign to the first respondent the licence to go on the land to win the slate and take it away. It would seem that an object of the agreement which the first respondent made with the first appellant, who then owned the land where the slate was deposited, was that the first respondent should obtain from the first appellant an authority to go on the land for the above-mentioned purpose. This agreement, if enforceable in a court of equity, is effective to give such authority. However, counsel for the respondents declined in argument to rely upon the agreement except as evidence that the first appellant knew before she paid for the land that the first respondent had purchased the heap of slate from the second respondent. Counsel also relied for this purpose on evidence showing that the second appellant in the course of his authority as the first appellant's agent obtained knowledge of the first respondent's interest in the heap of slate. The reason why counsel for the respondents declines to rely upon the agreement to support the first respondent's claim that he has authority to go on to the land and take away slate from the heap is that the appellants' counsel desires to contest the issue whether the agreement is specifically enforceable and that he had no opportunity of doing so at the trial because the respondents did not plead the agreement, nor was the issue contested whether the agreement supported the first respondent's claim that he had lawful authority to go on the land to win and carry away any slate from the heap. I think that it would be right to allow the application of the appellants' counsel for a direction that a trial of the issue be had and to make an order allowing this appeal. Consequently I would make an order setting aside the order of the learned trial judge and that both the appellants and the respondents should have leave to raise the relevant issues in relation to the agreement of 23rd January 1961. Further, that the respondents should pay the appellants' costs of the appeal to the Court of Appeal and to this Court and the costs of the suit should abide the order of the judge who disposes of the suit.

[31]

As regards the portion of the mound which is upon land under common law title - and that is the greater part of it - I agree with the Chief Justice in thinking that upon the evidence it should be held that Daphne Mills acquired the legal estate with notice of an equitable interest, created in favour of the respondent Warren by the agreement of 14th November 1955 and enuring for the benefit of the respondent Stokman by virtue of the agreement of 19th February 1960. The intendment appearing from the first agreement is that Warren should have a right to enter upon the land and remove the slate so as to acquire the beneficial ownership of it, and that the right should not be defeasible by any action on the part of the vendors: cf. Fitzgerald v. Firbank [1] . This was plainly an intention to create a right not only as against the vendors but as against all the world, for it was conferred without any specified limit of time (though perhaps impliedly limited to a reasonable time: cf. Reid v. Moreland Timber Co. Pty. Ltd. [2] ), and was in aid of what the parties joined in describing as an absolute sale of the slate. The agreed price having been paid, the result, on the footing that the slate was part of the soil, was that, although for want of a deed the only rights which resulted at law were rights enforceable against the vendors personally, the agreement was specifically enforceable and Warren therefore acquired in the contemplation of equity the rights and the interest in the land which a grant by deed in conformity with the agreement would have given him: Mason v. Clarke [1] . That is to say he acquired an interest in the nature of a profit à prendre, an irrevocable licence coupled with an interest and therefore binding not only upon the vendors but upon anyone taking the land from them with notice: In re Refund of Dues under Timber Regulations [2] ; Reid v. Moreland Timber Co. Pty. Ltd. [3] . The opposite view, which was accepted in the Court of Appeal, namely that by reference to the provisions of the Sale of Goods Act it should be held that the effect was to make the slate goods for relevant purposes, is, I think, not sustainable. I content myself with referring on this point to the reasons of the Chief Justice and to the case of Stratford (H. M. Inspector of Taxes) v. Mole and Lea [4] .

At a glance

Court

Decision date

Before

Source

Judgment (49 paragraphs)

Parties