Pinning v Gould v

Pinning v Gould v - [1907] HCA 35 - HCA 1907 case summary — Zoe

[50]

station, telling him that they were anxious to buy the defendants' Bendeena station, and they asked him to put himself in com- munication with one of the defendants who lived at Dubbo, in New South Wales, and endeavour to make a bargain for the purchase of the property. The instructions given to Mr. Camp- bell were contained in a letter of 4th November, written from Hobart. The plaintiffs suggested various devices to induce the vendors to accept a lower price, and the terms of the letter showed generally that the plaintiffs were anxious to buy. In pursuance of that letter Campbell visited one of the defendants, Mr. Sefton, at Dubbo, and had a conversation with him on the subject of the property. According to Sefton's evidence, he gave Campbell full information as to the stock then upon the property, but according to Campbell's evidence that was not done, or he did not recollect it. But there was, at any rate, a conversation about the cattle, and after it Campbell asked other persons to find out all about the cattle and to go to Sefton and ascertain the exact numbers. So much he admitted. That was all before the letter of 20th November, which is alleged to contain the misrepresentation. I pause here to remark again that the plaintiffs must show that the representation contained in that letter was understood by them to be continued up to the moment at which the contract was entered into in January. The letter of 20th November was in fact inaccurate. The number of cattle born in 1903 and earlier mentioned in the letter was actually 1,337. The total number mentioned was 2,912. There were not, however, at that time 1,337 cattle of those ages on the station. A good many had been sold before the letter was written. This letter, written by the defendants' agents, was therefore in- accurate. But there is no suggestion that the defendants' agents knew of any mistake in the numbers. There was no dishonesty whatever on their part. How the mistake arose is akandantly clear. It appears that the defendants, as trustees of the estate, were in the habit of getting quarterly returns showing the trans- actions on the property, and in the return for the quarter ending 30th June the figures showed the numbers of the cattle on the station at that date, but during the quarter ending 30th September many of these cattle had been sold, and a later return as of 30th

[54]

So that it appears incidentally that they had in the meantime instructed another gentleman, who was in fact the manager of the adjoining station, to make a full inspection of the property and report to them. While this was being done they wrote this letter and, without further reference to the defendants' previous offer, ask the defendants to make another offer in an alternative form, which they called two options, the first being the option of purchase of the land, with improvements, plant, &., but without stock, for £5,000, the other the option of purchase of the land, &e., with stock for £16,230, "assuming the number of cattle 1 year and upwards to be 2,740 and horses 200, any number under or over to be allowed for at £4 10s. per head." A note was added showing how they made up the amount by reckoning 2,740 cattle of one year and over, calves given in, and 200 horses at £4 10s., making £13,230, and the land, £3,000. The number, 2,740, is the number of cattle mentioned in the letter of 20th November, deducting the animals described as calves. But it is to be noticed that in this proposal, when the plaintiffs ask the defendants in this letter to make a new offer, they do not describe the cattle as of the ages mentioned in that letter, but under a different description altogether, "one year and over," for which they say they are willing to pay at the rate of £4 10s., per head. In the meantime Easy went to inspect the station. He was there in December for two or three days. According to the uncontradicted evidence, which must be taken to be true, for Easy was afterwards called by the plaintiffs and was not asked any questions on the subject, he asked for the last returns. Those were the returns of 30th Sep- tember. The witness Baker, manager of the station, said:- - * He asked for the last returns. I had a copy of the September returns. He asked me to read out the numbers for him, which I did. I went through the paddocks with him." The plaintiffs received Easy's report on 14th December, and on 19th December telegraphed from Hobart to their agents in Sydney authorizing them to offer £15,000 for the property, stock and plant, on the terms " walk in and walk out." But in the meantime the defendants' agents had acknowledged the plaintiffs' letter of 2nd December, saying "We could not do any business in terms of your offer" (he had been to see his principals at Dubbo), "and the trustees

[67]

'There was another minor point taken, which it is not absolutely necessary to decide, but upon which, as it is of general import- ance in practice, it is perhaps right that we should express an opinion. I refer to evidence tendered by the defendants as to a conversation between one of the defendants and Campbell, who was called by the plaintiffs in reply to contradict that evidence, and in cross-examination refused to make certain admissions. Evidence was then tendered by the defendants to contradict him, relying upon the statutory rule that, when a witness refuses in cross-examination to distinctly admit that he has previously made a statement inconsistent with his present testimony, evi- dence may be called by the other party to prove that he has done so. The learned Chief Justice who presided at the trial refused to allow the evidence of such a statement to be given on the ground that it could not be given at that stage of the case, taking the view that the section does not apply to the case of a witness called by a plaintiff in reply. But there is nothing in the Statute to limit the admissibility of evidence of that sort so as to exclude its application to the case of a witness called later than the defendant's ease in chief. There is no rigid rule as to the point at which evidence is to be closed. The burden of proof may change from time to time during the course of a case. In the case of an action for defamation the plaintiff proves the publication of defamatory matter. hen the defendant may prove that the occasion was privileged. 'Then evidence may be given by the plaintiff of express malice, then evidence by the defendant to rebut that evidence. It appears to me that the meaning of the section is merely this, that evidence of that sort is admissible and is not to be regarded as res inter alios, It is admissible evidence, and the Statute intends that it may be given in any ease in which evidence can properly be offered by the party tendering it to contradict that given by the other party.

[73]

at the time of the statement 1,337 cattle of the number 3 brand on the station, wasa statement that was fraudulent in the legal sense. And I think it may also be taken that, if the offer of Trebeck of 20th November in respect of which the statement was made was at that time accepted, there would have been some ground upon which the jury might have come to the conclusion that the contract thus made had been induced by fraudulent mis- representation. But before the plaintiffs can succeed they must go much beyond that. They must show, not only that the representation was fraudulent, but also that that fraudulent representation induced the contract which was afterwards entered into upon 8rd January. It is upon that part of the case it seems to me that the plaintiffs have entirely failed to put before the jury sufficient evidence to justify the jury as reasonable men in coming to the conclusion to which they came. Now, the require- ments of the law with respect to false representations materially inducing a contract is very clearly stated by Sir John Romilly M.R. in the case of Pulsford v. Richards (1) : - * With respect to the character or nature of the misrepresentation itself, it is clear that it may be positive or negative; that it may consist as much in the suppression of what is true, as in the assertion of what is false ; and it is almost needless to add, that it must appear that the person deceived entered into the contract on the faith of it. To use the expression of the Roman law, so much commented upon in the argument before me, it must be a representation dans locum contractwi, that is, a representation giving occasion to the contract, the proper interpretation of which appears to be the assertion of a fact, on which the person entering into the contract relied, and in the absence of which it is reasonable to infer he would not have entered into it, or the suppression of a fact, the knowledge of which it is reasonable to infer would have made him abstain from the contract altogether." We therefore have to inquire whether there was any evidence from which the jury could reasonably draw the inference that it was the assertion made on 20th November with regard to the

[89]

lishment of fraudulent misrepresentation in the first instance. Whatever view I might personally have taken of the facts, I am not prepared to say that there is no evidence upon which the jury might reasonably, if they thought fit, have come to the conclusion that the statements as to the numbers and ages of the cattle in the letter of 20th November, which were undoubtedly untrue in fact, were also fraudulent. 'The jury were the proper tribunal to decide that question, and I am not prepared to say, if I had to decide it, that I should hold that there was no evidence. It is not, however, in the view I take of the case, necessary to decide it. But supposing that established. The plaintiffs have not proved all they are bound to prove in order to establish suecess- fully their claim against the defendants on the ground of deceit. Now, in approaching this portion of the case I am fully sensible of the rule, and I give due weight to it in my mind, that the verdict of a jury is not to be set aside unless it is one that no reasonable man could have come to. I am very clear, however, on the facts of this case that, as to the inducement and as to the amount of damages, or as to whether any damage has been proved at all, the rule does apply in this case, that there was no evidence upon which the jury could reasonably find as they did. The plaintiffs have the onus of proving that the representations they complain of were material, and that they were induced to act upon them. If nothing more appeared than the letter of 20th November and a contract following upon that, I think it would be very difficult to say either that the plaintiffs were not induced to act upon the statements in that letter or that they were not material. They were undoubtedly material in fixing the average price of the cattle, and, consequently, the price to be paid for the whole property, supposing a count were taken. But a good deal more does appear in the case. The matter does not rest at that point. It is established law, as I understand it, that, even granting that a defendant has made a representation that is both false and fraudulent, it may be that the plaintiff has not relied upon it, and if he has not relied upon it then he has no case. There is a very old case showing the dis-

[90]

C.J. put the two positions clearly. That wasa case in which defendant was sued for fraudulent representation regarding rental of some houses sold to the plaintiff. In giving judg- it Holt C.J. said (2) : - "Tf the vendor gives in a particular of e rents, and the vendee says, he will trust him and inquire no rther, but rely upon his particular ; there if the particular be use, an action will lie: but if the vendee will go and inquire f ther what the rents are, there it seems unreasonable he ould have any action, though the particular be false, because id not rely upon the particular." In Redgrave v. Hurd (3) MR., referring to Attwood v. Small (4), quoted one para- graph from the opinion of the Earl Devon, which he says is the law : - " The whole course of the proceeding from its commence- ment to its close tends to show that the purchasers did not rely pon any statements made to them, but resolved to examine and ge for themselves." And further on (5), he quoted a portion of ord Brougham's judgment in the same case : - * We find that the purchasers did not rely upon the representation, but said, 'We will inquire ourselves,' that is the second ground ; it is the same as Lord Devon's ground, and also would be a good answer, though it was not taken by Lord Cottenham." 'These then being the principles, the 'question is what will be sufficient to displace the primd fucie pre- sumption that the plaintiffs did rely upon the false representation and act upon it. As to that also, Redgrave v. Hurd (6) helps us. _ Jessel MLR. said : - * If it is a material representation calculated to 'induce him to enter into the contract, it is an inference of law that he was induced-by the representation to enter into it" (that "has been shown since to be wrong, it is an inference of fact, not

of law) "and in order to take away his title to be relieved from the contract on the ground that the representation was untrue, it ~ must be shown either that he had knowledge of the facts contrary to the representation, or that he stated in terms, or showed clearly _ by his conduct, that he did not rely on the representation." In _ Arnison v. Smith (7), Lord Halsbwry LC. said: - *It was said, (1) 2 Raym. (Ld.), 1118. (5) 20 Ch. D., 1, at p. 16.

[100]

cattle, to buy on one of two distinct options regarding them. The report of Easy reaches him on 14th December. He has full time to consider the matter, and on 19th December he takes advantage of this offer and declares that he will buy, and takes further time to declare which of the two options he will select. On the 19th he declares he will purchase and makes up his mind to give £15,000 for property and stock, "walk in and walk out." It was urged on behalf of the plaintiffs that it did not appear that Mr. Easy had authority to receive information on behalf of Mr. Burgess regarding the number and ages of the cattle from Mr. Baker, I think that that is disposed of on the principle that an agent (he was clearly an agent for some purposes) has either the actual authority given him, or the authority within the apparent scope of his employment. Looking at it from the standpoint of the defendants, what would it have been natural for them to conclude as to the authority of Mr. Easy when he inspected? A person authorized to receive information may receive it through his eyes or his ears. Whether Mr. Easy communicated his information to his principals or not we do not know. We know that he communicated something on 14th December. | Whether he communicated truthfully and fully all that he learnt we do not know, because the plaintiffs themselves did not put in or tender that evidence. But I take it to be immaterial from the defendants' standpoint whether he did or did not, and I think it was also within the defendants' power as a matter of law to oppose the admission of evidence showing that Easy had not communicated fully. There are two authorities bearing upon this part of the case. One is Tanham vy. Nicholson (1), a case where service of a notice to quit at the house of a tenant upon a person whose duty it was to deliver it to the tenant, was held a good service on the tenant for the purposes of ejectment. The House of Lords held that the presumption was that the notice did reach the tenant, although in fact it was not delivered to him, and that the question was not whether the servant performed his duty but whether he was to be considered the agent for the purpose of delivering the notice. Lord Hatherley L.C. pointed out the prin- ciple ; he said (2): - " If once you have constituted your servant

At a glance

Court

Decision date

Before

Source

Judgment (119 paragraphs)

Parties

Cited By (4)