sation Pry v rymon.

sation Pry v rymon. - [1923] HCA 15 - HCA 1923 case summary — Zoe

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of the bargain so far as that is consistent with the language employed, neither neglecting the materiality of stipulations expressly assented to, nor blindly adhering to form at the expense of substance whereby either party may slip out of an honest bargain (see Dimech v. Corlett (1) and The Teutonia (2)). In the present case that duty is markedly apparent. There cannot be a doubt that the respondent in all substantial respects has faithfully carried out his part of the transaction : the right goods were procured, the prices are correct, there was no delay and, indeed, the only fault ascribed to him is a too speedy performance. No potential or actual damage is suggested by the fault ascribed ; the defence is purely formal. All the elements of real justice are on the side of the respondent. It must be acknow- ledged in favour of the appellant that the objection now relied on was not his own. When the circumstances come to be scrutinized, the appellant's silence on this point was only natural. No honest reasonable merchant in his position would have dreamt of asserting that what is now alleged as a fatal breach was such as frustrated the adventure or destroyed the foundation and substance of the contract. Not even in the course of the appellant's evidence is such an idea suggested. But that is what, in our opinion, is necessary to enable the appellant to succeed. The present objection was evolved as a dernier ressort by the ingenuity of his legal advisers. 'The appellant's only personal claim to be absolved from paying a debt otherwise just, was that the contract had been cancelled. When the draft and documents were placed before him, he raised no such contention as is now insisted on. He had one ground, and one only, namely, agreed cancellation. That, after controversial testimony, has been determined against him; and the decision is not now challenged. And we would observe that, when the true meaning and intention of the crucial provision as to shipment comes to be considered, the tacit admission by the appellant, by reason of his business conduct and undivided reliance on the one ground of discharge, is a strong indication that its strict performance was not intended to be a condition precedent (see per Lord Colonsay in Forbes v. Watt (3)). But, quite apart from that assistance, the

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in the second month afterwards (Freeman v. Read (1) ). If we are to read the phrase " half two months later " in the same way as the ; months are read in the Bowes v. Shand (2) class of cases, then a day earlier or a day later would be as fatal in the one case as in the other. No cy-prés doctrine could save the situation. No want of shipping facilities could avail as an answer, because the qualify- ing clause relates only to " short shipment," not to delay in shipping the full quantity. By that time the goods are assumed to have passed into the control of the respondent. What object is discern- ible in the contract and its attendant circumstances to lead the Court to suppose such a consequence intended ? The goods them- selves were not ties, but materials for making ties. The goods are not perishable, they ave not pretended to be of fleeting fashion, and, if they were, a speedier arrival could not interfere with the object of the contract; they could not spoil, they are not affected by the time of shipment: in short, there is no conceivable reason for thinking the purchaser's venture would be frustrated. Reading the phrase " half two months later " with the preceding expression, "half as soon as possible," we are inclined to think with Macfarlan J. that the " business efficacy " of Bowen L.J. is that the appellant indicates that he is anxious to get "half" shipped as early as it is possible to manufacture and despatch it, but that he is content to let the rest stand for another two months. However this may be, it is by no means essential to our ultimate conclusion, namely, that the stipulation is not a condition at all, and certainly that the particular breach alleged is not a breach which can be acted on as dissolving the contract, as being a breach that strikes at its root and foundation. No doubt, the same words if they came after a definite point of time would have denoted an exact period of two months, neither more nor less, and fixed at both termini by the con- tract ; but how can that be when the terminus aquo is itself unknown and entirely dependent on future circumstances incapable of present ascertainment ¢ The first half may be either by "sailer" or "steamer." Must it be in one "steamer" or one " sailer " 2 Tf, for instance, there were two steamers at Marseilles each ready to take a quarter but not a half, would it have been a breach of a (1) (1863) 4 B, & S., 174, at p. 184, (2) (1877) 2 App. Cas., 455.

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a rule that, where one party to a contract repudiates it before pletion on an improper ground, the other party, whether he accey : the repudiation and terminates the contract or not, not only is absolved from further performance but also is relieved from all necessity whatever of showing he was ready and willing to carry it out; in short, that the latter may sue and recover damages as if he had been fully prepared to carry out his contract to the letter, It is sufficient to say that it is impossible that the three eminent jurists who decided that case could ever have intended to lay down such a proposition, and there is no language in the judgments expres- sive of such a rule. On the other hand, notwithstanding what the learned primary Judge found as a fact and what the Court of Appeal accepted as established, that the plaintiff had failed in a vital particular, namely, the character of the goods, to comply with the conditions of the contract so as to have given the defendants the right to reject at one stage, the Court of Appeal certainly held that the plaintiff was entitled to recover damages, but damages lessened by the amount of damage sustained by the defendant through the plaintiff's breach. There is only one way to reconcile those two propositions, namely, that there had been a waiver of the right of rejection by the express statement of the ground on which the repudiation was made. That is what counsel for the plaintiff argued, and that is what Collins M.R. decided (1) in the following passage :

In my opinion that act of the defendants amounted in fact to a waiver by them of the performance by the plaintiff of the con- ditions precedent which would otherwise have been necessary to the enforcement by him of the contract which I am assuming he had elected to keep alive against the defendants notwithstanding their prior repudiation, and it is not competent for the defendants now to hark back and say that the plaintiff was not ready and willing to perform the conditions precedent devolving upon him, and that if they had known the facts they might have rejected the instalment when tendered to them. One answer to such a conten- tion on the part of the defendants is that, tested by the old form

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conditions precedent by adhering to their original repudiation of the whole contract, and would not accept any instalment if ten- dered to them. The defendants are not in a position now, by reason of their after-acquired knowledge, to set up a defence which they previously elected not to make." With that opinion Cozens Hardy L.J. agreed. Mathew L.J. (1) said the same thing. That case has given rise to a considerable amount of controversy, which has been set at rest in accordance with what we have said by the House of Lords in the recent case of British and Bening- tons Ltd. v. North-Western Cachar Tea Co. (2), which has reached us since we wrote what we have said as to the construction of the contract in this case. The actual decision in that case is remote from the question now under consideration; but still there is one point of contact, to which we may in passing refer. One question there was whether the parol agreement had the effect of creating a new agreement in substitution for the written agree- ment. It was held it had not; and Lord Atkinson says (3): "* There is a single provision for changing the place of delivery of some of the teas which cannot possibly be treated as so inconsistent with the earlier written contract as to go to the root of the latter." That seems to us to embody precisely the same considerations as we have set out above. If the parol agreement there did not so alter the delivery as to go to the root of the contract and make it really another con- tract, actual delivery, in the same way, would have to be tested by the same principles. Lord Swmner, as to " frustration " (for counsel for the appellants had argued that the essence of the contract was delivery in London), said (4) : - '* The arbitrator has found against frustration, so far as it is a matter of fact. It certainly is not a matter of abstract law, and as all this tea reached British ports without mishap and is not a particularly perishable commodity, any frustration of the commercial objects of the adventure must have been connected with markets and prices or other matters of fact, which were for the arbitrator. I, therefore, think this point fails." As to Braithwaite's Case (5) Lord Atkinson (6) quotes

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to act not on what they actually meant, but on what they have Looking at the construction of the words as they stand, I can find no ground for treating the stipulation as to the interval between " shipments as being other than a condition precedent to the duty of the purchaser to accept the goods. On this point, the case of - Bowes vy. Shand (1) throws much light. I state the case, omitting matters immaterial. There was a contract for the sale of Madras tice to be shipped at Madras " during the months of March and/or April 1874" per Rajah of Cochin. The rice was shipped - was put on board the ship - during the last few days of February, and bills of lading given. In an action for refusing to accept the rice, it was held to be a good defence that the rice had not been shipped " during the months of March and/or April" ; that the shipping during those months was an essential part of the description of the goods sold ; and that the plaintiff could not recover damages, not having tendered the thing contracted for. As Lord Cairns L.C. said (2), "it may well be that a merchant making a number of rice contracts, ranging over several months of the year, will be desirous of expressing that the rice shall come forward at such times, and at such intervals of time, as that it will be convenient for him to make the payments, and it may well be that a merchant will consider that he has obtained that end if he provides for the shipment of the rice during a particular month, or during particular months, and that he will know that provided he has made that stipulation the rice will not be forth- coming at a time when it will be inconvenient for him to provide the money for the payment." The Lord Chancellor also said (3) that the shipment in the two months mentioned was " part of the - description of the subject matter of what is sold"; in other words, as Lord Hatherley put it (4), " it is not the article rice only that is_ sold, but the thing that is sold is the article rice shipped in March or April,and . . . the article rice shipped in February is not th

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Counsel for the plaintiff have relied on a case before the Court of Appeal in England (Braithwaite v. Foreign Hardwood Co. (1) ). There a contract provided for the sale of rosewood to be delivered in Hull in instalments during 1903. There were two consignments. Before the first consignment reached Hull the buyers refused to accept any rosewood under the contract on a ground which was untenable. Afterwards, the plaintiff wrote saying that he had the bill of lading for the first consignment ; and the defendants wrote refusing to take the bill of lading as they had repudiated the whole contract; and the plaintiff sold the consignment and claimed the difference between the contract price and the price on resale. The second consignment came, and the defendants again refused, and the consignment was resold at less than the contract price. It appeared subsequently that the first consignment was inferior in quality to that agreed on; the second consignment was satis- factory in quality. It was held by Kennedy J. that the repudiation of the contract by the defendants was accepted by the plaintiff as a final repudiation ; and that the defendants could only give evidence of inferior quality in reduction of damages. This decision was affirmed by the Court of Appeal on the ground that the refusal of the defendants to take the bill of lading (after the general repudia- tion) amounted to a waiver by the defendants of the performance by the plaintiff of the conditions precedent. There is no such waiver here of the performance by the plaintiff of the conditions precedent as to shipment. This case was discussed and followed in Taylor v. Oakes, Roncoroni & Co. (2); and Scrutton L.J. said (3) : - ' The vendor, not accepting the first repudiation, tendered the bill of lading for the instalment, and the purchaser refused to take it, on the ground that there was a collateral contract which he in- accurately alleged to exist. Thereupon the vendor accepted the (1) (1905) 2 K.B., 543. (3) (1922) 27 Com, Cas., at pp. 272- (2) (1922) 27 Com. Cas., 261 ;127L.T., 273; 127 L.T. at p. 271.

At a glance

Court

Decision date

Before

Source

Judgment (198 paragraphs)

Parties