TURNER v New Sour

TURNER v New Sour - [1910] HCA 15 - HCA 1910 case summary — Zoe

[73]

ordinary form, by which the plaintiff transferred to them certain Derosir axp furniture and household property, with a power of sale. There bey was a provision for further advances, and it was stipulated that the security should be a continuing security, to be determined only in a formal way, by a memorandum of satisfaction entered on it and signed by defendants' manager. The plaintiff obtained a first advance, made repayments and obtained other advances. While the security was current he decided to go to New Zealand on some business, gave up his house and stored his furniture in a warehouse. With his household furniture he put a box containing some office requisites, papers and records. I may say at once that, in my opinion, the defendants were justified in seizing the box. It may be a question involving a good deal of consider- ation whether the proper steps were taken to vest the property in these goods in the defendants, but it is clear that if a man chooses to enclose goods, which may or may not be within the security, in a box and to store the box with his household furniture which is under the security, the person holding the security is entitled to assume primd facie that the goods in the box are goods included in the security. It appears to me, there- fore, that the plaintiff had no cause of action for trespass, and that there was nothing to complain of in the conduct of the defendants in their seizure and sale of the plaintiff's goods. The result was that, having realized on the goods seized, they had in their hands a balance of £7 8s. 9d. due to the plaintiff, and also the box containing the papers and other articles now in question which had not been sold. There is no doubt that both the money and the unsold goods belong to the plaintiff. The defen- dants having paid themselves out of the proceeds of sale had no right to hold them any longer. The plaintiff made a claim for the money and goods, and in reply received a letter from the defendants, asking him to call at their office, and make an appointment for taking delivery of the goods and payment

[79]

but we have nothing to do in this case with the general position. We have only to do with the particular equitable right claimed in the equitable replication. 'The only obstacle which even at law could stand in the way of the plaintiff's obtaining his goods and his money was the condition in the bill of sale that it should be treated as a continuing security, until the memorandum of satis- faction I have referred to had been signed by the defendants' manager. That was the only thing remaining to be done to entirely close the transaction. The declaration contained counts for trespass, detinue, and accounts stated. The trespass count must go; there is no evidence to support it. That leaves the detinue count and the common counts. The defendants in reply to the plaintiff's case set up the deed, to which the plaintiff pleaded an equitable replication, alleging that an agreement had been made to dispense with it. It seems to me that the equitable replication is open to the objection to which my learned brother, the Chief Justice, has referred, because it shows on the face of it that the plaintiff's title to the goods was not a legal, but an equitable title. Although the replication was not demurred to, yet if the plaintiff shows by his own pleading that his title is not legal but equitable, he cannot succeed at law in an action founded on his title. There is direct authority for this in Thames Iron Works and Ship Build- ing Co. v. Royal Mail Steam-Pucket Co. (1). Willes J. says: - "The replication in effect says that the defendants ought not in equity to be allowed to set up the want of a dispensation by deed, because they waived the performance of that condition. This replication, like the sixth count, fails to set up any new contract under which the defendants were to pay for the alterations and extra work; and, if it is to be sustained at all, it must be on the ground that the plaintiffs are entitled to recover the price of the alterations and extras under the deed, although they have not performed the stipulations on their part contained in the deed,

[100]

If there had been a simple covenant by the respondents to pay over whatever surplus remains after exercise of their powers under the mortgage, I should have agreed that the two cases were parallel. But that is not so. In Middleditch v, Ellis (3) there was an existing covenant to pay the debt in full, and after realization of the security and accounts taken the debtor admitted a certain balance was still due, and promised to pay it. But he was already under covenant to pay it, and all that happened by parol was to ascertain how much still remained unsatisfied. Here, assuming the execution of the deed, the contents of the document are very different. There is no covenant simply undertaking a legal liability to pay the surplus. What the company chose todo was this. It was agreed and declared that the company should receive and take the moneys arising from realization of the property assigned to them, and therefore their own property at Jaw, and stand possessed thereof wpon trust, in the first place to retain or reimburse their costs and expenses; next in their absolute discretion to pay rent, rates, taxes and incumbrances on the premises where the goods might be; next to retain the amount of the mortgagor's debt, and lastly to pay the surplus, if any, to the mortgagor. So that they took up the position of trustees of all realization moneys, and might be compelled to account like any other person occupying a fiduciary position by a suit to enforce the trust, but were not liable to an action at law to pay over any specific sum as a clear and ascertained debt. The mortgagor's rights then depended so far entirely on the trust so created: Pardoe v. Price (4) is a case exactly in point. There by Act of Parliament it was enacted that certain turnpike trustees should apply moneys received by them, first in paying expenses, secondly in paying interest and so on, the last trust being to pay lenders of money borrowed the amounts due to them. It was held that an action would not lie at

At a glance

Court

Decision date

Before

Source

Judgment (127 paragraphs)

1910,

Parties

Cited By (1)