Philip Bertie Petrides.

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the life insured, the innocent misstatement of law by the
agent, in the absence of proof of fraud, duress, oppression,
or such a difference in the position of the parties as would
create a fiduciary relationship between them, did not displace
the rule of law that, where one of two parties to <m illegal
contract pays money to the other in pursuance thereof,
he cannot recover it back.



An Agreement, innocent in itself, is void if in aid of an illegal

object.

PEARCE v. BROOKES. [1866]

(35 L. J. Ex. 134 ; L. R, 1 Ex. 213 ; 12 Jur. (N. S.) 342 ;
14 L. T. 288; 14 W. R. 614.)

The plaintiff, having lent a miniature brougham to the defen-
dant on the hire-purchase system, the defendant returned the
brougham before she had paid up all the instalments. On being
sued for damages for breach of contract the defendant pleaded



94 CONTRACT.

that the plaintiffs knew that she was a prostitute, and that the
hire of the brougham was to enable her to carry on her immoral
vocation in better style.

Held, the 'plaintiff was not entitled to recover, as the
brougham had been lent to promote an illegal /impose.



Past illicit cohabitation is no Consideration.

BEAUMONT r. REEVE. [1846]
(15 L. J. Q. B. 141 ; 8 Q. B. 483; 10 Jur. 284.)

The defendant, on ceasing to cohabit with the plaintiff, agreed,
in consideration of past cohabitation, to pay the plaintiff a
yearly annuity of 60/. The defendant, however, never paid
the annuity, and was accordingly sued therefor.

Held, there was no consideration for the agreement, and
that a precedent moral obligation, however strong, if the cir-
cumstances are such as not to create any subsequent legal
obligation, loill not raise an implied promise in law.

Note. — Such a contract would be valid if under seal, as it is
merely given for an unlawful l>ut not an illegal purpose. See
Fisher v. Bridges, supra, p. 92.



Money paid under Unlawful Contract cannot be recovered except
where unlawful purpose is not performed.

TAYLOR v. BOVVERS. [1876]

(46 L. J. Q. B. 39 ; 1Q.B. D. 291 ; 34 L. T. 938 ; 24 W. R.
499— C. A.)

The plaintiff, with the privity of the defendant, who was one
of his creditors, assigned and delivered certain goods to one
Alcock, in order to defeat his creditors generally. The



LEGALITY OF OBJECT. 95

defendant, without the knowledge of the plaintiff, obtained a
bill of sale of the goods from Alcock, and under this bill of sale
took possession of the goods. Before any fraud was accom-
plished upon the creditors, the plaintiff claimed the goods from
the defendant

Held, Bowers was not a bona fide purchaser of I lie
goods, as he knew that Alcock had no title to them, and that
the plaintiff was entitled to recover the goods, for where
money is paid or goods delivered for an illegal purpose, the
person who had so delivered them mag recover them back
before the illegal purpose is carried out, but if he waits till
the illegal purpose is carried out, or if he seeks to recover
by enforcing the illegal transaction, and to carry that out,
then the law will not allow that to be done. In the present
case this was not so, and the plaintiff did not require the
aid of the illegal transaction, but was really bringing the
action to set it aside.



Contracts made abroad which are legal where made, and which
are unlawful but not illegal in England, may be sued on
here.

SANTOS v. ILLIDGE. [1860]

(29 L. J. 0. P. 348; 8 C. B. (N. S.) 861 ; 6 Jur. (N. S.) 1.348 ;
3 L. T. 154 ; 8 W. E. 705— Ex. Ch.)

The defendants, a company of British subjects domiciled in
England, but working mines in Brazil, agreed to sell certain
slaves to the plaintiff, a Brazilian resident, and domiciled in
Brazil, where slavery was allowed. The slaves were acquired
by the defendants in Brazil after the passing of the statute
Greo. 4, c. 113, and before the passing of the statute 6 & 7
Vict. c. 98, s. 5. A large number of them were purchased.



96 CONTRACT.

The others were the children and offspring of those acquired by
purchase. The defendants having refused to deliver the slaves
this action was brought.

Held, that the contract was legal and might be enforced
in this country, on the ground that the statute 6 &f 7 Vict,
c. 98, s. 5, permitted the sale of slaves, the holding of whom
ivas not prohibited by any Act of Parliament ; and that no
statute prohibited the holding of the slaves in Brazil, even
though the purchasing of them there might be felony in a
British subject.

Note. — 5 Geo. 4, c. 113, constituted the purchase of slaves by a
British subject a felony.



Where the Original Consideration for a Contract is unlawful,
another and distinct Legal Consideration may be proved so as
to establish a new Contract.

HYAMS v. STUAET KING. [1908]

(77 L. J. K. B. 794 ; (1908) 2 K. B. 696 ; 99 L. T. 424 ;
24 T. L. R. 675— C. A.)

The plaintiff, a bookmaker, had certain betting transactions
with the defendant firm, which was carried on for the purpose
of bookmaking. These transactions resulted in a balance of
108/. 10s. being due to the plaintiff in respect of bets on horse
races, and a cheque for that amount signed in the firm's name
was given him. Subsequently a member of the firm requested
him not to present the cheque for payment, as certain money
expected by the firm had not arrived, and certain payments
were made which reduced the above-mentioned sum to 48/. 10s.
No further payments having been made, the plaintiff issued a
writ against the firm, which was endorsed for 48/. 10s., balance
due to him by the defendant firm on an account stated. The
plaintiff" at the trial contended that the promise to pay had been
based on some consideration other than that of the bets, such



LEGALITY OF OBJECT. 97

consideration being the holding over of the cheque by the plain-
tiff at the request of the firm aud an agreement by him not to
mention, and in fact not mentioning, the matter to other cus-
tomers of the firm.

Held, that such agreement constituted a neiv contract, the
consideration for which was sufficient to support an action
for the money claimed by the plaintiff.



Insurable Interest at date of Insurance is essential, but need not
continue till death of Assured. Life Assurance, unlike Marine
or Fire Assurance, is not a Contract of Indemnity.

LAW v. LONDON INDISPUTABLE LIFE POLICY CO.

[1855]

(24 L. J. Oh. 196 ; 3 Eq. E. 338 ; 1 Kay & J. 223 ; 1 Jur. (N. S.)
178; 3 VV. B. 154.)

Thomas Law, being short of money, induced his father, the
plaintiff, to lend him some on the strength of his being entitled
to a reversionary interest on his attaining the age of thirty
years. Thomas Law was then twenty-eight years of age, and
the plaintiff, wishing to make certain of being repaid the money
he had lent, insured his son's life for two years with the
defendants. Thomas Law attained the age of thirty years on
the 16th January, 1852, and thus became entitled to the rever-
sionary interest. On the 22nd of the same month Thomas
Law died, and the two years for which he was insured not
having expired, the plaintiff claimed the insurance money.
The defendants disputed the claim on the ground that the legacy
to insure which the policy was effected had been paid to and
received by the plaintiff, and his interest in the life of his son
had thereby ceased ; and also on the ground that the policy
was granted only as an indemnity to the plaintiff in case of his
son dying under the age of thirty years.

J. H



98 CONTRACT.

Held, an insurable interest in assured at. itate of assurance
is essential under 14 Geo. 3, c. 48, s. 3, but a policy of assur-
ance is not void by reason of the interest in the life assured
ceasing before the expiration of the policy.

Held also, a life assurance differs from fire or marine as-
surance, inasmuch as it is not a contract of indemnity, but
a contract to pay a certain definite sum at a future time in
consideration of certain annual payments in the meantime.



THE ASSIGNMENT OF CONTRACT.

Rights and Liabilities under an Executory Contract cannot be
assigned without the consent of the other party. An Agent
who contracts in his own name for an Undisclosed Principal
alone can sue on the Contract.

HUMBLE v. HUNTER. [1848]
(12 Q. B. 310 ; 17 L. J. Q. B. 350 ; 12 Jur. 121.)

C. J. Humble, the son of the plaintiff, signed a charter-party
which commenced as follows : — " It is this day mutually agreed
between C. J. Humble, Esq., owner of the good ship or vessel
called the Ann," &c. An action was brought by the plaintiff,
Mrs. Humble, who was the owner of the Ann, on this charter-
party.

Held, the plaintiff was not entitled to succeed, for the
defendant had entered into the charter-party ivith C. J.
Humble, ivho purported to be the owner of the Ann, ana
could not therefore be liable to the plaintiff, with whom he
had not contracted ; for where one party contracts zvith
another party, each has a right to the benefit he contemplates
from the character, credit and substance of the party with



THE ASSIGNMENT OF CONTRACT. 99

whom he contracts, and cannot be deprived of such benefit
without his consent.

Held also, that where a party appoints another to act for
him, and the person so appointed contracts in his own name,
without disclosing his principal, the principal cannot after-
wards come in and, declare that the contract was for his
benefit.



An Absolute Assignment in writing of a Debt or other legal Chose
in Action, express notice of which has been given to the
Debtor, gives Assignee the absolute right to sue for same in
his own name and deprives the Assignor of any rights.

HUGHES v. PUMP HOUSE HOTEL CO. [1902]
(71 L. J. K. B. 630 ; 2 K. B. 190 ; 86 L. T. 794 ; 50 W. E. 660—

0. A.)

The plaintiff, a builder, who had entered into a building con-
tract with the defendants, executed an assignment in the follow-
ing terms in favour of his bankers : — " In consideration of your
continuing a banking account with me . . . and by way of
continuing security to you for the money due to you from me
... I hereby assign to you all moneys due or to become due
to me from (the defendants) under or by virtue (of the said
building contract). And I hereby empower you, on my behalf
and in my name, to settle and adjust all accounts in connection
with the works and matters aforesaid, to give effectual receipts
for the moneys hereby assigned. . . . Also, if necessary, to sue for
or take such steps as you may think necessary for enforcing pay-
ment of the moneys hereby assigned. . . . And I hereby under-
take, at your request and my cost, to do and execute all such
further acts, deeds and things as you may reasonably require
for giving- full effect to the security hereby created." Notice
in writing of this assignment was given to the defendants in a
letter addressed to them by the plaintiff, authorising and re-
questing them to pay to Lloyds' Bank all moneys due to or to

h2



100 CONTRACT.

become due under the eoutract referred to. Notwithstanding
this assignment, the plaintiff claimed that the balance due by
the defendants should be paid over to him, and on the defendants
refusal brought this action.

Held, that this was an "absolute assignment" within
sect. 25, sub-sect. 6, of the Judicature Act, 1873. and that,

therefore, the plaintiff was not entitled to sue the defendant
in respect of the balance alleged to be due to him under the

building contract.

Bona fide Holder for Value of a Negotiable Instrument acquires
a Good Title in spite of Defective Title of Person from whom
he received it.

THE LONDON JOINT STOCK BANK v. SIMMONS. [1892]

(61 L. J. Ch. 723 ; (1892) A. C. 201 ; 66 L. T. 625 ;

41 W. E. 108; 56 J. P. 644— H. L. (E.).j

A broker was in the habit of pledging his customers' securities
en bloc with the London Joint Stock Bank as security for
advances to himself. He pledged, among others, certain mortgage
bonds belonging to Simmons, which were transferable by delivery.
The bankers had no notice, and no reason to suspect, that the
broker had no right to pledge these bonds for his own purposes.
The broker failed and absconded.

Held, that the bonds being negotiable securities, and the
bankers having acted in good faith and without notice of the
broker's fraud, were entitled to retain and realise the bonds
to repay themselves the money due by the broker, for the bona
fide holder for value of negotiable instruments tvho receives
them without notice of a defect in title of the person from
whom he receives them acquires a good title to them notwith-
standing the fraud or absence of title of the person from
whom he received them. It is of the very essence of a



THE ASSIGNMENT OF CONTRACT. 101

negotiable instrument that you may treat the person in
possession of it as having authority to deal with it, be he
agent or otherwise, unless you knoiv to the contrary, and are
not compelled, in order to secure a good title to yourself, to
inquire into the nature of his title or the extent of his
authority.



Mercantile Usage has the effect of adding to class of Negotiable

Securities.

BECHUANALAND EXPLORATION CO. v. LONDON
TRADING BANK. [1898]

(67 L. J. Q. B. 986 ; 2 Q. B. 658 ; 79 L. T. 270.)

The plaintiff company had a secretary named Evans, who was
entrusted with the key of the company's safe in which the
debentures were kept. Evans possessed himself of the deben-
tures, and fraudulently pledged them with the defendants in the
ordinary course of business to secure advances made by them to
him personally. The defendants took the debentures from
Evans in good faith. It was proved that there was a mercantile
usage to treat as negotiable the debentures of an English
company.

Held, that the list of negotiable securities is not closed,
and that where it is proved that there is a mercantile usage
to treat as negotiable the debentures of an English company,
the Court will give effect to such usage, not withstanding tint
it may be of recent origin only, and that therefore the defen-
dants tut re entitled to the debentures as being negotiable
instruments transferable by delivery, notwithstanding the
dejective title of the person from whom they had received them.



102 CONTRACT.

Loser of a Bill of Exchange or Promissory Note cannot recover on
it unless he indemnifies payer against loss.

THE CONFLANS STONE QUAEEY CO. v. PAEKEB. [1867]

(37 L. J. C. P. 51 ; L. E, 3 0. P. 1 ; 17 L. T. 283 ; 16 W. E, 127.)

The plaintiffs purchased from the National Bank, of which
the defendant was the registered public officer, eight circular
notes which were issued addressed to the bank's correspondents
abroad. The name of Jean Baptiste Eimbeaux, an agent of
the plaintiffs, was filled into the agent's circular notes as that of
the person who was to get them cashed. The plaintiffs sent the
circular notes by post to Paris, addressed to Rimbeaux, for the
plaintiffs' use abroad. The notes were lost, and the plaintiffs
brought this action to recover their value.

Held, that as there was a possibility of Ike notes being
made available, and of the bank becoming liable to pay any
of the indicated correspondents who might cash them, there
was no obligation on the bank to refund to the 'plaintiffs the
money they had paid without a sufficient indemnity.



Consignee of Goods may defeat right of Consignor to stoppage in
transitu by a bona fide assignment of the Bills of Lading for
value.

LICKBAREOW v. MASON. [1788]
(2 Ter. Eep. 63 ; 1 H. B. 357 ; 6 East, 21 ; IE. E. 425.)

Turing having received an order from Freeman, shipped a
quantity of corn on board the Endeavour to Liverpool. Two
bills of lading were sent to Freeman. Before the Endeavour
set sail Turing heard that Freeman had become bankrupt.
Turing at once endorsed the bill of lading remaining in his
custody to the defendants, and transmitted it to them with an
invoice of the goods authorizing them to obtain possession of
the goods for the benefit of Turing. On the arrival of the
Endeavour at Liverpool, the defendants presented the bill of



THE ASSIGNMENT OE CONTRACT. 103

lading and the goods were duly delivered to them. Freeman,
however, before he became bankrupt, negotiated the two bills
for valuable consideration to Messrs. Lickbarrow. The plaintiffs
sued the defendants in trover.

Held, that the plaintiffs tvere entitled to judgment, for a
bona fide assignment of a bill of lading by endorsement to
a holder for value defeats the right of the vendor to stoppage
in transitu.



A Personal Action cannot be brought after the Death of one of the
parties to it, unless special damage has been caused.

FINLAY v. CHIENEY. [1887]

(57 L. J. Q. B. 247 ; 20 Q. B. D. 494 ; 58 L. T. 664 ; 36 W. R. 534 ;
52 J. P. 324— C. A.)

The plaintiff, who had been a housekeeper in the service of a
deceased person, brought this action against the executors of the
deceased to recover damages for breach of promise of marriage
by the deceased, who had refused to carry out his promise to
marry her.

Held, that this being a personal action, no action would
lie, for actio personalis moritur cum persona, except in
respect of special damage — that is, actual loss to the temporal
estate of the promisee, flowing directly from the breach, or
ivhich may reasonably be supposed to have been in the con-
templation of both parties at the time of the promise as the
probable result of the breach of it.

Vide Hatchard v. Mege, infra. The same principle applies in

torts.



1(14 CONTRACT.

DISCHARGE OF CONTRACT.



A Licence, although by deed or for value, is revocable at will.

WOOD v. LEADBITTER. [1855]
(14 L. J. Ex. 161 ; 13 M. & W. 838 ; 9 Jur. 187.)

In the year 1843, when Lord Eglinton was steward of the Don-
caster races, tickets were sold in Doncaster at one guinea each,
which were understood to entitle the holders to admission into
the grand stand and its enclosure, and to remain there during
the races. They were issued with Lord Eglinton's privity,
but they were not sealed or signed by him. The plaintiff,
having purchased one of these tickets, went into the enclosure
while the races were going on, and while there and during the
races the defendant, by the order of Lord Eglinton, desired him
to depart, and gave him notice that if he did not go away force
would be used to turn him out. The plaintiff, having in no way
misconducted himself, refused to go, and thereupon the defen-
dant, by order of Lord Eglinton, forced him out, using no
unnecessary violence. An action for assault was brought by the
plaintiff against the defendant.

Held, a licence, if a mere licence, although under seal, is
revocable at pleasure, and that it was therefore lawful for
Lord Eglinton, without returning the guinea or assigning
any reason for what ha did, to order any holder of a ticket
to quit the stand and enclosure, and after reasonable time to
force him to leave, though such holder had not misconducted
himself, and but fur I he order to quit ivould have been justi-
fied bg the purchase of the ticket in remaining there.

Note. — It has been held that a licence to cut trees and remove the
timber is irrevocable in law, as it was a licence coupled with a legal
interest conferred on the buyer, and the absence of a deed made no
difference since the Judicature Act. Jones v. Tankerville, 127
L. T. 267.



DISCHARGE OF CONTRACT. 105



Generally, any variance without consent of Surety in the terms of
Contract between Principal Debtor and Creditor, discharges
the Surety.

PYBUS v. GIBB AND OTHERS. [1857]
(26 L. J. Q. B. 41 ; 6 El. & Bl. 902 ; 3 Jur. (N. S.) 315 ; 5 W. E. 44.

The condition of a bond recited that Gibb had been appointed
bailiff of a County Court under 9 & 10 Vict. c. 95, and stipulated
for the proper execution by Gibb of all warrants, &c. issued out
of the said Court to the high bailiff, and making true returns
thereof according to the rules regulating the practice of the said
Court, and for his due performance of the office of bailiff, and
for his not taking any fees except those specified in that Act.
After this bond, and before any breach occurred, statutes were
passed increasing the jurisdiction of the County Court in point
of amount, giving it jurisdiction on matters of insolvency and
over absconding debtors, and enabling any one of the bailiff's
authorized by the judge to sell goods seized in execution with-
out the intervention of a sworn broker. A breach having been
committed by Gibb, the plaintiff brought this action against
Gibb and his sureties.

Held, that by these statutes the duties and liabilities of
the office were essential/// changed, and the risk of the
sureties increased ; and that consequently they were dis-
charged, notwithstanding that the breach of duty relied upon
arose entirely out of the original duties of the office.



I in; contract.

To constitute a Legal Tender the whole amount due must be
tendered, an. I if the Creditor will not accept it, the Debtor
must continue always ready and willing to pay the Debt,
and must pay the Money into Court.

DIXON v. CLAKKE. [1848]
16 L. J. C. P. 237 ; 5 C. B. 365 ; 5 D. & L. 155.)

The sum of 13/. 15s. being due by the defendant, the plaintiff
refused an offer to pay 51. which had been made by the
defendant. 8/. 10s. was subsequently paid by the defendant,
leaving due the 5/. which the defendant had previously offered
to pay. On an action being brought the defendant contended
that, having tendered the 51., he was entitled to the costs of the
action.

Held, that the offer to pay 51. was not a good tender, as
it ivas part only of the money then due, and that the defen-
< In nt, in order to prove a good tender, should have shown that
he had been alivays ready to perform, entirely the contract,
and thai he did perform it as far as he was able, by
tendering the requisite money, the plaintiff himself pre-
cluding a complete performance by refusing to receive it,
and Ibis must be accompanied by a payment into Court in
order to entitle the defendant to his costs.



DISCHARGE OF CONTRACT BY ACT OF GOD.



A Person cannot escape liability by alleging an act of God unless
something has happened which he cannot reasonably foresee
and provide against.

NUGENT v. .SMITH. [1876]
(45 L. J. C. P. 697 ; 1 C. P. D. 423 ; 34 L. T. 827 ; 25 \V. E.

117— C. A.)
The plaintiff shipped a mare of his by the defendant's ship.
A storm was encountered, and owing partly to the badness of the



DISCHARGE OF CONTRACT BY ACT OF GOD. L07

weather and partly to the conduct of the mare herself, the mare
received a fatal injury.

Held, a loss is a loss by the act of God if it is occasioned
by the elementary forces of nature unconnected with the
agency of man or other cause ; and a common carrier is
entitled to immunity in respect of loss so occasioned if he
can show that it could not have been prevented by any
amount of foresight, pains and care reasonably to be required
of him.

If the loss is occasioned partly by the act of God as
above defined, and partly by some other cause, which if it
had been the sole cause of the loss woidd have furnished a
defence, the carrier will be entitled to immunity in respect
of such loss if he can shoio that it could not have been pre-
vented by any amount of foresight, pains and care reason-
ably to be required of him.

In this case the carrier satisfied these requirements, and
judgment was accordingly given for the defendants.



In the absence of Negligence a Carrier is not liable for Damage
caused by the act of God, the King's Enemies, or by inherent
defect in goods carried.

BLOWER v. G. W. R. CO. [1872]
(41 L. J. C. P. 268 ; L. R. 7 C. P. 655 ; 26 L. T. 883 ; 20 W. R. 776.)

The plaintiff sent his bullock by the defendant company's
line from Monmouth to Northampton. The bullock was safely
placed in a truck at Monmouth, but proved obstreperous, and
by dint of great effort succeeded in escaping from the truck. It
was found that the company had been guilty of no negligence,



108 CONTRA.CT.

and that the truck was perfectly fit to receive and retain an
ordinary bullock.

Held, the company were not liable for the loss of the
animal; that the liability of a railway company as common
carriers of live animals as well as yoods is, in the absence
of any negligence, subject not only to the exemption of the
act of God or the Quecrfs enemies, but to the further exemp-
tion of any act wholly attributable to the development of a
latent inherent vice in the animal itself.



DISCHARGE OF CONTRACT BY LAPSE
OF TIME.



Ignorance of Cause of Action is no answer to the Statute of Limi-



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