HARRY MEREDITH, THE LIQUIDATOR APPOINTED FOR THE PURPOSE OF WINDING UP OF THE FIRM OF J H ELLIOT AND CO LTD OF BIRMINGHAM Vs. VKABDUL SAHIB

JUDGEMENT

(1.) This is an appeal by the plaintiff from the judgment of Mr. Justice Coutts Trotter dismissing a suit brought by the plaintiff as liquidator of Messrs. J.H. Elliott & Co., Ltd., to recover damages for breach of certain contracts made with the defendants by which Elliott and Co. undertook to purchase and ship certain goods " on account and risk of the defendants ", and did ship them under c. i. f. c. i. contracts on board a German ship. War broke out while the goods were still in transit, and the contracts of affreightment between the shippers and the German ship-owners were thereupon dissolved, with the result that, if these were ordinary c. i. f. contracts between vendors and vendees, then, as held by the learned judge in accordance with the decision of the Court of Appeal in England in Arnold Karberg and Go. v. Blythe Green Jourdain & Co. (1916) 1 K.B. 495 the tender of the shipping documents including these bills of lading which had been dissolved as contracts of affreightment was not such a tender as the defendants were bound to accept under the c. i. f. contract and the goods were thrown on to the vendor s hands. The only serious attempt to distinguish that case at the trial was on the ground that in the present case the bills of lading had been indorsed over to the defendants before the outbreak of war. As observed by the learned judge that fact is not proved. On the contrary the Captain s copies which have been filed are to order of the shippers, and the fact that the National Bank on behalf of the plaintiff was able to recover the goods goes to show that there never was any such endorsement. Even, if there were, I agree with the learned judge that would not make any difference. What I understand the Court of Appeal to have decided was that tender by the vendors after the goods had been shipped of shipping documents including bills of lading which represent the goods was a good tender and performance by the vendor in a c. i. f. contract, but that he did not so perform his contract by delivering bills of lading which as contracts between the shippers and the ship-owner had become dissolved owing to the outbreak of the war.

(2.) No serious attempt seems to have been made at the trial to distinguish the present case on the more substantial ground that under the contract the goods, as pleaded in the plaint, were to be purchased and shipped on account and risk of the defendants and, consequently, the learned judge has not dealt with that aspect of the case. As however the question arises on the pleadings and is purely one of law, and as cases of this kind are of infrequent occurrence in our courts we have allowed it to be taken before us.

(3.) Now it is well settled that, where goods are purchased in this way from a commission agent under a c. i. f. contract, though the agent is regarded for some purposes as a principal and as any other vendor under a c. i. f. contract, yet the relation of principal and agent still subsists. Ireland v. Livingston (1872) L.R. 5 H.L. 396 in which Blackburn, J. (as he then was) gave his well-known explanation of the nature of a c. i. f. contract, when advising the House of Lords, was a case of this kind, and was disposed of by the House of Lords on a principle of the law of agency, viz., that, as the error arose from the principal s indistinctness of expression, he must bear the loss. The first case in which such an agent was assimilated to a vendor was in Feise v. Wray (1802) 3 East. 39 where he was allowed to exercise the right of stoppage in transit in respect of goods which he had bought and paid for; and the true principle would appear to be that the assimilation is only to be carried so far as is necessary to give business efficacy to the transaction This I gather to have been the view of Brett, M.R. and Fry, L.J., in Cassaboglou v. Gibb (1882) 11 Q.B.D. 797 where Lord Blackburn s observations in Ireland v. Livingstone (1872) L.E. 5 H.L. 395 were considered. Otherwise, the relation remains one of principal and agent, as held in the last mentioned case, in assessing damages; and the agent remains accountable, as held in Williamson v. Barbour (1877) 9 Ch. D.529 which has recently been applied to similar cases in this Court.