PECULIAR CASE.

Evening Post, Volume LXXXII, Issue 26, 31 July 1911, Page 2

PECULIAR CASE.

TROUBLE OVER A BARLEY DEAL. UNUSUAL APPLICATION. Some very unusual features were ?e» I vealed in a reserved jtfdgment delivered by Mf . Justice Denniston to-day. An English firm obtained judgment against a Blenheim company without the latter 'fi having becii really eefved, and it sought execution, which his Honour granted. The parties were Montgomery, Jones, and Company, plaintiffs, and Corry and Company, defendants. Mr. H. D. Bell appeared for the former, and Mr, A. W. Blair for the latter. Plaintiffs asked for liberty to issue execution' against the defendants npon two judgments againet them obtained by the plaintiffs in the King* Bench Division in England for the sum of £1331 Is 6d and £2617 2s Qd respectively, The plaintiffs are grain merchants carrying on business in .Liverpool, England. The defendants are a firm of merchaiite in Blenheim, New Zealand, On the 4th March, 1909, "a member of the defendant's firm— Mr. John MacKenzie-— on the firm's behalf entered into an agreement with the plaintiffs for a sale to them of the New Zealand Chevalier barley crop, 1909, -to average a sealed sample put into the hands of the .plaintiffs at a price of 30s per 4solb gross, including freight and Insurance delivered in Liverpool. , Payment was^ to be made by buyers acceptance of shippers' draft at sixty days' sight, The agreements contains a very, stringent clause, evidently a common form in the trade, and was intended to forbid in the most definite way recourse to the^courts of the Dominion in any proceedings arising out of the contract. Defendants shipped the barley in dus course. As to three shipments, the plaintiffs' dispute arose hs to the quality of the barley. These disputes the plaintiffs desired to have refered to arbitration in terms of -the agreement. MacKenzie says in his affidavit that he instructed the plaintiffs to appoint arbitrators on behalf of the defendants, which they did— and that in the arbitration, and in the appeal the defendants were, at his (Mackenzie' b) request represented by a- partner of the plaintiffs, MacKenzie was dissatisfied with the result of the arbitration, and appealed to the Liverpool Corn Trade Association, Limited, which disallowed the appeal. He says that he instructed the plaintiffs to appoint in each instance an arbitrator on his behalf— which they did— and that in the arbitration and appeal the defendants were at his request represented by a, partner of the plaintin's firm, because, owing to his limited acquaintance with the grain trade in England, he did not know of ,any, other person who could represent the defendants, "This," declared his Honour, "seems a singular method of procedure. It is probable that these agreed arbitration tribunals may be administered by recognised methods, .with which we are not familiar— and in any case it cannot lie in the mouth of the defendants, in the absence of any averment of collusion of fraud, to challenge the acts of their acknowledged agent. The awards in the two cases which are the subject of these two summonses were made on 29th and 31st December, 1909, respectively. On Bth June, 1910, .the plaintiffs issued writs in the High Court of Justice, Liverpool district, requiring the defendants to entetf.an appearance within eight days of service. In each case, the particulars of" demand set out the amount of the award proceeded on, with interest, and give credit foT proceeds of sales of barley on defendants' account. These writs were served on the date of their issuo by leaving a trne copy of each with the cashier of the Liverpool Corn Trade Association, Ltd., 'at Liverpool, and on tho same date a true copy of such writ was sent by prepaid letter post to the defendants, addressed to them at Blenheim, New Zealand. These letters did not, of course, reach their addresses until the end of July, 1910, the time for entering appearance- expiring on 16th June. MacKenzie had left Fnglancf before these proceedings *were c<-mmenced. Of course, no appearance was entered, and on 18th June judgment was entered by default. On 12th October a memorial of. this judgment was extracted, and was filed in this court on 25th November. It is on these facts that the plaintiffs now move, "The defendants' answer is to challenge the correctness of tho accounts on which the balance sued for was arrived at. He asserts that on proper accounts the balance, after allowing the ampuiit of the awards, vvould be shown to be in his favour. This may be the case, The awards were not produced here, It is, however, evident that they were only in each case the amount to be deducted, from the price to be paid by the plaintiffs to the defendants, and that the defendants could be properly only liable to be sued pn a.ny balance due, the amounts of the awards being only an item in stich accounts. There was, I am informed, a third arbitration and award under which the shipment which was then subject was actually rejected. This the defendants say the plaintiffs are selling, or have sold, on the defendants' account. It is quite possible that the defendants could, had they been actually instead of merely constructively represented at the place of service in Liverpool, have successfully defended the action wholly or in part. The service was, however, made at the place and in the mannei- designated by them in the contract, They took no steps to provide for the contingency that should have been contemplated by .them, that is the absence of, any actual representation by them. They are-, by their, contract, to be taken to be domiciled at the offices of the association where the service was made." After going into the law, his Honour proceeded: — "Even had I seen my way to allow defendants the right, to challenge the judgment of the. English Couit had the application been made promptly, I think they have put themselves out of court by the delay ,m taking any steps in the matter. They knew at the end of July, 1910, of the issue of the writ, of its service on their prescribed agents, and of the fact that it was an eight days' writ. If they then knew or believed that they had grounds for objecting to the proceedings of the court, or to the judgment which they must huve known would be given on default of their non-appear-ance, they should have at once taken the necessary steps for their protection. As all the proceedings are on their face in order, and as in my opinion the defend* ants have not shown any sufficient cause against the grant of the summons, I must make in each case the order asked for."'