DOCK CONTRACT.

Evening Post, Volume LXXXIII, Issue 73, 26 March 1912, Page 7

DOCK CONTRACT.

SUM INVOLVED: £20,000. PITCAITHLY V. M'LEAN AND SON. A further stage in* the litigation caused by the determination of the dock contract came before the Court of Appeal to-day. Sir Joshua Williams, Mr. Justice Edwards, and Mr. Justice Chapman occupied the Bench. Last year Piteaithly and Co. proceeded to recover £20,000 from John M'Lean and Son for the latter company's failure to purchase the full quantity sand and gravel required to compete the contract. A special case was stated and heard in Novmber by the Chief Justice (Sir Robert Stout). The basis of the -action was an agreement made on 6th February, 1907, between defendants and plaintiffs. The contractors agreed to deliver in railway trucks at the dock siding or sidings, Wellington, all assarted gravel and sand (Included in which shall be a large pro portion of broken metal, as required by the Harbour Board's engineer) required by and in accordance with the specifications for the Wellington graving dock attached to the contract entered into by the employers with the Harbour Board, which shall,, from time to time, be ordered or required by the employers. The Chief Justice, in giving judgment, said he was of opinion that the agreement was to supply a definite quantity of gravel, but the dominant words were "which shall from time to time be ordered or required by the employer." It might be, and in his Honour's opinion was, that no greater quantity might) be ordered than wag necessary for docs purposes, but the quantity required was to be ordered. The word "required" after the words "be ordered or" meant Masked for." This, then, in his opinion, wae the limit of the contractors' engagement, subject always to the other terms in clauses 3 and 4. The next question was what did the employers undertake to do? It was, that employers while and so long as the contractors should duly perform all and singular the stipulations of this present contract on their part shall and will order from the contractors all gravel and sand required in connection with the ' concrete work included in the graving dock contract. This obviously prohibited the employers ordering gravel or sand ekewhere. The point, however, was : "Suppose the contract were stopped or put an end to by agreement and no more contract work were necessary, must the employers order sand and gravel, or, if they do not* are they guilty of a breach of contract and liable to damages?" It wad contended for plaintiff company that it was an implied condition of the agreement that defendant company should proceed with the erection of the dock, and accordingly it could not enter into any arrangement whereby the contract should be determined. This contention was not the one much relied on. The alternative contention was this: It was alleged that if no such condition, were implied, and if defendant company had a right to elect, and did elect, to determine the contract with the Harbour Board, defendant company nevertheless remained liable to pay to plaintiff company as damages the whole of the profit which would have accrued to plaintiff company if the contract had been carried out to completion. This meant in effect that the employers had by the agreement agreed to purchase a definite quantity of sand and gravel whether it was necessary for concrete work in the dock or not. His Honour said as to the implied condition, a condition not expressed was never implied unless the contract could not be carried" out unless it was implied. The contract did not say that if cod crete were not required, sand and gravel weire to be ordered. Therefore, in his opinion, unices there was an implied warranty that the dock contract would be completed, and in the way the specifications provided (by the use of concrete), there was no undertaking on the part of the employers to order sand and gravel. He was of opinion that he could not infer such a promise in the agree* ment between the parties. From this decision, Piteaithly ana Co. appealed on the ground that the judgment was erroneous in point of law Mr. H. D. Bell, K.C., and Sir John Findlay, KIC, with them Mr. D. S. Smith, appeared for appellant company, and Mr. C. B. Morison, with him Mi-. A. W. Blair, for respondent company. The argument promises to be lengthy.