COURT OF APPEAL.

New Zealand Times, Volume XXIX, Issue 4263, 18 November 1874, Page 5

COURT OF APPEAL.

Tuesday, November 17. (Before Sir G. A. Arney, Chief Justice ; Mr. Justice Johnston, Mr. Justice Richmond, Mr. Justice Gresson, and Mr. Justice Chapman.) HOKITIKA AND GRKTMOBTH TBAJOVAY COMPAXY V. THE COUNTY COUNCIL OP WESTLAND. Mr. Newton and Mr. Button appeared for the appellants, the Attorney-General and Mr. South for the respondents. Mr. Newton, in continuation of his argument, drew the attention of the Court to a point relating to the fourth ground, which had escaped his attention on the previous day, and which was that, in accordance with rule 78 of the Supreme Court rules, if the plaintiffs averred generally performance of all the conditions precedent which it was necessary for them to perform, it was incumbent on the defendants specifically to deny any one of them upon the non-performance of which they relied, but they had not done so. By the general averment contained in the declaration the plaintiffs practically alleged that they had maintained the tramway in an efficient condition of repair as long as it was necessary for them so to maintain it in order to entitle them to their cause of actioD, and that averment had not been traversed. The defendants, therefore, accepted the construction put upon the contract by plaintiffs, which was that maintenance up to the opening of a Government road was alone necessary. The general averment could only amount to this, as if plaintiffs alleged maintenance for full term of ten years they would be alleging what would be incapable of proof, as such term would not expire until May, 1879. The third ground upon which a motion in arrest of judgment was made was that the contract was ultra vires of the defendants, and therefore not binding upon them. The plaintiffs of course contended that the contract was not ultra vires of them; that it was valid, inasmuch as it sought to charge the revenues of the County of Westland for a purpose of public utility, and that nowhere in the Act of Incorporation is such contract expressly or impliedly prohibited Further than that he should contend that the Act did actually authorise the contract. In point of law, however, it was not necessary that the Act should contain an express authority. If it did not forbid it, it must be taken to authorise. In support of the proposition that a corporation such as that created by the County of Westland Act, 1868, was bound by all contracts not expressly or impliedly prohibited, the learned counsel cited the South Yorkshire Railway Company v. the Great Northern Railway Company (22 Law Journal, Ex. 305), in which the whole case hinged upon the language of the statute enabling the parties to contract, and as to the meaning of the word "tolls." In Taylor v. Chichester and Midhurst Railway Co. (36 L.J., Ex. 201), per Blackburn, J., whose opinion was upheld on appeal to the House of Lords, it was also held that where a contract was not forbidden it must be deemed as legal and binding against the corporation. In the majority of cases where contracts had been held to be invalid as being ultra vires of the parties, the decision had, turned upon the clauses of appropriation in the Acts incorporating the companies ; and clause 81 of the County of Westland Act, 1868, stated that all moneys paid in to the County Treasurer under the provisions of the Act should be at the disposal of the County Council for the purpose of establishing gaols and maintaining police, constructing harbor works, main roads,

bridges, ferries, and other public works, for .the - support of hospitals, the promotion of education, and for other purposes of public utility within the county. The words used toward the end of the section bore as wide a meaning as could have been imported into them. They were all " works of public utility," and this tramway was of a cognate nature. The argument could even be carried further, for the language of clause 73 actually authorised the defendants to enter into such a contract as that upon which the plaintiffs were suing. Therefore, if the Court coupled clauses 73 and 81 it became at once apparent that the county government both had power to undertake the contract and to dispose, of the public funds in discharge of the liability thereby incurred. There remained, then, only one further matter to argue, and that was the alternative question whether the amount awarded in the. verdict should not be reduced to the lesser sum of £5227 on account of damage sustained up to the commencement of the action. The jury assessed "the damages generally at £15,374, and up to the commencement of the action at £5227. The defendants now contended that the plaintiffs were entitled only to such damages as had been sustained up to the commencement of the action. The plaintiffs' contention was that when the road was opened the value of the tramway became nil : that the property then became as valueless as if it had never existed. The competition of the road had been so detrimental that the tramway was latterly worked at a 1033 of £l2 or £ls a week ; nevertheless, the defendants maintained that they had no right of recovery until the whole period of ten years had expired, and that then, at the end of the ten years, they would be able to recover compensation, not only for the injurious competition of the road, but that the £l2 or £l4 paid out weekly would be refunded. All authorities agreed that the plaintiff was entitled to recover prospective damages, when the damages were such as flowed from the original injury. There must be some damage before cause of action shown, and the defendants must suffer all the consequences of the wrong done. Nicklin v. Williams (23 L.J., Ex. 335) ; Bonomi and "White v. Backhouse (28 L.J., Q. 8., 378) ; Hamer v. Knowles (30 li.J., Ex. 102). Where a wrong was done the injury must be compensated for once and for all. A complete analogy to the present case was furnished in the Queen v. The Cambrian Railway Company, where a ferry was superseded by a bridge, and thus the money value of the ferry destroyed. So in this case the money value of the tramway was absolutely destroyed by the construction of the road. The plaintiff's view of the matter was that, upon the happening of the event contemplated, namely, the opening and competition of the road, they were entitled to damages from that moment, and to all profits which they were prevented making by the road being made. Referring back for a moment to the latter portion of the third ground in the rule, the Court would recollect that in referring to the question whether or not the plaintiffs were bound to allege the contract in writing, executed with the formalities required by the County of Westland Act, 1808, he stated that the contract was admitted and that the admission was in point of fact an admission that the contract had been entered into with all due, formality either as to writing or execution, and that that objection could not bo taken in arrest of judgment, as the admission must be deemed to be an admission of all facts that would hive required proof if the making of the contract had been traversed. The defendants were therefore in the position of having admitted all the facta which the plaintiff would have had to prove, either as to writing or execution. '"hie. Button called the attention of the Court to one point which his learned friend had overlooked, and which was one of a set of facts which placed the present case on all-fours with the Queen v. The Cambrian Railway Co. The Court had already intimated its opinion that in a case of continuing trespass damages might be recovered de die in diem. - Every continuation of the trespass was in fact a nevv trespass, a new cause of action upon which damages might be recovered. In this case the construction of the road-by the Government was a legal act, an act which they were entitled to perform, ■

- The mere construction of the road by itself • was not a cause of action. That was exactly ) the position in the Cambrian railway case. They f were authorised by Act of Parliament to cons': struct a bridge which competed with a ferry, i; and therefore the continuing of it was no fresh ; cause of action. It was once and for ever i. done. It was done by legal right, and the con- ■ tinuing of it day by day did not thereby create a fresh cause of action to the owners of the : ferry. The cases were exactly similar. Here • the Government constructed a road, and as soon as they did so the plaintiffs' cause of action ensned. The Attorney-General first addressed himself to the question as to the power of the County Council to enter into such a contract as that alleged in the declaration. The tramway was a tramway which the plaintiffs had acquired authority from the Government to construct. They had the right to levy tolls, and they were to keep the tramway in repair, but nevertheless it wa3 clear from the language of the County Council Aet that the Legislature never intended that the Council should have authority to enter into such a contract. It was important to look at the express provision with regard to the power to contract. He submitted that the interpretation which held good with regard to written documents between parties was applicable to Acts of Parliament : where there was an express provision that that provision overruled; and that matters that were not expressed were intentionally omitted. Therefore it was very important to look at the power to contract. If there was an express provision with power to contract, and if it were found that this express provision was precise and not general, then the true interpretation of the Act of Parliament would be, not to give a general power to contract, although there might be objects mentioned which the corporate body might well carry out. It was clearly intended by the County Council Act that the Government should have power to dispose of its money, and yet not have power to contract, because they could carry out the purposes themselves, and not enter into contracts. The 73rd section was to this effect :—" The Council and every Road Board may respectively enter into contracts for the execution of »ny works authorised by this Act to be done by the Council, or for furnishing materials, or for any other things necessary for the purposes of this Act." The only general provision was contained in the words " things necessary for the purposes of this Act." They might enter into contracts for the execution of works authorised to be done, for furnishing materials, &c, but they could not go beyond that. The clause was very precise. Then came the 81st clause, as to the appropriation of funds, which were to be at the disposal of the Council for the purposes of maintaining an efficient police force, constructing harbor works, main roads, for promoting education, and for other purposes. It was contended on the other side that these words, " for other purposes," included a power to enter into a contract to indemnify the plaintiffs in respect of what might be called a private work ; for although the tramway was in one sense a public work, it was in reality a private work. According to the Goldfields Act it is constructed by private enterprise, although it is for the benefit of the public. It had been contended by the learned counsel on the other side that the county government was justified in applying its funds to this work because it was a work of "public utility," but he submitted that the works must be public works in the proper sense of the word. There was no doubt that the words "public utility" might in a certain connection have a sense which would meet the case of the plaintiff : that was to say these works would be convenient to the public although they did' not belong to the corporate body. The words "public utility" might mean " purposes useful to the public," but in another connection they would have a more restricted meaning, and he contended that they were used in a connection which gave them a more' restricted meaning, because the language of the Act showed that all the preceding purposes were purely public purposes. The only language used which could be said to be at all in favor of the kind of contract entered into here was the words "promotion of education," and he apprehended that that was a materially different object to the construction of a tramway. The real intention of the contract was that the plaintiffs should maintain the tramway for a period of ten years, and that at the expiration of that time, they should be compensated for .any "loss ; but the maintenance was a condition precedent. The contract was simply a promise that the defendants would compensate for any loss sustained by reason of the opening of roads, and that loss he submitted could not be ascertained until the whole period had gone by. It was said on the Other side that the allegation was in the form required by law, and that if it were not, that the defect was cured by verdict; that because it was admitted on the record, it was cured; and that it was not necessary that the contract should be alleged by deed, or that it should be in accordance with the forms specified in the County of Westland Act, 1866. He submitted that the omission was not aided by pleading over, and quoted Rhodes and Robinson and Miles andWaitt(l Appeal Cases); Kitchingv. McCard, (N.Z. Jurist) ; Harris v. Goodwin, (2 Manning and Grainger, 417) ; Williams's Note 3 on Saunders's Reports, 1 V., 267 ; and Finlay v.' The Bristol and Exeter Railway Company, (7 Ex., 418). With regard to the question of damages, he had said all he had to say. He submitted that the contract was clearly within the Statute of Frauds. It was a contract which could not be fully completed in any one year. It was a continuing contract," and not one of those cases where there was a contract with a contingency which might happen within the first year. In order to enable the plaintiffs to sustain their action the road must continue to compete for the full term of ten years. The continuance of the competition was really the ground for compensation ; and, if the plaintiffs were entitled to recover anything now, they were only entitled to recover damages sustained up to the time of the action being brought. Mr. South followed on the same side, and at the conclusion of Mr. Newton's reply the Court adjourned till eleven o'clock next day.