SUPREME COURT.

Otago Daily Times, Issue 11197, 20 August 1898, Page 2

SUPREME COURT.

■>■■ ,IN BANCO. ■■'..; ...Fbiday^ August 19.. . , . •. (Before his Honor Mr Justice Pennefather.) FLEMING iV. THE; BANK OF. NEW ZEALAND., s Motion by plaintiff for judgment on the findings, and t uiotion on behalf of the defendant foe. a'nonsuit ox for/ judgment for the bank,, or' in the alternative'for.a newHrial'ori the grounds . of misdirection' and- the 'improper admission of 'evidence,, and ion1 the;.further-' ground,:that:.' the damages,.were excessive. ~..-; h-'-ic. ■*'• '■ Mr'Sini and Mr :Kattray, (of Inyercargill), appeared on behalf of the plaintiff, JameS Fleming, farmer, of Rakahouka; Southland, and Mi Oilivier (of "Wellington) and Mr Hosking on behalf of the defendant bank.' .■' •■" -■■ ■Hia Honor: gave judgment as. follows: —;; ; In. ithis, case, the verdict of the, jury having been taken the, matter ~wa3 adjourned, for further consideration, and leave1 "was given to the defendant to 'move for a nonsuit. It lias' now been brought before the court again (1) on motion: by the ''plaintiff for jiidgment ;■ (2)'onthe motion by the defendant for noni,suit or. judgment for the defendant; .and (8). oil.the motion of the defendant for a new. trial. It haa been arranged that the second motion shall be taken flr3tand an order mado on it'; anclthat in the event of that ■ order being in favour of the plaintiff the third motion fihall not be argued--. ■■■ :■ : ■ ■V-Y It* has . been -urged for. the defendant .that, there was no intention on the. part of,.Chis-' holin^o enter into\a contract with '.Thompson to honour the cheques of Fleming in consideration of the deposit of the warrant;- that-, the' evidence of Thompson.1 and Chisholm as to .the conversation which took place between. them on the Monday morning . may be explained equally well as referring to. a consent on the part of Chisholm to receive £1000 in reduction of Fleming's overdraft, or in 'the1 alternative to'receive the wafrant as additional security-;/ and that being so'the surrounding, circumstances, and the previous conversation between Fleming and Chisholm must.be looked at, and these will show that such a view is more pro: bable; therefore the seventh question, viz.— ■■ Did Mr Chisholm-; accept the said warrants a'a consideration- for honouring .plaintiff.'flcheques beyond the limits of,his overdraft r.'-r^. ought not to, have been leffc,.to .the jury.., Fail-, ing that, the ..defendant, .-contends that.. the' proper form .in. which ..the issue. should have been put/in order to raise the question whether there really was a'consonsusad. idem.'between1 the parties,: was (aa .suggested by-counsel for; defendant- at-jthe-trial):.v:,"Dia -}h-e Manager,: of the bank ''understand that the' cheques're-, ferred to by .Thompson'at' their interview Of the 6th Septeniber were cheques'dr&wn by the plaintiff "beyond; the limit of-his- existing;'oyer.Failing thaty- the-defendant; contends,.that, even supposing a contract to have, taken place, there .was no consideration, .inasiimch as i$ waS'. open to.'Flfeming, as' Thompson's' prirP cipal, to repudiate the action of his agent in. any moment. '. : ',',;, 1- / Fa ilin'g that,'. he contends. that. the . contract was never broken by the defendant, as the only, cheques to be. honoured, were those given for tho purchase of-sheep, and it was. not proved to. the defendant what had'been the consideration for the cheques which'actually were presented. '.■ •" ■■■■'■'' '-. ■'■' ■'■ ''. Lastly, the defendant contends that tneya!leged contract was made by ; a. person who, .had authority to., contract; . that. the., principal remained in ignoranc.e of the contract until after the breach .of it; and that when ho es_' sayed to ratify it it had'oome to an end, ana therefore was not; capable; of ratification. .... 'Forl the first contentino , .Cotton.. v. Wood-*'. (8 C.8.N.5.), has been,', cited, That was :■', an .-. action claiming damages for injury^ resulting from ' the n%S^gent driving of the defendant's servant. •_ J. ha judge' who tried the case had been of opinion that.there was no evidence of"actionable negligence'; but to avoid the necessity of going down again if the.court should think otherwise, ho left the caso to :the jury, who returned a ver^ diet for' the plaintiff. The" court were of opinion that a scintilla of evidence; - a ;. mere surmise that there may have, been neligence on the part of the defendant, would notjustify the judge in leaving- the case to, the. jury. There -must be-, evidence upon which they might reasonably and. properly conclude there was negligence; that.' where the evidence -waa equally consistent with the existence or nonexistence of negligence it. was not-competent to tlie judge" to leave the,matter to, the.-jury;.;. I need hardly say that I respectfully.concur.in the- judgment of,-the. Cour^of. Common Pleas, fout I must: add-that in this caso I.am stilly opinion that the; jury 'might; and did; reasbiiiUily and properly conclude that' the ■ -arrangement which Thompson pr6posed,an'd:t6-whiohiChis-holm agreed, was.that further cheques,given,dt Fleming should be .'cashed- by the,, bank, ana that the overdraft might be increased.^ v might.not have.been improbable that Flfiuiinj, if he had an extra £1000 in his pocket, should wish to reduce JUs overdraft by that amount; but it certainly" seems improbable that he should wish to borrow that sum from the Freezing Company in order to pay it to the bank, and the fact that Thompson suggested the alternative scheme' must have sttown .o Chisholm that Fleming'was borrowing tne £1000 from' tho Freezing Company. Sesides that, Thompson's evidence as to his conversation with Chisholm seems to me only consistent with' the view that he understood, and that he represented to Chisholm. that' a hew arrangement •- was. being made in consequence ot more cheques having been issued- by Fleming. :So far from the plaintiff having only given evidence as consistent ■ with one view of ..the case as the other (see the remarks of Mr Justice ■ Erie in Wheelton v. Hardisty, 8 E. and'B. 263), I must hold that the evidence which he has tendered is far more consistent with his case than with that of the defendant. ■ ' ■■'■■■ If, therefore, the warrant was tendered by Thompson to Chisholm as consideration for honouring Fleming's cheques beyond the limits of his overdraft, and Was accepted by Chisholm as such, it appears to me that there must have been' aggregatio mentium necessary to complete a contract, and therefore the question-put to. the jury was the correot one. .- ;:• ■■• : Next, as to there being no consideration lor '"the contraot. But there was, in,fact, a considoration—namely, the deposit of the warrant. It may be' said that that consideration'was not very valuable, as Fleming might theoretically at any moment repudiate the unauthorised action of his agent (remote tnough The. chance of his doing so might be, seeing that tiie oank lias just granted him a convenient overdraft); but Chisholm knew .the circumstances, and was j willing to take the risk. ■ , ! Next, as to the contract not having been broken inasmuch as it was to honour, cheques drawn for the purchase of sheep, and the oanlc had no proof that the cheques presented wevs for that purpose. I may here remark in passing that this is a strange defence for tho oank to set up, seeing that Chisholm had Bworn thto Thompson never referred to. the purchase of sheep; but I do not base my decision on thai ground, bub on the fact, that if the bank had any doubt on the subject it was for them to make inouiries. Could it be supposed that Fleming ought to have written on each che^un "This is for the purchase of sheep?"- Cheques which appeared to have been given m the ordinary course of business on the Saturday by a sheepdealer, whose agent on the Monday "i°rning informed the bank that his principal iiad been drawing cheques for the purcnase of sheep, were presented to the bank on the Monday afternoon; if the banker had any suspicion that those were not the cheques referred to, his proper course would have been to have made inquiries from the agent. I come now to the,last contention of the defendant. Here I wish to state that I^do not consider it perfectly correct to speak of Ihompson as "a person who had no authority to contract." If I pay £1000 to my banker, he comes under a liability to cash my cheques to that amount; in other words, he and I have contracted that he shall do so. To go a »t«p

'further, if'T ask1 a "friend:t6' lodge £1000 for meat my banker's, I authorise him to make that contract for me. Hence in the present case Thompson was authorised, by Fleming to make a certain contract. 'What he did>was to vary that contract, with the consent of the contractee, who knew the circumstances. But a very difficult question, arises as ..to whether it was possible for Fleming to ratify that contract so varied after it had been broken by- the bank. The analogy of a policy of marine insurance which may be-ratified although the ■ship has been lost in 'the meantime (see Williams v. North -China* Insurance Company, 1 C.P.D.i 757) is a tenijting one; but unfortunately that rule is an exception from the gene-' ral rule—in other woi'ds, tho general rule is "the'other way. It has b'sen strongly urged that this case is exactly governed by. Bolton v. Lambert, 41 CD., 295, in which an offer to purchase was made by.Lambert, to the. agent of Bolton, Who was not authorised to mase any contract for sale. The offer was 'accepted, by the agent oh behalf of his principal; Lambert then withdrew his offer, and after the withdrawal Belton ratified the acceptance of the offer ami claimed specific performance; and it was held that the ratification by Bolton related back to the acceptance by his agent, and therefore the withdrawal by Lambert was inoperative, and Bolton was entitled to specific performance. If that case were exactly in point I should hold myself bound by it, in spite of the hostile criticism it has received in the note to the 3rd edition of "• Fry on Specific Performance.'' But T think it is clearly, distinguishable. ' When ' Lambert attempted .to' withdraw :his' offer the' ' right of the other patty was at his-option either;----•to treat the contract''as broken-and.seek-for damages, or to treat, it as still subsisting and. claim specific performance. Therefore,-at, the •moment iwhen the principal ratified ihere was . something, to ratify..'. The ratification was.made ■' at a time and under circumstances wneri the ratifying party could "himself have effectuallydone the act'which hel has ratified (see Bird v. Brown, 4 Ex., 786). But here, from the nature of the case, when the cheques were dishonourei >the contract.was irretrievably gone; the so.called ratification was?merely an. allccatjo^ to .himself by "the principal of a- right of action. . for damages. 'It' ha 3 Been argued that in Bcl.toti v. .Lambert the court might have awarded • •damages in lieu.of erf in addition to specific, perforahmce;■ but it has .not been shown that;ii£ specific, performance had been impossible ' the ratification would: have been held good. • , If,'therefore, the matter rested there I should feel obligee! to hold that a nonsuit must be entered; but the plaintiff has-urged in replythat the defendant-has by his conduct estopped. Ivimself from raising the objection that Thompson had exceeded his powers. In the. first; place,-it. has been pipved that Thompson went ■ to Chisholm and stated that -his instructions were only to pay in a sum of money; that it; would be more convenient to him (or, rather, to ! the Freezing Company) to deposit the warrant [instead; Cnisholrn assented to "his action, stoodjby whilst1, he prepared : the warrant, then.- ac.- ---! cepted the wairant; then,in the afternoon when . •the cheques had: come in had, another, interview with Thompson, but never, led him to suppose .that he did not -Consider the warrant a. ; sufficient".' cbnsidersttibri: 'for the , cheques-(of course had:'he said so Thbmpscn. ■would at 6nce'have"dep'ositeci: the'cash instead-.; . it was Ghisholm's conduct '.that" put ; him •to ■ a breach of .duty ,po : -the fiart of Chisholm to re--lieve-, :that.. he .was ( carrying 'out : contract. ad Varied by.;Thb'mpson and hiihsfelf, bo there " a breach of duty on.thevpart of phisholm to *evea'l theHrUth"'as're^irds' Thompson,' the agtmV for "Fleming; and therefore %s. regards rhimself (see " Cababe mi' Estoppel,'' p.;85).f Iriother i words', Chisholm, by.> his words and. con-, diiot, induced Fleming's agent, to believe that he would honour the cheque^;,Thompson acted on. the belief, and sent' the warrant; he wag prevented: by Chisholni's ''representation from: lodging the ■money;' in fact,.*; Chisholm . led Thompson'to'believe-, as a man:-of average intelligence, that -the v. lodgment-: pf -.they rnbney would not be required.. He .therefore cannot aow take the point as, against , t Thompsott'B. principal that the money was not lodged (sea Simon v> Anglo-American Company.,'S Q.B.LI.', 188, 211; " Bigelow on "Estoppel,"-p. 633). I hold, therefore," that lSthe defendant is Dot entitled to enter a nonsuit.' ■ ' '■ >•■ ..".-- Mr Ollivier1 said'that if-the ney trial pointa could be dealt with pn appeal he ; didnpkthink he was entitled to ask his Honor to hear argaiiient .on the new trial motion.", ,"/ j'~. ..; Mr Sim suggested .thai. Hie best way would be for his friend"to 'consent to judgment' for plaintiff with stay of execution- on "the under-' standing that the. defendant went.;to:appeal a* the next sitting of the.Court ftf.AppeaL,,,.>-'. , Mr Ollivier.thought.it. might be more, conveniently dealt, with in that manner.. ',". His Honor made .the ''..'following.- minute: — Judgment for plaintiff f6r':£2QOo'; costs according to scale; iss for each of two-extra-days;'. second .'counsel, allbwedf' £8 8s for. interrogatories (incindiag argument) ;,:stay^of execution, pending appeal, the defendant undertaking to appeal at Ahe next sittings of the Court of Appeal; disbursements a.nd witnesses' ( . .expenses to be fixed by the .registrar;-motion for judgment'costs, '£10 10b; extra- counsel, £B'Bs;> defendants niotion for -a new:trial to be 'takeri as .ihaving been,'.argued and dismissed ;and :to be-'heard ..at. the same' time .as.the .appeal .from refusal to.nonsui^ and .treated,as one. with it.> defendant tp ( be at liberty, .to; amend, h, is notice of motion "for 'a ae'#^trial, a-s ;he'thinks' fit , '[f ,;,-. ~:„.„ '']!'■ '1'.. ; ..;J:. (Be-f or,e~ His' ijonor. Mr.- Justice Pennefatijer.jf ..Probate.was' grated of'the wills of Joiin Eeiii (Mr Payne), Samuel "William Gib"bs'(Mr Cook), and JamesMackaypMS Sim ibt Mr Diilfc'iell)'.'' Letters of administratiorf wore granted in tho estatoa of .-G-eOrgeiVGiay .■(Mi llusseli;,-Ann P.roudfooj;'(Mr .Brent))< and: Francis iluliopne/ (M r :pook),'••.•.■.:" ;:,.-';4r<v- \".'^ :'-- The, Executors of-.., Bryan Cecil 'Haggitt (deceased) v. the Government Life Insurance Cbnimissioner and Others."—This/was' an originating summons tb' determine the rights of j parties with reference to an insurance policy fbi« £1000 on the life !pf the late, B.C. Haggitt. Mr Hosking appeared for the ylaintiffs, Mr Sim.for the Commissioner, and. Mr Cook for the. adult children of Mr Haggitt's first marriage, Mr Wbodhouse' for the inftiiit children of the first marrißgo/ aiid Mr Boloinon for the 'children of the second marriage!— The facts ' were., that.-Mr Haggitt effected;, an'insurance j for'£looo in the Government Life Insurance Ofnce .ill November, 1670. In .Julie, 1871, .he. endorsed on this .policy a. declaration in the form prescribed'" By the 'regulations thilt the policy was effeoted for the benefit of his Wife and children, but he. did not give to the commissioner the notice required by "The New Zealand Government Insurance arid Annuities Act, 1870." Subseduently deceased caused inquiries tc.be made'as to whether the endbrsemerithad neen. brought under'the notice i)f the commissioner, and was informed that it had not/and the department tnought he should cancel it. He : therefore, made, a further endorsement oh the ! policy, purporting to .cancel the, first endorsement. On Mr.Haggitt's death application was made by the executors of the will for payment •of the amount'of this policy, when the' luMit- : anco department stated in reply that, they were j advised they could'hot pay., the of ' the will, inasmuoh as the-endorsement once having been made, could not be cancelled, and although the notice required by fthe act had riot been given the' declaration took' effect in j equity as a gift:to> or a"declaration bfHrust in. i-fasrour'ofi'Mr Haggitt's .first wifea-nd.the children of Jiis first marriage, and therefore .neither his widow .nor the children, of his second mar Ha^e were,entitled to participate.'. This, summons therefore' issued in order to determine the rights' of '■ the 'relative parties with; reference to the matter. The" Government -Insurance Commissioner merely submitted himself to the .order of the court so <as to '-get' a, valid discharge.—2»Sr , Hosking explained that the plaintiffs were the trustees and 'executors of the late Mr B. C. Haggitt's will, and the defendants represented the whole of his children." There were -two infant 'grand-children who were not before the court, as.it-had. not been thought-necessary to bring them specifically before the . court until it was ascertained if their interests were different from those of the other defendants. —His Honor: Their interests would be hostile. The adult children of the first family ■ have con- ' sehted to what is against their own interest. i The grandchildren are in the same position ;as the adult. members, and would consent J but that they are infants?—Mr Hoßking: In one view of the mafcer they may take an interest; in another view they may not.—Mr j "Woodhouse: They, tok'e an interest if it goes under the will.—Mr Hosking opened the case, contending that the endorsement had no effect in any way, either under the act or independently of it, and that the, prbceds of the life policy went to the general estate, and was payable to the executors. Counsel cited several authorities in support of his propositions.— Mr Solomon followed on the. same side, contending that it was obvious, that Mr Haggitt intended his present family to participate. ■ : After Mr Woodhouse had expressed himself ! that he preferred to leave'the matter to the order of the court,'and Mr J.A, Cook had intimated that the adult children of the first marriage wished the widow and.the children 'of the second marriage /to participate, Jus Honor, gave . judgment that the.- endorsement was ineffectual under the act, not haying been completed by the statutory notice required, and .being so, ineffective could not., be givori effect itoby a court'of equity, -either asa gift or declaration of trust,' because that wo\ild be I opposed to the intentions of the deceased, 1 derivable from the fact that he adopted the form in the regulations and had left the endorsement incomplete, and therefore the proceeds of the policy of insurance must go to the executors and be dealt with according to , the will of the testator. .'