CLAIM BY DALGETY AND CO.

Otago Daily Times, Issue 22122, 28 November 1933, Page 5

CLAIM BY DALGETY AND CO.

DECLARATION OF LIABILITY JUDGMENT FOR PAINTIFF ■ Judgment was given by his Honor Mr Justice Kennedy in the Supreme Court yesterday in the case in which Messrs Dalgety and Company, Ltd., claimed fbr a declaration of liability .for £725 l s 6d from Robert Cephas Burgess as the trustee under a deed of assignment made between the Perpetual Trustees Estate and Agency Company, Ltd. (executor of the will of Thomas Thompson Ritchie, late of Dunedin, merchant) and J. B. Waters. At the hearing, on the application of Mr Callan* the names of defendant Waters and the defendant the Perpetual Trustees Estate and Agency Company, Ltd., were ■ struck out of the action. j His Honor’s judgment read as follows: It is not necessary to state the facts as them was no contest on any material matter other than that hereafter mentioned. Mr Black’s evidence was not impeached and it was expressly admitted that, after the death of T. T. Ritchie, j John Biggar Waters and the Perpetual i. Trustees Estate and Agency Company of ' Hew Zealand, Ltd., the executors of the will of T. T. Ritchie, to some extent car- : ried on in partnership the business of ■ Waters, Ritchie, and Co., and that John Biggar Waters had authority, if not express then implied, to write the letter of . June 4, 1930. The original arrangement for, the handling of the company’s business through Dalgety and Co., Ltd., was made by T. T. Ritchie. It follows from Mr Black’s evidence and the subsequent course of dealing is consistent with has evidence that the arrangement was concluded between Dalgety and Co., Ltd., and Waters, Ritchie,-and Co., rather than with T. T. Ritchie personally. The defendant claimed that, the arrangement was unenforceable by action because there did not exist a memorandum or note thereof in writing sufficient to satisfy the Statute of Frauds. The object of the contract ! was to secure for Dalgety and Co., Ltd., the introduction and continuance of safe business and for Waters, Ritchie, and Co. a share upon certain terms in the profit to be derived from business so introduced and continued, The whole transaction was of the del credere type referred to by Vaughan Williams, L.J., in Harburg India Rubber Comb Company v. Martin (1902)', 1 K.B. 778,at 764, and illustrated by a line of cases beginning with Couturier v. Hastie (1852), 8 Exch. 40, and coming down td Sutton and Co. v. Grey (1894), 1 Q.B. 285. The facts now being considered bear, a remarkable .similarity to the arrangement mentioned in the case last cited. There Lopes, L.J., stated the , principle to be applied in deciding whether the case came within the statute or not in the following words: “The true test, he said, “as derived from the cases, is, as the Master of the Rolls has. already said, to see whether the person who makes the promise is, but for the liability which attaches to him by reason of the promise, totally unconnected with the transaction, or whether he has an interest in it mder pendently of the promise. In the former, ' case, the agreement is within the statute; in th? latter, it is not. In the present case; it appears to me beyond all question .that the defendant hatL an independent interest in the transaction, because it was entered into for the mutual benefit ot , the plaintiffs and himself.” I think these ; latter words exactly describe the arrangement proved. Bowen, it.J., and the Court of Appeal took a similar view of the facte in Sutton and Co; v, Grey (supra). It follows that the statute does not apply ’ and that the arrangement deposed to is enforceable by action although not embodied in writing. There is, however, a further reason wny the plaintiff is entitled to the declaration ‘ sought. .On June 2, 1936, Dalgety and Co., Ltd., wrote to Waters, Ritchie, and Co. saying: “We have been waiting particularly for some definite arrangements or payment v c>f this debit. We have written him ” (that is Dow) “ twice_ to effect clearance, but he has not replied. We enclose statement of account to date, and shall be glad if you will clear this, .. otherwise we will need to take some steps ' against Dow.” - l " tWatefs, . Ritchie, - ; and ;i Co. replied in a letter-dated June 4, 1930,. saying: “In reply to yours of the 2nd inst., we beg to state that Mr F. M. Dow is at present fattening for sale the following stock: 1200 lambs (mixed Sexes), 350 old ewes, 650 two-tooth ■ wethers. Until he converts some of this *’tock into' cash we are' unable to make ,ny payment, and he is -at present somevhat hampered in regard to; space at ;he works, which is delaying proceeds. After consultation with the trustees for the. late Mr Ritchie: we have arranged that, although these stock are under lien, half the proceeds will be paid over , to . yolir company out of our account sales until your present debit of £7BO 8s 10a is liquidated. We also undertake on behalf. of our own firm and the _ trustees that the amount will be duly paid in the manner indicated'. We need scarcely add that we regret equally with yourselves the tardiness of this settlement, but it is the best that can be done under the circumstances.” This letter was . not written until after it had', been ascertained by inquiry that, as far as the National Bank was concerned,, the arrangement could be carried out. Three weeks later the bank withdrew consent, but by October 29, 1930, the bank’s hen had been discharged. It was clear that legal proceedings were threatened against Dow, prior to June 4, 1930. The letter of June 4, 1930, amounted to an offer or promise of payment for forbearance during- the time which ' would elapse in making payment in the manner referred to. ■No -proceedings were, in fact, taken against Dow during that time, and Waters, Ritchie, and Co., having had the benefit of the forbearance, must fulfil its undertaking. The case, on the facts, is indistinguishable from Wynne v. Hughes, ,21-W.R. 628, where a court composed of Kelly, C. 8., and Bramwell and Pollock, 8.8., came. to a ‘ similar conclusion. Kelly, C. 8., said; “ There .are two letters to.consider in this ease. The first from plaintiff’s agent to defendant, ‘I have this received the most peremptory instructions to' settle this account. Be good; enough to arrange something by tomorrow;’ The second, in reply from the defendant,-‘lVundertake to pay £SOO on the.account between my late brother, Mr ,G 1 D/Rushes,, and your-client on or before this day three weeks.’ It is true that the plaintiff did not expressly agree .to,;forbear suing for three weeks, but he did' in fact forbear, and' that to me, .independently of all authority, appears to -be a good consideration for the defendant's promise to - pay, and consequently 1 hold that the defendant entered into a good and binding promise.” _ The undertaking was in no way conditional upon ' the bank’s • Co-operation, which was indeed assumed. It follows acordingly , : that the. plaintiff has proved its right to 1 prove as a creditor. There will be a declaration that the plaintiff is entitled to execute- the deed of assignment mentioned in the statement of claim as a creditor-of Waters, Ritchie, and Co., as on March 31. 1931. for the sum of-£722 8s LOd. and accordingly to participate with the other creditors of the said firm of Waters, Ritchie, and Co. in the distribution' of any moneys which are or have been applicable under , the said deed . of assignment in payment of or in reduction of the debts of the said .Waters, 1 Ritchie, and Co. The plaintiff will have judg- ' ment against the defendant for costs according to scale'as upon a claim for £434, with -witnesses' expenses and disbursements to be fixed by the registrar, such costs and disbursements to be paid only out of the-moneys which are in or may * hereafter- come into the' imnds of the defendant Robert Cephas Burgees, or be under his control, as trustee of the said deed of assignment referred to m the statement of claim. ■■ At the hearing of the-case Mr J. »• Callan appeared for the plaintiff and Mr A. N. Haggitt for the defendant.