THE J. G. WARD FARMERS' ASSOCIATION.

Otago Witness, Issue 2244, 4 March 1897, Page 15

THE J. G. WARD FARMERS' ASSOCIATION.

In the Supreme Court, in Chambers, on Friday, Mr Justice Williams gave the following judgment in ex parte Cooper in re the J. Qt. Ward Farmers' Association :—: — The question in the present case is whether the relation between Messrs Cooper and the Ward Asaociation in respect of the goods sold by the Ward Association was that of vendor and parchaser or of principal and agent. That depends upon the true construction of the written contract between them. Reliance was placed by counsel on behalf of the liquidator on ex parte White re Neyill (»> Ch., 3.97). As pointed out by .Tames L.J. in ex parte Bright in re Smith (10 Ch. Div., p. 572), that was a decision upon the particular facts. In that case there vras no written agreement, and the relations of the parties had to be inferred from the course of dealing between them. In the present case the terms of the written agreement are in many respecti very similar to the terms of dealing found by the court to have existed between the parties in ex parte White re Nevill, but at the same time there are differences which, in my opinion, are material. The judgments in ex parte White re Nevill show that the court, in order to determine the relation between the parties, gave weight to every fact brought before them. Reliance was placed upon the circumstance that the alleged agent was authorised to manipulate the g o is and alter their character in curtain ways at his discretion before sale, and also uimn the circumstance that when so altered he could sell them at any price he chose. In the present case the agent has no power of manipulating lh- goods. By the terms of the contract the st ck in the hands of the agent is to remain the property of the proprietors, and is to be absolute yat their disposal. Nor can the agent Bell below a fixed limit of price Here a' so there is the express provision that the agent undertakes the risk ot bad debts. This would be wholly unnecessary if the intention of the parties was that the Ward Assoc'ation were to sell on their own behalf, furthermore, it is clear from the agieement that it was the intention of the parties that contracts of sale with sub-agents or traders should be made on the Waid Association on behalf of Messrs Cooper and not on their own account. The agreement provides that it shall be a condition of j sale or consignment to sub-agent* or trader* that they shall not re3?ll below the prices mentioned

in the agreement. This stipulation must necessarily be a part of the contract of sale, for otherwise there would be no consideration for it. It must therefore be made with the actual vendors. Tbe provision for the insertion of this stipulation is intended to protect Messrs Cooper and to enable them, in the event of a breach of the stipulation, to sue either for damages or an injunction. If Messrs Cooper coul.t not themselves sue for a breach of ihn stipulation the provision would be of no avail. The insertion of this prjvision seems to mrf to show conclusively that in the case of sales to sub-agents or traders it was not intended that the Ward Association should contract as principals. If this is so it is difficult to see why other sales effected by the Ward Association under the same agreement should be on a different footing. There is nothing in the agreement to suggest that the rights of the Ward Association to the money i received from sales are to be different in the two cases. It is suggested that because it is to be inferred from the agreement that the Ward Association are entitled to mix the money received with their own, and to make use of the monoy, merely accounting yaar by year for a specified amount of the proceeds of salea, it is a further and a necessary inference in all cases that it must have been intended by the agreement that the Ward Association, when selling, were to be in the position of principals. If there were nothing in the agreement to negative the latter inference, I admit it would be a necessary one, but in my opinion the agreement contains matter sufficient to negative it. If an agent to whom goodß are consigned is authorised to sell in such a way as to give his principal a right of action on the contract, the right of action is vo<; taken away because thare is a further bargain between the principal and the agent, either that, the agent is t to have the use of the purchase money for * time and is to account to his principal periodically, or that the agent, if he sells on credit, i* bound to account to the principal in cash. In such a case, if the bankruptcy of the agent intervened, moneys receivfid by the agent before the bankruptcy in respect to sales might be considered ai not im- i pressed with any tiusfc, but merely as lent to the j bankrupt. The principal, however, would still | retain his right of action against the purchasers ! in respect to goods sold before tho bankruptcy but not paid for. I think it is to b« inferred from the terms of the present agreement that the Ward Asaociation, though they may not have been constituted del credere, agents in the strict dense of the term, were yet intended to enter into contracts of sale as agents and not an principals. If that is so Messrs Cooper are entitled to recover from the liquidator the proportion to which they are entitled of moneys received by him since the liquidation for salrs of their dip and to be hereafter received. With respect to moneys > eceived 1 by the association before the liquidation, as they J cannot now be traced the only claim in to be j allowed to prove. This is, of course, admitted. |