DEAL IN OATS

Southland Times, Issue 21147, 29 July 1930, Page 4

DEAL IN OATS

AN APPEAL SUCCEEDS. JUDGMENT FOR £5,315. A dispute between Wright, Stephenson and Co., Ltd., and the New Zealand Loan and Mercantile Agency Co., Ltd. over a transaction in a considerable quantity of oats has involved considerable litigation since the parties first disagreed. When the case came before the Supreme Court some months ago his Honour the Chief Justice (Sir Michael Myers) gave judgment for the New Zealand Loan and Mercantile Agency Co. for the recovery from Wright, Stephenson and Co. of £5315 6/7, with £436 4/8 for costs. At the time his Honour delivered his judgment he stated that he had found the case a difficult one and would welcome an appeal. This was made to the Court of Appeal recently, and the Court has delivered its judgment, respectfully disagreeing with the Chief Justice’s decision and finding in favour of the appellant, Wright, Stephenson and Co. Ltd. The action was in respect of 4000 sacks of A grade Garton oats which the New Zealand Loan and Mercantile Agency Co. contracted in 1928 to purchase from Wright, Stephenson and Co., and several other parcels totalling 1649 sacks purchased by the New' Zealand Loan and Mercantile Agency Co. from third parties, who had previously bought them from Wright, Stephenson and Co., and in connection with which store warrants had been issued by Wright, Stephenson and Co., such warrants being subsequently endorsed over to the New Zealand Loan and Mercantile Agency Co. Delivery of the total sacks of oats, namely 5649, was not accepted by the New Zealand Loan and Mercantile Agency Co.; first, because each sack had not been branded; secondly, because each sack had not been sampled and graded by a Government grader. Each of the Judges who sat in the Court of Appeal (their Honours Mr Justice Herdman, Mr Justice Reed, Mr Justice Adams and Mr Justice Ostler) gave a separate written judgment. All agreed that the appeal by Wright, Stephenson and Co. should be allowed. '

In the course of his judgment Mr Justice Herdman said that the quantity of oats, the appellant contracted to sell was tendered and it could not be disputed that the very kind and quality of oats which respondent agreed to pay for' and had paid for were tendered for delivery. Because each sack did not bear letters, which, except, for identifying purposes, were meaningless, and because the grader of the oats had not graded and sample oats which were in fact of the grade and sample purchased, the respondent claimed a right to reject the goods. The real explanation for the rejection of the oats was that the price of oats had fallen since the purchase was made. In his judgment the Chief Justice held that there was a failure of consideration and that the respondent was entitled to recover the amount of the purchase money. The appellant claimed it did all it was required to do under its contract. Mr Justice Herdman found that an appropriation having been made at the instigation of the buyers, an assent having been given to that appropriation, payment having been made, the property having passed, and respondent having got precisely what it bargained to buy, there could be no failure of consideration. Regarding another ground upon which the respondent rested its claim in the Court below, his Honour said that the respondent company was tendered or had delivered to it all it was entitled to get and as the presence of the letters in the store warrants did not and could not detract in any way from the benefits enjoyed by it under the bailment, the claim founded upon conversion could not in his judgment succeed.

His Honour Mr Justice Reed, in concluding his judgment, said that there was no representation, express or implied, that each sack was branded or marked. There was therefore no estoppel, and as it had been proved that the oats delivered were the same oats as referred to in the store warrant there was no conversion. For the same reasons there was no conversion of the oats in the second series of transactions.

“In the circumstances of the present case,” said Mr Justice Adams, “the errors as to brands or marks are immaterial, there being no stipulation in the contracts for any brand or marks.” His Honour also agreed that the claim on the ground of conversion must fail, and that the appeal should be allowed. “In my opinion,” said the judgment of Mr Justice Osteler, “the respondent company has no claim at all against appellant company, unless it can show that there is any difference in value between the 4000 sacks of oats tendered wit... .t those arbitrary brands, and their value if they had all been branded. Such a claim would, of course, be absurd.” The appeal was allowed with costs on the highest scale, and judgment was directed to be entered in the Supreme Court for Wright, Stephenson and Co. with costs according to scale upon a judgment for £5315, witnesses’ expenses and disbursements. Three extra days were certified for at £l5 15/- a dav and four days for second counsel at £7 7/ a day. At the hearing Mr H. F. O’Leary and Mr H. E. Evans appeared for the appellant, and Mr A. Gray, K.C., with him Mr C. A. L. Treadwell, for the respondent.