APPEAL DISMISSED

Southland Times, Issue 21265, 11 December 1930, Page 6

APPEAL DISMISSED

DAIRY COMPANY AND SUPPLIER. TERMS OF SUPPLY. (Per United Frees Association.) Wellington, December TO. The Appeal Court delivered judgment today in the case of the Eltham Dairy Company v. Johnson,- which was heard on March 28. The delivery of this judgment was delayed pending a decision in the House of Lords of a case which it was thought would affect the judgment. The Chief Justice (Sir Michael Myers), in the course of judgment said: “In the present case the contract between the respondent as supplier and the company is constituted by the delivery and acceptance of the produce. The terms on which the produce -was delivered by the supplier and accepted by the company as at the date when such a supply' and the acceptance commenced, are to be found in the articles of 1910. The parties must be assumed to have agreed that these were the terms of contract in 1917. The company altered its articles by special resolution and radically altered the terms dealing with the supply of butterfat, and milk. The alterations did not affect the respondent so long as he supplied all his milk and butter-fat, which he did until 1924. Consequently he received payment in the same way’ as under the articles that existed prior to 1917. He would therefore have no knowledge or notice merely’ -from the course of business between the parties that any alteration had been made in regard to the payment for the milk and butter-fat supplied by him to the company. «If he had notice or knowledge of the alteration and had continued to supply’ he would have been deemed bound by the alteration in the articles. The judge in the Court below found as a fact that the respondent had no such notice or knowledge and the company therefore sought to rely’ upon the doctrine of constructive notice. In our opinion, that doctrine has no application to a case like the present. It was not until the 1924-25 season, when for a period of months, the respondent had supplied only’ a portion of his milk and butter-fat, that the company’ sought to pay him on a basis different from that which had previously been acted upon and until then, as the Judge in the Supreme Court found, the respondent had no notice of the alterations made in 1927. The company has only itsjelf to blame for the position in which it now finds itself in its relations with the respondent. Its proper course, when the articles were altered in 1917, was to give every supplier express notice of alterations. The respondent, had he receivsuch notice, would then have had the option of either discontinuing his supply to the company and making arrangements elsewhere or continuing on the. altered terms. This opportunity was not given him.”

Judgments to the same effect were also written by Mr Justice Herdman and Mr Justice Smith., The appeal was accordingly dismissed.