Misrepresentation

loss as a result of what would naturally and reasonably follow from being fraudulently induced to make the contract, and as he had not concluded his case and still had an opportunity of showing that his claim came within the above statement of the law the application for nonsuit must be refused. WALKER v. EYRE, 19 M.C.R. 95. [New Zealand.] Fraudulent Rescission of contract Damages Basis of assessment. The respondents brought separate claims against the appellant founded on allegations of misrepresentation, and, alternatively, of fraudulent misrepresentation, and asking for the rescission of contracts for the purchase of apple orchards, and, in the event of the misrepresentations being proved fraudulent, for damages in addition. The respondents relied mainly on two representations which they alleged to be false and fraudulent. Hosking, J., in the Supreme Court, held, that both representations were false and fraudulent. He refused rescission, but awarded damages, in ascertaining which he allowed and included certain expenditure incurred by the respondents by reason of their contracts. Held, on appeal (allowing the appeal), that fraudulent misrepresentation had not been proved. Per Stout, C.J.: That the damages had been assessed on 8 wrong basis. Piggford v. Tasman Orchards Co. (1923 G.L.R. Piggford v. Tasman Orchards Co. (No. 2) (1923 G.L.R. 128) reversed. PIGGFORD v. TASMAN ORCHARDS Co.; THOMPSON v. TASMAN ORCHARDS Co., 1924 N.Z.L.R. 732; G.L.R. 22. [New Zealand.]

17);

Rescission-False representations Inducement-Contract made by Crown-Agents of Crown not relying on representations. The right of the Crown to a rescission of a contract on the ground that it was induced by false representations must depend on the effect of the representations upon the minds of those who as agents of the Crown made the contract. If those agents, knowing of the representations, placed no reliance on them, the fact that persons who advised the agents, as to making the contract, in giving their advice relied on the representations is not a ground for rescission. Decision of the Supreme Court of New South Wales (Harvey J.) affirmed. ATTORNEY-GENERAL OF NEW SOUTH WALES v. PETERS, 34 C.L.R. 146. [High Court.]

Sale of chattel interests-Fraudulent misrepresentation by seller-What constitutes a material misrepresentation-Whether essential part of cause of action--InducementWhat amounts to Pleading — Disaffirmation before action-Appeal-Course of conduct at trial. In an action by a purchaser for rescission of a contract of sale on the ground of fraudulent misrepresentation by the seller, semble, it is not strictly an essential element of the cause of actionwhich must be alleged and proved-that the representation was a material representation; it is sufficient if the plaintiff proves that the representation was false to the knowledge

of the defendant, that it was made for the purpose of inducing, and that it did in fact induce, the plaintiff to enter into the contract. To constitute a material representation it is not necessary that it should be of such a nature that it would be likely to induce an ordinary reasonable man (as distinguished from the particular plaintiff in the particular case) to enter into the contract; it is sufficient if, to the knowledge of the defendant, having regard to the special circumstances of the particular case, it would be likely to induce the particular plaintiff to enter into the contract. From the fact that the representation was material, the inference may be drawn that it was made for the purpose of inducing and that it did in fact induce; and, e converso proof that the representation was made for the purpose of inducing and that it did in fact induce, affords evidence from which the inference may be drawn that it was material; thus, in all actions which succeed, the materiality of the representation is in reality proved, either directly-as where the representation is obviously of such a nature as to be likely to induce-or indirectly as where it is proved (apart from the nature of the representation itself) that it was made for the purpose of inducing, and that it did in fact induce. Purchasers under two contracts for the sale of the seller's interests in two ventures of highly speculative value sued for rescission of the contracts and return of all moneys paid, or alternatively for damages for deceit. The plaintiffs (in substance) alleged that, in order to induce them to enter into the contracts the defendant represented that he had boen offered

96

a very large sum of money" for his interests and had refused the same; the jury found (in substance) that the representation was made, that it was false to the knowledge of the defendant, and that the plaintiffs were induced by the representation to enter into the contracts. Held, that the representation was one of fact and not a mere expression of opinion as to value; that the representation was capable of being a material representation that the relationship between the plaintiffs and the defendant was such that the plaintiffs would be likely to be greatly influenced by statements made by the defendant; that there was evidence to justify the findings of the jury; and that on those findings (having regard to the conduct of the case at the trial as to the allegation that the representation was made in order to induce) the plaintiffs were entitled to recsission and consequential relief. Smith v. Kay (7 H.L.C. 750); Smith v. Chadwick (9 A.C. 187, at p. 196); and Brown v. Smitt (1924 V.L.R. 333) discussed and applied. In such a case the issue and service of a writ claiming rescission on the ground of fraud is sufficient evidence of an election by the plaintiffs to avoid the contract, and they need not disaffirm it before action. Clough v. The London and North Western Railway Co. (L.R. 7 Ex. 26) followed. Observations on the effect of the course taken at the trial by counsel as regards appeal. Nevill v. Fine Art and General Insurance Co., Ltd., ([1897}

A.C. 68), and Seaton v. Burnand ([1900] A.C. 135) applied. The form of pleadings in actions for rescission of contracts on the ground of fraud discussed. Judgment of Schutt, J., affirmed. NICHOLAS v. THOMPSON, 1924 V.L.R., 554; 30 A.L.R. 359; 46 A.L.T. 82. [Victoria.]

Breach-Election to rescind-Suit for rescission-Restitutio in integrum-Delivery up and cancellation of documents-Inquiry as to expenses of investigating title.-By three separate agreements, T. agreed to purchase from W. a property, A., and to sell to W. a property B., and W. agreed to sell certain sheep to T. The first two contracts were expressed to be dependent each on the other, and the third to be interdependent on the other two. Possession of the property A. and of the sheep was given to T., and shortly afterwards in breach of his contract, he sold the sheep and expended the proceeds of the sale. Subsequently, W. gave notice to T. that he rescinded the agreements in respect of the properties A. and B. After notice of rescission, T. mortgaged and then re-sold the property B., and he still retained possession of the property A. In a suit brought by W. against T., the latter pleaded (inter alia) that to the knowledge of W. he had re-sold the sheep and that restitutio in integrum could not be effected. The Court on the facts found that W. was entitled to and had duly rescinded the agreements in question and that T. had adopted such rescission. Held (1) that T. could not be allowed to set up his own wrongdoing as an answer to W.'s claim to obtain from him such restitution as was possible in the circumstances, and (2) that W. was entitled to a declaration that both the agreements in question were duly rescinded and to an order for the restoration of his property A. Held, also, that W. was

in the circumstances entitled to an order that copies of the agreements be delivered up for cancellation, and to an inquiry as to his expenses incurred in investigating T.'s title to the property B. WOODHOUSE v. THUR24 S.R. 342; 41 W.N. 76. [New ECHT, South Wales.]

What

Trover Conversion of goods amounts to Goods received by carrierNon-delivery-Mislaid or lost.-In an action by a consignor of goods against a carrier for conversion it appeared that the carrier, under a general authority from a consignee, signed for a parcel at a railway station. The carrier's duty was to collect any parcels arriving at the station for the consignee and to deliver them at his place of business. The parcel signed for was never delivered to the consignee. The disappearance was not discovered for some weeks and was not accounted for in any way. The carrier said that if he ever received the parcel it must have been delivered to the consignee. There was no suggestion of any wrongdoing. Held, even assuming that the defendants received the parcel, that in the absence of any evidence that they retained it in such circumstances as to amount to a repudiation or disregard of the title of the plaintiffs to the goods, the facts proved were not sufficient to establish a conversion. JOULE LTD. v. POOLE & ANOR., 24 S.R. 387; 41 W.N. 89. [New South Wales.]

Hire-purchase agreement-Motor car-Exchange between hirer and company for another car-Sale by company.-See SALE OF GOODS, col. 388.

Sale of chattel by person not ownerNot in vendor's possession-Delivery-License to buyer to take possession-Action for conversion.-See SALE OF GOODS, col. 399.

CONVEYANCING.

Vendor and purchaser-Interest in landGrowing timber-Parties conveying as mortgagees-Express covenant by owners to obtain necessary consents and licenses-Whether implied covenants for title and quiet enjoyment negatived thereby-Whether parties conveying as mortgagees would be relievedCovenants affecting such mortgagees Property Law Act 1908, ss. 49, 56, 61.FAUSETT v. KELEHER, 1924 N.Z.L.R. 1. [New Zealand.]

Same case 1923 G.L.R. 439; 1923 Digest, col. 73.

Person preparing instrument in writing relating to real estate-Offence-Corporation. -See COMPANY, col. 53.

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least one gramophone record of each of these two works, but there was no evidence that the defendants, at the time of the selling, knew of the existence of the copyright nor was there any evidence of a threat to continue to infringe it after notice thereof. The defendants, however, on the hearing of the application in effect refused to give an undertaking not to commit any breach pending the hearing of the suit. Held, that "selling a gramophone record was not included in the words publish any translation in s. 1 (2) of the Imperial Copyright Act 1911 adopted by the Copyright Act (Federal), 1912 No. 20) nor was it an authorizing of any of the Acts, the sole right of the owner, mentioned in s. 1 (2) of the Act, and that accordingly the defendants had neither done nor threatened any of the acts mentioned in that subsection. Held, also, that as the evidence had failed to establish a breach or threatened breach of the plaintiff's rights under s. 2 (2) of the above mentioned Act, no inference of a threat to continue to sell could be drawn from the fact that the defendants had refused to give any undertaking not to do so, and that the defendants therefore were entitled to an order dismissing the motion. D. DAVIS & Co. LTD. v. GRAFONOLA LTD., 24 S.R. 458; 41 W.N. 115. [New South Wales.]

COSTS.

High Court Costs-Taxation-Costs of appeal Costs of opposing motion for special leave. Costs of a motion for spectial leave to appeal to the High Court are costs of the appeal. Upon an appeal to the High Court by special leave an order was made that the repondents' costs of the appeal should be taxed, and paid by the appellant. The respondent had voluntarily appeared upon the motion for special leave and unsuccessfully opposed it, but no order had been made as to the costs of the motion. Held, that the respondent was entitled to his taxed costs of the motion for special leave if he established that such costs had not been incurred unnecessarily or through over-caution. GORDON & GOTCH (AUSTRALASIA) LIMITED v. Cox, 32 C.L.R. 465; 30 A.L.R. 117. [High Court.]

Extra counsel's fees-Rules of Court.-The power to certify for extra counsel's fees given by item 17 of the Fourth Schedule to the Rules of Court of 1st July, 1923, is exer. cisable only in cases in which the amount recovered exceeds £100. HARRIS v. FARRELL, 1924 S.R. (Q.) 27; 18 Q.J.P.R. 20. [Queensland.] Same case, on another point, under Evi

DENCE.

Garnishee order-Appearance by garnishee -Costs. When a garnishee appears on the application to make the order nisi absolute, he should receive his costs of so appearing if the facts of the case are not fully explained in the affidavits filed in support of the order nisi. DEAN v. DWYER; LIVERPOOL, LONDON

& GLOBE INSURANCE COY., GARNISHEE, 41 W.N. 67. [New South Wales.]

Practice Supreme Court and Circuit Courts Act, 1900 No. 35, s. 39-Rule 24 Increased scale. In appropriate cases, e.g., where the importance of the right contested is sufficiently great, the Court may order costs to be taxed on a scale higher than that which would ordinarily apply considering the amount of the verdict recovered. GAWLER บ. LINDEMAN AND ANOR., 41 W.N. 52. [New South Wales.]

Execution for costs-Lapse of more than six years from making of decree-PracticeEquity rules.-Execution for costs, which the defendant by decree made in 1914 was ordered to pay, had not been issued as he had no property on which execution could be levied. Recently, however, he had become entitled to a life interest in his deceased wife's

estate. On an ex parte application for leave to issue execution notwithstanding the lapse of more than six years from the making of the decree. Held, that leave as asked should be granted, and that in the circumstances of the case notice to the defendant of the making of the application was unnecessary. MCPHILLAMY . CAMPBELL, 24 S.R. 211; 41 W.N. 31. [New South Wales.]

Solicitor's bill-Application to tax-Rule 402 Special circumstances. On making an order referring a bill of costs to taxation, leave was reserved to the respondent to come in and take out a summons to vary or cancel the order on or before a certain day. That day was a Court holiday, and the summons was taken out on the next day under r. 402. Held, that although it is the practice of the Court when there is a Court holiday, to have an officer in attendance and to allow a person to file documents on payment of an extra fee, he is not bound to attend and pay the extra fee, but may wait till the day in which the office is next open. Re GRIGG, 41 W.N. 124. [New South Wales.]

Practice Special scale-Money claim indorsed on writ-Notice by defendant-Subsequent amendment of writ adding claim not a money claim-Judge not "otherwise ordering as to costs at trial. Plaintiff commenced an action, claiming, by the indorsement on his writ, a sum less than £500 as due on a covenant. The defendant gave notice, as provided by O. LXV., r. 29 (a) of the Rules of the Supreme Court, of her intention to proceed under the special scale of costs in Appendix N. At the trial plaintiff obtained leave to amend by adding claims for a declaration, an injunction and an inquiry. On these claims, judgment was entered for plaintiff with costs. On taxation, plaintiff claimed that by virtue of the amendments allowed, O. LXV., r. 29 (a) was no longer applicable. Held, on reference by the Taxing Master, that, the Judges, not having otherwise ordered within the meaning of that rule, the costs were to be taxed on the

44

special scale. BUTTNER v. BUTTNER, 1924 V.L.R. 229; 45 A.L.T. 142; 30 A.L.R. 155. [Victoria.]

Whether action more fit to be heard in Supreme Court than Local Court-Damages in breach of promise action-Refusal of certificate -Local Courts Act 1886, s. 41.-In an action in the Supreme Court for breach of contract of marriage in which the jury awarded £300 damages, there being no difficulties of law or fact to justify a certificate that the case was more fit to be tried in the Supreme Court than in the Local Court. Held, that as (1) the limited power of discovery of documents in the Local Court would have been sufficient for the plaintiff's purposes; (2) there was no reasonable expectation that the plaintiff could recover damages in excess of what a Local Court could award, and (3) there was no reasonable apprehension that the plaintiff would not get a fair trial in the competent Local Court, a certificate should not be granted that the action was more fit to be tried in the Supreme than the Local Court. MILES v. PATTERSON, 1923 S.A.S.R. 470. [South Australia.]

Action for libel-Nominal damages-Action justified Certificate for costs awarded to plaintiff Code of Civil Procedure, r. 557.— Plaintiff obtained judgment for less than 40s. and was, under rule 557, disentitled to the costs of the action unless the presiding judge certified therefor. The action was one for libel contained in a letter published by defendant, and the defences raised were those of privilege and fair comment. The jury found that there had been express malice on the part of defendant, thereby depriving him of the benefits of his privilege, and awarded plaintiff nominal damages. The presiding judge considered that plaintiff was fully justified in bringing the action to vindicate his character, which latter he had succeeded in doing. Held, that he was entitled to the costs of the action on the lowest scale, with witnesses' expenses and disbursements. Macalister v. Steedmaan (27 T.L.R. 217); Curlett v. Lyttelton Times Co. (11 G.L.R. 747) and Beath v. Goldsborough. (1918 G.L.R. 186) followed. MAY ROBINSON, 1924 N.Z.L.R. 1159; G.L.R. 315. [New Zealand.]

V.

Two defendants-Costs of successful defendant-Whether payable by plaintiff or by co-defendant.-Plaintiff originally brought action against B., but in consequence of an allegation by B. plaintiff applied for and obtained an order joining L. as a defendant. After B. had given his evidence, in which he expressly retracted the allegation which had led to L. being joined as a co-defendant, counsel for plaintiff admitted that he could not maintain the action against L. jury did not agree in the case against B. and were discharged. Held, that if plaintiff should succeed in his action against B. it might be necessary to determine whether B. or the plaintiff should pay L.'s costs, and that the answer would depend upon whether

The

in the circumstance B. by his conduct had made it reasonable and proper to join L., Besterman v. British Motor Co. ([1914] 3 K.B. 181) applied, but that as the case stood L. was a successful defendant and entitled to his costs of the action. SMITH 1. BRACKEBUSH, 1924 G.L.R. 563. [New Zealand.]

Action in Supreme Court-Reference to arbitration-Costs of reference-Power to grant-Arbitrators Jurisdiction to award themselves fees. In an action brought in the Supreme Court, the trial Judge referred all matters in difference to arbitration, and under O. XCVII. he also ordered that the certificate of the arbitrators should be entered and treated as a step in the action, and reserved all questions of costs of the action, the reference to arbitration, and the certificate. The arbitrators gave findings on all matters referred to them, and embodied the same in their certificate, but in addition they further certified that the fees for the umpire and themselves amounted to £226, which sum they apportioned. Held, that the Supreme Court had a general power to grant costs of the reference. Arbitrators have no jurisdiction to award themselves a specific sum for fees or to insist that such fees should be paid before their certificate is handed over. STEWART v. HENNING, 1924 S. R. (Q.) 37. [Queensland.]

Taxation between party and party-Two counsel Junior counsel-Partner of senior counsel-Matrimonial Rules. In a divorce suit there were four co-respondents, against, each of whom £1,000 damages was claimed. It was to be anticipated that the trial would be lengthy, and that a large body of evidence would be called. The evidence against the co-respondent F. proved to be of a flimsy nature, and he was dismissed from the suit at the trial at the close of the petitioner's case, and was awarded his costs against the petitioner. The Master disallowed the fees to the second counsel. Held, that the propriety of employing two counsel was not to be judged by the nature of the petitioner's case as it appeared on its close at the hearing, and that, in the circumstances known to F. at the time when briefs ought to be delivered, it was proper for him to employ two counsel. The Master in his reasons for disallowing fees to second counsel stated that the practitioner did not act as second counsel, having neither examined nor cross-examined witnesses nor addressed the Court and having been absent altogether during a considerable portion of the trial. Held, that the fact of the practitioner not having examined or crossexamined witnesses or addressed the Court did not establish that he had not acted as counsel. Held, also, as the onus of proving that the practitioner acted as counsel lay on the co-respondent, and there was nothing before the Master to show this, and both parties and the Master having misconceived the law as to the onus of proof, that the Master should review the disallowance and ascertain whether the practitioner had acted as counsel. Both counsel employed by the

co-respondent were members of the same firm. The Master gave as a further reason for the disallowance that the employing of two counsel from the same office is in respect of one of them an unusual expense. The co-respondent had given special instructions to employ the two practitioners as counsel. Held, that a client who has given special instructions for the employment of a practitioner in a case where it is proper to employ two counsel must pay him as such if the practitioner does the work of counsel. Svarfe v. Commissioner of Taxation (unreported) followed; Hutchinson v. Brown (1906 S.A.L.R. 136) distinguished. The allowance of one-third increase upon taxed costs under R.S.C. 1913, O. LXII., r. 84 (as amended on 20th September, 1920) does not apply to profit costs in a matrimonial suit under the Matrimonial Causes Act, No. 3 of 1867. Fees to counsel are to be regarded as disbursements whether they are paid to counsel retained who is not in the office of the solicitor instructing him, or to a partner of the instructing solicitor, or to the solicitor himself if he acts as counsel, and the increase is not allowable in respect of these fees. BICKFORD V. BICKFORD AND FRYBERG, 1923 S.A.S.R. 148. [South Australia.]

Allowance to second counsel from same office. On the hearing of an action fit for two counsel, the fees paid to the junior counsel, who was a partner of the leading counsel, were disallowed on party-and-party taxation on the ground that the expense of employing two counsel from the same office was a luxurious, unnecessary and unusual expense. The Taxing Master, on review, in his reasons stated that he thought the case was a proper one for two counsel, but that he was not satisfied that the solicitor, who was also the junior counsel, had sufficiently warned the client that he would be entitled to have his services at the hearing in the capacity of solicitor. The solicitor had advised the client that the case was a proper one for two counsel, and also that if he appeared, his fees might be disallowed and would then be payable by the client personally. The client said that he wished the solicitor to appear as junior counsel whether he recovered his fees or not. Held, that the functions of counsel responsible for the conduct of the case are distinct from those of a solicitor instructing counsel, and that there is no overlapping work, for which a solicitor appearing as counsel will be paid twice over, and that as the client had received sufficient warning, the fees to the junior counsel should be allowed. McDONALD v. DORRELL, 1923 S.A.S.R. 180. [South Australia.]

Solicitor-Taxation of mortgagor's solicitor's bill of costs-Procuration fee and fee for preparing and perusing mortgage.-B. and J. solicitors, were instructed to act for a client in certain business in which was included the raising of a loan of £2,500 upon security of a first mortgage of £3,600. The loan was effected by a sub-mortgage of the original mortgage and was arranged through another solicitor D., whose charges amounted