PART V.

ACTIONS FOR BREACH OF THE CONTRACT.

Remedies of the Seller.

Sect. 49.

Action for

49.—(1.) Where, under a contract of sale, the property in the goods has passed to the buyer, and the buyer wrongfully neglects or refuses to pay for the goods price. according to the terms of the contract, the seller may maintain an action against him for the price of the goods.1

(2.) Where, under a contract of sale, the price is payable on a day certain irrespective of delivery, and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price, although the property in the goods has not passed, and the goods have not been appropriated to the contract.2

(3.) Nothing in this section shall prejudice the right of the seller in Scotland to recover interest on the price from the date of tender of the goods, or from the date on which the price was payable, as the case may be.

1 Scott v. England (1844), 2 D. & L. 520; cf. Kymer v. Suwercropp (1807), 1 Camp. 109 (goods stopped in transitu); Alexander v. Gardner (1835), 1 Bing. N. C. 671 (goods lost at sea).

2 Dunlop v. Grote (1845), 2 C. & K. 153; Mayne on Damages, 4th ed., p. 167.

Sect. 49.

Payment by bill.

Interest.

The general rule of English law is that, in the absence of any different agreement, when a debt becomes due, it is the duty of the debtor to go and tender the amount to his creditor without waiting for any demand.1

Before the Judicature Acts the price of goods sold could be recovered under the common indebitatus counts. The count for goods sold and delivered was applicable where the property had passed and the goods had been delivered to the buyer, and the price was payable at the time of action brought. The count for goods bargained and sold was applicable when the property had passed to the buyer and the contract had been completed in all respects except delivery, and the delivery was not a condition precedent to the payment of the price. Now it is sufficient to shew facts disclosing either cause of action.

The term "sale" includes both a bargain and sale and a sale and delivery. See sect. 62, post, p. 119.

The neglect or refusal to pay must be wrongful. It does not necessarily follow that because the property has passed the price is forthwith payable. The sale may have been on credit, or payment may be made to depend on some specified contingency.3

Where there is an agreement for payment of the price by a bill payable at a future day, and the bill is not given, the seller cannot sue for the price till the bill would have matured. His remedy before that time is by action for damages for breach of the agreement.1 Where a bill is given for the price, the general rule is that it operates as conditional payment. If the bill be dishonoured, the debt revives, and the buyer may be sued either on the bill or on the consideration.5 The general rule of English law is that damages for the detention of a debt are merely nominal, and that in an action for the price of goods sold interest is not recoverable. Interest is only recoverable when there was an agreement for payment of interest, or where the debt was to be paid by a negotiable instrument, or under the special

1 Cf. Walton v. Mascall (1814), 13 M. & W., at p. 458; Fessard v. Mugnier (1865), 34 L. J. C. P. 126.

2 Bullen & Leake's Prec. of Pleading, 3rd ed., pp. 38, 39.

3 Cf. Calcutta Co. v. De Mattos (1863), 32 L. J. Q. B., at p. 328.

Paul v. Dod (1846), 2 C. B. 800; but see Bartholomew v. Markwick (1863), 33 L. J. C. P. 145, where there was a repudiation of the contract. › Chalmers on Bills of Exchange, 5th ed., p. 305. If plaintiff sues on the consideration he must be the holder of the bill at the time of action brought, Davis v. Reilly (1898), 1 Q. B. 1.

Gordon v. Swan (1810), 2 Camp. 429; Beaumont v. Greathed (1846), 2 C. B. 494.

circumstances which give the jury or other tribunal a discretion under the 3 & 4 Will. 4, c. 42, s. 28, to award interest by way of damages.1 In Scotland it seems "the seller may sue the purchaser for the price and interest, whether the goods sold are specific or not, provided goods according to the contract have been tendered to the purchaser." 2 The Act preserves this rule.

Sect. 49.

for non

50.-(1.) Where the buyer wrongfully neglects or Damages refuses to accept and pay for the goods, the seller may acceptance. maintain an action against him for damages for nonacceptance.3

(2.) The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the buyer's breach of contract.1

(3.) Where there is an available market for the goods in question 5 the measure of damage is primâ facie to be ascertained by the difference between the contract price and the market or current price at the time or times 6 when the goods ought to have been accepted, or, if no time was fixed for acceptance, then at the time of the refusal to accept.?

See note to sect. 53 as to non-delivery, and sect. 54 as to special damage. This section deals only with general damages.

Subject to the special case mentioned in sect. 49 (2), where the property in the goods has not passed to the buyer, the seller's only

1 Mayne on Damages, 4th ed., p. 146; L. C. & D. Railway v. S. E. Railway (1893), A. C. 429, see at pp. 440, 441.

2 Mercantile Law Commission, 1855, Second Report, p. 47.

3 See Bullen & Leake's Prec. of Pleading, 3rd ed., p. 239; Graves v. Legg (1854), 9 Exch. 709.

* Cort v. Ambergate Railway (1851), 17 Q. B. 127; Mayne on Damages, 4th ed., p. 10.

5 As to what is a market, see per James, L.J., Dunkirk Colliery v. Lever (1878), 9 Ch. D., at p. 25, C. A.

• Cf. Brown v. Muller (1872), L. R. 7 Ex. 319; Roper v. Johnson (1873), L. R. 8 C. P. 167, as to non-delivery; Mayne on Damages, 4th ed., p. 162.

Phillpotts v. Evans (1839), 5 M. & W. 475; Barrow v. Arnaud (1846), 8 Q. B. 595, at p. 609, Ex. Ch.; cf. Ex p. Stapleton (1879), 10 Ch. D., at p. 590, C. A.

H

Sect. 50. remedy is an action for non-acceptance.1 Where the property has passed he may sue, either for the price 2 or for damages for nonacceptance.

Damages

for nondelivery.

As to damages for buyer's delay in taking delivery, see sect. 37, ante, p. 74.

In some cases where the seller has re-sold, the re-sale price has been assumed to furnish the correct measure of damages.3

Remedies of the Buyer.

51.-(1.) Where the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may maintain an action against the seller for damages for non-delivery.1

(2.) The measure of damages is the estimated loss directly and naturally resulting, in the ordinary course of events, from the seller's breach of contract.5

(3.) Where there is an available market for the goods in question 6 the measure of damages is primâ facie to be ascertained by the difference between the contract price and the market or current price of the goods at the time or times when they ought to have been delivered, or,

1 Cf. Laird v. Pim (1841), 7 M. & W. 478.

2 Unless he has re-sold, in which case he must sue for damages, Lamond v. Davall (1847), 9 Q. B. 1030.

3 Maclean v. Dunn (1828), 4 Bing. 722; Ex p. Stapleton (1879), 10 Ch. D. 586, C. A.

* Bullen & Leake's Prec. of Pleading, 3rd ed., p. 241; Ramsden v. Gray (1849), 7 C. B. 961; cf. Jones v. Gibbons (1853), 8 Exch. 920 (not delivering goods agreed to be delivered "as required "); Lewis v. Clifton (1854), 14 C. B. 245 (refusal to permit growing timber, which had been sold by auction, to be carried away).

5 Smeed v. Foord (1859), 28 L. J. Q. B. 178 (non-delivery of machine); Grebert-Borgnis v. Nugent (1885), 15 Q. B. D. 85, C. A. (specially manufactured goods); cf. Hammond v. Bussey (1887), 20 Q. B. D., at p. 93, C. A. • As to what constitutes an available market, see Dunkirk Colliery v. Lever (1878), 9 Ch. D., at p. 25, C. A.

▾ Mayne on Damages, 4th ed., p. 167; Leigh v. Paterson (1818), 8 Taunt. 540; Hinde v. Liddell (1875), L. R. 10 Q. B. 265 (grey shirtings).

8 As to instalment deliveries, see Brown v. Muller (1872), L. R. 7 Ex.

if no time was fixed, then at the time of the refusal to Sect. 51. deliver.1

This section, in terms, deals only with general damages. Rules as to special damages are saved by sect. 54. The section is declaratory and is founded on Hadley v. Baxendale.

The rules laid down in Hadley v. Baxendale 2 are rules of general application. The measure of general or ordinary damages is the estimated loss directly and naturally resulting from the breach of contract, for those are the damages which a reasonable man would contemplate as the likely result of the breach if he directed his mind to it. The rule as to special damage depends on a similar principle. A party cannot be charged with special damages unless, when he entered into the contract, he had notice of the special circumstances which made the special loss the likely result of the breach in the ordinary course of things. It has been objected to this rule that, when parties enter into a contract, they contemplate its performance and not its breach; but the answer is that the standard of the law is always an objective one. The question is not what the particular parties had actually in contemplation, but what a reasonable man with their knowledge would have contemplated as the likely result if he had directed his attention to it.3 As to special damages, see further note to sect. 54, post, p. 106.

The rule as to market price is clearly a deduction from the more general rule in Hadley v. Baxendale. "When a contract to deliver goods is broken," says Tindal, C.J., "the proper measure of damages in general is the difference between the contract price and the market price of such goods at the time when the contract is broken, because the purchaser having the money in his hands may go into the market and buy. So, if a contract to accept and pay for goods is broken, the same rule may be properly applied, for the seller may take his goods into the market and obtain the current price for them."4 Hence, if

319 (iron); Roper v. Johnson (1873), L. R. 8 C. P. 167 (coal); cf. Bergheim v. Blaenavon Co. (1875), L. R. 10 Q. B. 319 (iron rails).

1 Mayne on Damages, 4th ed., p. 169; Shaw v. Holland (1846), 15 M. & W. 136, 146; Ashmore v. Cox (1899), 1 Q. B. 436, 443 (date of repudiation of contract).

2 Hadley v. Baxendale (1854), 9 Exch. 341, 354; 2 Smith, Lead. Cas., 9th ed., p. 594.

3 Cf. Cory v. Thames Iron Works Co. (1868), L. R. 3 Q. B. 181 (floating derrick), and Hammond v. Bussey (1887), 20 Q. B. D., at p. 100, C. A. ▲ Barrow v. Arnaud (1846), 8 Q. B., at p. 609, Ex. Ch.