60 See supra, §§ 700 et seq.

01 Hoare v. Rennie, 5 H. & N. 19. The contract was to sell about 667 tons of iron to be shipped in June, July, August, and September, in about equal portions. 21 tons only were shipped in June, but when tendered were refused because June had then elapsed and no further shipments had been made during the month. The sellers brought action but the defendants' plea setting up that the plaintiffs were never willing or ready to deliver a June shipment according to the contract was sustained. As time is of the essence of mercantile contracts the decision seems sound. The difference between 21 tons and about 167 tons to which the buyer was entitled as a June shipment was material even though it be assumed that the seller would within the four months have delivered the correct total number of tons; and if it be supposed that the seller would only have shipped about 167 tons during each of the remaining three months the materiality of the breach is still more apparent.

62 Freeth v. Burr, L. R. 9 C. P. 208. In Simpson v. Crippin, L. R. 8 Q. B. 14, the buyer had contracted to take from six to eight thousand tons of coal in his wagons from the seller's

colliery in equal monthly quantities for twelve months. During the first month the buyer sent wagons for only 150 tons. This was held not to entitle the seller to refuse to deliver any more coal. The court discredited Hoare v. Rennie, 5 H. & N. 19, and Blackburn, J., who delivered the longest opinion, said: "I prefer to follow Pordage v. Cole" [1 Wms. Saund. 319 (7)]. In view of the fact that Pordage v. Cole is regarded as the leading authority for the medieval doctrine that the promises in bilateral contracts are independent unless the parties have expressly stated a condition (a doctrine which was overthrown by Lord Mansfield, and of which Lord Kenyon said in Goodisson v. Nunn, 4 T. R. 761, that it outraged common sense, and which is now generally regarded as wholly indefensible), this statement seems extraordinary. In Freeth v. Burr, L. R. 9 C. P. 208, there was a contract to deliver 250 tons of iron, half to be delivered in two months, the remainder in four months. Payment was to be made fourteen days after delivery of each lot. The buyer under a mistaken claim of a right to set off loss for delay in delivery of the first instalment refused to pay for it as agreed, and was sued for the

price and only then paid it. The seller because of the buyer's delay in paying for the first instalment refused to deliver the second, but was held liable for this failure to deliver because the non-payment by the buyer did not "evince an intention no longer to be bound by the contract." In Honck v. Muller, 7 Q. B. D. 92, Hoare v. Rennie was approved and other cases distinguished on the ground that in Hoare v. Rennie and in the case at bar no performance at all had taken place. In Mersey Steel Co. v. Naylor, 9 A. C. 434, the contract was for the delivery of 5,000 tons of steel in monthly instalments of 1,000 tons each, payment to be within three days after receipt. The seller delivered a part of the steel, but before payment became due a petition was presented to wind up the company. Under erroneous legal advice the buyer refusal to pay for the instalment unless the sanction of the court was first obtained. The buyer was informed that such refusal would be considered a breach of contract releasing the seller from further obligation. An action was brought for the price of the steel delivered and the buyer counterclaimed for damages sustained by the seller's refusal to deliver the remainder of the steel. The House of Lords held the seller not justified in its refusal-Lords Selborne and Bramwell on the principle stated in Freeth v. Burr, supra, that there was no renunciation or absolute refusal by the buyer to perform

the contract; Lord Blackburn, because the breach did not appear to him to go to the root of the contract. See also Millar's Karri &c. Co. v. Weddel, 100 L. T. 128; Berk v. Day, 13 T. L. R. 475; Payzu v. Saunders, [1919] 2 K. B. 581; cf. Morris v. Baron, [1918] A. C. 1.

63 See in addition to the cases cited in the previous note, Cornwall v. Henson, [1900] L. R. 2 Ch. 298; Newsum v. Bradley, [1918] 2 K. B. 271; Rubel Bronze &c. Co. v. Vos, [1918], 1 K. B. 315, 323; Rhymney Ry. Co. v. Brecon, etc., Ry. Co., 83 L. T. 111; In re Phoenix Bessemer Steel Co., 4 Ch. D. 108; Bloomer v. Bernstein, L. R. 9 C. P. 588. There are strong expressions to the same effect in Colonial decisions. In Bradley v. Bertoumieux, 17 Vict. L. R. 144, 147, it is said: "A contract broken is not a contract rescinded, and unless one of the parties to the contract clearly intimates his intention not to perform his contract, or his inability to perform it, the other party is not at liberty to rescind the contract." See to similar effect, Prendergast v. Lee, 6 Vict. L. R. (Law) 411; Hacker v. Australian, etc., Co., 17 Vict. L. R. 376; Oaten v. Stanley, 19 Vict. L. R. 553, 555; Moroney v. Roughan, 29 Vict. L. R. 541; Edilson v. Joyce, [1917] N. Zealand L. R. 648; Midland Ry. Co. v. Ontario Rolling Mills, 10 Ont. App. 677; Cromwell v. Morris, 34 Dom. L. R. 305. See, however, Muston v. Blake, 11 S. C. New South Wales, 92.

64 See infra, § 867.

of the English statute (St. 56 and 57 Vict. c. 71, § 31, subd. 2), which keeps the contract alive unless the breach is equivalent to repudiation. Note of Commissioners on Uniform Laws, American Uniform Commercial Acts, p. 98; Williston on Sales, pp. 809, 810; 25 Halsbury, Laws of England, p. 220. We have established a new test which weighs the effect of the default, and adjusts the rigor of the remedy to the gravity of the wrong. 'It depends in each case on the terms of the contract and the circumstances of the case' whether the breach is 'so material' as to affect the contract as a whole. "The answer to that question must vary with the facts (Williston on Sales, p. 810). Default in respect of one instalment, though falling short of repudiation, may under some conditions, be so material that there should be an end to the obligation to keep the contract alive. Under other conditions, the default may be nothing but a technical omission to observe the letter of a promise. Williston on Sales, p. 823; National Machine Co. v. Standard Co., 181 Mass. 275, 279, 63 N. E. 900; Wharton & Co. v. Winch, 140 N. Y. 287, 35 N. E. 589. General statements abound that, at law, time is always of the essence. Williston, supra; Norrington v. Wright, 115 U. S. 188, 6 Sup. Ct. 12, 29 L. Ed. 366; Booth v. S. D. Rolling Mills Co., 60 N. Y. 487; Schmidt v. Reed, 132 N. Y. 108, 30 N. E. 373. For some purposes this is still true. The vendor who fails to receive payment of an instalment the very day that it is due may sue at once for the price. But it does not follow that he may be equally precipitate in his election to declare the con

66

tract at an end. Williston, p. 823; Beatty v. Howe Lumber Co., 77 Minn. 272, 79 N. W. 1013, and cases there cited; Graves v. White, 87 N. Y. 463, 466. That depends upon the question whether the default is so substantial and important as in truth and in fairness to defeat the essential purpose of the parties. Whatever the rule may once have been, this is the test that is now prescribed by statute. The failure to make punctual payment may be material or trivial according to the circumstances. We must know the cause of the default, the length of the delay, the needs of the vendor, and the expectations of the vendee. If the default is the result of accident or misfortune, if there is a reasonable assurance that it will be promptly repaired, and if immediate payment is not necessary to enable the vendor to proceed with performance, there may be one conclusion. If the breach is willful, if there is no just ground to look for prompt reparation, if the delay has been substantial, or if the needs of the vendor are urgent so that continued performance is imperiled, in these and in other circumstances, there may be another conclusion. Sometimes the conclusion will follow from all the circumstances as an inference of law to be drawn by the judge; sometimes, as an inference of fact to be drawn by the jury." A similar test was applied as matter of common law in Collins-Plass-Thayer Co. v. Hewlett (S. Car., 1918), 95 S. E. 510.

66 Corey Co. v. Minch, 82 N. J. L. 223, 82 Atl. 304, and see cases in the following section.