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paid for in the customary manner, that is, part by acceptance on receipt of the customary documents, and part by paying the freight on delivery, and the other party binds himself to pay that fixed price. Each party there takes upon himself the risk of the rise or fall in price, and there is no contract of agency or trust between them, and therefore no commission is charged.

But it is also very common for the consignor to be an agent, who does not bind himself absolutely to supply the goods, but merely accepts an order by which he binds himself to use due diligence to fulfil the order. In that case he is bound to get the goods as cheap as he reasonably can, and the sum inserted in the invoice is the actual cost and charges at which the goods are procured by the consignor, with the addition of a commission; and the naming of a maximum limit shews that the order is of that nature. It would be a positive fraud if, having bought the goods at a price including all charges below the maximum limit fixed in the order, he, the commission merchant, were, instead of debiting his correspondent with that actual cost and commission, to debit him with the maximum limit; nor can I doubt that in an action brought against him as an agent for not accounting properly, this extra sum would be disallowed.

The contract of agency is precisely the same as if the order had been to procure goods at or below a certain price, and then ship them to the person ordering them, the freight being in no ways an element in the limit. But when, as in the present case, the limit is made to include cost, freight and insurance, the agent must take care in executing the order that the aggregate of the sums which his principal will have to pay does not exceed the limit prescribed in his order; if it does the principal is not bound to take the goods. If by due exertions he can execute the order within those limits he is bound to do so as cheaply as he can, and to give his principal the benefit of that cheapness. The agent therefore, as is obvious, does not take upon himself any part of the risk or profit which may arise from the rise and fall of prices, and is entitled to charge

commission because there is a contract of agency.

I should apologize for stating so precisely what your Lordships doubtless know already, if it were not that I think one of the learned Judges in the Court below has fallen into a fallacy from not recollecting what I am sure he well knew. It is quite true that the agent who in thus executing an order ships goods to his principal is in contemplation of law a vendor to him. The persons who supply goods to a commission merchant sell

them to him and not to his unknown foreign correspondent, and the commission merchant has no authority to pledge the credit of his correspondent for them. There is no more privity between the person supplying the goods to the commission agent and the foreign correspondent than there is between the brickmaker who supplies bricks to a person building a house, and the owner of that house. The property in the bricks passes from the brickmaker to the builder, and when they are built into the wall, to the owner of that wall; and just so does the property in the goods pass from the country producer to the commission merchant; and then, when the goods are shipped, from the commission merchant to his consignee. And the legal effect of the transaction between the commission merchant and the consignee who has given him the order is a contract of sale passing the property from the one to the other; and consequently the commission merchant is a vendor, and has the right of one as to stoppage in transitu.

I therefore perfectly agree with the opinion expressed by Baron Martin in the Court below, that the present is a contract between vendor and vendee; but I think he falls into a fallacy when he concludes therefrom that it is not a contract

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superadded sale is not in any way inconsistent with the contract of agency existing between the parties, by virtue of which the plaintiffs were under the obligation to make reasonable exertions to procure the goods ordered as much below the limit as they could.

If this view be correct it shews that the point raised at your Lordships' bar as to whether the evidence received was that of a custom does not really arise. A commission merchant using reasonable exertions to get the goods as cheap as possible, ought to buy them in small parcels if the state of the market in the country is such that it is the reasonable way to get them. If the merchant would get the goods cheaper by giving a wholesale order to the manufacturer, which probably would be the case in England, where Manchester goods are ordered from a London or Liverpool commission agent, he ought to give the wholesale order.

The evidence shews the circumstances under which the plaintiff's acted, and that the course they pursued was a reasonable one under those circumstances.

Having said thus much, I now come to what I take to be the real question, namely, what is the construction of the letter of the 25th of July, 1864 ?

One question is, whether the order required the plaintiff to procure a vessel which should carry the defendant's sugar and no other goods. I am of opinion that it does not. The letter expresses a wish that, if possible, the defendant should have the option of sending the vessel to London, Liverpool or the Clyde. It is rarely possible to obtain a ship which is to call for orders unless the whole ship is chartered, and, therefore, it is probable that in order to give the defendant this option the plaintiff's would have required to charter the whole of a vessel. If a vessel could have been procured willing to obey the defendant's orders, and deliver his goods as required, I do not see what harm it would do the defendant if that ship was larger than was required, and the superfluous space was utilized in any way consistent with his contract. And therefore, if necessary, I should advise your Lordships to reconsider the decision of the Court of Exchequer in

Krenger v. Blanck (4). But it is not necessary to reconsider it, for the defendant gave the plaintiffs the alternative of shipping either to Liverpool or London; and there is no reason at all why the shipper of goods direct to a port should take up the whole of the vessel.

The second question is, whether the order for 500 tons, fifty more or less no object, and which, therefore, clearly required the plaintiffs, if practicable, to procure him at least 450 tons, is complied with by procuring about 392 tons, and shipping them in one vessel with the intention, if practicable, to procure the remaining quantity required to make up the order and ship them by another. As the defendant countermanded the order before the plaintiff's could procure the other sixty tons, the case must be considered as if the plaintiff's had actually procured and shipped the remaining sixty tons. This I have felt to be a more plausible objection than the other, but according to the view which I take of the law, the plaintiffs, having accepted the defendant's order, were not only entitled but bound to fulfil it in any reasonable way which they could.

In Story on Agency, s. 170, it is said, "The principal is not bound by the unauthorised acts of his agent, but is bound where the authority is substantially pursued, or so far as it is distinctly pursued. But the question may often arise whether in fact the agent has exceeded what may be deemed the substance of his authority. Thus, if a man should authorise an agent to buy 100 bales of cotton for him, and he should buy fifty at one time of one person, and fifty at another of a different person, or if he should buy fifty only, being unable to purchase more at any price, or at the price limited, the question might arise whether the authority was well executed. In general it may be answered that it was; because in such a case it would ordinarily be implied that the purchase might be made at different times of different persons, or that it might be made of a part only, if the whole could not be bought at all, or not within the limits prescribed."

In the case of Johnston v. Kershaw (3), the Court of Exchequer acted on this doc

trine. In that case the order was from a Liverpool merchant to one at Pernambuco for 100 bales of cotton, and, though the order does not expressly say so, it is clear (from the usage of trade and the facts) that the 100 bales were to be shipped to Liverpool. The plaintiff purchased and shipped ninety-four bales only, and yet recovered their price, my brother Channell saying, "I may add that the observation of Justice Story seems to me replete with common sense, and I make it the basis of my judgment. I am, therefore, of opinion this order must not be taken as an order to buy 100 specific bales of cotton at one time, but that the plaintiff by purchasing ninety-four bales has executed it with due and reasonable diligence."

This case was not noticed in the judgments in the Exchequer Chamber, but it is impossible to suppose that the three Judges, Chief Baron Kelly and Barons Martin and Channell, who decided it, either overlooked their own decision, or intended to overrule it. I must suppose, therefore, that they distinguished it on the ground that in the order in the case at bar there was enough to shew that the defendant required one shipment, and one only, of the whole of what he ordered, so as to prevent that which would ordinarily have been due and reasonable diligence in the fulfilment of an order from being so in this special case. I do not doubt that the defendant might by the use of proper terms have so limited the plaintiff's authority, but I do not think he did so in fact.

On this part of the case my brother Montague Smith has in his judgment in the Court of Exchequer Chamber accurately and clearly expressed what is my opinion. I cannot improve on what he has said, and, therefore, I refer to it without repeating it. It will be for your Lordships to decide whether the letter has the effect of so limiting the plaintiffs' authority. For the reasons I have given I think it had not, and I am, therefore, of opinion that the judgment of the ExcheChamber is wrong. quer

BYLES, J.-I think judgment ought to be entered for the plaintiffs in error.

The decision turns mainly on the con

struction of the letter of the 25th of July, 1868; which letter seems to me to shew that the relation existing between the parties was not that of vendor and vendee, but of agent and principal. The following expressions appear to me to indicate the relation of principal and agent; some of them more clearly, others less clearly; but all of them to be more naturally and easily reconcilable with the relation of principal and agent than of buyer and seller. Without fatiguing your Lordships with separate observations on every one of these expressions, I would call attention to the word "circulars,” (6 orders," "limit," "maximum," the expression "to cover cost," "draw upon me for costs." Moreover the words, "fifty tons more or less are of no moment, if it enable you to get a suitable vessel," are, as it seems to me, very strong to shew that this was an order from a principal to his agent; for otherwise the buyer would have put it into the power of the seller and exposed him to the temptation, should the price rise or fall, to vary the quantity sold to the extent of 20 or 25 per cent. to the disadvantage of the buyer.

From the plaintiffs' answer of the 6th September it is plain that they understood the defendant's letter as an authority to purchase and ship.

I see nothing in the letter or telegram to make it an implied condition in the order that the whole quantity should be shipped in one ship, although that may have been and probably was contemplated by the defendant as the more probable

event.

It

MARTIN, B.-The question in this case is whether the defendant in error was bound to accept a bulk of 393 tons of sugar which was brought to London from the Mauritius in a vessel called The Ilma. depends almost entirely, if not altogether, upon a letter from the defendant to the plaintiffs, dated the 25th of July, 1864. The material part of the letter gives a limit as a maximum of 26s. 9d. per cwt. for certain qualities of sugar, and continues thus: "You may ship me 500 tons, to cover cost, freight and insurance, fifty tons more or less of no moment, if it enables you to get a suitable vessel. You

will please provide insurance and draw upon me for cost thereof as customary, attaching documents, and I engage to give same due protection on presentation. I should prefer the option of sending vessel to London, Liverpool, or the Clyde, but if that is not compassable you may ship either to Liverpool or London." About the same date a telegram was sent to one of the plaintiffs, by the authority of the defendant, namely-"In writing to the Mauritius, say Mr. Livingston's (the defendant) insurance is to be done with average, and, if possible, the ship to call for orders for a good port in the United Kingdom."

The question is, whether this order must be performed by one bulk of sugar in one ship and conveyed to one port, or whether it may not be performed by two or more bulks of sugar in two or more ships.

I do not think there can be any doubt as to the relation created between the plaintiffs and the defendant upon the former accepting the order contained in the letter. The plaintiffs were merchants and commission agents, not planters, and upon accepting the order undertook to use due diligence to carry it out. When they bought the sugar they did so on their own account; and when they had collected a sufficient quantity to enable them to perform the order, and thought fit to appropriate it for or to the defendant, the relation of vendor and vendee would arise-Fieze v. Wray (5).

A priori, I should think it likely that a Liverpool merchant ordering 500 tons of sugar from abroad to the United Kingdom would desire that it should constitute the entire cargo of one ship; this would give him greater facility for selling the cargo afloat, or for having the ship call for orders at Cork or Falmouth, and other advantages. I also think there is nothing more unlikely than that a merchant giving an order for 500 tons of sugar should intend that it was to be forwarded to him in several bulks, namely, 100 tons in one ship to London, another 100 tons in another ship to Liverpool, a third 100 tons in a third ship to Glasgow, and so on, or indeed in several separate bulks to one and the same port. I cannot think

that a man of sense and intelligence would intentionally subject himself to be so dealt with. A merchant or agent abroad could not perform such an order by sending the 500 tons in bulks of a ton each in 500 different ships; and if he can forward it in more than one ship it must of necessity (in case of litigation) be a question for a jury whether the shipments were in reasonable bulks-a question, upon the result of which no man could form a judgment beforehand, and which would have to be decided by what is called the discretion, or, in other words, the caprice of a jury, and much more likely by their prejudices. I do not believe that any sane man would intentionally give such an order or subject himself to such a litigation. The question, however, must be decided by the letter and telegram.

A similar question arose in the Court of Exchequer in the case of Krenger v. Blanck (4), and my brother Cleasby there stated in substance, as applicable to this case, and I think correctly, "that the order is contained in the letter, that the question turns on the construction of it, and that the Court ought to abide by the natura meaning of the words used, unless excep tional circumstances were found to the contrary."

There are no exceptional circumstances in the present case, and the question is, what is the natural, grammatical, fair and reasonable meaning of the letter? "Vessel" in the singular number is twice used. First, "a suitable vessel to carry 450 to 550 tons of sugar;" secondly, the defendant states his preference of the option of sending "the vessel" to London, Liverpool, or the Clyde. Again, the telegram states "if possible, the ship" is to call for orders for a good port in the United Kingdom. To me this seems to indicate in the clearest manner that there was to be one ship, one port and one bulk. I have repeatedly read and considered it. and I could understand, if the plaintif had bought all the sugar that could be procured at the Mauritius within the de fendant's limits, and had shipped it in one vessel for one of the named ports, it might have been contended that the defendant was bound to accept it as a fulfilment and completion of the order, but I

error.

cannot understand why it should be ought to be entered for the defendant in deemed the essential part of the order that 500 tons should be forwarded, but a non-essential part of the order that it should be forwarded in one vessel to one port.

I do not desire to occupy your Lordships' time by further verbal criticism, but beg to refer you to the considered judgment of the Chief Baron and my brothers Channell and Keating in the Court below. Their reasoning is, in my opinion, conclusive in favour of the defendant. As I have already said, I think the case depends upon the letter of the 25th of July, and I think the custom stated in the case has no bearing upon it, but I desire to call attention to the letter of the plaintiffs to the defendant of the 6th of September, 1864, which to my mind clearly shews that the plaintiffs understood the defendant's letter of the 25th of July in the sense in which I understand it. The plaintiffs there write: "By the arrival of our packet of the 24th ultimo, we are in receipt of your esteemed favour of the 25th of July, and take due note that in the hope of some good being done by importing sugar, you authorise us to purchase and ship on your account a cargo of about 500 tons, provided we can obtain Nos. &c. at a cost not exceeding 26s. 9d. per ton free on board, including cost, freight and insurance; and your remarks regarding the destination of the vessel have also our attention." Now, here it is to be observed that the plaintiffs twice indicate their understanding of the defendant's letter; first they speak of "a cargo about 500 tons, which clearly indicates one bulk, the full loading of a ship; and, secondly, they speak of the destination of the vessel in the singular number. This to my mind speaks as clearly as words can speak, that they were to provide one cargo and forward that cargo to England in one ship; and I cannot but think any intelligent practical man would understand it in the same sense. I therefore think that the defendant was under no obligation to accept the 393 tons shipped in The Ilma, and in my opinion the judgment of the Court of the Exchequer Chamber was right; and my answer to your Lordships' question is that judgment NEW SERIES, 41.—Q.B.

LORD CHELMSFORD.-My Lords, the difference of opinion which has prevailed amongst the judges in this case, shews that the order given to the plaintiffs by the defendant in his letter of the 25th of July, 1864 (upon which the question principally turns), is of doubtful construction; and this, in my mind, is a sufficient ground in itself for bringing me to the conclusion at which I have arrived. I would preface what I have to say by stating my opinion that the question is to be regarded as one between principal and agent, though the plaintiffs might in some respects be looked upon as vendors to the defendant, so as to give them a right of stoppage in transitu. But the transaction began as a contract of agency, and in that light I am disposed to consider it.

Now, it appears to me, that if a principal gives an order to an agent in such uncertain terms as to be susceptible of two different meanings, and the agent bona fide adopts one of them and acts upon it, it is not competent to the principal to repudiate the act as unauthorised, because he meant the order to be read in the other sense of which it is equally capable. It is a fair answer to such an attempt to disown the agent's authority, to tell the principal that the departure from his intention was occasioned by his own fault, and that he should have given his order in clear and unambiguous terms. This view of the case will, in my opinion, dispense with the necessity of determining which is the more correct construction of the contract, that which was adopted unanimously by the Court of Queen's Bench and by two of the Judges of the Exchequer Chamber, or that which the four other Judges of the Exchequer Chamber considered to be the right interpretation of it. It is sufficient for the justification of the plaintiffs, that the meaning which they affixed to the order of the defendant is that which is sanctioned by so many learned judges. It would be most unjust after the plaintiffs have honestly acted upon what they conceived to be the wishes of the defendant, as expressed in his order, that he should be

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