the contract, but giving a cause of action to neither." Another argument for the plaintiffs was that the property in the work done had passed to the defendant and was therefore at his risk (a). To this the Court answered that it was at least doubtful whether it had; and even if it had, the contract was still that nothing should be payable unless and until the whole work was completed. to instal already Where there is an entire contract for doing work upon Saving as specific property, as fitting a steamship with new machinery, ments of for a certain price, but the price is payable by instalments, payment and the ship is lost before the machinery has been earned. delivered, but after one or more of the instalments has been paid, the further performance of the contract is excused, but the money already paid, though on account not of a part, but of the entire contract, cannot be recovered back (). for future The same doctrine has been applied where the subject- Contract matter of the contract is a future specific product or some specific part of it. In March A. agreed to sell and B. to purchase product. 200 tons of potatoes grown on certain land belonging to A. In August the crop failed by the potato blight, and A. was unable to deliver more than 80 tons: the Court held that he was excused as to the rest. "The contract was for 200 tons of a particular crop in particular fields". . . "not 200 tons of potatoes simply, but 200 tons off particular land". . . "and therefore there was an implied (a) In the case cited in argument from Dalloz, Jurisp. Gén. 1861, pt. 1. 105, Chemin de fer du Dauphiné v. Clet, where railway works in course of construction had been spoilt by floods, the Court of Cassation relied on the distinction that they were not such as remained in the contractor's disposition till the whole was finished, but "de constructions dont les matériaux et la main d'œuvre étaient fournis par l'entrepreneur et qui s'incorporaient au gol du propriétaire," as excluding (b) Anglo-Egyptian Navigation Co. C C Impossibility at date of contract term in the contract that each party should be free if the crop perished" (a). These are all cases of the performance becoming impossible by events which happen after the contract is made. But sometimes the same kind of impossibility of things results from the present existence of a state of things not templated contemplated by the parties, and the performance is excused by parties. to the same extent and for the same reasons as if that from state not con state of things had supervened. Where this impossibility consists in the absolute non-existence of the specific property or interest in property which is the subject-matter of the agreement, it is evident that the agreement would not have been made unless the parties had contemplated the subject-matter as existing. Otherwise it would be reduced to a case of absolute impossibility; for when a thing is once known to be in the events which have happened impossible, it is the same as if it had been in its own nature impossible. Here, then, the agreement of the parties is induced by a mistaken assumption on which they both proceed, as in the analogous cases noticed above under the head of impossibility in law. Here, as there, it is a question whether impossibility or mistake, or both, shall be assigned as the ground on which the agreement is void. And here likewise, according to our authorities, mistake seems to be the ground assigned by preference. It is not so much the impossibility of performance that is regarded as the original non-existence of the state of things assumed by the contracting parties as the basis of their contract. The main thing is to ascertain, not whether the agreement can be performed, but what was in the true intention and contemplation of the parties (b). If it (a) Howell v. Coupland, L. R. 9 Q. B. 462, 466, affd. in C. A. 1 Q. B. D. 258, see per Cleasby, B. at p. 263. (b) See especially Couturier v. Hastie, 5 H. L. C. 673. Savigny (Syst. 3. 303) is decidedly against error being considered the ground of nullity in these cases: but chiefly because, as he holds, the knowledge or other state of mind of the parties makes no difference. It is at least doubtful, as we shall have opportunities of seeing, whether this position be true in English law. appears that they conceived and dealt with something non-existent as existing, the agreement breaks down for want of any real contents. Hence these cases are treated for the most part as belonging to the head of Mistake. It may be that the peculiar historical conditions of English law count for something in this. Accident, Fraud, and Mistake were the accustomed descriptions of the heads of equity under which the Court of Chancery gave relief. The fiction of this relief being something extraordinary and as it were supra-legal was kept up in form long after it had ceased to be either true or useful and the terms Fraud and Mistake were extended far beyond. any natural or scientifically admissible meaning in order to support the jurisdiction of the Court in a great variety of cases where the procedure and machinery of the common law Courts were inadequate to do justice. In the cases now before us, however, there is real difficulty in drawing the line and one or two examples of the class will be given in this place. cargo In the leading case of Couturier v. Hastie (a), decided Sale of by the House of Lords in 1856, a bought note had been previously signed for a cargo of Indian corn described as "of fair lost. average quality when shipped from Salonica." Several days before the sale, but unknown to the parties, the cargo, then on the voyage, was found to be so much damaged from heating that the vessel put into Tunis, where the cargo was sold. The only question seriously disputed was what the parties really meant to deal with, a cargo supposed to exist as such, or a mere expectation of the arrival of a cargo, subject to whatever might have happened since it was shipped. Lord Cranworth in the House of Lords, in accordance with the opinion of nearly all the judges, held that "what the parties contemplated, those who sold and those who bought, was that there was an existing something to be sold and bought." No such (a) 5 H. L. C. 673. Covenants to work to raise minimum amount. Clifford v. thing existing, there was no contract which could be enforced. When a lessee under a mining lease covenants in unmines, or qualified terms to pay a fixed minimum rent, he is bound to pay it both at law (a) and in equity (b), though the mine may turn out to be not worth working or even unworkable. But it is otherwise with a covenant to work the mine or to raise a minimum amount. In the case in equity last referred to (b), where a coal mine was found to be so interrupted by faults as to be not worth working, it was said that the lessor might be restrained from suing on the covenant to work it on the terms of the lessee paying royalty on the estimated quantity of coal which remained unworked. A similar question was fully dealt with in Clifford v. Watts (c). The demise was of all the mines, veins, &c., of clay on certain land. There was no covenant by the lessee to pay any minimum rent, but there was a covenant to dig in every year of the term not less than 1000 tons nor more than 2000 tons of pipe or potter's clay. An action was brought by the lessor for breach of this covenant. Plea (d), to the effect that there was not at the time of the demise or since so much as 1000 tons of such clay under the lands, that the performance of the covenant had always been impossible, and that at the date of the demise the defendant did not know and had no reasonable means of knowing the impossibility. The Court held that upon the natural construction of the deed the contract was that the lessee should work out whatever clay there might be under the land, and the covenant sued on was only a subsidiary provision fixing the rate at which it should be worked. The tenant could not be presumed to warrant that clay should be found: and "the result of a decision in favour of the plaintiff would be to give him a a) Marquis of Bute v. Thompson, 13 M. & W. 487. (b) Rudgway v. Sneyd, Kay 627. (d) It was pleaded as an equitable plea, but the Court treated the defence as a legal one. fixed minimum rent when he had not covenanted for it" ("). effect of express in com In certain kinds of contracts, notably charter-parties, it Analogous is usual to provide by express exceptions for the kind of events we have been considering. It is not within our exceptions province to enter upon the questions of construction which mercial arise in this manner, and which form important special contracts. topics of commercial law. However, when the exception of a certain class of risks is once established, either as being implied by law from the nature of the transaction, or by the special agreement of the parties, the treatment is much the same in principle: and a few recent decisions. may be mentioned as throwing light on the general law. Where the principal part of the contract becomes impossible of performance by an excepted risk, the parties are also discharged from performing any other part which remains possible, but is useless without that which has become impossible (b). It is a general principle that a contract is not to be treated as having become impossible of performance if by any reasonable construction it is still capable in substance of being performed (c): but on the other hand special exceptions are not to be laid hold of to keep it in force contrary to the real intention. Thus where the contract is to be performed" with all possible despatch," saving certain impediments, the party for whose benefit the saving is introduced cannot force the other to accept performance after a delay unreasonable in itself, though due to an excepted cause, if the manifest general intention of the parties is that the contract shall be performed within a reasonable time, if at all. The saving clause will protect him from liability to an action for the delay, but that is (a) Per Montague Smith, J. at p. 587. Cp. and dist. Jervis v. Tomkinson, 1 H. & N. 195, 26 L. J. Ex. 41, where the covenant was not only to get 2000 tons of rock salt per annum, but to pay 6d. a ton for every ton short, and the lessees knew of the state of the mine when they (b) Geipel v. Smith, L. R. 7 Q. B. (c) The Teutonia, L. R. 4 P. C. 171, 182. Cp. Jones v. Holm, L. R. 2 Ex. 335. |