1907.

BOWDEN BROS. & Co. LTD.

v.

LITTLE.

Isaacs J.

a third count, which may be laid aside as immaterial in view of H. C. OF A. the course the case has taken. The defendants denied the promise and the breach. There was a cross action by Bowden Bros. against Little for the price of the onions, which Little refused to his defence to this action being practically his allegations pay; in his own action. At the trial the pleadings were not strictly adhered to. Mr. Campbell in opening the case for Little stated "That if the obligation of the defendants was to deliver at Kobe, the defendants were to deliver at Kobe onions fit for voyage to Sydney under ordinary conditions." The jury was asked to make special findings, which they did. [His Honor then read the special findings in answer to the first four questions and continued] The other answers may be regarded as immaterial. The jury returned a verdict for Little in both actions, finding damages in his own action at £3,729 15s. 10d.; they added the following: The jury find for the plaintiff in this action in accordance with your Honor's ruling as to the construction of the c.i.f. contract and award damages to the amount of £3,729 15s. 10d." His Honor the presiding Judge directed the jury that Bowden Bros. were bound to deliver to the plaintiff Little merchantable onions in Sydney, except for such necessary and inevitable deterioration as would occur on the voyage. A rule nisi for a new trial was applied for to the Full Court on various grounds, but the Full Court, though granting a rule nisi, declined to include certain grounds, including one to the effect that the direction already mentioned was wrong. The appeal in this case included as one of the grounds that the direction was erroneous. In my opinion that direction, having regard to the whole of the evidence, cannot be sustained. It was given upon what was understood to be the effect of Lorimer v. Slade (1). That case may be perhaps considered to turn on its special circumstances, but if it decides broadly that a c.i.f. contract requires the seller to deliver at the port of destination, it cannot be supported. A contract c.i.f. is well known, and its effect has been described by Blackburn J. in the case of Ireland v. Livingston (2) in the passage cited by the learned Chief Justice. It is plain from the statement of the law by that very learned Judge, whose opinions

(1) (1905) 5 S.R. (N.S. W.), 71.

(2) L.R. 5 H.L., 395, at p. 406.

1907.

BOWDEN

LTD.

v.

LITTLE.

Isaacs J.

H. C. OF A. upon such a subject are entitled to especial weight, that the vendor's part is performed by shipping the goods in conformity with the contract, first insuring them and procuring the bill of BROS. & Co. lading and policy of insurance, and then promptly despatching these to the purchaser. In 1889 the case of Delaurier & Co. v. Wyllie (1) was decided by the Scottish Court of Session upon a case submitted to an opinion of the Judges of the whole Court. The plaintiffs, who were French merchants, had purchased from Stevenson & Co., of Glasgow, 1,000 tons of Ayrshire coal "c.i.f. Rochefort." Stevenson & Co. shipped the coal on defendant's ship and insured it, the ship was lost with her cargo, and the action was brought against the shipowner on the ground that the loss was through the fault of the master or other servant of the defendant. It became necessary to determine the meaning and effect of a c.i.f. contract. There were thirteen Judges, and it was held by the Court, dissentiente Lord Young, that the coals became the plaintiff's property on shipment or endorsement of the bill of lading, as the seller's obligation to pay insurance and freight did not imply a suspension of delivery till the port of arrival, and the plaintiffs therefore had a title to sue. The case came originally before the Lord Ordinary (Trayner) who made a decree against the defendant. The important passage from His Lordship's judgment read by my brother Barton indicates with great clearness the meaning and effect of a contract c.i.f. In the argument before the Full Court of Session the dictum of Blackburn J. in Ireland v. Livingston (2) was referred to, and the following passage from the judgment of Lord Wellwood (3) states tersely the view taken by the majority of the Court on the question" The meaning and effect of the expression c.i.f. simply is that the sellers undertake to insure for the purchaser and include in the invoice price the cost of the cargo, the insurance premium, and the full freight. From this they deduct the amount of the freight to be paid at the port of discharge, and draw for the balance upon the consignee. In substance, therefore, as Lord Blackburn says in Ireland v. Livingston (4)

(1) 17 Ct. of Sess. Cas., 167.

(2) L.R. 5 H.L., 395.

(3) 17 Ct. of Sess. Cas., 167, at p. 189.

(4) L.R. 2 Q.B., 99, and L.R. 5 H. L., 395.

1907.

BOWDEN

BROS. & Co.
LTD.

v.

LITTLE.

Isaacs J.

the consignee pays the same price as if the goods had been H. C. or A. bought and shipped to him in the ordinary way.' Lord Shand (1), says expressly that Rochefort was not the place of delivery under the contract. Lord Lee (2) said 'In this case Messrs. Stevenson & Co. were the sellers of the coals, and I agree with the Lord Ordinary that the contract between them and the pursuers did not require that in order to transfer the risk to the pursuers the coals should be delivered at Rochefort. I think that the case was one in which Stevenson & Co. did all that was incumbent on them by arranging for the carriage of the coals, putting them on board of the vessel they had chartered, insuring them, and undertaking to pay the freight. The risk was with the buyer after such shipment, unless there had been a clear undertaking to deliver at Rochefort, implying that the risk was to remain with the seller until delivery at the place stipulated." The concluding words of the contract are of importance in connection with the first finding of the jury. As already pointed out, the same view has been put shortly by Lord Davey in Ströms Bruks Aktie Bolag v. Hutchison (3). It therefore seems clear that the sellers in this case did not agree to deliver in Sydney but at Kobe, and the only question is whether the goods they shipped at Kobe as in pursuance of the contract were of the proper description. The goods being described as Japanese onions, there was an implied condition that the goods should be of merchantable quality. The jury have found that they were of merchantable quality as understood in Japan; but the purchaser contends that, besides the condition of merchantability, the sellers were bound to put on board onions reasonably fit for the voyage from Kobe to Sydney under ordinary conditions. There has been no finding of fact that the purchaser made known to the seller the particular purpose for which the goods were required, so as to show that the buyer relied upon the sellers' skill or judgment. It was urged, however, on behalf of the purchaser that the mere fact that the contract stated that the onions were to be shipped to Sydney, and that the sellers knew that the onions were to be shipped to Sydney, was sufficient to

(1) 17 Ct. of Sess. Cas., 167, at p. 180.

(2) 17 Ct. of Sess. Cas., 167, at p. 198. (3) (1905) A.C., 515, at p. 528.

1907.

BOWDEN

At

H. C. OF A. establish in law the further implied condition that the goods should be reasonably fit for the purpose of the voyage so as to arrive in Sydney in merchantable condition, except for the necessary and inevitable deterioration caused by the voyage. the trial, and in the argument before this Court, it was put on behalf of the purchaser that the implied condition referred to necessarily arose as a matter of law.

BROS. & Co.
LTD.

υ.

LITTLE.

Isaacs J.

In my judgment that is not a sound position. The mere fact that in the written document itself the fact and dates of shipment are referred to does not conclude the matter, because that is common to all c.i.f. contracts, and, unless such an implied condition exists in every contract of the character, the position contended for cannot be maintained. But that cannot be the case. Subsec. 1 of sec. 14 of the English Sale of Goods Act 1893 has been held by the Court of Appeal to be the same as the common law: Frost v. Aylesbury Dairy Co. (1), and it is the common law which still exists in this State. The suggested implied condition of reasonable fitness for the purpose must arise, if at all, on facts showing that the purchaser not only made known to the seller the particular purpose for which the onions were required, but also did this so as to show he was relying on the seller's skill and judgment. That this is a question of fact appears from several cases: Gillespie Bros. & Co. v. Cheney, Eggar & Co. (2); Frost v. Aylesbury Dairy Co. (1). In that case Collins M.R. said (3):— We arrive then at this result, that milk was supplied for a purpose known to the seller under circumstances which showed that the buyer relied on the seller's skill or knowledge," &c. In Wallis v. Russell (4), the Irish Court of Appeal dealt with this question exhaustively. Walker L.J. said (5):—“The buyer has made known to the seller the purpose for which the goods are required, viz., for eating, and she has, as found by the jury, made that known in a manner that showed that she relied on the seller's skill and judgment, and not on her own." Holmes L.J. said (6): -Sec. 14, sub-sec. 1, enacts that this implication will arise when the buyer directs the attention of the seller to the purpose for

(1) 1905) 1 K.B., 608.

(2) (1896) 2 Q. B., 59.

(3) (1905) 1 K.B., 608, at p. 612.

(4) (1902) 2 I.R., 585.

(5) (1902) 2 I. R., 585, at p. 627. (6) (1902) 2 I. R., 585, at p. 635.

1907.

BOWDEN

LTD.

v.

LITTLE.

Isaacs J.

which the goods are required in such a way as to convey that he is H. C. of A. relying on the seller's skill and judgment to select a suitable article." The quotation by Fitzgibbon L.J. from Brown v. Edgington (1), and by Walker LJ. from Bigge v. Parkinson BROS. & Co. (2) support the same position. It is, therefore, plain that the mere fact that the seller knows the purpose without more will not of itself raise the implication. Looking at the facts in this case to see whether they are such as would entitle the purchaser to a direction that he relied on the sellers' skill and judgment to select onions fit for the voyage, I am clear that on the evidence no such direction could be given. The facts are certainly open to the construction, if the jury thought fit, that the purchaser did not rely on the sellers' skill and judgment. In view of the order the Court now makes I abstain from weighing the evidence. There being, however, so far no finding in plaintiff's favor of the fact essential to raise the implied condition of reasonable fitness, and the evidence not entitling him to a direction, it follows that the verdict cannot be sustained, and the appeal must therefore be allowed. I have not overlooked the first finding of fact, but this cannot be taken as amounting to an agreement by the sellers that they would bear the risk of transit, or, in other words, warrant merchantable condition of the goods on arrival at Sydney. No reliance was placed on this finding during the argument, nor, in my opinion, would it bear the construction that the sellers understood the buyer to rely on their skill and judgment to provide onions reasonably fit for shipment to Sydney. The only question as to which I have any doubt is whether a new trial should be ordered in both actions or whether a nonsuit should be entered in Little's action, and judgment for the plaintiffs in the crossaction. Strictly speaking, and in the absence of amendment, the sellers are entitled to judgment, and the purchaser cannot complain of a mistrial on the ground that by a mischance or other miscarriage for which he is not responsible the necessary facts were not found. He never asked for or intended that the facts as to reliance on the sellers' judgment should be found by the jury, see Nevill v. The Fine Art and General Insurance Co. (3). The pleadings do not raise the issue, and even the extended form (2) 7 H. & N., 955.

(1) 2 Man. & G., 279.

(3) (1897) A.C., 68.