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So the non-performance of a condition precedent, before any CH. XXII. default by the defendant(e), entitles the latter to consider himself
Performance freed from his liability to do the act, which he agreed to perform (Rescission). after such condition precedent should have been executed (e). Non-perform
So, where a party who was to perform a condition precedent ance of conby a certain time is disabled by sickness (f), or disables himself
Illness, before that time from performing it, the other party may abandon the contract (g). And so where, by the terms of the contract, a service to be performed by A. for B., is to be paid for in goods; if B. by his own act render the delivery of the goods impossible, A. may sue for the value of his service, and is not bound to sue on the special contract (1). In Hoare v. Rennie the agreement was, that the defendants Continuing
contract. should buy of the plaintiffs 667 tons of iron, to be shipped from
Hoare v. Sweden in the months of June, July, August and September, in Rennie. about equal portions each month; and the plaintiffs shipped only twenty-one tons in June. It was held in an action by them against the defendants for refusing to accept the iron, that the defendants were entitled to refuse the twenty-one tons so shipped, and also to give notice to the plaintiffs that they would not accept the residue of the iron (i); it having been previously held, in Withers v. Reynolds (k), that where the defendant agreed to supply the plaintiff with straw, to be delivered at the plaintiff's premises at the rate of three loads in a fortnight, during a specified time; and the plaintiff agreed to pay the defendant for each load of straw delivered on the premises during that time; but, after some of the straw had been delivered, the plaintiff refused to pay for the last load, and insisted on always keeping one payment in arrear: the defendant was not bound to supply any more.
But in Simpson v. Crippin (1), a contract to supply some 6,000 Simpson v. tons of coal to be delivered into buyer's waggons in equal monthly
Crippin. quantities for twelve months, was held not to have been justifiably cancelled on the ground of the buyers only taking 158 tons in
(d) Fitt v. Cassanet (1842), 4 M. & G. 898.
(e) See Jones v. Gibbons (1853), 8 Ex. 920; Johnassohn v. Great Northern Rail. Co. (1854), 10 Ex. 434 ; Mawman v. Gillett (1869), 2 Taunt. 325, n.; 11 R. R. 597.
() Poussaril v. Spiers (1876), 1 Q. B. D. 410, 414; distinguished in Loates v. Maple (1903), 88 L. T. 288, on the construction of a contract for a jockey's services, which had been interrupted by a riding accident, per Wright, J.
(9) Chanter v. Leese (1838), 4 M. & W.
(1) Keys v. Harwood (1846), 2 C. B. 905.
(i) Hoare v. Rennie (1859), 5 H. & N. 19; dissented from by Brett, L.J., but approved by Bramwell and Baggallay, L.JJ., in Honck v. Muller (infra). And see Reuter v. Sala (1879), 4 C. P. D). 239, C. A. ; Brandt v. Lawrence (1876), 1 Q. B. D. 344, C. A.
(k) Withers v. Reynolds (1831), 2 B. & Ad. 822.
(1) Simpson v. Crippin (1872), L. R., 8 Q. B. 14.
the first month ; while in Honck v. Muller (m), a contract to s. 7.
deliver 2,000 tons of iron in November, or equally over November, Performance (Rescission). December and January, was held to have been justifiably cancelled
on the ground of a refusal to take any delivery in November (n).
These cases, which are, as will have been seen, to a certain extent discordant, together with the House of Lords case of Mersey Steel and Iron Co. v. Naylor (o) (where they are to some extent reviewed by Lord Blackburn), are exhaustively discussed by the Supreme Court of the United States in Norrington v. Wright (p), where it is pointed out that Hoare v. Rennie and Honck v. Muller are supported by a greater weight of authority than Simpson v. Crippin.
In Norrington v. Wright, the contract was for the sale of 5,000 tons of iron rails for shipment at the rate of about 1,000 tons per month beginning February, 1880, but whole contract to be shipped before August 1st, 1880. The Court held that the sellers were bound to ship 1,000 tons in each month from February to June inclusive, except that slight deficiencies might be made up in July; and that where only 400 tons were shipped in February, and 885 tons in March, and the buyers accepted and paid for the February shipment on its arrival in March in ignorance that no more had been shipped in February, and were first informed of that fact after the arrival of the March shipments, and before accepting or paying for either of them, the buyers might rescind the contract for the non-shipment of about 1,000 tons in February and
March (p). Sale of Goods The 10th and 31st sections of the Sale of Goods Act, 1893
56 & 57 Vict. c. 71 (ante, pp. 74, 495), to some extent deal with the subject matter of the above decisions, but do not solve the difficulties raised by them.
There are some cases in which, although an agreement of a formance
continuing nature has been in part performed, the further perexcused by misconduct of formance of it may be excused or discharged, by conduct of the other party.
other party, which is wholly at variance with the spirit of the contract (9). Thus, a publisher will discharge an author from liability to provide articles agreed to be inserted in a particular publication, by altering the nature of the work in which such articles were to appear; or requiring that they should be published separately,
(m) Honck v. Muller (1881), 7 Q. B. D. 92, C. A.
(n) Withers v. Reynolds (1831), 2 B. & Ad. 882.
(0) Mersey Steel and Iron Co. v. Naylor (1884), 9 App. Cas. 434.
(p) Norrington v. Wright (1885), 8
Davis (115 U.S.), 188, and see the extracts from and comments on the judgment in Pollock on Contracts, 6th ed., at p. 256, where also the principle of the cases is examined.
(9) See Burton v. Pinkerton (1867), L. R., 2 Ex. 340.
contrary to the spirit of the contract, and to the probable injury CH. XXII. of the author's reputation (1).
Performance Mere failure on the part of a buyer to pay for any one of a (Rescission) series of instalments does not justify the seller of goods, to be Effect of delivered in instalments, in cancelling the contract so as to free refusal of
payment. him from the obligation to deliver (8); and the refusal or omission
Freeth v. of one of the contracting parties, to do something which the con- Burr. tract binds him to do, will not entitle the other party to rescind the contract, unless the acts and conduct of the party who makes default, show an intention to abandon, and wholly to refuse performance of his part of the contract (t).
And it is a clearly-recognised principle, that if there be only a Partial partial value of performance by one party to a contract, for which failure. there may be a compensation in damages, the contract is not put an end to (u). The right to abandon a contract vests only in the party who has Contract can
be rescinded, not been guilty of any default; for a man cannot take advantage only by party of his own wrong, in order to put an end to a contract into which who has made
no default ; he has entered (x).
And such right, when it does exist, must be exercised within a and in reasonreasonable time (y).
able time; Nor can a contract, in general, be rescinded in toto by one of and where the parties, where both of them cannot be placed in the identical both can be situation which they occupied when the contract was made (z); so statu quo. that where one party has derived some advantage from the other party having, to some extent, performed the contract, the general rule is, that it shall stand ; and that the defendant must perform his part thereof, and seek compensation in damages for the plaintiff's default. Although, however, this is the general rule, a partnership agree. Exception in
case of partment has been set aside by the House of Lords on the ground that
nership the plaintiff was induced to enter into it by misrepresentations agreement. made without fraud, although the result of the rescission was to restore to the defendant a business which was worse than worthless, (r) Planché v. Colburn (1831), 8 Bing. (x) See Hughes v. Palmer (1865), 19
C. B., N. S. 393; Malins v. Freeman (s) Mersey Steel and Iron Co. v. Naylor, (1838), 6 Scott, 187, 193. ubi sup. ; Freeth v. Burr (1874), L. R., (y) Per Buller, J., Towers v. Barrett 9 C. P. 208.
(1786), 1 T. R. 133; and see Hodgson v. (1) See Bloomer v. Bernstein (1874), Davies (1810), 2 Camp. 530 ; 11 R. R. L. R., 9 C. P. 588 ; Morgan v. Bain 789; Poolcy v. Broun (1862), 11 C. B., (1874), L. R., 10 C. P. 15; Ex parte N. S. 566. Chalmers (1873), L. R., 8 Ch. 289; Ex (z) Blackburn v. Smith (1848), 2 Exch. parte Carnforth Hæmatile Iron Co. 783, 792 ; per Tindal, C.J., Filt v. Cas. (1876), 4 Ch. D. 108.
sanet (1842), 4 M. & G. 898, 903; Hunt (u) Per Littledale, J., Franklin v. v. Silk (1804), 5 East, 449; 7 R. R. Miller (1836), 4 A. & E. 599, 605; and 739; per Vaughan, B., Beed v. Blandford see Johnassohn v. Young (1863), 4 B. & S. (1828), 2 Y. & J. 278.
and that the defendant could not recover against the plaintiff for Performance money lent and goods sold by him to the partnership (a ). (Rescission). There are also cases of partial failure of consideration, in which Evidence of the Courts, in order to prevent unnecessary litigation, permit the partial failure defendant, instead of bringing a cross action, to set up such partial of damages. failure in reduction of damages. And this principle applies,
generally, to all cases of contracts either for goods or works; in which the defendant, when sued for the price, may show the insufficiency of the goods, or the incomplete performance of the work, even although a specific price was agreed for (b).
The defendant, however, is not bound in such cases to give evidence in reduction of damages, but he may bring a action (c) or plead a counter-claim. And as the rule only permits him to prove, in reduction of damages, how much less the subject-matter of the action was worth, by reason of the plaintiff's breach of contract, he was bound before the Judicature Act, if he had any claim for damages beyond that, to bring a cross action to recover them (d), and must now counter-claim for
such damages. Rescission of
A person suing a company to obtain rescission of an agreement take shares to take shares in it must, generally speaking, bring his case under in company. one of the following heads :Lynde's case.
(1) Where the misrepresentations are made by the directors or other the general agents of the company entitled to act, and acting on his behalf.
(2) Where the misrepresentations are made by a special agent of the company while acting within the scope of his authority, including the case of a person constituted agent by subsequent adoption of his acts.
(3) Where the company can be held affected, before the contract is complete, with the knowledge that it is induced by misrepresentation.
(4) Where the contract is made on the basis of certain representations, whether the particulars thereof were known to the company or not, and it turns out that some of them were material and untrue (e).
(a) Adam v. Neubigging (1888), 13 App. Cas. 308.
(6) See very fully, per Parke, B., delivering the judgment of the Court in Mondel v. Steel (1841), 8 M. & W. 858.
(c) Davis v. Hledges (1871), L. R., 6
Q. B. 687.
(d) Mondel v. Steel (1841), 8 M. & W. 858, 872.
(e) Lynde v. Anglo-Italian Hemp Spinning Co.,  1 Ch. 178, per Romer, J.
OF THE DEFENCES TO AN ACTION ON CONTRACT.
PAGE 1. Payment
623 (a) By whom made
623 (b) To whom ....
624 (c) of the amount paid
627 (d) When presumed..
627 (e) Time, Mode, and Place of Payment
628 (f) Appropriation of Payments.. 632
(g) "Receipt for the money 636 2. Accord and Satisfaction
637 (a) Generally ...
637 (b) Satisfaction must be Complete
640 (c) By One of many Parties 640 (d) By Stranger
641 3. Bill of Exchange taken....... 641 4. Release.....
646 (a) Form and Effect of...
646 (b) By whom Executed
648 (c) To whom Executed ....... 649 (d) By Operation of Law
650 5. Judgment recovered ......
653 6. Arbitrament and Award
662 (1) Mode of Tender.
663 (g) Effect of Prior or Subsequent Demand
666 8. Statute of Limitations
679 (d) Revival of Debt by Part Payment......
685 (e) Renewal of Writ to save Statute
690 9. Set-off and Counter-claim 690 10. Bankruptcy
694 11. Equitable Defences
(a) By whom made. The general rule as to payment or satisfaction, not by the By whom debtor himself, but by a third person who is not liable as a co-contractor or otherwise, appears to be,—that it is not sufficient to discharge the debtor, unless it be made by such third person as agent for and on account of the debtor, and with his prior authority or subsequent ratification (a), and the debtor can ratify after action brought by placing plea of payment on record.
And where payment is made by a third person for the debtor, but without authority from the debtor, the creditor and the person who made the payment may together rescind the transaction at any time before the debtor has affirmed the payment, and may
(a) Fitz. Abr. tit. Barre, p. 166, Simpson v. Eggington (1855), 10 Exch. 845, 847; and see Lucas v. Wilkinson (1856), 1 H. & N. 420 ; Walter v. James
(1871), L. R., 6 Ex. 124; Purcell v.