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LA313 - Commercial Law - Cases

COURT OF APPEAL

Civil Division

[1976] 2 All ER 552

 

ALUMINIUM INDUSTRTIE VAASSEN BV

v.

ROMALPA ALUMINIUM Ltd.

 

Queen’s Bench Division Coram : Mocatta J
3rd, 4th, 5th, 6th, 7th, 11th February 1975

Court of Appeal Coram : Megaw, Roskill and Goff LJJ
13th, 14th, 15th, 16th January 1976

Sale of goods-Passing of property-Vendor retaining property in goods-Duty of purchaser to account for proceeds of sub-sales-Fiduciary duty as agent and bailee of goods-Right of vendor to trace and recover proceeds of sub-sales in priority to other creditors of purchaser- Contract reserving property in goods after delivery until full price paid-Implied power of purchaser to sell goods as agent of vendor-Implied duty to account to vendor for proceeds of sub-sales-Purchaser in financial difficulties-Receiver appointed-Whether vendor entitled to trace and recover proceeds of sub-sales in priority to secured and unsecured creditors.

The plaintiffs, a Dutch company which manufactured aluminium foil in Holland, sold quantities of foil to the defendants, an English company carrying on business in England. Clause 13 of the general selling terms and conditions which governed the individual contracts. provided: 'The ownership of the material to be delivered by [the plaintiffs] will only be transferred to [the defendants] when [they have] met all that is owing to [the plaintiffs]. Until the date of payment [the defendants could be required] to store this material in such a way that it is clearly the property of [the plaintiffs].' Clause 13 then continued with elaborate provisions to deal with cases in which, after delivery, the foil had been mixed with other material by the defendants for the purpose of creating new 'objects'. The clause provided that in those circumstances the ownership of any such objects was to be transferred to the plaintiffs as ‘surety' for 'full payment' and until full payment had been made the defendants were to keep the mixed goods for the plaintiffs as 'fiduciary owner'. The defendants were also given an express power of sale over such 'mixed' goods on condition that, so long as the defendants had not fully discharged their indebtedness to the plaintiffs, they were, on request, to assign to the plaintiffs the benefit of any claim against sub-purchasers. Subsequently the defendants got into serious financial difficulties and a receiver was appointed by the debenture holders. At the date of his appointment the defendants were indebted to the plaintiffs for over 122,000. Following his appointment, the receiver certified that 35,152 was held by him representing the proceeds of sale of unmixed aluminium foil supplied by the plaintiffs to the defendants and sold by the latter to third parties. The plaintiffs claimed that, by virtue of cl 13 of the general conditions, they were entitled to that sum in priority to the secured and unsecured creditors.

Held-In order to give effect to the obvious purpose of cl 13, that clause was to be construed as conferring on the defendants a power to sell unmixed foil and also as imposing on them an obligation to account to the plaintiffs for the proceeds of sale unless and until all moneys owing from the defendants to the plaintiffs had been paid. Although, so far as sub-purchasers were concerned, the defendants sold the unmixed foil as principals, so far as the plaintiffs were concerned, the foil was the plaintiffs' property which the defendants were selling as agents for the plaintiffs to whom, by virtue of their fiduciary relationship as agents and bailees, they remained fully accountable. It followed therefore that the plaintiffs were entitled to trace the proceeds of sale of the unmixed foil and to recover them in priority to the secured and unsecured creditors (see p 563 j to p 564 c, p 565 c d and g to j, p 566 g and h and p 568 b to e, post).

Re Hallett's Estate (1880) 13 Ch D 696 applied.

Note

For the right to follow and recover assets or the money into which they have been converted, see 16 Halsbury's Laws (4th Edn) para 1460.

Cases referred to in judgments

Diplock's Estate, Re, Diplock v Wintle [1948] 2 All ER 318, [1948] Ch 465, CA; affd sub nom Ministry of Health v. Simpson [1950] 2 All ER 1137, [1951] AC 251, HL, 47 Digest (Repl) 532, 4825.
Hallett's Estate, Re, Knatchbull v Hallett (1880) 13 Ch D 696, [1874-80] All ER Rep 793, 49 LJ Ch 415, 42 LT 421, CA, I Digest (Repl) 655, 2278.
Henry v Hammond [1913] 2 KB 515, 82 LJKB 575, 108 LT 729, I Digest (Repl) 530, 1605.
King v. Hutton [1900] 2 QB 504, 69 LJQB 786, 83 LT 68, CA, 4 Digest (Repl) 336, 3059.
Thornton v Shoe Lane Parking Ltd [1971] 1 All ER 686, [1971] 2 QB 163, [1971] 2 WLR 585, CA.

Case also cited

Tailby v Official Receiver (1888) 13 App Cas 523, [1886-90] All ER Rep 486, HL.

Action

By a writ issued on 30th October 1974 the plaintiffs, Aluminium Industrie Vaassen BV, brought an action against the defendants, Romalpa Aluminium Ltd, claiming, inter alia, (i) a declaration that they were entitled to a charge on the sum of 35,152.66 held in an account of the defendants' receiver-manager, Mr J N Prentice, representing the proceeds of sale of aluminium foil supplied by the plaintiffs to the defendants and then sold by the defendants to third parties; (ii) a declaration that aluminium foil f to the value of 50,235 held by the receiver originating in deliveries to the defendants by the plaintiffs was the plaintiffs' foil and an order for its delivery up; (iii) alternatively judgment for the price. The facts are set out in the judgment.

Anthony Lincoln QC and David Donaldson for the plaintiffs.
Murray Pickering for the defendants.

Cur adv vult

11th February. MOCATTA J read the following judgment: The plaintiffs are a Dutch company making, amongst other things, aluminium foil. The defendants are an English company in respect of which its bankers, Hume Corporation Ltd, on 1st November 1974 appointed a receiver pursuant to powers granted by the defendants under a debenture dated 10th January 1974. On 3oth October 1974, just before the appointment of the receiver, a writ had been issued in this action by the plaintiffs, and an interlocutory injunction was obtained on 30th October from Cusack J in relation to goods supplied by the plaintiffs to the defendants and still in the possession of the defendants.

There is no doubt that on 1st November 1974 the defendants owed the plaintiffs Hfl 757,886, or 122,239.74 at the rate of exchange of Hfl 6.20 to the pound, in respect of a large number of invoices in relation to sales of aluminium foil to the defendants from1st August 1974. After his appointment, the receiver certified that 35,152.66 was held in an account in his name as receiver-manager of the defendants with the Hume Corporation, and that that amount represented the proceeds of sale of aluminium foil supplied by the plaintiffs to the defendants and then sold by the latter to third parties. In this action the plaintiffs now seek to establish by declaration their light to a charge on this sum, basing their claim on a right to trace on the principle established in Re Hallett’s Estate.1.

Secondly, the receiver has certified that aluminium foil to a value alleged to be 50,235 is held by him, having originated in deliveries to the defendants by the plaintiffs. The plaintiffs seek a second relief, namely a declaration that this quantity of foil is theirs, and an order for its delivery up. Very much as a third string to their claim and only if they should fail on their first and second claims to relief, the plaintiffs sought judgment for the price.

The first major issue in this case turns on whether cl 13, in what the plaintiffs say are their general selling terms and conditions for aluminium foil, applied to the transactions done between the plaintiffs and the defendant company, in respect of which 122,239 is owing. That clause began with this important reservation of title. The first sentence of the clause reads as follows:

'The ownership of the material to be delivered by A.I.V. [i.e. the plaintiffs] will only be transferred to purchaser when he has met all that is owing to A.I.V., no matter on what grounds.'

I read the remainder of the clause in view of its somewhat elaborate nature and of subsequent issues arising:

'Until the date of payment, purchaser, if A.I.V. so desires, is required to store this material in such a way that it is clearly the property of A.I.V. A.I.V. and purchaser agree that, if purchaser should make (a) new object(s) from the material, mixes this material with (an) other object(s) or if this material in any way whatsoever becomes a constituent of (an) other object(s) A.I.V. will be given the ownership of this (these) new object(s) as surety of the full payment of what purchaser owes A.I.V. To this end A.I.V. and purchaser now agree that the ownership of the article(s) in question, whether finished or not, are to be transferred to A.I.V. and that this transfer of ownership will be considered to have taken place through and at the moment of the single operation or event by which the material is converted into (a) new object(s), or is mixed with or becomes a constituent of (an) other object(s). Until the moment of full payment of what purchaser owes A.I.V. purchaser shall keep the object(s) in question for A.I.V. in his capacity of fiduciary owner and, if required, shall store this (these) object(s) in such a way that it (they) can be recognized as such. Nevertheless, purchaser will be entitled to sell these objects to a third party within the framework of the normal carrying on of his business and to deliver them on condition that-if A.I.V. so requires-purchaser, as long as he has not fully discharged his debt to A.I.V. shall hand over to A.I.V. the claims he has against his buyer emanating from this transaction.'

If the plaintiffs can establish that cl 13 does apply, as between themselves and the defendants, they are admittedly entitled to succeed on their second claim, the goods in question in the possession of the defendants still being their property. But their first claim, namely the right to trace, is disputed. I must therefore deal first with the hotly contested point whether cl 13 did apply between the plaintiffs and defendants. The plaintiffs say it did, expressly, or impliedly. The defendants say that it did apply admittedly to trade that had been carried on between the plaintiffs and a firm called Romalpa Aluminium, prior to the plaintiffs beginning to do business with the defendants on 1st September 1973. They deny, however, that the clause applied to business done between the plaintiffs and the defendants from that date onwards. [His Lordship, having considered the facts, concluded that the general selling terms and conditions as applied to the dealing between the plaintiffs and Romalpa Aluminium also applied to the dealings between the plaintiffs and the defendants and continued:] Having decided that cl 13 did apply to the many transactions between the plaintiffs and defendants after 1st September 1973 when the defendant company took over the aluminium foil business that the partnership had previously conducted with the plaintiffs, I now have to deal with the consequences of that decision as applying to the claims in the action.

In the first place, it is admitted that the plaintiffs are the owners of the remaining unsold aluminium foil held by the receiver, and that they are entitled to an order for its delivery up to them. The real contest arose in relation to the plaintiffs' right to a charge on the receiver's account with the Hume Corporation to the extent of 35,152.66 representing, as certified by the receiver, the sum recovered by him from customers of the defendants as a result of A.I.V materials supplied to the defendants by the plaintiffs. This right the plaintiffs claim on the basis of the principle established in Re Hallett's Estate,2. entitling them to trace the proceeds of the sale of their property sold by the defendants into the receiver's bank account. It is common ground that the effect of the clause is that, whilst money was owing by the defendants to the plaintiffs, any aluminium foil delivered by the plaintiffs to the defendants, whilst still in their possession, was held by them as bailees.

It is further common ground that the clause must be read subject to the necessary implication that the defendants were entitled to sell the foil to sub-purchasers. It is curious that this is not said about sales of unmixed foil whilst it is said in the last sentence of the clause about foil mixed with other material. In respect of this, it is to be noted that the defendants were, if required, to assign to the plaintiffs their rights against sub-purchasers in respect of the mixed materials sold to them. Notwithstanding the generally far-reaching and somewhat elaborate provisions in cl 13, reserving the plaintiffs' right of ownership in the goods until nothing was owing from the purchasers, and the admission that the clause had the effect of making the defendants bailees of the goods whilst in their possession until all money owing had been paid, the argument for the defendants was that once foil had been sold to bona fide purchasers, the relationship between the plaintiffs and the defendants was purely one of debtor and creditor. As against this, the plaintiffs argued that a fiduciary relationship stemming from the bailment continued after sales to third parties, and that in consequence equitable remedies applied, including the right to trace proceeds of the sub-sales. It was not necessary, said the plaintiffs, to find as a prerequisite to the right to trace an express or constructive trust. The equitable proprietary remedy followed as a consequence of the finding that the defendants were bailees.

Having indicated the general nature of the competing arguments, I can go straight to the judgment of Jessel MR in Re Hallett's Estate.3. Although in that case there had been breaches of express trust, it is clear from the passages I am about to read that the reasoning was not founded on this, and that the principle stated applied to much wider circumstances. It is necessary to make certain fairly extensive quotations. Jessel MR said:3.

'The modern doctrine of Equity as regards property disposed of by persons in a fiduciary position is a very clear and well-established doctrine. You can, if the sale was rightful, take the proceeds of the sale, if you can identify them. If the sale was wrongful, you can still take the proceeds of the sale, in a sense adopting the sale for the purpose of taking the proceeds, if you can identify them. There is no distinction, therefore, between a rightful and a wrongful disposition of the property, so far as regards the right of the beneficial owner to follow the proceeds.’

Pausing there for a moment, it is not, of course, suggested here that there was a wrongful disposition of the plaintiffs' property when the defendants sold the foil to bona fide sub-purchasers. The latter would get a good title pursuant to s 25 of the Sale of Goods Act 1893. As between the plaintiffs and the defendants, however, the property had never passed to the defendants. I continue with the quotation.4.

'But it very often happens that you cannot identify the proceeds. The proceeds may have been invested together with money belonging to the person in a fiduciary position, in a purchase. He may have bought land with it, for instance, or he may-have bought chattels with it. Now, what is the position of the beneficial owner as regards such purchases? I will, first of all, take his position when the purchase is clearly made with what I will call, for shortness, the trust money, although it is not confined, as I will shew presently, to express trusts. In that case, according to the now well-established doctrine of Equity, the beneficial owner has a right to elect either to take the property purchased, or to hold it as a security for the amount of the trust money laid out in the purchase; or, as we generally express it, he is entitled at his election either to take the property or to have a charge on the property for the amount of the trust-money. But in the second case, where a trustee has mixed the money with his own, there is this distinction, that the cestui que trust, or beneficial owner, can no longer elect to take the property, because it is no longer bought with the trust money simply and purely, but with a mixed fund. He is, however, still entitled to a charge on the property purchased, for the amount of the trust-money laid out in the purchase; and that charge is quite independent of the fact of the amount laid out by the trustee. The moment you get a substantial portion of it furnished by the trustee, using the word "trustee" in the sense I have mentioned, as including all persons in a. fiduciary relation, the right to the charge follows. That is the modern doctrine of Equity.'

There then follows this passage5. showing the width of the application of the principle:

'Has it ever been suggested, until very recently, that there is any distinction between an express trustee, or an agent, or a bailee, or a collector of rents, or anybody else in a fiduciary position? I have never heard, until quite recently, such a distinction suggested. It cannot, as far as I am aware (and since this Court sat last to hear this case, I have taken the trouble to look for authority), be found in any reported case even suggested, except in the recent decision of Mr Justice Fry6., to which I shall draw attention presently. It can have no foundation in principle, because the beneficial ownership is the same, wherever the legal ownership may be.’

Then there is the following short passage 7.:

‘Now that being the established doctrine of Equity on this point, I will take the case of the pure bailee. If the bailee sells the goods bailed, the bailor can in Equity follow the proceeds, and can follow the proceeds wherever they can be distinguished, either being actually kept separate, or being mixed up with other moneys.’

Finally, there follows this sentence:

‘Therefore there is no difficulty in following out the rules of Equity and deciding that in a case of a mere bailee, as Mr Justice Fry has decided8., you can follow the money.’

These passages are dearly most apposite, since they refer to the position of a mere bailee, and were strongly relied on by counsel for the plaintiff. Counsel for the defendants sought to avoid them by saying they were obiter or had in some way been modified in Re Diplock’s Estate9. and that it was necessary that there should be some express or constructive trust before the equitable doctrine could apply. My attention was not drawn to any passage in Re Diplock's Estate10. criticising or modifying, in any way, the statements of principle which I have quoted. Although I fully recognise that in considering this problem I find myself in a most unfamiliar field, I feel it my duty to follow and apply those statements. Counsel for the defendants drew my attention to two authorities as illustrating the simple debtor/creditor relationship, namely King v Hutton11. and Henry v Hammond12. It is unnecessary to refer to these in detail, save to say that the former makes it clear that the special facts of each case are crucial in determining whether there is a simple debtor/creditor relationship, although the intention of the parties as ascertained from the terms of their contract shows that some kind of fiduciary relationship exists. The preservation of ownership clause contains unusual and fairly elaborate provisions departing substantially from the debtor/creditor relationship and shows, in my view, the intention to create a fiduciary relationship to which the principle stated in Re Hallett's Estate13. applies. A further point made by counsel for the defendants was that if the plaintiffs were to succeed in their tracing claim this would, in effect, be a method available against a liquidator to a creditor of avoiding the provisions establishing the need to register charges on book debts: see s 95 (I)(2)(e) of the Companies Act 1948. He used this only as an argument against the effect of cl 13 contended for by counsel for the plaintiffs. As to this, I think counsel for the plaintiffs' answer was well founded, namely that if property in the foil never passed to the defendants with the result that the proceeds of sub-sales belonged in equity to the plaintiffs, s 95 (I) had no application.

The plaintiffs accordingly succeed and are entitled to the reliefs sought.

Order accordingly.

Appeal

The defendants appealed against the judgment of Mocatta J.

Leolin Price QC and Murray Pickering for the defendants.
Anthony Lincoln QC and David Donaldson for the plaintiffs.

 

ROSKILL LJ delivered the first judgment at the invitation of Megaw LJ. This appeal, from a judgment of Mocatta J dated 11th February 1975, arises out of a dispute between the plaintiffs (the respondents to this appeal), a Dutch company who amongst other things manufacture aluminium foil in Holland, and the defendants (the appellants in this appeal), an English limited company, regarding entitlement, first to certain. quantities of aluminium foil admitted to be physically in the defendants' possession and, secondly, to certain proceeds of sale of other aluminium foil delivered to the defendants by the plaintiffs, and sold by the defendants to sub-purchasers in this country for which those sub-purchasers had paid the defendants but for which the defendants had not paid the plaintiffs by the time the defendants-whose business has been in the hands of a receiver since 1st November 1974-got into the serious financial difficulties which led to that receiver being so appointed. At that date the defendants were indebted to the plaintiffs for over 122,000.

The value of the foil concerned in the first head of claim is said to be just over 50,000. The sum involved in the second head of claim is just over 35,000. The present action is thus an attempt by the plaintiffs to reduce that very substantial loss which they have suffered in their trading operations with the defendants, albeit at the expense of the debenture holders by whom the receiver was appointed and to whom the defendants remain very heavily indebted in respect of two advances of 100,000 each made to the defendants by the debenture holders.

The business which has lead to these heavy losses was not always conducted between the defendants and the plaintiffs. Before September 1973 it had been conducted by the plaintiffs with a partnership called Romalpa Aluminium (for brevity I shall call it ‘the partnership’), the two partners in which became the two principal directors of the defendant company, the third director of the defendant company being a nominee of the debenture holders who first of all financed the defendants in return initially for the issue of unsecured loan stock and later in return for the debentures which the defendants issued to them.

There is no doubt what the express terms were on which the plaintiffs did business with the partnership. The plaintiffs did their business on certain general conditions of sale dated February 1971 which were deposited or registered with all district or county courts in Holland. The significance of such deposit, in Dutch law, was not the subject of any evidence; nor does it matter, though it would have been interesting to have known what the position was under Dutch law, as indeed it would have been interesting to know how a Dutch lawyer would have construed some of those express terms. Those conditions were in Dutch, but there was what one might describe as an authentic and specially prepared, though not perhaps very well expressed, English translation of the Dutch conditions. On 4th April 1972 the plaintiffs obtained from the partnership the signature of the two partners on a copy of that English translation. The conditions were expressed to be subject to Dutch law, the Amsterdam court being given exclusive jurisdiction.

The relevant conditions for present purposes were 13, 22, 25 and 26. I shall read parts of those later. Thereafter, and until the defendants took over the business with the plaintiffs previously done by the plaintiffs with the partnership, there can be no doubt that that business was done, inter alia, on those express conditions. Individual invoices covering specific transactions incorporated both in Dutch and in English what was described as an 'epitome' of the plaintiffs’ general conditions to which I have just referred. One hesitates to criticise such a document, for one knows the difficulties of translation of this type of document from one language to another; but it cannot be said that the English translation is happy. Clause 13 is not referred to in the epitome at all-an omission on which the defendants placed considerable reliance in connection with their submission that, though the general conditions had governed the relationship of the plaintiffs with the partnership, they never governed the plaintiffs' relationship with the defendants, notwithstanding that exactly the same printed form of invoice was used for business both with the partnership and with the defendants.

It was argued by counsel for the defendants that since the same procedure had not been gone through with the defendants as with the partnership, that is to say by obtaining the signatures of the defendants' directors on a copy of the conditions, those general conditions did not apply to the transactions between the defendants and the plaintiffs; and he went on to argue that the knowledge of the partnership was not the knowledge of the defendants even though those two partners were the defendants' two principal directors.

The avowed purpose of this argument was to enable the defendants, if they could, to escape, in particular, from the bonds of cl 13 of the general conditions. For, if the defendants were not bound by those conditions, and in particular by cl 13, the whole of the plaintiffs' claim must fail and Mocatta J's judgment would be manifestly wrong. If, however, the defendants were bound by cl 13, it was admitted that, as indeed Mocatta J held, the plaintiffs must succeed on their first head of claim, though it was strenuously contended on their behalf that, even so, cl 13 did not enable them to succeed on their second head of claim. Indeed, before us the major part of the argument was directed to this latter question, which the judge also decided in the plaintiffs' favour. Indeed, counsel for the defendants, if he will forgive my saying so, for reasons which I can well understand and indeed sympathise with, argued the second point first.

The opening sentences of cl 13 read:

'The ownership of the material to be delivered by A.I.V. [i.e. the plaintiffs] will only be transferred to purchaser when he has met all that is owing to A.I.V., no matter on what grounds. Until the date of payment, purchaser, if A.I.V. so desires, is required to store his material in such a way that it is clearly the property of A.I.V.'

In argument those first two sentences in cl 13 were referred to for convenience as the first part of that clause. Following those first two sentences, which only occupy just over four lines of typescript, there are some 20 further lines of small print dealing with, and as I think only with, what were called in argument mixed or manufactured goods, that is to say goods manufactured from the material supplied by the plaintiffs, so that that material thus lost its original identity.

At one stage in his argument, counsel for the defendants submitted that the second e part of cl 13 also applied to unmanufactured goods, by which I mean goods which remained in the state in which they were delivered to the defendants; but ultimately he did not press this part of his argument, rightly, as I think, for it seems to me plain that the two parts of this clause are dealing with separate subject-matters, the first part with unmanufactured goods and the second with mixed or manufactured goods. The second part is, however, relevant, especially in the light of the argument which counsel for the defendants sought and obtained leave yesterday to advance by virtue of his amendment to the notice of appeal which we allowed, for in determining what implication is to be made in the first part of the clause-which is the all-important issue in this appeal-it is clearly right to look at cl 13 as a whole and not merely at one part of it. The second part reads thus:

'A.I.V. and purchaser agree that, if purchaser should make (a) new object(s) from the material, mixes this material with (an)other object(s) or if this material in any way whatsoever becomes a constituent of (an)other object(s) A.I.V. will be given the ownership of this (these) new object(s) as surety of the full payment of what purchaser owes A.I.V. To this end A.I.V. and purchaser now agree that the ownership of the article(s) in question, whether finished or not, are to be transferred to A.I.V. and that this transfer of ownership will be considered to have taken place through and at the moment of the single operation or event by which the material is converted into (a) new object(s), or is mixed with or becomes a constituent of (an)other object(s). Until the moment of full payment of what purchaser owes A.I.V., purchaser shall keep the object(s) In question for A.I.V. in his capacity of fiduciary owner and, if required, shall store this (these) object(s) in such a way that it (they) can be recognized as such. Nevertheless, purchaser will be entitled to sell these objects to a third party within the framework of the normal carrying on of his business and to deliver them on condition that-if A.I.V. so requires-purchaser, as long as he has not fully discharged his debt to A.I.V. shall hand over to A.I.V. the claims he has against his buyer emanating from this transaction.'

Clause 22 reads:

'Payment has to be made net cash by purchaser not later than fourteen days after the date of invoice, preferably by payment by transfer to the postal giro or banking account of A.I.V. If required a bill of exchange can be drawn. The place of payment for all deliveries is Vaassen (Gld.). [That was where the plaintiffs carried on their business.] This also holds good when a bill is returned unpaid. In spite of any complaints about flaws in the material delivered, purchaser is obliged to pay the purchase price at the time laid down.'

The provision regarding 14 days was varied (assuming for the moment that the general conditions applied) in that 75 days' grace was allowed to the defendant and not the 14 days for which cl 22 alone provided. Whilst, as I think, one must deal with the question of construction and implication on the footing that the credit allowed was 75 days, I do not think that that question can be answered differently according to whether the credit period was 14 or 75 days or some other period.

Clause 13 appears in the general conditions with cl 22 unvaried.

Clause 25 reads:

'Should purchaser remain in default of any payment for which he is liable to A.I.V.-which would be the case in exceeding the time within which purchaser should have paid-then A.I.V. is entitled to stop all deliveries, irrespective of which contract with purchaser they spring from, and to rescind the contract in question without judicial interposition, all this without prejudicing their right to full compensation and without prejudicing their right to take back at once from purchaser the material [which], by virtue of what is laid down under 13, is still their property.'

It is to be noted that the rights given by cl 25 (again assuming that the general conditions apply) are not limited to non-payment of individual debts due under each individual contract evidenced by individual invoices, but apply in the case of default of any payment' for which the purchaser (that is to say the defendants) is liable to the plaintiffs-a fact which I regard as of great importance. Clause 26 gives the plaintiffs an additional right to interest on outstanding invoice debts.

I shall deal first (as did Mocatta J) with the question of the alleged incorporation of the general conditions into the transaction with the defendants, it being, as I have already said, conceded that those general conditions applied to the antecedent transactions with the partnership. The judge had no difficulty in holding that the business done with the defendants was done on exactly the same terms as the antecedent business with the partnership. In his judgment he set out fully and clearly the course of dealing between the defendants and the plaintiffs. I respectfully adopt his clear statement of that course of dealing, the accuracy of which was not challenged in argument before us. I entirely agree with his conclusion as expressed in these terms:

'The important matters however to my mind are that, as Mr Rodbard [he was one of the defendants' directors] admitted in his evidence, he knew that from 4th April 1972 when he and Mr Malyon signed the English translation of the general selling terms and conditions, that the full terms of the epitome on the back of the confirmation forms, and as deposited in the Dutch county courts, were in the terms put into English that he and Mr Malyon had signed. In my judgment it follows from the facts, as I have narrated them, that the full deposited terms, including cl 13, did apply to every order placed by the defendants with the plaintiffs. I say this, firstly, because the acknowledgement form referred on the front to the epitome behind, and cl 13 was in fact part of the general selling terms and conditions filed with the Dutch county courts. There was therefore an express incorporation of cl 13 in the various contracts made between the parties. Secondly, if there were any doubt hesitation in holding that the full terms, including cl 13, were impliedly agreed to apply to each order.'

A repetition of these reasons would not improve them.

It is obvious that the defendants' directors, the two ex-partners, knew precisely what the terms of business had been before the defendants came on the scene as a contracting party with the plaintiffs, and what those terms were going to be there after-that is to say after the defendants had so come on the scene-and in fact were at all material times; and their knowledge was manifestly the knowledge of the defendants. Whilst it is true that there are, as counsel for the defendants rightly said, many cases in the books in which the knowledge of a director of company A acquired in that capacity, has been held not to be the knowledge of company B, of which that person is also a director, that principle to my m mind has no application whatever here. The defendants took over the antecedent business of the partnership. If ever there were a case in which the past knowledge of the partners became the present knowledge of the defendants, whose two main directors were those two former partners, to my mind it is the present. With all respect to the argument of counsel for the defendants, the contrary seems to me to be almost unarguable.

Accordingly, it seems to me clear that the foil physically held by the receiver is the plaintiffs' foil, to which they are now entitled, and the appeal against that part of Mocatta J's judgment must in my view clearly fail.

I turn to the second part, which counsel for the defendants argued first. Are the plaintiffs entitled to the proceeds of sales to sub-purchasers now held by the receiver? We were told both by counsel for the defendants and by counsel for the plaintiffs that the receiver received these moneys after he had entered into his receivership from sales made by the defendants to sub-purchasers before that date. The receiver, properly if I may say so, kept those moneys separate; and we were told that there is no complication arising of those moneys having become mixed with other moneys, because they were always kept separate. There was no suggestion that the sub-sales in question were other than authorised by the plaintiffs or that the sub-purchasers concerned did not acquire a valid title to the several quantities of foil which each of them bought. The sole question is whether, on the facts and on the true construction of the bargain, including the general conditions, between the plaintiffs and the defendants, the plaintiffs are entitled to trace and recover those proceeds of the sub-sales, on the well-known principles laid down in the judgment of Jessel MR in Re Hallett's Estate14.. Those principles are so well known that it is not necessary to quote Jessel MR's famous judgment or from the various restatements of principle in the several textbooks to which counsel for the defendants has referred. The most relevant passages from that judgment will be found in Mocatta J's judgment15..

The critical question is whether there was a fiduciary relationship between the Plaintiffs and the defendants which entitles the plaintiffs successfully to claim these moneys in the way and on the footing which I have just described. Counsel for the defendants strenuously argued that the bargain between the parties was a perfectly ordinary bargain, creating the ordinary contractual relationship of seller and buyer, with the consequence that if the buyers-that is to say the defendants-became insolvent before payment for the goods was made by them to the sellers-that is the Plaintiffs-the sellers were left with their ordinary contractual or, as he put it, personal remedy as unsecured creditors of the buyers, and that there was no additional proprietary remedy (again to borrow his language) available to them justifying their seeking to trace and recover the proceeds of the sub-sales which had come from the sub-purchasers into the hands of the receiver.

It seems to me clear that, but for the provisions of cl 13-which have to be read in conjunction with the other relevant clauses I have mentioned-this would be the position. The individual contracts were for delivery ex the plaintiffs' works in Holland, and, apart from special provisions, in English law at least-as already stated, there is no evidence of Dutch law and therefore we must apply English law to these contracts -both property and risk would have passed to the defendants on such delivery.

But cl 13 plainly provides otherwise. The plaintiffs as sellers were to retain the property in the goods until all-and I underline 'all'-that was owing to them had been paid. It is a curious fact that the first part of cl 13 is so short while the second part is so long and detailed. But, as counsel for the plaintiffs said, the problems with which the second part had to deal were infinitely more complex than those with which the first part had to deal. It is obvious, to my mind, that the business purpose of the whole of this clause, read in its context in these general conditions, was to secure the plaintiffs, so far as possible, against the risks of non-payment after they had parted with possession of the goods delivered, whether or not those goods retained their identity after delivery. I unhesitatingly accept that part of counsel for the plaintiffs' submission. In the case of unmanufactured goods this was to be achieved by the plaintiffs retaining the property until all payments due had been made, to which were added the special rights given by cl 25. In the case of mixed or manufactured goods, more elaborate provisions were made and indeed were obviously required if the avowed objects of cl 13 were to be achieved in the case of the latter class of goods. The plaintiffs were to be given the ownership of these mixed or manufactured goods as 'surety' for 'full payment'. 'Surety' I think in this context must mean, as counsel for the plaintiffs contended, 'security'. This is as between the defendants and the plaintiffs, and it is not necessary to consider how far these provision would protect the plaintiffs against adverse claims, at any rate in this country, by third parties. Further, the clause later provides that until 'full payment' is made the defendants shall keep the mixed goods for the plaintiffs as 'fiduciary owners'-not perhaps the happiest of phrases but one which suggests, at least to an English lawyer, that in relation to mixed or manufactured goods there was produced what in English law would be called a fiduciary relationship in this respect. The clause goes on to give to the defendants an express power of sale of such goods, and the right to deliver them; and adds an obligation on the defendants, if required by the plaintiffs to do so, to assign (to use English legal language) to the plaintiffs the benefit of any claim against a sub-purchaser so long as the defendants have not fully discharged all their indebtedness to the plaintiffs.

For my part, I accept that this last-mentioned provision is not itself an equitable assignment in English law. But I think that counsel for the plaintiffs is right in his general approach to the construction of the second part of cl 13. Like the first part, it contemplates the resale by the defendants of goods which at the time of such resale were to be the property of the plaintiffs and not of the defendants. The second part of cl 13 dearly contemplates the creation of a fiduciary relationship in relation to mixed goods; and the assignment provisions are, as I think, clearly designed to give the plaintiffs if they so require, an additional security to recover debts otherwise payable to the defendants but not paid to them by the sub-purchasers, if the defendants have failed to discharge all or any of their current indebtedness to the plaintiffs.

The burden of counsel for the plaintiffs' argument was, first, that all goods dealt with in pursuance of cl 13 were, until all debts were discharged, the plaintiffs' goods which the defendants were authorised to sell on the plaintiffs' behalf and for the plaintiffs' account but only within the framework of cl 13. Since the goods were the plaintiffs', the defendants remained accountable to the plaintiffs for them or for their proceeds of sale, so long as any indebtedness whatever remained outstanding from the defendants to the plaintiffs. Hence the creation of the fiduciary relationship on which counsel for the plaintiffs sought to rely. The burden of counsel for the defendants' argument was, as already stated, that the clause created in the first part no more than the ordinary debtor/creditor-buyer/seller and in the second part justified placing additional fiduciary obligations on the in respect of unmanufactured goods, referred to in the first part of the clause.

It was common ground at the trial and during argument in this court that some implication had to be made into the first part of cl 13; since otherwise the defendants could not lawfully sell the unmanufactured goods in their possession, at least until they were paid for-for, as already pointed out, they were the plaintiffs' and not the defendants' goods. To hold otherwise, as I think both parties accepted, would be to stultify the whole business purpose of these transactions. What, if any, implication is to be made beyond that? The first part of cl 13 is silent not only as to the power of sale but as to the dealing with any proceeds of the goods lawfully so sold by the defendants. Is the admitted power of sale (if I may respectfully borrow Goff LJ's phrase during the argument) fettered or unfettered? If it is fettered, is the fetter that, so long as any indebtedness remained outstanding in any respect from the defendants to the plaintiffs, the defendants after a sub-sale remained accountable to the plaintiffs for all proceeds of sub-sales, not even, as counsel for the defendants pointed out in argument, being able to retain for themselves the profit on any such sales?

Counsel for the defendants relied much on the 75 days' credit, though, as I have already ventured to point out, the problem is the same whatever the length of the credit. But the longer the period it can fairly be said the greater the business, if not the legal, force of this part of counsel's argument. If the plaintiffs were right, counsel for the defendants argued, then whenever sub-purchasers paid the defendants before the 75 days' credit had expired the defendants could not use those proceeds in their business for any purposes whatever save for paying their creditors, the plaintiffs; they must always retain those proceeds specifically for the plaintiffs' account and pay them over to the plaintiffs unless and until the entirety of outstanding indebtedness was discharged. This, he said, would deprive the defendants of all day-to-day finance and, so far from according with business efficacy, would produce precisely the opposite result, for it would cause acute cash-flow problems and make conduct of the defendants' business impossible. This is a formidable argument if one looks at the matter solely from the point of view of the defendants. But this matter has to be regarded in the light of the contractual provisions agreed on by both parties, and the question of business efficacy, in relation to which there are here obvious competing business considerations, must be answered in the light of what both parties expressly agreed on and therefore must be taken also impliedly to have agreed on, and not unilaterally from the point of view of one party only.

The crucial facts to my mind are two: first, that the defendants were selling goods which the plaintiffs owned at all material times; and secondly, that cl 13 as a whole is obviously designed to protect the plaintiffs, in the event of later insolvency, against the consequences of having parted with possession of, though not with legal title to, these goods before payment was received, 75 days’ credit being allowed. When, therefore, one is considering what, if any, additional implication has to be made to the undoubted implied power of sale in the first part of cl 13, one must ask what, if any, additional implication is necessary to make effective the obvious purpose of giving the requisite security to the plaintiffs. One is, I think, entitled to look at the second part of cl 13 to answer this; for it would be strange if the first part were to afford no relevant security when the second part is, as I think, elaborately drawn to give such security in relation to manufactured or mixed goods.

I see no difficulty in the contractual concept that, as between the defendants and their sub-purchasers, the defendants sold as principals, but that, as between themselves and the plaintiffs, those goods which they were selling as principals within their implied authority from the plaintiffs were the plaintiffs' goods which they were selling as agents for the plaintiffs to whom they remained fully accountable. If an agent lawfully sells his principal's goods, he stands in a fiduciary relationship to his principal and remains accountable to his principal for those goods and their proceeds. A bailee is in like position in relation to his bailor's goods. What, then, is there here to relieve the defendants from their obligation to account to the plaintiffs for those goods of the plaintiffs which they lawfully sell to sub-purchasers? The fact that they so sold them as principals does not, as I think, affect their relationship with the plaintiffs; nor, as at present advised, do I think-contrary to argument of counsel for the defendants-that the sub-purchasers could on this analysis have sued the plaintiffs on the sub-contracts as undisclosed principals for, say, breach of warranty of quality.

It seems to me clear (and so far from helping counsel for the defendants I think the second part of cl 13, properly construed, helps counsel for the plaintiffs) that to give effect to what I regard as the obvious purpose of cl 13 one must imply into the first part of the clause not only the power to sell but also the obligation to account in accordance with the normal fiduciary relationship of principal and agent, bailor and bailee. Accordingly, like the learned judge, I find no difficulty in holding that the principles in Re Hallett's Estate16., to which I have already referred, are of immediate application, and I think that the plaintiffs are entitled to trace these proceeds of sale and to recover them, as the learned judge has held by his judgment.

Counsel for the defendants relied on the conduct of the parties after the defendants took over from the partnership, pointing out (as was the fact) that the defendants were never required to account to the plaintiff in the way I think, as a matter of law, the plaintiffs were entitled to require them to account. As a matter of business I would not have expected the plaintiffs so to have required the defendants to account. But, as counsel for the plaintiffs forcefully replied on this point, cl 13 is directed to a state of insolvency, not to what he described as to the halycon days of solvency; and it is only on insolvency that the question of what the powers are under cl 13 comes into play.

On the view which I have formed of this case it is not necessary to discuss some of the other interesting points on which we had the benefit of argument from counsel on both sides, and I refrain from doing so. For the reasons I have given, for my part, I would unhesitatingly uphold Mocatta J's judgment and dismiss this appeal.

 

GOFF LJ. I need not repeat any general statement of the facts. They have been fully set out in the judgment just delivered by Roskill. LJ.

The first question which arises for determination is whether cl, 13 of the general selling terms and conditions applied to the contracts made between the plaintiffs and the defendants or only to those made whilst the business was still being carried on by the partnership. if it did apply to the defendants, then it follows that the plaintiffs are entitled to recover the unsold stock and the appeal must fail as to that item. There is, however, then a second question whether, even so, the judgment is right in allowing the plaintiffs to recover the 35,000 odd proceeds of sale. I turn to the first of these questions.

There is in my view no doubt at all that, the partners having accepted and signed the translation of the general terms and conditions, the whole of those terms, including cl 13, applied to the contracts made by them, and that is agreed. It is said, however, that the defendants are in a better position than the partners and are not bound by cl 13. I cannot accept that argument. True, the company was a different entity in law. True also, a company is not necessarily to have imputed to it the knowledge of its directors acquired in another capacity. But here those directors were the vendors of the very business in relation to which they not only acquired the knowledge but agreed the terms on which the business was to be conducted, and they continued to manage the company and told the plaintiffs that they were doing so. It would be a travesty if the defendants were not bound, and I do not see anything to force one to the conclusion that they were not. On the contrary, it seems to me that the facts lead irresistibly to the conclusion that they were. In any case, the forms, which the defendants continued to receive and accepted, expressly pointed out that the full terms were filed in every county court in Holland, and I do not see how they can possibly be heard to say that they had no notice of cl 13 and did not contract on the full filed terms, which they could have caused to be inspected, but had no need so to do, because the majority at least, if not the whole, of the board knew them and had accepted them.

I agree with Roskill LJ in saying that the reasoning of Mocatta J on this part of the case is quite unchallengeable.

In my judgment the second part of the case comes down to a short question of construction. It is common ground that a power of sale during the period that any money remains owing to the plaintiffs must be implied; but the question is on what terms.

I do not think it is necessary to go into the cases cited, since it is clear to me, and was for a long time during the argument, that the plaintiffs must, on the principle of Re Hallett's Estate17., be entitled to trace their aluminium into the proceeds of sale so as to enable them to take the 35,000 and to take that sum in priority to the general body of the defendants' creditors and in priority to the secured creditor, Hume Corporation Ltd, unless, as the defendants contend, one ought to imply a power to sell and apply the proceeds of sale for their own purposes, or, as they put it, to sell for their own account. In the end this was accepted by both counsel, and nothing short of that will serve the defendants' purpose.

The plaintiffs say that the power should be qualified so as to maintain for them the security which they gave themselves by providing that property in the aluminium should not pass so long as any money remained owing to them, and accordingly it could only be exercised for their benefit in this sense, that the proceeds of sale must be held in trust for them until the defendants' indebtedness to them on any contract be discharged.

In considering this problem, one may at the outset dispose of one point. The provisions in the latter part of cl 13 dealing with cases where there has been admixture cannot, in my judgment, as a matter of construction apply to the type of case with which we are concerned where there has been no admixture. Those provisions are, however, as Roskill LJ has said, relevant insofar as they throw light on what the implication in the earlier part should be; and, indeed, in an alternative submission, introduced by amendment, to which I must return later, the defendants submit that the power of sale to be implied is the same as that expressly provided in that latter part of cl 13.

In considering what should be implied in a contract, the court has to consider what is required to give it business efficacy; but I agree with Roskill LJ that there are here two distinct and opposing approaches to 'business efficacy'. The one, looking at the matter from the point of view of the defendants, suggests that an unqualified power is required, because they would need to use the money in carrying on their business, and indeed, so it is suggested, anything else would largely stultify the agreement that they should have 75 days' credit. The other is, from the standpoint of the plaintiffs, that the power should not be so wide as to frustrate the whole purpose of cl 13, which it is submitted, and in my judgment rightly submitted, discloses a manifest intention to preserve the vendors from being left in the position of unsecured creditors.

In the end, in my judgment, the question is which of these ought to prevail; and I have come to a clear conclusion that the plaintiffs' contention should be preferred.

There is no doubt force in counsel for the, defendants' argument that this as a matter of strict law destroys the benefit of the 75 days' credit. I would observe, as Roskill LJ has pointed our, that the general selling terms and conditions as originally accepted by the partners provided for 14 days' credit only, and it may well be that in considering what should be implied one should disregard the later extension of time in which case the point would be much weakened, although not altogether destroyed. I will assume, however, that the court ought to consider the matter in the light of that extension. Even so, in my judgment this is not enough to require, or entitle, the court to imply a term plainly and utterly inconsistent with the clear intention of the clause into which it is to be implied.

The difficulty arises largely because the general conditions tie the passing of the property not to the particular contract but to all indebtedness. But for that, the qualified power would not prevent the defendants from enjoying reasonable advantages from the 75 days' credit. No doubt in practice, so long as all went well, the plaintiffs would allow the defendants to use the proceeds of sale in their business, as I understand they did; but things ceased to go well, and now one has to determine the strict rights of the parties, and in my judgment the difficulty so imported is not enough to drive one to imply a term defeating the whole object of cl 13.

I turn to the alternative argument which I have already mentioned. I do not myself think it is a correct approach simply to imply in the first part of cl 13 the same power as is expressed in the latter part, and which as a matter of construction does not apply to the first part and which is dealing with a different state of affairs. Even, however, if one does, it does not in my view help the defendants.

The argument is that under that clause there is no equitable assignment of the book debts until the plaintiffs require the defendants, in the words of the translation before us, to 'hand over to A.I.V. the claims he has against his buyer', and, further, that as no such requirement was made before the security crystallised by the appointment of the receiver, any equitable assignment resulting therefrom could only be subject to the security created by the debentures.

I accept that as far as it goes, but it still leaves the question whether one should then construe the power as entitling the defendants to sell and use the proceeds as and when received for their own benefit unless and until required to assign the debt, or whether on the contrary, as the plaintiffs contend, it is implicit that the proceeds of sale when received are received on their account and the right to call for an assignment is ancillary only. In my judgment, that would be the right view, even if one simply implied a power in precisely the same terms as expressed concerning admixture cases.

In short, my conclusion is that the power of sale to be implied where none has been expressed must be so qualified as not to defeat the intention clearly shown by cl 13 as a whole, including the latter part, which only emphasises this. It follows that there was, as Roskill LJ says, a sufficient fiduciary relationship between the parties, and this is indeed expressly contemplated in the reference to a fiduciary owner in the second part of cl 13. The implied power must, therefore, in my judgment be a power to sell, not for the defendants' own account, but for the account of the plaintiffs unless and until all moneys owing be paid.

For these reasons, I agree that this appeal fails as to both parts and should be dismissed.

 

MEGAW LJ. Ground (I) of the notice of appeal raises the question whether Mocatta J was wrong in holding that the terms of cl 13 of the plaintiffs' general selling terms and conditions (I quote from the notice of appeal) 'applied to and were incorporated in contracts for the sale of aluminium foil made between the Plaintiff and the Defendant'? If the defendants were right on this issue, they would succeed on the whole appeal-each part of it. If they are wrong on this issue, they would fail in their appeal as regards the parts of the claim by the plaintiff which relates to the aluminium foil still in the possession of the defendants or the receiver. They would still have their further argument that, even so, the plaintiffs are not entitled to recover the moneys held by the receiver as moneys received from customers of the defendants.

In my judgment the learned judge was clearly right to hold as he did on this first issue, for the reasons given by him. This is not a case of a contract between parties of unequal bargaining power, and it does not involve any of the considerations which it has, whether rightly or wrongly, sometimes been suggested apply, or ought to apply, in such cases. We are now concerned with a commercial transaction, or series of transactions, between parties who must be deemed to see and take the trouble to read documents which have, or which they should reasonably expect to be intended by the other party to have, a contractual status. On each occasion when the defendant company entered into contracts with the plaintiffs, as it did on hundreds of occasions, there was brought to the notice of the responsible representatives of the defendant company, even if those representatives had not earlier had full knowledge of it, a clearly printed document-an acknowledgement of order- which on its face said 'vide epitome of our General Selling Terms at the back'. The English translation, on the back of the document, of the so-called 'epitome' said that the epitome was an epitome of 'the General Selling Terms and Conditions ….. which general selling terms and conditions are filed at the Record Office of all County Courts in the Netherlands'. There is no dispute but that cl 13, though not included in the 'epitome', was included in the general selling terms and conditions thus filed.

There could not sensibly on the facts of this case be any suggestion that the defendant company, through its representatives, was in any way misled by that non-inclusion. There is no doubt that the two directors of the defendant company, Mr Rodbard and Mr Malyon, in their previous capacity as partners in the firm which was thereafter taken over by the defendant company, had seen and considered all those terms, including cl 13. Yet it is, apparently, seriously suggested that cl 13 was not a term of the relevant contracts. I am unable to see why not.

I agree with that part of counsel for the defendants' submission in which he contended that more might be required to establish that a contracting party is to be treated as bound by a particular intended term, of the contents of which he was in fact unaware, when that term is an unusual one, than is required when the term is a usual one. I adhere to the view which I expressed on that point in Thornton v Shoe Lane Parking Ltd18., a case to which counsel for the defendants made reference in passing in the course of his submission. But, with respect, that has nothing to do with the issue raised in this present case. In the artificial way in which, in law, a corporation a limited liability company has knowledge, this defendant company did have knowledge of this particular term its existence and its contents. The defendants' representatives, the two directors, had that knowledge, and had it in circumstances in which their knowledge was the. knowledge of the defendant company. I should not, unless I were shown binding authority to that effect, be prepared to accept as a proposition of law that before a limited liability company can be held to have knowledge of some fact, it must be shown that its representatives who have that knowledge acquired that particular item of knowledge at a time when they were representatives of the company, and that they acquired it in that capacity. But, even if that were a correct proposition of law, as I think counsel for the defendants' argument implied, it would have no application here. The two directors, formerly the partners, when the defendant company took over the partnership business, its assets and its liabilities, were well aware of the contracts being taken over, including their terms; and I should have said that, as an obvious and necessary consequence, the defendants were at once and thereafter affixed with knowledge, not only of the details of the particular contracts, but also of the general terms applicable to them, that knowledge coming to the defendants through the partners, now the directors. That knowledge of the terms of those contracts, once acquired, would continue in relation to future contracts following the same form. If it be said that this is artificial, I would reply that it has not one-tenth of the artificiality involved in the submission that the knowledge of the partners as to the terms ceased to be relevant when the partnership business was taken over by the defendant company. I agree that the learned judge was entirely right to reject the defendants' arguments on that issue.

As regards the other ground put forward on behalf of the defendants, relating to the moneys in the hands of the receiver deriving from material which had been delivered by the plaintiffs to the defendants, the point is I think indeed, as it ultimately was defined in this court, a short one though, I would agree, by no means an easy one. It is a question of the true construction of cl 13 of the general selling terms and conditions. It is accepted by both parties that in the first part of the clause, dealing with, as it is called, 'the material', that is aluminium foil not made up with other constituents into a 'new object', some further term must be implied. There must be implied a right on the part of the defendants to arrange sales of the material. But are those sales to be made, as the defendants contend, on their own account; or are they to be made on account of the plaintiffs?

For the reasons given by Roskill and Goff LJJ, I agree that the submissions made in this court on behalf of the plaintiffs are correct. The power of sale to be implied in the first part of cl 13, where none has been expressed, must be such as not to defeat the intention shown by cl 13. It is not a power to sell for the defendants' own account, but it is a power to sell for the account of the plaintiffs.

I agree that the appeal should be dismissed.

Appeal dismissed.
Leave to appeal to the House of Lords refused.

Solicitors: Theodore Goddard & Co (for the defendants); Woodham Smith, Greenwood & Holland (for the plaintiffs).

Mary Rose Plummer Barrister.

ENDNOTES:

  1. (1880) 13 Ch D 696, [1874-80] All ER Rep 793.
  2. (1880) 13 Ch D 696, [1874-80] All ER Rep 793.
  3. 3 Ch D at 708, 709, [1874-80) All ER Rep at 796.
  4. (1880) 13 Ch D at 709, [1874-80] All ER Rep at 796.
  5. 13 Ch D at 709, 710, [1874-80] All ER Rep at 796.
  6. Re West of England and South Wales District Bank, ex parte Dale & Co. (1879) II Ch D 772.
  7. 13 Ch D 696 at 710, [1874-80] All ER Rep 793 at 797.
  8. Re West of England and South Wales District Bank, ex parte Dale & Co (1879) II Ch D 772.
  9. [1948] 2 All ER 318, 2 [1948] Ch 465.
  10. [1900] 2 QB 504.
  11. [1913] 2 KB 515.
  12. (1880) 13 Ch D 696, [1874-8o] All ER Rep 793.
  13. (1880) 13 Ch D 696, [1874-8o] All ER Rep 793.
  14. (1880) 13 Ch D 696, [1874-8o] All ER Rep 793.
  15. Pages 555-557, ante.
  16. (1880) 13 Ch D 696, [1874-8o] All ER Rep 793.
  17. (1880) 13 Ch D 696, [1874-8o] All ER Rep 793.
  18. [1971]1 All ER 686, [1971] 2 QB 163.