Barwick v English Joint Stock Bank
| Jurisdiction | England & Wales |
| Date | 1865 |
| Court | Exchequer |
Principal and Agent - Representation - Money had and received.
A principal is liable to an action for the fraudulent misrepresentation of his agent, acting in the course of his business.
The plaintiff having for some time, on a guarantee of the defendants, supplied J. D., a customer of theirs, with oats on credit for carrying out a government contract, refused to continue to do so unless he had a better guarantee. The defendants' manager thereupon gave him a written guarantee to the effect that the customer's cheque on the bank in plaintiff's favour, in payment for the oats supplied, should be paid, on receipt of the government money, in priority to any other payment, “except to this bank.” J. D. was then indebted to the bank to the amount of 12,000l., but this fact was not known to the plaintiff, nor was it communicated to him by the manager. The plaintiff thereupon supplied the oats to the value of 1227l.; the government money, amounting to 2676l., was received by J. D., and paid into the bank; but J. D.'s cheque for the price of oats drawn on the bank in favour of the plaintiff was dishonoured by the defendants, who claimed to retain the whole sum of 2676l. in payment of J. D.'s debt to them. The plaintiff having brought an action for false representation, and for money had and received:—
Held, first, that there was evidence to go to the jury that the manager knew and intended that the guarantee should be unavailing, and fraudulently concealed from the plaintiff the fact which would make it so.
Secondly, that the defendants would be liable for such fraud in their agent.
Thirdly, that the fraud was properly charged in the declaration as the fraud of the defendants.
Quoere, whether the plaintiff could have recovered under the count for money had and received.
DECLARATION, 1st count, that, in consideration that the plaintiff would sell to or purchase for J. Davis & Son not exceeding 1000 quarters of oats for the use of their contract, the defendants promised the plaintiff that they would honour the cheque of J. D. & Son in the plaintiff's favour in payment of the said goods, on receipt of the money from the commissariat in payment of the forage supplied for the then present month, in priority to any other payment except to the defendants' bank, provided that J. D. & Son were able to continue the contract, and were not made bankrupts; that the plaintiff, relying on the defendants' promise, and within a reasonable time, sold to and purchased for J. D. & Son, 1000 quarters of oats, to the amount 1227l., under and according to the guarantee; that J. D. & Son made their cheque on the defendants in favour of the plaintiff in payment of the goods, and delivered it to the plaintiff; that the plaintiff did all things necessary to entitle him to have the cheque honoured; that the defendants received from the commissariat money in payment for the forage supplied by J. D. & Son for the said month, more than sufficient to pay the cheque, and out of which they could and ought to have honoured it; that all necessary conditions, &c., yet the defendant did not honour the cheque, nor have the said J. D. & Son nor the defendants paid the plaintiff the price of the said goods, or any part thereof, and the same remains due and unpaid to the plaintiff.
2nd count, for money had and received, and on accounts stated.
3rd count, that the defendants, by falsely and fraudulently representing to the plaintiff that J. D. & Son were not then indebted to them, induced the plaintiff to accept the guarantee in the first count mentioned, and to sell to and purchase for J. D. & Son 1000 quarters of oats on the faith of the said guarantee, and to take the cheque of J. D. & Son on the defendants in payment of the oats; averring that J. D. & Son were then, as the defendants well knew, indebted to the defendants in an amount greatly exceeding the cheque and any moneys then coming to the defendants on account of J. D. & Son, and out of which the cheque would otherwise have been payable: that by means of the premises the plaintiff was then deceived by defendants, and, believing their representations to be true, gave J. D. & Son credit for the said 1000 quarters of oats on the faith of the guarantee, and wholly lost the amount for which he so gave credit and the interest, and was otherwise injured.
Pleas — 1, to the first count, denial of the promise; 2, to the same, that the money received from the commissariat was not more than sufficient to pay what was due from J. D. & Son to the defendants' bank, wherefore, &c.; 3, to the second count, never indebted; 4, to the last count, not guilty.
Replication, joining issue on all the pleas, and to the second plea, on equitable grounds, that the money due to the defendants' bank was due before, and at the time of making the guarantee, whereof the defendants had notice, but the plaintiff had no notice, either at the time of accepting the guarantee, or of selling the oats, and that the defendants fraudulently concealed from the...
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