Brandeis Goldschmidt & Company Ltd v Western Transport Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE BRANDON,LORD JUSTICE DONALDSON |
| Judgment Date | 19 March 1981 |
| Judgment citation (vLex) | [1981] EWCA Civ J0319-1 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 81/0068 |
| Date | 19 March 1981 |
[1981] EWCA Civ J0319-1
Lord Justice Brandon
Lord Justice Donaldson
and
Lord Justice Ackner
(Not Present During Delivery of Judgment)
81/0068
1976 B No. 6292
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(HIS HONOUR JUDGE LIPFRIEND)
Royal Courts of Justice,
MR. CRAWFORD LINDSAY (instructed by Messrs. Herbert Smith & Co., Solicitors, London EC4M 5SD) appeared on behalf of the Defendants (Appellants).
MR. P. LEAVER (for Mr. J.J. Finney) (instructed by Messrs. Herbert Oppenheimer Nathan & Vandyke, Solicitors, London EC2R 7JH) appeared on behalf of the Plaintiffs (Respondents).
Lord Justice Ackner is unable to be present this morning because he is occupied in another court; but he has authorised me to say that he agrees with the judgment which I am about to read.
This is an appeal by the defendants from a judgment of His Honour Judge Lipfriend sitting as a deputy judge of the High Court, given on 27th July 1979. By that judgment he awarded to the plaintiffs, by way of damages for the wrongful detention of goods, two sums of £3,588 and £2,800 respectively, with a further agreed sum of £1,618 for interest, and costs. The defendants now appeal from the whole of that judgment, contending that the plaintiffs, having regard to the sole way in which they chose to put their case on damages, are entitled either to no damages at all, or alternatively to nominal damages only.
Four companies are concerned, directly or indirectly, in the subject-matter of the action: first, the plaintiffs, of London, who are importers of copper which they first have refined and then sell as cathodes; secondly, the defendants, of Avonmouth, who are transporters of goods by road; thirdly, Pemelco Ltd., who were during part of the material time forwarding agents but subsequently went into liquidation; and, fourthly, Elkington Copper Refineries Ltd., of Walsall, who operate a copper refinery at which the plaintiffs had all or much of their copper refined.
Prior to July 1976 it had been the regular practice of the plaintiffs to employ Pemelco to arrange for the transportation of copper imported by the plaintiffs from the port of importation to the refinery at which it was to be refined. In accordance with this practice, by letter dated 30th July 1976, the plaintiffs engaged Pemelco to arrange for the transportation of about 500 tons of copper imported by the plaintiffs through the port of Avonmouth from that port to the premises of Elkington Copper Refineries in Walsall for refining there.
Pemelco were at the time in financial difficulties. They owed substantial sums of money to the defendants and on 2nd August 1976 went into voluntary liquidation. In those circumstances the defendants, instead of transporting the whole of the plaintiffs' 500 tons of copper to Elkington Copper Refineries, retained possession of about 42 tons of it in purported exercise of a general right of lien which they claimed was given to them by their contract with Pemelco. They put the copper so retained in a safe store and kept it insured.
The plaintiffs through their solicitors demanded the release of the copper, but the defendants would not agree to that demand. Accordingly on 15th September 1976 the plaintiffs began an action against the defendants in the Queen's Bench Division of the High Court by a specially indorsed writ, in which they claimed delivery up of the copper detained, or approximately £37,000 its value, together with damages for wrongful detention.
In February 1977 Master Lubbock, on an application by the plaintiffs under R.S.C. Order 14, made an order that the defendants should deliver up the copper concerned, or for value to be assessed, and damages to be assessed. On 5th May 1977 Mr. Justice Griffiths dismissed an appeal by the defendants from that order of Master Lubbock. On 27th May 1977 the defendants, in compliance with the order of the court, delivered up the copper to the plaintiffs.
Discussions subsequently took place between the solicitors for the parties with regard to the question of damages for detention. No agreement was reached, however, and arrangements were made for the case to come back again before the master on 11th January 1978 for assessment of damages.
No particulars of the plaintiffs' claim for damages had been pleaded at any time, but on 28th December 1977 Mr. Cotgrove, their secretary, swore an affidavit in support of the claim. In paragraph 3 of that affidavit Mr. Cotgrove said: "The plaintiffs purchase scrap copper and other refining materials such as blister copper and send it to Elkington Copper Refineries who refine it on the plaintiffs' behalf to produce copper cathodes. These copper cathodes are sold by the plaintiffs to customers in the Midlands area. The whole production has been fully sold over the last three years. The purchasers of scrap and blister copper are financed by bank borrowings which are later reduced by the proceeds of the cathode sales. Thus the plaintiffs have suffered loss on two bases. The first is in relation to the decline in value of copper over the period of detention and the second is the additional interest which had to be paid by the plaintiffs to their bankers over the same period".
Mr. Cotgrove went on, in paragraphs 4 to 6 of his affidavit, to quantify each of the two losses referred in paragraph 3. In paragraphs 4- and 5 he quantified the fall in the market value of the copper during the period of detention as £3,588. In paragraph 6 he quantified the additional interest payable during the same period as £2,962. This figure was subsequently agreed, without prejudice to recoverability, at £2,800.
Mr. Cotgrove did not deal anywhere in his affidavit with what would have happened to the detained copper if it had not been detained. In particular he did not state whether the process of refining it, turning it into cathodes and selling the cathodes, with the subsequent application of the proceeds in reduction of the plaintiffs' overdraft at the bank would have taken place (a) forthwith; or (b) at some time, and if so what time, during the period of detention; or (c) not until the period of detention had expired. In this connection Mr. Cot-grove gave no indication of the stocks of copper held by the plaintiffs at Elkington Copper Refineries or elsewhere. Nor did he say that the plaintiffs had replaced the detained copper by a purchase in the market.
It seems to me, however, that one inference at least can be safely drawn from what Mr. Cotgrove deposed to in his affidavit; that is that the plaintiffs had not acquired the copper with the purpose of selling it on the market, and would not in any event or at any time have used it for that purpose. On the contrary they would have used it as a raw material for their business with the purpose of making profits from the sale of the finished product.
When the matter came back before the master on 11th January 1978, the assessment of damages was adjourned pending discovery of documents by both sides. The defendants were dissatisfied with the discovery given by the plaintiffs and on 23rd October 1978 obtained an order from Master Lubbock for further discovery of four categories of documents relating to the question of what would have happened to the copper and at what time if it had not been detained, and what the effect (if any) of the detention on the plaintiffs' business had been.
It was contended for the plaintiffs that the further documents concerned were irrelevant to the issue of damages to be tried, on the ground that they were entitled to recover as of right under a general rule of law the amount of the fall in the market value of the copper during the period of detention, and interest on so much of their bank overdraft as was attributable to its purchase during the same period, irrespective of the use which they would actually have made of the copper if it had not been detained. Relying on these contentions, they appealed against the order of Master Lubbock of 27th October 1978 to Mr. Justice Peter Pain, who on 8th March 1979 allowed the appeal on the basis that the plaintiffs would, at the trial on damages, limit their case to the contentions set out above, and would not seek to rely on any other way of putting their claim.
In June 1979 Master Lubbock made a consent order providing, first, that the assessment of damages be transferred to a judge, and secondly that the case be set down within three days as a short cause in London. On 27th July 1979, pursuant to that order, the issue of damages came on for trial before His Honour Judge Lipfriend sitting...
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