Brauer & Company (Great Britain) Ltd v James Clark (Brush Materials) Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE SINGLETON,LORD JUSTICE DENNING,LORD JUSTICE ROMER |
| Judgment Date | 21 July 1952 |
| Judgment citation (vLex) | [1952] EWCA Civ J0721-2 |
| Date | 21 July 1952 |
| Court | Court of Appeal |
[1952] EWCA Civ J0721-2
In The Supreme Court of Judicature
Court of Appeal
Lord Justice Singleton,
Lord Justice Denning, and
Lord Justice Romer.
Counsel for the Appellants: MR A.A. MOCATTA, Q.C., and the Hon. T.G. ROCHE, instructed by Messrs Layton & Co., Liverpool and London.
Counsel for the Respondents: SIR HARTLEY SHAWCROSS, Q. C., and MR E.W. ROSKILL, instructed by Messrs Gregory Rowoliffe & Co., Agents for Messrs Bartlett & Son, Liverpool.
This is an appeal from a judgment of Mr Justice Sellers which reversed a finding of the Board of Appeal of the Seed, Oil, Cake and General Produce Association.
James Clark (Brush Materials) Ltd., were buyers, and Brauer & Company (Great Britain) Ltd., were sellers under a contract in writing of the 20th February, 1951.
The contract was expressed to be made on the terms and conditions of sale of the Seed, Oil, Cake and General Produce Association, and disputes arose between the parties. They were referred to Arbitration, and by an Award dated the 3rd August, 1951, two of the Arbitrators found in favour of the buyers. The sellers appealed to the Board of Appeal and asked that the Award of the Board should be stated in the form of a Special Case. The decision of the Board, subject to questions of law raised, upheld the finding of the Arbitrators in favour of the buyers. The sellers appealed, and the learned Judge reached the conclusion that they were entitled to succeed, and gave judgment accordingly. The buyers appeal to this Court.
The Case Stated finds: (a) By a Contract dated the 20th February 1951 the Sellers sold to the Buyers 90 tons of Bahia Piassava comprising 40 tons of Crude Seconds 30 tons of Cut Stiff 7" and 20 tons of Cut Stiff 8" at the price of £118 per 1,000 kilos for Crude Seconds and £163 per 1,000 kilos for Cut Stiff 7" and Cut Stiff 8" both prices being C.I.F. London. (b) By the terms of the said Contract shipment was to be from Salvador/Bahia/Brazil during February/March/April/May/June/July subject to freight space being available to London and the Quality of the said Goods was to be 'Best', if inferior thereto a fair allowance to be made.(c) The said Contract also contained the following Clauses:- 9. 'Should shipment be prevented or delayed owing to prohibition of export, revolution, riots, strikes, lock-outs, blookade, hostilities, force majeure or plague, Shipper shall be entitled at the termination of such cause or causes to an extension of time for shipment prior to the outbreak of such cause or causes, but such extension shall in no case exceed one month. In case of non-fulfilment under above conditions the date of default shall be similarly dealt with. Shipper shall give notice by cable within two days after the last day for shipment if he claims an extension of time for shipment. If, from any of the above causes, shipment be not completed within one month from the expiration of the original contract period then this contract is to be void for any unfulfilled quantity.'"
There was added to Clause 9 of the printed form of contract a further clause in type as follows: "Any freight alterations pro or con for buyer's account. This contract is subject to any Brazilian export licence. Any import duty for buyer's account."
The Case also sets out Clause 12 of the conditions, which provides for Arbitration.
(d) refers to the conditions of sale of the Association, and (e) quoting from a letter of the 20th June, finds: "On the 20th June 1951 the Sellers informed the Buyers that due to the intervention of a section of the Bank of Brazil it was impossible for them to ship the goods mentioned in the said Contract on the basis of the prices contained therein and on the same date the Sellers wrote to the Buyers (inter alia) as follows:- 'We confirm that due to the intervention of a section of the Bank of Brazil it is impossible forour Associates to ship the Piassava on the base of the prices contained in the above-mentioned contract. The department of the Bank of Brazil concerned state that the Piassava must be shipped at the minimum f.o.b. prices of £180 a ton for the Cut Stiff and £135 a ton for the Seconds, which would in effect mean an increase respectively of £28 and £40 a ton. We personally regret this situation most sincerely but frankly we must claim protection under the Force Majeure clause as it is due solely to the Brazilian Authorities that we are unable to fulfil your contract. As we see the position three courses remain open to yourselves, namely:- (a) You decide to cancel the contract, (b) You decide to accept the new prices. (c) You decide to take the matter to arbitration.' A copy of the said letter is contained in the bundle of correspondence annexed hereto and which forms part of this Special Case. (f) No goods of any description were at any time shipped declared or tendered by the Sellers to the Buyers in pursuance of the said contract. (g) The Sellers could have shipped declared and tendered during February, March, April, May, June and July, as it was admitted by them at the hearing before us, goods to fulfil the said Contract if they had paid the minimum prices mentioned in the said letter dated 20th June 1951 and on the 12th June 1951 the Sellers Associates in Brazil cabled to the Sellers as follows:- '678 open credit hundredeight hundredthirty five only way can fulfil'. (h) It was admitted by the Sellers at the hearing before us that a Brazilian Export Licence would have been granted so that the goods could have been shipped on or about the said 20th June 1951 if the Sellers had paid the minimum higher prices for the saidgoods. (i) Subject to the questions of law raised in the Special Case the Sellers did not dispute the amount awarded under and by virtue of the said Award. (j) Condition Number 13 of the said Conditions of Sale of the Seed Oil Cake and General Produce Association provides as follows:- 'Whenever it is admitted by the Seller, or decided by arbitration, that the seller has failed to declare or tender goods to fulfil any contract, the buyer shall close the contract by, at his option, either cancelling the contract or invoicing back the goods to the seller at once at a price and weight to be fixed by agreement, or, failing such agreement, by arbitration (which price shall be not more than 10 per cent. over the estimated market value of the shipment or delivery contracted for on the day upon which the default occurs) the difference to be due to the buyer in cash as from the date of such default. The buyer shall not be entitled to recover any further damages from the seller in respect of his default'. (k) The Buyers elected to proceed by way of Arbitration as mentioned in recitals (3) (4) and (5) hereof. (1) The Seller being dissatisfied with the said Award appealed as mentioned in recital (6) hereof. (m) We find and decide subject to the questions of law set out in paragraph (p) of this Special Case, that the said Contract dated 20th February 1951 was not performed by the Sellers, and that the Sellers were not prevented from fulfilling the terms thereof, owing to any of the causes specified in the said Contract."
(n) shows the Award of the Board; that under Condition 13 they were entitled to fix an amount, and they fixed the amount to be paid by the sellers at the sum of £3,000.
Paragraph (p) states the questions raised: "The questions for the decision of the Court are: (i) Did the refusal of the Bank of Brazil and/or other Brazilian Authorities to grant licences for the export of the said goods, except at prices higher than the prices contained in the said Contract, excuse the Sellers from fulfilling the said Contract by reason of the provisions of Clause 9. (ii) Did the refusal of the Bank of Brazil and/or other Brazilian Authorities to grant licences for the export of the said goods, except at prices higher than the prices contained in the said Contract, excuse the Sellers from fulfilling the said Contract by reason of the Clause in the said Contract reading: 'This Contract is subject to a Brazilian Export Licence'".
Mr Justice Sellers was of opinion that the sellers were not excused from performance of the contract by anything in the printed Clause 9. He said (and I read from pages 4 and 5 of his judgment): "The Award finds under (g) that the Sellers admitted before the Appeal Committee that they could have shipped, declared and tendered the Contract goods within the contractual date if they had paid the minimum price. On this admission, the Sellers cannot, in my opinion, rely on ' force majeure'. There was no prohibition, no embargo, no physical or legal prevention. The goods could have been exported"; but the learned Judge considered that, in the events that had happened, the sellers were relieved within the type-written words "subject to a Brazilian Export Licence"; and he answered question (p) (ii), which question was: "Did the refusal of the Bank of Brazil and/or other Brazilian Authorities to grant licences for the export of the said goods, except at prices higher than the prices contained in the said Contract, excuse theSellers from fulfilling the said Contract by reason of the Clause in the said Contract reading: 'This Contract is subject to a Brazilian Export Licence'" in favour of the sellers.
I find myself in complete agreement with Mr Justice Sellers that Clause 9 of the contract, as it appears in print, does not excuse the sellers from performance of the contract, and I do not propose...
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