Carapanayoti & Company Ltd v Comptoir Commercial Andre & Cie. S.A.
| Jurisdiction | England & Wales |
| Judge | THE MASTER of THE ROLLS,LORD JUSTICE MEGAW,LORD JUSTICE STEPHENSON |
| Judgment Date | 03 December 1971 |
| Judgment citation (vLex) | [1971] EWCA Civ J1203-1 |
| Court | Court of Appeal (Civil Division) |
| Date | 03 December 1971 |
[1971] EWCA Civ J1203-1
In The Supreme Court of Judicature
Court of Appeal
Appeal by Carapanayoti & Co. Ltd. (Sellers) from Judgment of Mr. Justice Donaldson on 13/2/71.
Before
The Master of The Rolls (Lord Denning),
Lord Justice Megaw and
Lord Justice Stephenson.
In the Matter of The Arbitration Act, 1950
and
In the Matter of An Arbitration
Mr. ANTHONY LLOYD, Q. C., and Mr. KENNETH ROKISON (instructed by Messrs. Richards, Butler & Co.) appeared on behalf of the Appellant Sellers.
Mr. CHRISTOPHER STAUGHTON, Q. C., and Mr. DAVID GRACE (instructed by Messrs. Thomas Cooper & Co.) appeared on behalf of the Respondents, Buyers.
On 9th November, 1967, Carapanayoti & Co, Ltd, of London sold to a French company - Comptoir Commercial Andre & Cie., S. A., 500 tons of Nigerian groundnuts at £56 10s. Od. a ton, cost, freight and insurance, to "one port only" out of fourteen named ports, ten of which were in Northern Europe and four in the Mediterranean. The goods were to be shipped during "February/March 1968" from Nigeria direct or indirect to one of these ports. The contract contained these clauses as to the declaration of destination:
"If the Groundnuts are sold to two or more ports Northern Range at Buyers' option, the port of destination shall be declared by the last Buyer to his Seller not later than 21 days before commencement of shipment period and shall be passed on by intermediate parties without delay.
Buyers to declare Mediterranean option 42 days before first day of shipment period and actual port to be declared not later than 30 days before the first day of shipment period".
Before the Buyers declared any port of destination, on 18th
November, 1963, sterling was devalued. In consequence, groundnuts increased considerably in value in terms of sterling. On 11th December 1967, the buyers resold the groundnuts to Valensi et Cie. of Marseilles at the higher price of £63. 10s. 0d. a ton, but on the same terms as to shipment, declaration of destination, and so forth.
The buyers did not avail themselves of the Mediterranean option. They were, therefore, bound to declare one of the European ports "not later than 21 days before commencement of shipment period". The shipment period was "February/March 1968". It started, therefore on 1st February 1968. The crucial question is when was 21 days before 1st February, 1968? Was it 10th January, 1968, or 11th January, 1968? It was very important for the buyers to make their declaration in time: for, if they did not do so, theywould lose the benefit of this now very profitable contract.
The buyers realised this, and pressed the sub-buyers. I will not read all the communications. I will confine myself to those passing between the head buyers and the sellers.
On 10th January 1968, by telex as at 17.52 hours, the buyers said:
"For this contract we declare port of destination: KOBE".
Kobe, of course, is in Japan, and was not one of the ports named in the contract. On the same day — 10th January, 1968, at 18.01 hours, the sellers replied by telex:
"Quite apart from the fact that the declaration is made out of time the port of Kobe is not included in the options in the contract. Under the circumstances we must treat buyers as being in default of the contract and we reserve all our rights accordingly".
The reason why the sellers said the declaration was made out of time on 10th was that it was made at 5.52 p. m. which was out of business hours. These were between 10 and 4 p. m.
On the next day, 11th January, at 11.20 hours, the buyers sought to put themselves right. They sent this telex to the sellers:
"The port of Kobe is usually an acceptable port by the NPMC with a surcharge of sterling £2. 10s. 0d. per ton. As this port of destination is not accepted please inform sellers that we declare for the above contract the port of Dunkirk. We regret we cannot agree with sellers that we are in default and our declaration of port of Dunkirk of today to be considered as quite in order under the contract".
The port of Dunkirk was a permissible port. It was one of the ten ports in the Northern range. But the declaration was not made until 11th January 1968. Was it in time? Was it "not later than 21 days before 1st February 1968? The market price of groundnuts, had by that time gone up to £70 a ton. If the buyers were in time, they would have the benefit. But, if they were outof time, the sellers would do so.
The point was put before two arbitrators of the Seed, Oil, Cake & General Produce Association. They held that 11th January was the latest date. So the buyers were in time. The sellers appealed to the Board of Appeal of five. They took the contrary view. They held that the latest date for making the declaration was 10th January. They stated a Case for the opinion of the Judge. The Judge thought that, if the clause "not later than 21days" stood alone, the latest day would be 10th January 1968: but he held that there was a special clause which made all the difference. It was Clause 22 of the conditions of sale, which said:
"Where an act has to be done on or before a given day such day shall be considered to have commenced at 10 a. m. and to have ended at 4 p. m., Monday to Friday inclusive".
The Judge thought that, by reason of that condition, the latest date was 11th January. So he reversed the Board of Appeal and restored the decision of the two arbitrators. Now the case comes to this Court.
What is then the true construction of the words: "not later than 21 days before commencement of shipment period"?
The first thing to do is to ascertain what is the "commencement of the shipment period"? Is it the first moment of 1st February 1968, such as 0.01 a. m.? or the first working hour, such as 8.00 a. m.? or any other time on that day? The answer is that it is no particular moment of time at all on that day. It is simply the one day itself. The reason is because, in this context, we do not divide the day into hours or minutes. We take no account of fractions of a day. We take the day itself as an indivisible point of time: see Trow v. Ind Coope (West Midland Ltd.)(1967) 2 Q. B. at page 899.
The next thing to do is to count backwards from that day. "One day before" is the day of 31st January. "Two days before" are the two days of 31st and 30th January. If the declaration had to be made "not later than two days" before let February, I should have thought it would have to be made on 29th January: for, if it were made on 30th January, it would be less than two days before. So, if the declaration had to be made "not later than three days" before 1st February, it would have to be made on 28th January, so as to leave the three days (29th, 30th, 31st) before 1st February: for if it were made on 29th January, it would be less than three days before. And so on. Eventually it is seen that if the declaration has to be made "not later than 21 days" before 1st February, it has to be made on 10th January at latest: because, if it is made on 11th January, it is less than 21 days before 1st February.
I see nothing in condition 22 to negative this result. The only effect of that condition is that, on whatever day the declaration is made, it must be done in business hours between 10 a. m. and 4 p. m. So the declaration must be made at latest on 10th January 1968, and before 4 p. m. on that day. The result is that the buyers did not make their declaration in time. They have not the benefit of the contract.
Turning now to the authorities, they are entirely consistent with what I have said. They fall into two groups which are well summarised by Halsbury, Volume 37, pages 94 to 96.
One group deals with cases when the instrument prescribes a period within which a person must act or take the consequences. As, for instance, where a man must give notice or do some other thing within a certain number of days from or after some date or event.
In this group you do not count the beginning day of the period, but do you count the last? That was settled in 1808 in Lester v. Garland (1808) 65 Ves. Jr. 248; and has been repeatedly followed since.
The other group deals with cases where the instrument prescribes that a certain time must elapse between some event and other, such as between the doing of a thing and some other date or event. In this group you do not count the day on which the act is done, nor do you count the day of the date or event. You exclude both, so as to give so many clear days. Often the instrument makes this clear by saying that he must do the act "at least" so many days before, or "not less" than so many weeks. Such was Zouch v. Empsey (1821), 4 B. & Aid. 522, when the words "at least" were used: but in Regina v. Justin of Shropshire (18?8) 8 Ad. & El. 173, Mr. Justice Littledale said the position would be the same if "at least" were left out. A recent case is Re Hector Whaling Ltd. (1936) Ch. 208, when the words were "not less" than. In the present case we have the words "not later than" which have, to my mind, a similar meaning.
There are exceptions to this second group. For instance, in landlord and tenant cases, when a periodic tenancy is determinable by notice, it is always sufficient to give a notice to quit expiring on the periodic day, e. g., a week's notice given on one Saturday to expire on the next Saturday, and so forth: see Schnabel v. Allan (1967) 1 Q. B. 627. Save for these exceptions, the general rule is that, between the two events there must be so many clear days.
This case falls within the general rule. The contract provided that 21 days were to elapse between the giving of thedeclaration and the commencement of the shipment period. That means 21 clear days.
Mr. Staughton...
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