Davies v British Geon Ltd

JurisdictionEngland & Wales
CourtCourt of Appeal
Judgment Date25 July 1956
Judgment citation (vLex)[1956] EWCA Civ J0725-2
Date25 July 1956

[1956] EWCA Civ J0725-2

In The Supreme Court of Judicature

Court of Appeal


Lord Justice Denning

Lord Justice Birkett, and

Mr Justice Harman

Devid William
British Limited

MR READ (instructed by Messrs Roberts & Co., Agents for Messrs. C.J. & Co., Cardiff) appeared on behalf of the Respondents.


I will ask Lord Justice Birkett to deliver the first judgment.


LORD JUGTICE BIRKETT: This is an appeal from a judgment of Mr. Justice Pearson given on the 7th May this year. It concerns the meaning to be given to the words in order I2, rules 4 and 5 of the Rules of the Supreme Court. Rule 4 states "If any Defendant to a writ issued In a District Registry resides or carries on business within the District, he shall appear in the District Registry" and Rule 5 (1) "If any defendant neither carries on business in the District, he may appear other in the District Registry or at the Central office."


In the present case the Writ was issued in the Cardiff District Registry, and the Defendants have their factory within the District, and if it should be hold that they carry on business within the district, they ought to appear in the District Registry in conformity with Rule 4: but if it should be held that they do not carry on business within the District then the appearance can be in the Cardiff district Registry or at the Central Office.


It is not contended that the Defendants "reside" In the Cardiff Districts in view of the decided cases, but merely that they carry on business there.


The words "resides or carries on business" first appear in the Rules of 1875 and are repeated In the rules of 1083. Some of the case a which are relevant to this appeal are decisions on the words appearing in the County Courts Act of 1846, sections 128 and 129. Such a case was the Important case of flayer ( Taylor v. The & Co. 1956 retorted in II Exchequer Reports at page 1). Section 128 provided that "all actions and proceeding a which before the passing of this Act might have been brought in any of Her Majesty's Superior Courts of Record … where the cause of notion did not arise wholly or in some material point withinthe jurisdiction of the Court within which the Defendant or carries on his business… may be brought and determined in any such superior Court at the election of the party suing or proceeding…"


Section 129 deals with the question of costs when any party has acted in disregard of the provisions of Section 128.


The precise point raised in this appeal does not appear to have been in this form during the lifetime of the order and Rules in question: and from the practical point of view It does art appear to matter such, at first whether the appeal is allowed or dismissed, for any inconvenience which may arise from any construction of the rules can be quickly remedied by an application under Order 35, rule 16. But it has been thought right to raise the question of the meaning of the words in the Order and Rules because of the special facts of this case, and Mr. Justice Pearson gave the matter the fullest consideration and delivered a most helpful and painstaking judgment, in which he reviewed the authorities at some length, and stated his conclusions neat clearly and firmly.


The evidence before the learned judge showed that the Defendant Company manufactured certain products, including a powder used for making plastic goods, This manufacture was carried on at Sully in the County of within the district of the Cardiff registry of the high Court of Justice. About 400 or 500 people were employed at the factory, and it was the only factory of the Defendant Company. The registered office of the Company is In Piccadilly, London. The Board of the Company are held and the policy of the Company Is decided at St. James's aware, London. The Secretary of the Company in his affidavit said that the control of the Company was in London, contracts were entered into there, prices fixed there, and the sale of the Company a products was is the hands of the Sales Director whose office was In London. Mr. Davies, the Plaintiff in the action, was employed by theDefendants at the factory in Glamorgan, and he his employers for damages on account of Injuries ho had suffered through contracting dermatitis at his work for which he contended the Defendants were liable. The writ was in the Cardiff District Registry, and it was contended for the Plaintiff that as the Defendant Company "Carried on business" within the Cardiff District Registry at the factory at sully some seven miles from Cardiff, they ought to have entered an appearance in the Cardiff District Registry, in accordance with order 12, Rule 4. But the appearance was in fact entered in London end it follows that as matters now stand and if nothing more is done all the interlocutory work will be done in London. The Plaintiffs solicitors who reside and carry on business in have not Invoked the aid of Order 35, Rule 16, but have chosen to mate the matter a point of principle by moving to strike out the appearance of the Defendants as they are enjoined in the white Book to do if the Appearance is erroneous, and to compel them to enter appearance in Cardiff. The defendant Company entered the appearance in London because they contended that they did not reside or carry on business in Glamorgan within the meaning of the Order and Rules with which we are now concerned, but resided and carried on business in London only, and were within the protection of Order 12, Rule 5 (1). Giving the ordinary meaning to ordinary English words, nobody could doubt, I think, that the defendant Company carried on business at the factory in Glamorgan, and also at the Head Offices in London: but unfortunately the Question is not be simple as that because of the decided oases of the la tit 100 years.


Mr Justice Pearson made it quite plain that had fee been free to do so, he would have given the words this plain ordinary meaning. In a passage which appears at the end of his judgment as reported in 1956. 2 All England Reports, at page 416, and which appears to contain the learned judge's considered opinion when he was re-reading the transcript ofhis judgment as delivered in Court, he said: "on merely looking at the words of the Rules without guidance from authority, I should have been inolined to say (1) that different meanings should be given to the expression 'resides' and the expression 'carries on business'; (2) that as a Defendant might be either a natural person or a corporation, the two expressions probably have their different meanings both in relation to a natural person and in relation to a corporation; (3) that a corporation, no loss than a natural person, may be carrying on business in several places and (4) that manufacturing in a large factor constitutes carrying on business Moreover, a reasonable and convenient effect could be given to the rules in question if the expression 'carries on business' were understood according to the ordinary meaning, be that if a company, though its principal offices were elsewhere, had an establishment end carried on one of its principal activities in the area of a District Registry, it could be sued in that District Registry and would then have to enter its appearance there and the interlocutory proceedings could be conducted there, except that in a case of hardship an could be made under Order 35, Rule 16, to have the case transferred to the Central Office. In industrial accident cases I think there would normally be a saving of expense if the interlocutory proceedings were conducted in the District Registry of the area in which the accident occurred".


If I may respectfully say so, that passage is filled with excellent common sense, and it is necessary to look at the authorities to whether they do indeed compel the learned judge to decide the case as he did, contrary to his desire, and the common sense of his interpretation. There were three passages in the learned judge's judgment which seem to me to contain the of the matter. He said; "Therefore I think it must be taken that for many purposes, it is possible for a corporation to be carrying on business in more places than one, and even to be residing in sore places than one; buthere we have these Rules drafted initially in 1875 and repeated in 1883; they have remained in force ever since, and I think one should give great weight to the view taken in hitty's Archbold in 1885. I think also it is reasonable to suppose that the draftsman of the I875 Rules must have had in mind the previous decisions and the matters are sufficiently in peri material. Therefore, I think. and I hold, that notwithstanding the recent authorities, it is right to say that for the purposes of these Rules a corporation is deemed to have only one place of business".


The second passage is: "Therefore, I think one Is bound to hold, in spite of what one would naturally have thought on merely reading the words, that there is no distinction between 'residing' and 'carrying on business' when you are talking of a corporation and that a corporation has only one place of business, and that is its principal place of business."


The third passage roads as follows: "As I have said, if there had been no previous authority I should have arrived at a different conclusion here. I should have thought that the right general principle le that you give the ordinary meaning to the nerds 'carries on business', and if in ordinary reasonable sense you find a company is established and is carrying on one of its principal activities at that establishment within the area of the district Registry, it should have been said at any rate that its business was carried on partly within that district Registry. If that created hardship on the Defendant in some cases, as it might, then an application can be made under order 35, Rule 16, to have it transferred to the...

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