National Employers' Mutual General Insurance Association Ltd v Jones

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeLORD JUSTICE MAY,LORD JUSTICE CROOM-JOHNSON,SIR DENYS BUCKLEY
Judgment Date27 March 1987
Judgment citation (vLex)[1987] EWCA Civ J0327-3
Docket Number87/0371
Date27 March 1987

[1987] EWCA Civ J0327-3

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE BRIDGEND COUNTY COURT

(His Honour Judge Hywel ap Robert)

Royal Courts of Justice

Before:

Lord Justice May

Lord Justice Croom-Johnson

and

Sir Denys Buckley

87/0371

Between:
National Employers Mutual General Insurance Association
Respondent (Plaintiff)
and
R. W. Jones
Appellant (Defendant)

MR. MALCOLM T. PILL, Q.C. and MR. JOHN JENKINS (instructed by Messrs Dolmans, Cardiff) appeared on behalf of the Respondent/Plaintiff.

MR. J. LEIGHTON WILLIAMS, Q.C. and MR. ROGER GARFIELD (instructed by Messrs Kenwright & Cox; London agents for Messrs Randalls, Bridgend, Mid Glamorgan) appeared on behalf of the Appellant/ Defendant.

LORD JUSTICE MAY
1

This is a defendant's appeal against a judgment of His Honour Judge ap Robert of 30th January 1986 awarding the plaintiff £2,650 by way of damages, together with interest of £824 and costs. The appellant now seeks to have that judgment set aside and judgment entered in the action for him against the plaintiff.

2

All the facts in this case were agreed. A Miss Hopkins was the owner of a Ford Fiesta motor car which was stolen from her on 3rd February 1983. On 23rd September 1983 those thieves were convicted. Prior to this, however, they had sold the car to a person called Lacey on a date and at a price unknown. Lacey then sold on to one Roderick Thomas, again on a date and at a price unknown. On 7th February 1983 Thomas in his turn sold the car to Autochoice (Bridgend) Ltd. for £2,100. A week later, on 14th March 1983 Autochoice (Bridgend) Ltd. sold the car to Mid-Glamorgan Motors Ltd. for £2,350. On 17th March 1983 Mid-Glamorgan Motors Ltd. sold the car to the defendant for £2,650. It was accepted that the defendant was completely honest when he bought the car. The plaintiffs were Miss Hopkins' insurers who, having bought out their insured's interest after the theft for £2,750, thereby acquired rights to the car. They asked for the car back by letter of 6th January 1984 but the appellant refused to return it. The plaintiffs accordingly began these proceedings in the Bridgend County Court on 27th September 1984 in which they succeeded, as I have indicated, in recovering damages representing the value of the car from the appellant. The short point which was argued below and before us is the extent to which, if at all, the operation of the maxim nemo dat quod non habet has been affected by the provisions of section 9 of the Factors Act 1889 and what is now section 25 of the Sale of Goods Act 1979, which is in very much the same terms.

3

As the relevant provisions of the two statutes are for present purposes identical, I quote those in the earlier statute for convenience. Section 1(1) of the Factors Act 1889 provides:

"For the purposes of this Act—(1) The expression 'mercantile agent' shall mean a mercantile agent having in the customary course of his business as such agent authority either to sell goods, or to consign goods for the purpose of sale, or to buy goods, or to raise money on the security of goods."

4

Section 2(1) provides:

"(1) Where a mercantile agent is, with the consent of the owner, in possession of goods or of the documents of title to goods, any sale, pledge, or other disposition of the goods, made by him when acting in the ordinary course of business of a mercantile agent, shall, subject to the provisions of this Act, be as valid as if he were expressly authorised by the owner of the goods to make the same; provided that the person taking under the disposition acts in good faith, and has not at the time of the disposition notice that the person making the disposition has not authority to make the same."

5

Sections 8 and 9 of the Act are as follows:

"8 Where a person, having sold goods, continues, or is, in possession of the goods or of the documents of title to the goods, the delivery or transfer by that person, or by a mercantile agent acting for him, of the goods or documents of title under any sale, pledge, or other disposition thereof, or under any agreement for sale, pledge, or other disposition thereof, to any person receiving the same in good faith and without notice of the previous sale, shall have the same effect as if the person making the delivery or transfer were expressly authorised by the owner of the goods to make the same.

9. Where a person, having bought or agreed to buy goods, obtains with the consent of the seller possession of the goods or the documents of title to the goods, the delivery or transfer, by that person or by a mercantile agent acting for him, of the goods or documents of title, under any sale, pledge, or other disposition thereof, or under any agreement for sale, pledge, or other disposition thereof, to any person receiving the same in good faith and without notice of any lien or other right of the original seller in respect of the goods, shall have the same effect as if the person making the delivery or transfer were a mercantile agent in possession of the goods or documents of title with the consent of the owner."

6

The learned judge held that the operation of the maxim was not affected by, in particular, section 9 of the 1889 Act and that in effect one had to construe the section as if the word "owner" had the same meaning as "seller". The argument in brief on behalf of the appellant, which was the argument advanced before the learned judge below, was that one should look at the actual words of section 9 and interpret them literally. If one did so on the facts of the instant case, it followed, it was contended, that the appellant acquired a good title to the car when he bought it from Mid-Glamorgan Motors Ltd., as indeed may some or all of the earlier sub-purchasers of it, other than the purchaser from the thieves themselves.

7

The argument advanced on behalf of the appellant was direct and uncomplicated. Counsel submitted that there was no reason why one should not give section 9 of the Factors Act 1889 its literal and clear meaning. If one did so and, for instance, in relation to the sale by Autochoice (Bridgend) Ltd. to Mid-Glamorgan Motors Ltd., substituted the names of the appropriate parties for their descriptions in the relevant words of section 9, it would read:

"Where Mid-Glamorgan, having bought or agreed to buy goods [the car], obtains with the consent of Autochoice possession of the car, the delivery or transfer, by Mid-Glamorgan, of the car, under any sale, to the defendant/appellant receiving the same in good faith and without notice of any lien or other right of Autochoice in respect of the car, shall have the same effect as if Mid-Glamorgan were a mercantile agent in possession of the car with the consent of Miss Hopkins."

8

Then, the argument continued, by virtue of section 2 of the 1889 Act, the delivery or transfer of the car by Mid-Glamorgan to the appellant under the sale agreed between them was as valid as if the former had been expressly authorised by Miss Hopkins, as the owner of the car, to make the sale. Thus at least on the facts of this case, the appellant acquired a good title to the car and Miss Hopkins' insurers ought not have succeeded against the appellant in the court below.

9

Counsel supported this argument by a number of collateral submissions. First, he contended that, other things being equal, the court should always adopt a literal approach to the construction of statutes. The court's task was to see what Parliament had said, giving words their ordinary and natural meanings, and then to give effect to this in respect of the facts of a given case. It was only when the words of a statute in their ordinary meaning were unclear, or gave rise to an ambiguity, that the court in construing them should depart from the literal approach.

10

Secondly, unless there was any clear reason to the contrary, a court should give the same meaning to the same word where it is used in different places in a statute. Thus "the owner" of goods in section 2 clearly referred to the true owner, to the person having the general property in the goods. Unless there was any reason to the contrary, therefore, which counsel submitted there was not, the court should give the same meaning to the same words in section 9. On this basis any argument that one should read the word "owner" in section 9 as equivalent to "seller", or perhaps to "original seller", could not be correct. Further, where in the same section of an Act the draftsman had used specific and different words, the clear inference was that Parliament had intended them to mean different things. Thus where in section 9 the draftsman had specifically referred to the seller and to the original seller, and thereafter to the owner, it again could not be right to equate one with the other. The care with which the section was drafted was demonstrated by the use of the phrase "the original seller" at one point; this was used to make it quite clear that the reference was back to the seller referred to in the seventeenth word of the section and to avoid any possible confusion.

11

Thirdly, if the original seller in a section 9 situation already has the proprietary title to the relevant goods, then section 9 is not needed to pass that title to the ultimate buyer.

12

In further support of his argument, counsel traced the legislative history of the relevant provisions. Section 2 of the Factors Act 1889 had its general origin in section 1 of the Factors Act 1823. That enacted that where goods were entrusted by their owner to an agent for the purpose of sale, then if that agent shipped the goods in his own name he should be deemed to be the true owner to any consignee of the goods who took them in good faith and...

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3 cases
  • National Employers Mutual General Insurance Association Ltd v Jones
    • United Kingdom
    • House of Lords
    • 21 April 1988
    ...damages from him representing the value of the car. They succeeded in their claim. Mr. Jones then appealed to the Court of Appeal [1987] 3 W.L.R. 901. The Court of Appeal, by a majority (May and Croom-Johnson L.JJ., Sir Denys Buckley dissenting) dismissed the appeal. Mr. Jones now appeals ......
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