Nicholson and Others against Rickets and Other
| Jurisdiction | England & Wales |
| Judgment Date | 24 January 1860 |
| Date | 24 January 1860 |
| Court | High Court |
English Reports Citation: 121 E.R. 187
IN THE COURT OF QUEEN'S BENCH, AND THE COURT OF EXCHEQUER CHAMBER.
S. C. 29 L. J. B. Q. 55; 1 L. T. 544; 6 Jur. N. S. 422; 8 W. R. 211. Followed In re Adansonia Fibre Company, 1874, L. R. 9 Ch. 643. Distinguished Yorkshire Banking Company v, Beatson, 1880, 5 C. P. D. 119.
nicholson and others against ricketts and others. Tuesday, January 24th, 1860. Von S. & Co., merchants trading in Buenos Ayres under that title, agreed with defendants, merchants trading in London under the title of R., B. & Co., to carry on joint exchange operations ; by which Von. S. & Co. were, at Buenos Ayres, to draw bills periodically on defendants, at ninety days' sight, to sell them there, and to invest the proceeds, keeping defendants out of cash advance by periodically remitting to them bills to the same amount, on other firms, to be bought by Von S. & Co. These transactions were to be on the footing of a community of profit and loss.-Plaintiffs, another firm of merchants at Buenos Ayres, bought there of Von S. & Co. certain of the bills drawn by the latter, in their own name, on defendants, in the course of these operations. Plaintiffs were induced to buy the bills by the statement of a broker, employed by Von S. & Co. to procure purchasers, that " the bills were all in order, he having seen " defendants ' " letter of credit to Von S. & Co., in virtue of which the bills were drawn." Defendants refused to accept these bills on presentation. Von S. & Co. became bankrupts, and plaintiffs proved on the bills against their estate, and recovered 40 per cent, of the amount. Plaintiffs also brought this action against defendants. The declaration contained counts on the bills against defendants as drawers; counts for money lent and money had and received, and a count for the breach of a contract by defendants to accept the bills.- On a case stated embodying the above facts, and giving the Court power to draw inferences of fact: Held, that plaintiffs had no cause of action against defendants. That defendants were not drawers of the bills, the signature " Von S. & Co." to the bills not including defendants, though the agreement between Von S. & Co. and defendants created a partnership between them. That defendants were not liable for money lent plaintiffs having made no loan to Von S. & Co.; or for money had and received, plaintiffs not having paid money on a consideration which had wholly failed. That defendants had not contracted with plaintiffs to accept the bills; Von S. & Co. having no authority to make such a contract for defendants, and (per Crompton and Hill Js.) not having in fact made any such contract, the broker's statement to plaintiffs amounting merely to an expression of belief that the bills would be, not to a contract that they should be, accepted. [S. C. 29 L. J. Q. B. 55; 1 L. T. 544 ; 6 Jur. N. S. 422; 8 W. R. 211. Followed, In re Adansonia Fibre Company, 1874, L. R. 9 Ch. 643. Distinguished, Yorkshire Banking Company v. Beatson, 1880, 5 C. P. D. 119.] The first count of the declaration was on a bill of exchange, drawn at Buenos Ayrea by defendants, [498] Messrs. Ricketts, Boutcher & Co., for 26001., payable 188 NICHOLSON V. RICKETT3 3 EL. * EL. 499. to defendants' order, ninety days after sight; indorsed by defendants to Fielden, Brothers, and by them to plaintiffs. Averments: that the bill was duly presented for acceptance, was dishonoured, and waa protested; of which defendants had due notiee. Breach, non-payment. The third count was similar to the first, on another bill of exchange for 12291. 19s. 2d. The fifth count was on another similar bill of exchange for 11701. Os. 10d., but made payable to the order of Messrs. Joseph Green & Co., and by them indorsed to plaintiffs. The second, fourth and sixth counts were against defendants as makers of promissory notes similar to and corresponding in amount with the above mentioned bills of exchange respectively. The seventh count alleged that, in consideration that plaintiffs, at defendants' request, would purchase from defendants certain bills of exchange, drawn at Buenos Ayres by Messrs. Von Seutter & Co. upon defendants, defendants promised plaintiffs to accept the said bills on presentment to them in London. Averments : that plaintiffs did purchase the said bills from defendants; that the said bills were presented to defendants for acceptance in London ; and that defendants refused to accept the same ; whereby the said bills were returned to plaintiffs protested, and their value lost, and the price thereof. The eighth count was for money lent, money had and received, and money due on an account stated. The pleas to the first, third and fifth counts traversed the drawing of the bills, their indorsement, and the notice of dishonour. Those to the second, fourth and sixth counts traversed the making of the notes. Plea to [499] the seventh count, non assumpsit. To the eighth count, never indebted. Issues were joined on the pleas, and afterwards, by consent, and by order of Crompton J., a case was stated, which, so far as is material, was as follows. In the Spring of 1857, Edmund Von Seutter was a merchant in Buenos Ayres, carrying on business there under the firm of E. Von Seutter & Co. The defendants were and are merchants in London, and carry on business under the firm of Messrs. Ricketts, Boutcher & Co. The plaintiffs were and are merchants in Buenos Ayres, and carry on business under the firm of Messrs. Nicholson, Green & Co. The plaintiff Mr. John Nicholson also alone carries on the business of a merchant in Liverpool, under the firm of Joseph Green & Co. Messrs. E. Von Seutter & Co., for a considerable lime previous to 1857, carried on large transactions iti business with the defendants and other houses in England and the Continent. On 31st January, 1857, Von Seutter & Co. addressed a letter to the defendants, from which the following is an extract. "Buenos Ayres, 31st January, 1857. "In former letters you stated to be ready to listen to our views on exchange operation!. We now beg to expose you a business which may turn out a very profitable one. To draw in April or May, when exchange is very likely to be at 65s., and ounces 3606, from 10,0001. to 20,0001., and put the proceeds in the bank, which may pay 8 per cent, interest; actually the bank pays 10 per cent, and covers 15 per cent. This bill, drawn at ninety days' sight, could be renewed every three months; say, draw the same amount and remit bills for equal sums. In this way you may be only in cash advance for three or four days. This is the only way to get funds at a [500] favourable rate for the Summer season. Several respectable houses make the same business, and we could exchange our drafts with one or the other of them. You may be asaured that we will be cautious." To this letter the defendants replied as follows. "London, 27th March, 1857. " Messrs. Von Seutter & Co., Buenos Ayres. "Dear Sirs.-In reply to the various paragraphs contained in your favour dated 31st January last, bearing on the following subjects, and to simplify the present credits, we hereby grant you a blank running credit for the sum of twenty thousand pounds (20,0001.) sterling (for all purposes), that ia to say, you are at liberty to draw upon us, and we engage to accept the bills so drawn at 90 days' sight, in advance 8 EL. fcELMl, NICHOLSON V. EICKETTS 189 against River Plate produce, whether on joint account between us, or on your own account, or an account of third parties to our consignment in Europe, with permission as usual to draw against documents; it being understood and mutually agreed to, that the bills of lading of the produce shall follow immediately or as soon as possible, wfthin two months at most, after the issue of such bill against invoice. In case you cannot conveniently cover by shipping documents in the course of two packets, you are to keep us out of cash advance, by redrawing and remitting simultaneously within that period, to the extent of such amount uncovered by shipping documents." " In addition to the above credit we agree to the proposition you submit to us aa to joint account exchange operations, in equal shares between us, that is to say, you may draw on us at 90 days' sight for 10,0001. or 20,0001., keeping us out of cash advance during the operation, by [501] remitting and redrawing every second packet after the issue, in the manner described in the preceding on produce accounts. This account subject to interest as therein stated, but free of commission on either side. The account to bear the actualities of its attendant charges and earnings pro and con, and to be finally closed not latev than 31st December next. We place implicit faith in your judgment and intimate knowledge as to the solidity of the concerns wherein you employ the funds, the collateral security they give, and as to the undoubted character of the remittances you make to us during the operation throughout." "We, in reference to the future, would add our leaning to the impression that tbese credits, if employed mainly in exchange operations, are in their ultimate issue likely to prove more remunerative than if applied to produce, unless a good, margin be afforded for reaction in the European markets during the working of the operations. If these meet your views, we shall thank you to ratify same in full detail in extenso at your earliest convenience,-And remain, Dear Sirs, Yours very truly, " ElCKETTS, BOUTCHER & Co." On 1st June, 1857, Messrs. Yon Seutter & Co. wrote to the defendants as follows. "Buenos Ayres, 1st June, 1857. " Messrs. Eicketts, Boutcher & Co., London." " Dear Sirs,-We are in possession of your favour of 27th March, by which, and in reply to various paragraphs contained in our former private letters, you grant us a blank running credit for the sum of twenty thousand pounds sterling (20,0001.), for all purposes, that is to say, that we...
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