Skilton v Sullivan
| Jurisdiction | England & Wales |
| Judgment Date | 18 March 1994 |
| Date | 18 March 1994 |
| Court | Court of Appeal (Civil Division) |
Court of Appeal
Before Lord Justice Nourse, Lord Justice Beldam and Lord Justice Simon Brown
Contract - not unenforceable for illegality - postponement of payment of VAT
A contract for the sale of koi carp was not unenforceable for illegality because the seller's invoice was raised with an illegal purpose in mind, the postponement of the payment of value-added tax. The unilateral illegal intent was formed after the parties had entered into the contract and the seller did not have to rely on his illegal act to establish his right to recover from the buyer.
The Court of Appeal so held dismissing an appeal by the defendant, Mr Colin Sullivan, from the order made by Judge Rice in Brentwood County Court in June 1992 that he pay £3,764 together with interest to the plaintiff, Mr Christopher Skilton.
Mr Alan Gourgey for the defendant; Mr Donald Lambie for the plaintiff.
LORD JUSTICE BELDAM said that in November 1985 the plaintiff, an aquarist, and the defendant a property developer who wished to stock a lake, reached an agreement for the sale of a number of koi carp at a price that was to include VAT. The plaintiff delivered the fish by March 1986.
The defendant had when reaching the agreement paid £3,000 on account but refused to make the further payment of the sum left outstanding. His case was that the contract that he had agreed with the plaintiff was unenforceable for illegality: it was, he said, a fraud on the Revenue. That argument was founded on the plaintiff's invoice to the defendant that was for stocking the defendant's lake with "trout". For VAT purposes trout were zero-rated and koi carp were not.
Judge Rice found that the plaintiff, although rather vague, was not dishonest and had no intention of avoiding liability for VAT but merely of postponing the payment of it. However, the judge had overlooked the fact that postponement of VAT was as much an offence as was evasion.
The court was bound to approach the case on the basis that the invoice was false and was given by the plaintiff for an illegal purpose. That being so, the defendant argued, the plaintiff could not recover the outstanding balance.
The principle to be applied...
To continue reading
Request your trial
-
21st Century Logistic Solutions Ltd ((in Liquidation)) v Madysen Ltd
...common law principle that one who knowingly enters into a contract with an improper object cannot enforce his rights thereunder" and in Skilton v Sullivan CA 18 March 1994; The Times, 25 March 1994, Beldam LJ said: In a case in which one party to a contract seeks performance of an obligati......
-
WORKPLACE SEXUAL HARASSMENT IN SINGAPORE: THE LEGAL CHALLENGE
...the findings in the AWARE survey were reported in Schutz Lee, “Half of Women in Survey Cite Sexual Harassment at Work”, The Business Times, 25 March 1994 at 2. Since their 1993 survey, AWARE has found that almost 12% of the telephone calls to their telephone helpline involve complaints of s......