Yeoman Credit Ltd v Apps
| Jurisdiction | England & Wales |
| Judge | Lord Justice Holroyd Pearce,Lord Justice Harman,Lord Justice Davies |
| Judgment Date | 16 March 1961 |
| Judgment citation (vLex) | [1961] EWCA Civ J0316-4 |
| Date | 16 March 1961 |
| Court | Court of Appeal |
[1961] EWCA Civ J0316-4
In The Supreme Court of Judicature
Court of Appeal
Lord Justice Holroyd Pearce
Lord Justice Harman and
Lord Justice Davies
Mr NEIL LAWSON, Q. C., and Mr JOHN LLOYD-ELEY (instructed by Messrs Paisner & Co.) appeared on behalf of the Appellants. (Plaintiffs)
Mr STEPHEN CHAPMAN, Q. C., and Mr GERALD E. MORIARTY (instructed by Messrs Breeze, Benton & Co.) appeared on behalf of the Respondent (Defendant).
This is the plaintiffs' appeal from a Judgment of His Honour Judge Baxter at Bow County Court. He dismissed the plaintiffs' claim for arrears of instalments due under a hire purchase agreement and for damages. He gave Judgment for the defendant on the counterclaim for £170, being the first payment and three monthly instalments of hire paid by him under the agreement. The learned Judge held that there had been a total failure of consideration for those payments.
The plaintiffs are a finance company. A hire purchase agreement dated 21st April 1959 was made between the plaintiffs and the defendant in respect of a 1954 Ford car. The car was sold by Goodbody Motors to the plaintiffs, and the plaintiffs hired it to the defendant. In April 1959 the defendant, who wished to buy a secondhand motorcar on hire purchase, was introduced to Goodbody. Late at night when it was dark Goodbody brought to his house a Ford motorcar, and asked him to have a run in it. It being dark, the plaintiff was not able to examine the car. They went for a short ride. Goodbody drove the car at what the defendant described as a steady pace. The defendant noticed that the windows were cracked. He pointed this out. Goodbody said that he would have the car overhauled and the windows replaced and new tyres, or better tyres, exchanged for the defective tyres which were then on the car. They went to a house at which the defendant was introduced to someone called Marx, and Goodbody and Marx persuaded the defendant to agree to take the car at a cash price of £;495 and to sign a hire purchase agreement. That agreement sets out that the cash price of the car is £;495 that the hire purchase price was £;574. 12s. 6d. that the initial instalment was £;125 and that there were payable thirty monthly rentals of £;14. 19s. 1d, The defendant paid £;125 then and there to Goodbody. Unfortunately, Goodbody is now insolvent, and the loss which in the event was caused by him must fall on others. It is clear (and the Judge so found) that the agreement between the defendant and Goodbody was not an agreement with Goodbody Motors as agent for the plaintiffs. The defendant relied on Mr Goodbody himself.
At the time of signing the hire purchase agreement the defendant signed a delivery receipt attached to the same document addressed to the plaintiffs in those terms: "I hereby acknowledge having examined and taken delivery of the goods described in the schedule to the within written hire purchase agreement between us and am satisfied as to their condition and their fitness for the purpose or purposes required".
On the 5th May the car was delivered to the defendant. Goodbody brought it round at night and left it outside the house. No repairs at all had been done It was in exactly the same condition as when the defendant signed the document. The learned Judge said: "I accept the evidence that the article delivered to Mr Apps" (the defendant) "was a 1954 Zephyr car in an unusable, unroadworthy and unsafe condition requiring an expenditure of at loast £;70, and possibly £;100/£;120 to put it into a reasonable roadworthy condition".
The defendant's account of what happened thereafter is this: "That month I got copy of agreement. I had had the car by that time. I had been able to drive it - very poor. I telephoned finance company in West End. They said they would put me through to London office. Put through to a man. He said I would have to go to Goodbody. I rang up finance company over twenty times. I took car to Mr Watson" - the date was about the middle of May. "He did some work for me. I had not been able to use it. I had tried. Took me 1 1/2 hours to go three to four miles. Brake, clutch, steering terrible. Watson repaired it so that I could got it back to Goodbody. I tried to return it to him. He was away. I took it home. Again rang the finance company. They told me to take it to Goodbody. I paid some instalments. I hoped Goodbody would bear half the expense of repair".
The defendant in fact paid the three instalments due on the 21st May, 21st June and 21st July 1959. The Judge found that he had made some complaints to the plaintiffs about the condition of the car, but not as many complaints as he claimed to have made. The defendant failed to pay instalments due on the 2lst August and 2lst September. Accordingly, on the 9th October the plaintiffs determined the hiring under clause 4 of the agreement on the ground of the defendant's failure to pay the instalments. A collector went to the defendant's house, taking with him a notice of termination. He had a discussion with the defendant who told him that as the car was not roadworthy, he could take it away. As the car would not go, the collector had it towed away. The car was resold by the plaintiffs just as it was for £;210.
By letter to the defendant dated 5th November 1959 the plaintiffs claimed various amounts, the total of which was £193 odd, which. sum was claimed In the action. The learned Judge found that if the plaintiffs were entitled to anything, they were entitled to only £29. 18s. 2d., being the two instalments in arrear, plus £30 damages for broach of the agreement.
So much of the appeal as is against that, finding has been abandoned, and the plaintiffs here ask for Judgment for £59. 18s. 2d. On that part of the case the defendant's counsel argues (rightly, I think) that there is no evidence on which the Judge could find damages proved even to the extent of £30, since he had held that the sum payable under clause 5 by way of liquidated damages for depreciation was a penalty, and therefore irrecoverable.
The learned Judge has set out his reasons at length in a very clear and careful Judgment. He deals with two main questions: (1) Were the plaintiffs in breach of a fundamental term that the car should be roadworthy so that the exclusion under clause 8 of the conditions and warranties did not protect them? (2) If so, was there a total failure of consideration so that the plaintiffs cannot recover anything and the defendant can recover the £170 which he has paid? The Judge answered both those questions in the defendant's favour.
Clause 8 of the hire purchase agreement reads: "No warranty whatsoever is given by the owner as to the age state or quality of the goods or as to fitness for any purpose and any implied warranties and conditions are also hereby expressly excluded except such as are implied by section 8, subsection (1) of the Hire Purchase Act 1938 if applicable". The Act is not applicable since the hire purchase price in this case exceeded £300.
Before considering the effect of that clause, the learned Judge considered what the implied terms would be apart from it. He said: "There is an implied term of any hiring agreement that the goods hired should be as reasonably fit and suitable for the purpose for which they are expressly hired, or for which, from their character, the owner must be aware that they are intended to be used, as reasonable care and skill can make them".
He went on to hold that such a term was fundamental and, therefore, was not excluded by the exception clause.
The plaintiffs contend that there is no implied condition of fitness in a hiring agreement for a specific chattel even though the object of the hiring is known or obvious to the owner. They rely on Robertson v. Amazon Tug & Lighterage Company, reported in volume 7 Queen's Bench Division at page 598. There the plaintiff, a master mariner, contracted with the defendants for a lump sum to take a specified tug from Hull to the Brazils, paying the crew and providing provisions for all on board for seventy days. The engines of the tug were (unknown to the parties) out of repair, so that the time occupied on the voyage was increased, and the plaintiff suffered loss accordingly.
Lord Chief Justice Coleridge held that there was an implied warranty that the tug should be reasonably efficient for the purposes of the plaintiff. In the Court of Appeal Lord Justice Bramwell agreed with that view, but the majority (Lords Justices Brett and Cotton) held otherwise. Lord Justice Bramwell said at page 603: "The case seems to me the same as a contract of hiring, and as all contracts when one man furnishes a specific thing to another which that other is to use. The man so letting and furnishing the thing does not, except in some cases, undertake for its goodness or fitness, but he does undertake for the condition being such that it can do what its means enable it to do. Thus, if a man hired a specific horse and said he Intended to hunt with it next day, there would be no undertaking by the letter that it could leap or go fast but there would be that it should have its shoes on, and that it should not have been excessively worked or unfed the day before.
"If I am asked where I find this rule in our law, I frabkly own I cannot discover it plainly laid down anywhere. But it seems to me to exist as a matter of good sense and reason, and it is, I think, in accordance with the analogous authorities. I am afraid that the nearest is the dictum of Lord Abinger in Smith v. Marrable: 'No authorities were wanted … the case is one which common sense alone enables us to decide'. The subject is treated in Story on Bailments, section 383. And certainly according to what is said there, if this had been a case of...
To continue reading
Request your trial
- Lai Ping Yoon; United Engineers (M) Ltd
-
Charterhouse Credit Company Ltd v Tolly
...Common Law it was an implied term of the contract that the car should be reasonably fit for the purpose for which it was hired. Yeoman Credit Ltd. v. Apps infra 9 The findings of the learned County Court Judge were these: 1. There had been a fundamental breach of the contract on the part of......
-
Brewer v Mann
...a fortiori for the purposes of Mrs Brewer's claim against Fortis. 316 Before coming to Charterhouse Credit v. Tolly, we would mention Yeoman Credit v. Apps [1962] 2 QB 508 (CA). That involved the hire purchase of a second-hand Ford. The car as delivered was unusable, unroadworthy and unsafe......
- Hong Leong Leasing Sdn Bhd v Tan Kim Cheong
-
Cases referred to in 1965
...E.R. 751, C.A. . . 7 Woodward v. Sarson (1875) L.R. 10 C.P. 733; 32 L.T. 867. ....................... 221 Yeoman Credit Ltd. v. Apps (1961) 2 All E.R. 281, 292. ............................. 312 Yukon Consolidated Gold Corporation Ltd. v. Clark (1938) (C.A.) 241. . . 238 ...
-
Exculpatory Clauses
...Ltd , [1907] 1 KB 660 (CA); Hain SS Co Ltd v Tate & Lyle Ltd , [1936] 2 All ER 597 (HL). 21 See, for example, Yeoman Credit Ltd v Apps , [1962] 2 QB 508; Charterhouse Credit Co Ltd v Tolley , [1963] 2 QB 683 (CA); Astley Industrial Trust Ltd v Grimley , Exculpatory Clauses 871 soundness of ......
-
VISITING AN OLD FRIEND — THE “ROMALPA” CLAUSE
...reservation of title clause”[1992] Lloyds Maritime and Commercial Law Quarterly 35. 83 See for example Yoeman Credit Ltd v Apps[1962] 2 QB 508. 84 See criticisms of Rowland v Divall in G H Treital, Treital Law of Contract, (9th ed, 1995), at 947. 85 [1985] 1 WLR 111, at 119. 86 Ibid, at 120......