37'i

1881 HAKMON LINDLEY, J. nomination. t h e y assent ?

QUEEN'S BENCH DIVISION.

I am of t h e same opinion. the eight

VOL. VII.
T h e A c t of P a r l i a assent t o t h e

m e n t requires t h a t

burgesses shall

"What t h e n is t h e nomination in writing to which T h e n o m i n a t i o n consists in filling u p t h e n a m e of

the candidate on the nomination form, with the signatures of the proposer and seconder. The argument for the petitioner comes to this, that the eight persons might sign even, before the name of the candidate was on the nomination paper. This is not the kind of assent required by the statute. The Domination must precede the assent, the assent must not precede the nomination.
LOPES,

J., concurred.

Solicitors for petitioner: Bell, BrodricJc, & Gray,for Snowball, Sunderland. Solicitors for respondent: Brownlow & Howe, for Ritson, Sunderland. A. P. S.
March 28. [IN THE COURT OF APPEAL.] THE NEW ZEALAND AND AUSTRALIAN LAND COMPANY v.
WATSON AND ANOTHER.

Principal and AgentUndisclosed PrincipalConsignor and ConsigneeSubcontractPrivity of ContractBight to follow Goods or ProceedsTrustee. The plaintiffs, who were landowners in New Zealand, were in the habit of shipping wheat from New Zealand to England for sale on the London market, taking bills of lading which made the wheat deliverable to themselves in London, and indorsing these bills to M. and T., merchants and factors at Glasgow, with instructions to sell the wheat in London. M. and T. having no house or agency in London were themselves in the habit of indorsing these bills of lading to the defendants, who were cornfactors and brokers in London, for the purpose of their selling there the wheat. When any sales were effected, M. & T. delivered account sales to the plaintiffs in the usual form, deducting a del credere commission of SI. per cent., whilst the terms upon which the defendants were employed by M. & T. were different, being a factorage of 21. per cent, and not a del credere commission. The indorsement of the bills of lading by the plaintiffs to M. & T. and by M. & T. to the defendants, was in each case only for the purpose of selling the wheat and without the intention of passing any property in it. The plaintiffs knew that the sales effected for them by M. & T. in London were made by brokers employed by M. & T., but the plaintiffs were in no way parties to the particular contracts of sale nor were their names disclosed upon them. The defendants effected sales of certain cargoes of wheat which had been so consigned for

VOL. VII.

QUEEN'S BENCH DIVISION. 1881

375

sale by the plaintiffs in the above mode, and paid the proceeds into their own account with their bankers, and from time to time made remittances to M. & T. on account of them; but upon reference to the defendants' books of account the proceeds of the particular cargoes could be separated and identified. M. & T. carried on a business at Leith as well as at Glasgow, and they employed the defendants in respect of both, and when they stopped payment which they did, they were indebted to the defendants upon the Leith account but not on the Glasgow account. The plaintiffs having brought an action against the defendants for the net balance of the proceeds of the said cargoes of wheat after deducting the remittances made to M. & T. in respect thereof, but without giving credit due to them from M. & T. on other transactions, the jury found at the trial first, that the plaintiffs did not, through their agents, employ the defendants to sell and account for the proceeds of the wheat; secondly, that the defendants knew, or had reason to believe, that M. & T. were acting in the sales as agents for a third person: Held, reversing the judgment of Field, J., that the plaintiffs were not entitled to recover, as there was no privity of contract between them and the defendants, and the defendants did not stand in any fiduciary character towards the plaintiffs so as to entitle the latter to follow the proceeds of their property in the defendants' hands, and as whatever right the plaintiffs might have had as owners to claim the wheat before it had been sold, they had no right, after such sale, to the proceeds, without giving credit for the sum due to the defendants from M. & T., on their general account. APPEAL by the defendants from the judgment of Field, J., on further consideration. (1) The action was to recover 25717. 8s. 6d., the balance in the defendants' hands of the proceeds of three cargoes of wheat, ex the vessels Oamaru, James Wishart, and Auckland, consigned to them for sale by Messrs. Matthews & Thielman (who were merchants and factors at Glasgow), after giving the defendants credit for such sums as they had remitted to Matthews & Thielman on account of such proceeds. It appeared that the plaintiffs who were landowners in New Zealand and had offices in Glasgow, but no office or agency in London, were in the habit of shipping wheat, the produce of their land, to England, for sale in the London market, and of taking bills of lading in which the wheat was made deliverable to themselves in London. These bills were indorsed to Matthews & Thielman, at Glasgow, with instructions, as the agents of the plaintiffs, to sell the goods in London. Matthews & Thielman had no house or agency in London, and (1) 5 Q. B. D. 474, nom. New Zealand and Australian Land Company v. Euston and Another.

AUSTBALIAN LAND CO.

v.
WATSON.

376 1881

QUEEN'S BENCH DIVISION.

VOL. VII.

their mode of realizing the produce on behalf of the plaintiffs NEW ZEALAND was by indorsing the bills of lading to the defendants who were corn AUSTRALIAN factors an& brokers in London, for the purpose of the sale LAND CO. of the wheat by them. The indorsement of the bills of lading .WATSON, by the plaintiffs to Matthews & Thielman, and by Matthews & Thielman to the defendants, was in each case only for the purpose of selling the wheat and without the intention of passing any property in it. Matthews & Thielman, when any sales had been effected, delivered account sales to the plaintiffs in the usual form, deducting a del credere commission of 3 per cent, whilst the terms of employment between Matthews and Thielman and the defendants were different, being a factorage of 2 per cent. and not a del credere commission. The plaintiffs knew that the sales effected for them by Matthews & Thielman in London were made by brokers employed by Matthews & Thielman, but the plaintiffs were in no way parties to these sub-contracts, nor were the plaintiffs' names disclosed upon them, Matthews & Thielman appearing upon the face of them not as agents for any one but as principals. The defendants, in pursuance of their employment, effected sales of the cargoes in question and paid the proceeds into their own account with their bankers in the ordinary way, and from time to time made remittances to Matthews & Thielman on account of them. The defendants' books shewed the amounts received and paid in respect of each particular cargo, so that the proceeds of these sales could be separated from the other credits, * and traced and identified. Matthews & Thielman carried on a business at Leith as well as at Glasgow, and they employed the defendants both in respect of their Glasgow business and their Leith business, and when Matthews & Thielman failed and stopped payment, as they afterwards did, they were indebted to the defendants upon the Leith account, but not on their Glasgow account. The balance which the plaintiffs claimed was, after giving credit to the defendants for all sums remitted to Matthews & Thielman, in respect of the sales of the three cargoes in question, but without giving credit for amounts due to the defendants from Matthews & Thielman on other transactions, but which the defendants sought to set off against the plaintiffs' claim.

VOL. VII.

' QUEEN'S BENCH DIVISION.

377

In the statement of claim, the plaintiffs alleged that they, 18S1 through their agents, retained and employed the defendants to NEW ZEALAND sell and dispose of the cargoes of wheat ex the three vessels, AUSTRALIAN Oamaru, James Wishart, and Auckland, for the plaintiffs for L A N D COreward to the defendants in that behalf, and to account to the \VAT6ON. plaintiffs for the proceeds thereof, that the defendants accepted the said employment and received and sold the goods for the purpose and on the terms aforesaid, but had refused to pay the proceeds of such sale to the plaintiffs. The defendants in their statement of defence, denied that they were so retained or employed by the plaintiffs, and alleged that they were employed by Matthews & Thielman who acted as principals, and to whom they had accounted. At the trial the learned judge left two questions to the jury, first, did the plaintiffs through their agents employ the defendants to sell and account for the proceeds to the plaintiffs, and did the defendants accept that employment and sell for the plaintiffs ? Secondly, did the defendants know or have reason to believe that Matthews & Thielman were acting in their sales as agents for another ? The jury answered in the negative the first, and in the affirmative the second of these questions. The learned judge afterwards gave judgment for the plaintiffs for the amount they claimed. The defendants appealed. C. Russell, Q.C., and Finlay, for the defendants. In giving judgment for the plaintiffs, Field J., relied upon Xnatehbull v. Hallett (1), but this case is not in point: the learned judge ought to have taken into account that the plaintiffs put Matthews & Thielman into the place of principals, and the state of facts found by the jury cannot be disregarded. The question depends upon the law of principal and agent; and the decisions, as to the liability of the London agents of country solicitors to the client, shew that no privity existed between the plaintiffs and the defendants, and that the present action is not maintainable:
Bobbins v. Fennell (2); Stephens v. Badeock ( 3 ) ; Cobb v. Beehe. (4)
(1) 13 Ch. D. 696. (2) 11 Q. B. 248. (3) 3 B. & Ad. 354. (4) 6 Q. B. 930.

378 1881
NEW ZEALAND accountable

QUEEN'S BENCH DIVISION.

VOL. VII.

The defendants were not employed by the plaintiffs and are not to them: Behmaling v. Thomlinson (1) ; Cull v. Baclcus AUSTEAIIAN h e- (2) It is laid down in Myler v. Fitzpatrieh (3), that a LAND CO. m ere agent is to account to his principal only. Toland v. A A S N Murray (4) is a decision of an American Court; it does not V TO . conflict with the argument for the defendants. The decisions as to the liability of bankers, who are entrusted with the collection of money, establish that no right to sue exists without privity of contract: MacJcersy v. Bamsays (5); Prince v. Oriental Bank Corporation. (6) The defendants are entitled to avail themselves of their set-off: Armstrong v. Stokes. (7) H. Matthews, Q.C., and Barnes, for the plaintiffs. In this action the plaintiffs merely seek to recover funds, the produce of their property, which have actually reached the defendants' hands. The employment of the defendants by Matthews & Thielman to sell on the London market was authorized by the plaintiffs, as it was necessary that there should be some one in London to represent the plaintiffs, and get delivery there of the wheat. Then, the defendants employment as sub-agents being authorized by the plaintiffs, any contract of sale made by the defendants would be as binding on the plaintiffs as if made by the plaintiffs themselves, and there would consequently be a privity of contract between the plaintiffs and defendants: Story on Agency, ch. vii. s. 201: Moon v. Guardians of Witney Union (8); 2 Duer on Insurance, p. 355; Be Bussche v. Alt. (9) The defendants were not only subagents lawfully authorized to act as such, but they knew that Matthews & Thielman were acting only as agents for a third person; therefore the plaintiffs had a right to intervene and sue for the proceeds, without any right of the defendants to set off what might be due to them from Matthews & Thielman on their general account: Babone v. Williams (10); Sims v. Bond (11); Mann v. Forester (12); Maans v. Henderson (13); Lanyon \.
(1) (2) (3) (4) 24. (5) (6) C Taunt. 147. , 6 Taunt, 148, n. ' 6 Mad. 360. 18 Johnson (New York, U.S.) ' 9 Cl. & F. 818. 3 App. Cas. 325. (7) (8) (9) (10) (11) (12) (13) Law Rep. 7 Q. B. 598. 3 Bing. (N.C.) 814. S Ch. D. 286. 7 T. R. 360, n. 5 B. & Ad. 389. 4 Camp. 60. 1 East, 335.

VOL. TIL

QUEEN'S BENCH DIVISION.

379

Blanchard (1) ; Wesiwood v. Bell. (2) If the defendants are not U81 liable as the plaintiffs' agents they are liable for the conversion NEW ZEALAND of the wheat upon the principle of the decision in Hollins v. AUSTRALIAN Fowler. (3) Moreover the defendants, as agents for sale, stood iu L A N D a fiduciary position towards the plaintiffs, who as beneficial owners WATSON. had a right therefore to follow the proceeds if they could be identified, as they clearly could be in the present case: Enatchhull v. Hallett (4); Ex parte Kingston, In re Gross (5) ; and Ex parte Coohe, In re Strachan (6) ; and in the notes to Ryatt v. Bowles (7) it is shewn that one who has money to be paid to another person is bound after notice of this to pay it to such person, although there may be no contract between them to do so. At common law, apart from any equitable doctrine, the beneficial owner of goods can follow them and take them out of the hands of any one who may have obtained possession of them. Then, if such owner can follow the goods he ought also to be able to follow their proceeds if he can identify them. Finlay, in reply, Cur. adv. vult.
BEAMWELL, L.J. With the sincere respect I always have for the opinion of my Brother Field, I confess that I cannot come to the same conclusion as he has in this case. The statement of claim was that the plaintiffs, through their agents, retained and employed the defendants to sell and dispose of certain quantities of grain by the vessels Oamaru, James Wishart, and Auckland, for the plaintiffs for reward to the defendants in that behalf, and to account to the plaintiffs for the proceeds thereof; and that the defendants accepted the said employment, and received and sold the goods for the purpose and on the terms aforesaid. That is traversed by the statement of defence. It was specifically left to the jury who found that the statement of claim was not correct; that the plaintiffs had not employed the defendants, and that the defendants had not accepted that employment. One would have thought that that would have made an end of the case, but my (1) 2 Camp. 597. (2) 4 Camp. 349. (3) Law Eep. 7 H. L. 757. (7) 2 VV. & T. 5th (4) 13 Ch. D. 708. (5) Law Eep. 6 Ch. 632. (6) 4 Ch. D. 123. ed. 770, 771.

380 1881

QUEEN'S BENCH DIVISION.

VOL. VII.

Brother Field, notwithstanding that finding, felt himself bound NEW ZEALAND to give judgment for the plaintiffs upon a ground upon which ArsTBALiAN ^ r e a ^ y cannot agree with him. He found no fault with the LAKD CO. yerdict, and in my opinion the verdict was perfectly right, because WATSON, the plaintiffs had employed Matthews & Thielman in Glasgow, Bramweii, L.J. upon certain terms, one of which was that they should be entitled to 3 per cent, commission, and that it should be a del credere commission, and Matthews & Thielman had employed the defendants in London to sell the cargoes of grain upon the terms of a 2 per cent., and not a del credere, commission. Therefore it is clear that the plaintiffs employed Matthews & Thielman upon one set of terms, and that Matthews & Thielman employed the defendants upon another and different set of terms. It -was admitted that if the defendants had misconducted themselves in the sale of these cargoes, and had sold improperly, the plaintiffs could have brought no action against them for such misconduct, but must have sued Matthews & Thielman for not performing their duty by the sub-agents whom they employed. On the other hand, if the defendants had found it necessary to have brought an action for their commission they must have brought it not against the plaintiffs but against Matthews & Thielman. There was, therefore, no privity of contract between plaintiffs and defendants, and the verdict of the jury upon that point was quite right. Nevertheless my Brother Field thought he was bound to give judgment for the plaintiffs upon this principle. He said the defendants were sub-agents, and Matthews & Thielman had authority to employ sub-agents, and no doubt he was quite right as to that, because these cargoes were to be sold in London, and Matthews & Thielman carried on their business in Glasgow and not in London. Then he said it was the case of a principal and agent, and a principal can intervene in a contract which his broker and agent has made, and can sue the party with whom it has been made ; that is to say, if a man employs another to sell goods, and that other sells the goods in his own name, the principal may intervene and bring his action against the buyer. There is no doubt about that, and why ? Because a broker or agent who is so employed is employed to make the contract between the two principals and one of them may sue the other upon it. But in this case

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QUEEN'S BENCH DIVISION.

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Matthews & Thielman at Glasgow were not employed to make 1881 a contract of brokerage between the plaintiffs and defendants. It NEW ZEALAND may have been no breach in their agreement with the plaintiffs to AUSTRALIAN employ a snb-agent, but they had no authority to make a contract L A N D COof agency between the two. I cannot agree, therefore, with the WATSOK. similitude which Mr. Justice Field made. Another illustration Bramweii, L.J. which the learned judge gave was this: " The owner of an estate in England employs a manager at a salary to realize the produce of his estate, leaving him absolute discretion as to the way in which he thinks it most advisable to realize, and the latter employs a broker, or factor, or agent on commission to effect the sale; but it cannot for a moment be supposed," says the learned judge, "that the original principal may not at any time before the sub-agent has accounted to the mesne agent, or paid over to him, or accounted for the proceeds of the sale (subject of course to any set-off accrued in ignorance that the mesne agent was not principal) intervene and claim the proceeds." I should say upon that statement the owner of an estate employs a manager to manage and not to sell, and one part of the manager's management was to employ a broker or agent for the purpose of selling the things that are to be sold, and therefore in that case the manager ha9 authority to create the relation of principal and agent between the owner of the estate and the person he employs to sell. I cannot agree with the conclusion that Mr. Justice Field has come to, that there was any contract of agency between the plaintiffs and the defendants. If there was, what were the terms of it ? They were not the same as those between Matthews & Thielman and the defendants, for the plaintiffs never undertook to employ anybody otherwise than upon the terms of the del credere commission. It seems to me, therefore, that the judgment cannot be supported on that ground. Then another point in the judgment is that the second finding of the jury (which I also think was a perfectly correct one), namely that the defendants knew, or had reason to believe, that Matthews & Thielman were acting as agents, was in the opinion of Mr. Justice Field rightly relied on by the counsel for the.plaintiffs, as conclusively entitling the plaintiffs to judgment in respect of then1

382 1881
NEW ZEALAND property

QUEEN'S BENCH DIVISION.

VOL. VII.

rights as owners of the cargoes to follow the proceeds of their in the hands of the defendants in their fiduciary character a e n s an( AUSTRALIAN ^ S * * trustees. Now I do not desire to find fault with the LAND CO. various intricacies and doctrines connected with trusts, but I should WATSON, be very sorry to see them introduced into commercial transactions, Bramweii, L.J. and an agent in a commercial case turned into a trustee with all the troubles that attend that relation. I think there is no ground for holding that these defendants have any fiduciary character towards the plaintiffs. They are the sub-agents of Matthews & Thieltnan, and there is nothing in the nature of a trust that I can see in the case. Therefore, upon the two points that my Brother Field rested his judgment, I differ from him. Mr. Barnes, who was for. the plaintiffa, took an entirely new point before us which was this. He said the plaintiffs are the owners of this property and can therefore follow it into the hands of any person to whom they can trace it, and he based this right not merely on an equitable doctrine, but on a common law doctrine for which he cited authorities, and in this I agree with him. But the first observation I have to make upon it is that no such case as this is in the statement of claim, nor was it made before the jury or in the argument before Mr. Justice Field. If pleadings are to be of any use a man should be bound by the statement of his case, so that a defendant may know what he has got to answer. Otherwise pleadings are a snare and a delusion. I do not say that an application may not sometimes be properly made to the Court in which the record is, for leave to amend the statement of claim so as to raise a different question from that which is already in it, but I think it an inconvenient thing, when the question comes to be discussed before the Court of Appeal, that an entirely new point should then be raised for the first time. I am prepared therefore to decide this case upon the ground that this point is not in the statement of claim, and that it is not within the rule that allows an amendment necessary for the purpose of determining the matter in controversy between these parties, which is whether the defendants were the agents of the plaintiffs, not whether there was any such right as is now alleged on the part of the plaintiffs to follow the goods. I am, however, also prepared to decide this case upon the merits. I agree that goods and the produce of

VOL. VII.

QOEEN'S BENCH DIVISION.

383

goods may be followed, and that before the defendants had sold 1881 these goods, and while they continued to hold the bills of lading ^EV ZEALAND for them, the plaintiffs might have claimed to have had those AUSTRALIAN bills of lading handed over to them. Whether the defendants L A N D Cocould have retained them for advances is a matter upon which WATSON. one need express no opinion at present, because that was not the Bramweii, L.J. case; for what really happened was this, that they had sold the cargoes and the claim was not to have the bills of lading or the goods specifically restored, but the produce of them, and as to that the defendants would be only liable to account for what remained in their hands after adjusting their accounts with Matthews & Thielman. Now Matthews & Thielman carried on two businesses, one at Glasgow and the other at Leith, and they employed the defendants both in respect of their Glasgow business and their Leith business, and it so happened that when Matthews & Thiel man stopped payment they were indebted to the defendants upon the Leith account, but not on the Glasgow account, whereupon the plaintiffs sought to have the produce of their goods at the hands of the defendants, leaving the defendants to go and prove as creditors against Matthews & Thielman for the balance which was due to them on the Leith account. It seems to me that the plaintiffs have no right to do so, and that therefore this last contention on the part of the plaintiffs fails, both because it was not raised by the pleadings and that, if it had been, it ought to have been decided on the merits in favour of the defendants. The judgment should therefore be reversed.
BAGGALLAY, L.J. I am of the same opinion, and I should not have added anything to what has fallen from Bramweii, L.J., had it not been that a strong argument was based upon the decision in Knatchbull v. HalleU. (1) There is no question as regards the doctrine well known in Equity, which that case illustrates, with respect to property disposed of by persons standing in a fiduciary position, namely that such property, or the proceeds of it, can be followed if it can be identified, and it is also equally well known that there is no distinction as regards this doctrine between an express trustee or an agent or bailee standing in a

(1) 13 Ch. D. 696.

384 1881

QUEEN'S BENCH DIVISION.

VOL. VII.

similar fiduciary position. The mistake is in applying the prinKBW ZEALAND ciple of that case to the present case where there is no fiduciary re a n as AUSTRALIAN l t i between the plaintiffs and defendants. The fiduciary
LAND CO.
WATSON.

relation which exists, if at all, was between the defendants and

Matthews & Thielman.
BEAMWELL, L.J. Lord Justice Brett, who is absent, desired me to say he concurs in this judgment for the appellants.

Judgment reversed. Solicitors for plaintiffs : Young, Jones, Roberts, & Hale. Solicitors for defendants: Stibbard, Gibson, & Co. W. P.

June 29.

THE QUEEN ON THE PROSECUTION OP THE GUARDIANS OF FULHAM UNION, APPELLANTS ; THE GUARDIANS OP PORTSEA
UNION, RESPONDENTS.

Poor LawIllegitimate Child under SixteenDerivative Settlement39 & 40 Viet. c. 61, s. 35. Under 39 & 40 Viet.- c. 61, s. 35, illegitimate children tinder sixteen do not take the settlement of their mother where such settlement has been derived from her marriage, although the birth of the children and the marriage of the mother were before the passing of the Act. UPON appeal to the Portsmouth Borough Sessions, against an order for the removal of Maria Butler and Emily Butler from the Portsea Island Union, the order was quashed, subject to the following case. The paupers, Maria and Emily Butler, are the illegitimate children of Emma Maria Savage, now Burdett, who was at the time of the paupers' birth, a single woman. The paupers were both born in the parish of Portsea, within the respondent union. Maria, on the 6th of January, 1866, and Emily, the 11th of May, 1868. The paupers have not since their birth acquired any settlement for themselves in their own right. The paupers' parent, Emma Maria Savage, was on the 3rd of October, 1875, married to one John Burdett. John Burdett, the paupers' parent's husband, was born on or