ON APPEAL FROM THE SUPREME COURT OF Contract-Artist-Supply of drawings- Us Fellers "__" Ginger Meggs '-Inser-
tion on specified page of weekly newspaper-Undertaking by newspaper company Condition-Breach going to root of contract-Rescission of contract by artist. SYDNEY,
B., an artist, by contract, agreed, inter alia, for the term of ten years April 30; May 1, 2, 11.
commencing on 27th March 1949, for a substantial weekly salary, to devote the whole of his time and attention to the affairs and business of A., a news- paper company, and to use his best endeavours to promote and foster the same to the best of his skill and ability. B. agreed in the course of his employment to prepare and furnish to A. weekly a full-page drawing of " Us Fellers " or such other subject as might be agreed upon from time to time and A. undertook that each weekly full-page drawing would be presented on the front page of the comic section of a specified weekly newspaper published each Sunday by A. Until 11th February, 1951, A. had complied with its undertaking but on that day and on the two succeeding Sundays, owing to a shortage of newsprint, the comic was printed as an inset in the rotogravure section of the colour magazine, the presentation of B.'s work being on the third page and not on the front page of the comic. On the ground that A. had repeatedly, without his consent and in face of his protest, broken its undertaking, B. gave notice to A. that he was no longer bound by the contract.
Held (1) that A's undertaking was not a mere warranty or non-essential and subsidiary term of the contract, but was a condition or essential term going to its root, the breach of which entitled B. to rescind; (2) that if A.'s undertaking constituted merely a non-essential term, A.'s conduct was. in the circumstances, such as to amount to a refusal to be bound by the contract.
Mersey Steel &Iron Co. Ltd. v. Naylor, Benzon &Co., (1884) 9 App. Cas. 434, per Lord Selborne L.C., at pp. 438, 439, applied.
Decision of the Supreme Court of New South Wales (Roper C.J. in Eq.),
APPEAL from the Supreme Court of New South Wales.
A suit, instituted by an originating summons under the Equity Act 1901-1947 (N.S.W.), Sched. 4, r. 8A, was brought in the equitable jurisdiction of the Supreme Court of New South Wales by Associated Newspapers Ltd. for certain immediate injunctions restraining the threatened breach by the defendant, James Charles Bancks, of certain negative stipulations contained in a contract of employment entered into between the plaintiff company and the defendant.
The defence was that the defendant properly and lawfully rescinded the contract, and that therefore the stipulations referred to were no longer binding upon him. The right to rescind was alleged to have arisen from the fact that the plaintiff, on its part, had broken and…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Associated Newspapers Ltd v Bancks [1951] HCA 24
Case
[1951] HCA 24
Decision Date
CaseChat Overview and Summary
The case of *Associated Newspapers Ltd v Bancks* involved a dispute between a newspaper company, Associated Newspapers Ltd (the appellant), and an artist, James Charles Bancks (the respondent). Bancks had contracted to supply weekly full-page drawings of his comic strip "Us Fellers" (later known as "Ginger Meggs") to the appellant for a term of ten years. A key term of the contract stipulated that the appellant would present each weekly drawing on the front page of the comic section of its Sunday newspaper. The appellant subsequently changed its printing process due to newsprint shortages, resulting in Bancks' drawings appearing on the third page of the comic section, rather than the front. Bancks protested this change, and after repeated instances without his consent, he rescinded the contract. The appellant then sought injunctions to restrain Bancks from breaching negative covenants in the contract, arguing the rescission was unlawful. The Supreme Court of New South Wales dismissed the appellant's suit, and the matter proceeded to the High Court of Australia on appeal.
The central legal issue before the High Court was whether the appellant's undertaking to present Bancks' weekly drawings on the front page of the comic section constituted a condition of the contract, the breach of which entitled Bancks to rescind, or merely a warranty, the breach of which would only give rise to damages. The court also considered whether, even if the term was not a condition, the appellant's conduct amounted to a repudiation of the contract as a whole.
The High Court held that the appellant's undertaking to publish the drawings on the front page of the comic section was a condition of the contract, going to its very root. The court reasoned that the parties' intention, as evidenced by the contract and surrounding circumstances, was that the prominent placement of the comic was of fundamental importance to Bancks, who was engaged as a comic artist and whose substantial salary was primarily for this work. The court found that the appellant's repeated breaches of this undertaking, despite Bancks' protests, demonstrated an intention not to be bound by this essential term. Consequently, Bancks was entitled to rescind the contract. The court also noted that even if the term were considered a mere warranty, the appellant's conduct, in deliberately disregarding Bancks' protests and continuing the altered publication, amounted to a refusal to be bound by the contract, thereby entitling Bancks to terminate it. The appeal was dismissed.