Charlick v Foley Brothers Limited - [1916] HCA 27

FOLEY BROTHERS LIMITED Sale of Goods-Executory contract-Defence-Duty of legal adviser when pleading the

Statute of Frauds-Effect of pleading the Statute-Statute of Frauds (29 Car. II. c. 3), sec. Usury, Bills of Lading, and Written Memoranda Act 1902 (N.S.W.) (No. 43 of 1902), sec 11.

It is the duty of the defendant's legal adviser before placing on the record a defence based upon the Statute of Frauds to explain fully such defence to his client, and point out its full meaning and effect, and the probable conse- quences of the defence in case the event turns upon a question of credibility.

TRIAL OF ACTION.

An action was brought in the High Court by Fred Charlick, trading as Charlick Brothers and resident in South Australia, against Foley Brothers Limited, of Sydney, to recover damages for the breach of a contract of sale and delivery of certain butter above the price of £10, to be despatched to the plaintiff on 17th April 1915.

The defendants pleaded (inter alia) that it was agreed by and between the plaintiff and the defendants that if the Attorney- General for New South Wales should prior to 17th April 1915 in any way interfere with or prohibit, or attempt to prohibit, the export of butter from the State of New South Wales, or should request the defendants not to export or attempt to export any butter from the said State, the defendants should be released from any liability to deliver to the plaintiff any butter as alleged in the statement of claim, and should no longer be bound by the alleged

21 CLR 250

OF A. contract sued upon, and that prior to 17th April 1915 the Attorney-

General for New South Wales did interfere with and prohibit the export of butter from New South Wales, and did request the defendants not to export any butter from the said State, whereby the defendants became released from their obligations. The defen- dants also pleaded the Statute of Frauds and the Usury, Bills of Lading, and Written Memoranda Act 1902 (N.S.W.) (No. 43 of 1902), sec. 11.

It was proved at the trial of the action that the Attorney-General for the State of New South Wales, on 10th April 1915, purported to place certain restrictions upon the export of butter from New South Wales as from 12th April 1915, and that such restrictions were communicated to the defendants. The restrictions, if valid, would have prevented the performance by the defendants of the contract sued upon.

Other material facts sufficiently appear from the judgment hereunder.

Loxton K.C. and Hammond, for the plaintiff. Curtis and Weston, for the defendants.

Cur. adv. vult.

ISAACS J. read the following judgment :-This is an action brought by Fred Charlick, trading as Charlick Brothers, a resident of South Australia, against Foley Brothers Limited, a New South Wales trading corporation, to recover damages for non-delivery of butter pursuant to an oral contract of sale.

The terms of the contract, if there was a contract…

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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Details

Case: [1916] HCA 27
Decision Date: 19 April 1916

CaseChat Overview and Summary

This case involved an action brought in the High Court by Fred Charlick, trading as Charlick Brothers, against Foley Brothers Limited. Charlick sought damages for the alleged breach of an oral contract for the sale and delivery of butter, with a price exceeding £10, to be despatched on 17th April 1915. Foley Brothers Limited pleaded, among other defences, that the contract was subject to a condition releasing them from liability if the Attorney-General for New South Wales interfered with or prohibited the export of butter from the state, which they alleged had occurred. They also pleaded the Statute of Frauds and the relevant New South Wales Act concerning written memoranda.

The legal issues before the court were twofold: firstly, whether the provisions of the Statute of Frauds had been satisfied, and secondly, and more substantively, whether a definite and binding contract had been formed, or if the order had been accepted subject to an express condition that had not been met. The court was required to determine the enforceability of an oral contract for the sale of goods above a certain value, considering both statutory requirements and the express terms of the agreement.

Isaacs J. found that the contract was indeed oral and that the parties had relied on their business trust rather than a written agreement. While acknowledging the Statute of Frauds applied to such bargains, His Honour commented on the ethical implications for legal advisers when pleading this defence, particularly when clients have a history of conducting business based on verbal agreements and business honour. The court ultimately found in favour of the defendants, holding that the contract was conditional and that the condition had not been satisfied. Consequently, judgment was entered for the defendants with costs.

Orders