H. C. OF A. tralian Bank Limited Collins Street Melbourne or wherever else 1907. the vendor and purchasers may in writing agree upon as an escrow pending the payment to the vendor of the balance of the ROBINSON. purchase money and interest represented by such promissory CHRISTIE notes." On this document was endorsed :-" The above agreement cancelled by mutual consent 21st March 1905," and this endorsement was signed by the parties to the contract By his defence the defendant denied that he had received the £500, and said that it was verbally agreed that the £500 should be paid to Good as stakeholder merely. He also denied that the contract was cancelled, but said that the endorsement was made on the contract merely to enable him to get back the documents of title to the land from the English Scottish and Australian Bank Limited. The defendant then counterclaimed for rectification of the contract, if, on the construction of the contract as written, it should be held that Good received and held the deposit as agent of the defendant, so as to accord with the true agreement between the parties, viz., that the deposit should be held by Good as a stakeholder merely. The defendant also counterclaimed for rectification of the memorandum of 21st March 1905 so that the true terms of the agreement for cancellation might be set forth, viz., that thenceforth the contract should be cancelled, abandoned or rescinded, and/or that, for the purpose of enabling the defendant to obtain the titles to the land from the English, Scottish and Australian Bank Ltd., at Melbourne, where they had been deposited, there should be endorsed on the contract a memorandum of cancellation of the contract. The action was tried before Hodges J., who gave judgment for the defendant with costs. From this judgment the plaintiff's now appealed to the High Court. Hayes, for the appellants. The £500 paid as a deposit is part of the purchase money: Whitbread & Co. Ltd. v. Watt (1); and having been paid to Good as agent for the vendor is recoverable from the vendor. Apart from clause 15 of the conditions there is no doubt that is so. (1) (1901) 1 Ch., 911; (1902) 1 Ch., 835. 1907. CHRISTIE υ. ROBINSON. [ISAACS J. referred to Ex parte Edwards; In re Chapman (1).] H. C. OF A. In that case the money was wrongfully received by the agent, and at most it shows that the agent might be liable for money received on behalf of his principal, not that the principal would not be liable. Good was not in the position of a stakeholder. Clause 15 of the conditions makes no difference. It was not inconsistent with Good's position as agent for the respondent that he was to hold the deposit until the happening of a particular event. The money once paid over to Good was the respondent's money. The appellants could not recover the money from Good: Ellis v. Goulton (2). The facts do not support the claims for rectification. Duffy K.C. and Cohen, for the respondent. The intention of the parties was that the deposit should be held by Good as a stakeholder, and, if the written contract does not carry out that intention, it should be rectified. The £500, which was in fact received by Good, was not received by him under the contract so as to make the respondent liable to repay it. In fact a cheque was accepted by Good instead of cash, as was provided by the contract. That cheque was at first dishonoured but was afterwards paid. On dishonour of the cheque there was an end of the conditional payment, and Good had no right to take a new payment without reference to his principal, who might have chosen to put an end to the contract. There was a breach of the contract by the appellants before the alleged cancellation, and that had the effect of giving the respondent a right of action and a right to treat the deposit as forfeited. The cancellation did not revest any right to the deposit in the appellants. The contract as it stands entitled Good to hold the deposit as a stakeholder. The contract is adapted from Table A to the Transfer of Land Act 1890, the whole scheme being that the appellants shall go and look at the property before either party is bound. All the provisions are consistent with Good being a stakeholder. Payment to an agent is not in fact payment to his principal, but the principal is estopped from denying that he has been paid-it is a legal fiction. If money is paid to a person, who nominally receives (2) (1893) 1 Q.B., 350. (1) 13 Q. B.D., 747, at p. 751. 1907. CHRISTIE H. C. OF A. it for certain parties, and no contract eventuates, the money being found in the hands of that person may be recovered from him: Wells v. Birtchnell (1); English v. Gibbs (2); Abrahams v. Watson (3). The costs of the commission were made costs in the cause. and there was no jurisdiction to give those costs to the appellants. v. ROBINSON. Hayes in reply. The meaning of costs in the cause is that they shall follow the event unless the Judge otherwise orders: Urquhart v. Macpherson (4); Lund v. Campbell (5); M’Millan v. Read (6), and Groom v. Parkinson (7) are opposed to Wells v. Birtchnell (1). [The following authorities also were referred to during argument:-Farebrother v. Prattent & Aitcheson (8); Gadd v. Houghton (9); Williams on Vendor and Purchaser, p. 659; Wright on Principal and Agent, pp. 301, 459; Paice v. Walker (10); Edgell v. Day (11); Harington v. Hoggart (12); Holland v. Russell (13); Powell v. Smith (14); Samuel v. Newbold (15); Mackenzie v. Coulson (16); Bentley v. Mackay (17); Cogan v. Duffield (18); Johnson v. Donaldson (19); Hampden v. Walsh (20); Furtado v. Lumley (21); Edwards v. Hodding (22); Smith v. Jackson & Lloyd (23); Annesley v. Muggridge (24); Duke of Norfolk v. Worthy (25); Norton on Deeds, p. 75; Leake on Contracts, 4th ed., p. 143; Smith on Master and Servant, 5th ed., p. 349; Bruner v. Moore (26); Earl of Lonsdale v. Church (27); Lord Salisbury v. Wilkinson (cited by Lord Eldon L.C. in Lord Chedworth v. Edwards (28); Koosen v. Rose (29).] Cur, adv. vult. 12. (16) L.R. 8 Eq., 368. (17) 4 DeG. F. & J., 279. (18) 2 Ch. D., 44. (19) 6 V.L.R. (Eq.), 121; 2 A. L.T., (20) 1 Q.B.D., 189. (21) 6 T. L. R., 168. (22) 5 Taunt., 815; 1 Marsh., 377. (23) 1 Madd., 618. (24) 1 Madd., 593. (25) 1 Camp, 337. 1907. CHRISTIE υ. ROBINSON. Griffith C.J. GRIFFITH C.J. This is an action brought by the appellants H. C. OF A. against the respondent for the recovery of a sum of £500 paid as a deposit upon a contract for the sale of a certain property by the respondent to the appellants. The property was a large area of Crown land situated in the Northern Territory of South Australia, on Melville Island, and estimated to contain 2,400 square miles, held under Crown leases, with a herd of buffaloes. The price was £3,000, and the terms of payment of the purchase money were set out in the first clause of a contract in writing, dated 24th January 1905, as follows:-"The purchase money shall be the sum of £3,000 and the purchasers shall on the signing hereof pay a deposit of £500 to Mr Wm. Good as agent for the vendor and pay the balance by instalments as follows, viz. :-£500 on acceptance of title as hereinafter provided and the balance by four promissory notes of £500 each with interest at the rate of £5 per centum per annum added to each promissory note and to be respectively dated at six, twelve, eighteen and twenty four calendar months from the date hereof and shall sign the subjoined contract." Then followed conditions as to title under which the vendor undertook to make a good title with liberty to the purchasers to rescind under certain circumstances, in which case they were entitled to have the deposit repaid. The purchasers were to go to Port Darwin and thence to Melville Island to inspect the property, and the vendor guaranteed that there should be at least 10,000 buffaloes on the island, that the island was not excessively swampy inland, and that the native inhabitants were not more than ordinarily fierce. On the purchasers being satisfied on all these points they were to accept the title. By clause 15 of the conditions it was provided that:-" As soon as the said purchasers have accepted the title as aforesaid the deposit shall be paid over to the vendor and upon payment of the further sum of £500 to the vendor" the instruments of title were to be dealt with in a particular way. One of the purchasers went to Port Darwin and thence to Melville Island in accordance with the terms of the contract, but, after a partial inspection, some difficulties arose, and finally it was agreed that the contract should be rescinded. That rescission was effected in that part of the country on the 21st March 1905, when these words were written on H. C. OF A. the original agreement:-" The above agreement cancelled by mutual consent," and that was signed by the parties. 1907. CHRISTIE V. ROBINSON. Griffith C.J. The appellants contend that, the contract being rescinded, they became entitled to get back their £500. So much is not disputed by the respondent. The appellants also contend that, on the rescission of the contract, the person to whom they should look for the repayment of the deposit is primâ facie the respondent, because, if money is paid to an agent, his principal is primarily responsible for that money. No doubt that is the general rule of law. In this contract Good is described as the agent for the vendor, and it is provided that the money is to be paid to him as agent for the vendor. The appellants say that that is sufficient, that the vendor has received the money, that he is no longer entitled to keep it, and that their cause of action is complete. The answer made by the respondent to that is that under clause 15 it was the duty of Good not to pay over the money to the respondent until the title was accepted, and that that clause so far controls the statement in clause 1 that Good is the agent of the vendor, that it transmutes Good's position from that of agent for the vendor to that of a stakeholder, who did not hold the money in the capacity of agent for one party rather than the other. If that be so, the respondent's contention is sound, and that view commended itself to Hodges J. The general rule that a principal is the only person who can be sued, and that the agent cannot, is established by the English case of Ellis v. Goulton (1), and in accord with the decision in that case are two decisions of the Supreme Court of Victoria: M Millan v. Read (2) and Groom v. Parkinson (3). That rule is subject to some exceptions. In the case of an auctioneer it has been settled for a long time that, if a deposit is paid to an auctioneer, though paid to him as agent for the vendor, he is personally liable. But it has never been suggested that in such a case the vendor is not also liable. So that the answer to the question whether Good is liable to repay the £500 does not conclude the question whether the respondent is liable or not. That that is the ordinary rule as to an auctioneer needs no authority. He is in a (1) (1893) 1 Q.B., 350. (3) 10 V.L.R. (L.), 14; 5 A.L.T., 171. |