EDINBURGH, DUNDEE RAILWAY PHILIP. [ *521 ] In this case, the substantial question between the parties is, PERTH, AND whether or not the Company entered into a contract with Mr. Philip, to purchase at all events from him the property in question, for the sum of 11,500l.; or whether, looking at the terms of the contract, the true meaning of it was that they were to purchase if they should obtain authority to make the railway, and should make that railway, the terms being that they should get an Act of Parliament, and begin to make the railway; I dare say the anticipation of the parties was, that if they began to make it, they certainly would continue, and conclude the making of it. This is not like the case of a railway which is intended to run over 100 miles, where it frequently happens that when the Company have made about fifty miles of the line, they have no funds to go on with, and there the line stops. This is a line less than a mile in length, and was to be for the convenience of an existing railway. The question with the Company would be, if they obtained the power to make the railway, whether they were minded to make it. Of course, if they began to make it, it was almost certain that they would finish it. [ *522 ] Now, the terms of the contract are these: First," Mr. Philip, in consideration of the obligation after written, assents to the bill presently in Parliament." Secondly, "the Railway Company, considering the line will pass through the ground and premises of Old Church Wharf, Leith," (that is Mr. Philip's property), "or some part thereof," "whereby the remaining part of the ground and premises would be deteriorated, they agree to acquire the whole ground and premises of every description situate there, belonging to Mr. Philip, and to make payment of the sum of 11,500l. in full of the price thereof, and of all claims whatever competent to Mr. Philip on account of the same, and of the intended operations of the said Company relative thereto." Now, if it had stopped there, there could be no doubt that, upon the construction of that sentence, it would amount to a contract (whether in the most formal language we need not stop to inquire), binding the Company to purchase from Mr. Philip the whole. ground and premises belonging to him, for the sum of 11,500l. But it was to be a purchase, it must be borne in mind, to enable the Company to make their railway. Now, when we come to the third head, we find that it is in these terms: "The said Company hereby become bound to pay the sum of 11,500l. to Mr. Philip, his heirs, executors, or assignees, at the first Term of Martinmas or Whitsunday after the Company, on obtaining their Act of Parliament, shall have begun to execute any part of the said railway under the powers of the Act, and the price to bear legal interest thereafter" (that is, from the time they begin PERTH, AND to make the railway) "until paid; and the Company, before taking EDINBURGH, possession of or entering on the premises, either paying or satisfying the said Robert Philip for the price thereof; and Mr. Philip to exhibit a clear title to the property." Now, what is the effect of that third item in the contract, connected with the items which precede it? I will not say that I have not had some doubts, in the course of the argument, upon this contract. In all informal contracts it is always very difficult to satisfy oneself completely of what has been the intention of the parties, or rather, what is the meaning of the terms which they have used. But, looking at this contract, I have come to the conclusion that what the parties must have meant was this, that if the Company obtained the Act of Parliament (that was certainly a condition), and if they made the railway, then they should pay 11,500l. to Mr. Philip for his premises. That 11,500l. should either be paid the moment they commenced the railway, or, at all events, it was to bear interest from that time; and it should actually be paid to him before they entered upon or took any part of his property. My Lords, I come to that conclusion upon several grounds. In the first place, that there was some condition is plain. Perhaps it may be right (as was said at the Bar) that that condition would have been a condition implied, if it had not been expressed; but there is an expressed condition that they should first obtain their Act of Parliament, for the terms are that they shall become bound to pay 11,500l. at the first Term of Martinmas or Whitsunday after the Company, on obtaining their Act of Parliament, shall " do so and so. If they did not obtain their Act of Parliament it is impossible to suppose that it was at all meant that anything then should be paid to Mr. Philip. That has not been argued. Then in the same sentence it is said, "on obtaining their Act of Parliament," after they "shall have begun to execute any part of the railway." Now, although the obtaining of the Act of Parliament is a condition expressed (and if it had not been expressed, it might have been said that it was implied from what follows), it is said that the words after they "shall have begun to execute any part of the railway" are but a condition. I think, in the first place, that it is an inconvenient method of dealing with a contract of this kind, to say that one member of a sentence is conditional, and the other is not conditional. If we saw clearly that that was the sense, of course we should not be estopped from deciding such a point, merely because it was inconvenient in point of language; but it seems to me that all reasoning shows that this must have been what they contemplated. In the first place, unless the price was a low price, it was absurd to suppose that the Company would pay PHILIP. [ *523 ] PERTH, AND RAILWAY COMPANY PHILIP. [ *524 ] EDINBURGH, 11,500l. for this property if they did not want it for the purpose of DUNDEE their railway. It is said, on the other hand, that it is very hard on Mr. Philip; for until the Company have determined whether they will or will not make their railway, he cannot satisfactorily *deal with this property. That is perfectly true; but how do your Lordships know that that very inconvenience did not form an ingredient in the price contracted for, of 11,500l.? I have looked through the papers to see whether there was any statement anywhere as to what was the supposed value of this property, and I find nothing of the sort. I must infer, therefore, that the 11,500l. was the price which Mr. Philip was minded to contract that he would take for it, taking upon himself the burden and inconvenience of being unable in the meantime to dispose of his property. That which seems to me to settle the matter is this, that, most unquestionably, no time of payment is expressly fixed until the Company shall have begun to make their railway. Then, supposing they do not ever make their railway, Mr. Philip is driven to say that at the end of the time when their power of making the railway had ceased, viz., at the end, I think, of seven years, or whatever the time was, then it was to be considered that the condition had ceased, and that the contract had become absolute. That is a mere gratuitous introduction into the agreement of something which is not found there. [ *525] Upon the ground, therefore, that the probability was that the Company never would intend to purchase anything unless they were making the railway, and that by the terms of their contract. they were certainly not to pay the 11,500l. until they had put themselves in a condition to make the railway, namely, till they had obtained their Act of Parliament; and, secondly, that the time of payment was not to arrive until they had begun to make the railway, I have come to the conclusion that the agreement was, as the pursuer, Mr. Philip, from the first seems to have considered it, a conditional agreement. I intimated *some time ago that we were clearly of opinion that the condition, if it was a condition, has never been purified; that the LORD ORDINARY was quite right upon that ground. This, therefore, was a conditional agreement, the condition of which has never been purified, and, consequently, nothing becomes payable under it. The course, therefore, which I propose to take is to move your Lordships that the interlocutor of the Court of Session be reversed, and the cause be remitted with a declaration that they ought to have assoilzied the defenders. LORD WENSLEYDALE: My Lords, in this case several questions have been argued at PERTH, AND PHILIP. your Lordships' Bar with very great distinctness and ability. I EDINBURGH, feel that it is quite unnecessary to pronounce my opinion upon any of those questions, except the second, which is as to the construction of the contract; and I certainly formed an opinion pretty early in the case, which I was only restrained from expressing in stronger terms by my great respect for the learned Judges in the Court below, with one of whom I was personally acquainted, and for whom I have always entertained the highest esteem, from my knowledge of his eminent judicial qualities, I mean Lord Rutherfurd. This made me doubt whether the conclusion that I came to was the proper conclusion, it being against the opinions of those four learned Judges. But the matter is one common both to the Scotch and the English law; and it is to be decided upon principles equally belonging to both. I think our duty is to look at the terms of the contract, and to construe it according to the ordinary grammatical sense and meaning of the words, taken in conjunction with the facts and circumstances existing at the time, and which are to be looked at in order to interpret the contract. So doing, I confess I think it is quite clear that this was a contract which was never meant to take effect unless the Railway Company determined to exercise their powers under the Act of Parliament. It is perfectly clear that it was conditional upon the Company obtaining the Act. And it is clear, upon the face of the contract itself, that that was to be, not an Act of Parliament obliging, but an Act of Parliament enabling them to make a branch railway from the Leith branch to the Leith Docks. Now it has been very clearly settled, though in the first instance there was some doubt about it, that these enabling Acts are not compulsory. It was solemnly decided by the court of error, of which I formed a part, in a case in which the judgment was delivered (and an excellent judgment it was) by the late Chief Justice JERVIS (1), that permissive words in an Act of Parliament are not obligatory. Consequently, at the time this contract was entered into, it was perfectly competent for the defenders to decline. to make the railway, even although they had obtained the Act for carrying it into effect, if they thought it more conducive to their interests to decline to do so. Now, that being so, are we to suppose that at the time when they entered into this contract they wholly abandoned the power which they had of declining to make the (1) York and North Midland Rail. Co. v. Reg. (1853) 93 R. R. 444 (1 El. & Bl. 858), where it was held by the Exchequer Chamber that no duty is cast on the Company to make their line, the words of these Railway Acts being enabling, but not obliga- [ *526 ] PERTII, AND v. PHILIP. [ *527 ] EDINBURGH, railway, and that they determined at all events from the first, whatever the consequences might be, to enter into this contract? I think it can hardly be supposed that they did, unless there were clear words showing that they absolutely, unconditionally, and unequivocally meant to purchase the property from Mr. Philip. Instead of that, we find words in the latter part of this contract clearly to show that the purchase was to depend upon a condition. The agreement fixes the price. There is a positive obligation to pay the money, provided the Company obtain the Act of Parliament, which is clearly a condition, and provided they "shall have begun to execute any part of the railway under the powers of the said Act;" there is no other time for the payment of the money stipulated except that. It was a condition on the part of the Company to pay the money before taking possession of the property, or the money was to bear legal interest from that date. The payment of interest would date from the first Term of Martinmas or Whitsunday after they had determined to execute the Act of Parliament, and had commenced making the railway under it. But it was to be accelerated in case the Company should choose to take possession of, or enter on the premises before that; then the money was, at all events, to be payable at the next Martinmas or Whitsunday Term after they had begun to make the railway under the powers of the Act; they were not to take possession of or to interfere with the land without paying the money. [ *528 ] Now, reading all these clauses together, finding no time stipulated for the payment, except the fixed day dating from the commencement of the making of the railway under the Act, I cannot conceive that they were bound to pay, unless they began to make the railway under the Act of Parliament. Therefore, I concur entirely with my noble and learned friend in pronouncing an opinion that, according to the true construction of the terms of this contract, looking especially at the condition in which the Company were, namely, that they were under no obligation to make the railway at the time they entered into this contract,) that they did not mean to abandon that right which they might exercise with reference to their general interests, and undertake to pay at an indefinite time the price for this land. I therefore am of opinion that the Court of Session has miscarried in the construction of the instrument in question. I need not say any more upon the other part of this case, except that I am quite clear, as I have already expressed my opinion, that the LORD ORDINARY was perfectly right in the conclusion to which he came upon the facts found before him, and that the proper conclusion to come to was, that the Company had never executed any part of the railway under the powers of their Act. I therefore entirely concur with |