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action. As opposed to this, there are cases where a person has suffered damage but can obtain no redress because there has been no infringement of what the law regards as a legal right, the maxim here being that Damnum sine injuria (harm without legal injury) will not entitle the person to maintain an action. Thus, in Chasemore v. Richards (1859), it was held that a person may dig down in his land and so deprive his neighbour of water which would otherwise be available on his land. This would do great harm to the neighbour, but it is not the infringement of a legal right, and is therefore not sufficient to maintain an action. In this connection may be noted also the leading case of Allen v. Flood (1898). A shipbuilding firm employed many workmen, including the plaintiffs, and the plaintiffs had incurred the displeasure of a trade union. One of the officials of the union went to the firm and threatened that if the plaintiffs were not dismissed, the other workmen would be called out, and the firm yielded to the threat and terminated in a lawful manner the employment of the plaintiffs. On the plaintiffs suing the official of the trade union for damages, it was held that there was no cause of action as the harm suffered was damnum sine injuria. As a rule damnum and injuria combine to support an action, as otherwise the plaintiff would not receive substantial damages, and where they do combine there is always a good cause of action. The rule at Common Law is that if a person who has suffered injury should die before he enforces his claim the cause of action comes to an end on his death, the legal maxim being-Actio personalis moritur cum persona (a personal action dies with the person), but there are many exceptions to this rule; and, similarly, in some cases the death of the person who caused the injury deprives the injured party of his remedy. Ordinarily, the maxim applies to actions arising out of torts and not out of contracts, that is, in legal phraseology, to actions ex delicto and not ex contractu; but rights arising out of contracts will expire where the contract is personal, e.g., where an artist contracts to paint a picture and dies before completing the work. So that actually the distinction is not between actions out of torts and action arising out of contracts, but really between rights affecting persons and those affecting property.
Actions on commercial matters would, as a rule, be taken in the King's Bench Division of the High Court, in which there is now a special court known as the Commercial Court for the trial of causes" arising out of the ordinary transactions of merchants and traders, amongst others those relating to the construction of mercantile documents, export or import of merchandise, affreightment, insurance, banking, and mercantile agency and mercantile usages." Matters connected with shipping
would, as a rule, be commenced in the Admiralty Division, and those relating to partnership, patents, trade-marks, copyright, and the winding up of joint-stock companies in the Chancery Division.
An action in the King's Bench Division is commenced by a Writ of Summons, which commands the defendant to enter an appearance usually within eight days of service. On the writ are endorsed particulars of the plaintiff's claim; and, if the defendant should decide to contest the claim, he must enter an appearance within the stated time. If he does not appear, judgment may be entered against him, which will be final if the claim is for a liquidated amount-that is an ascertained sum-but, if for an unliquidated amount, what is termed an interlocutory judgment is signed and a writ of inquiry is issued to assess the amount of damages. If the defendant enters an appearance, the plaintiff must take out a Summons for Directions within fourteen days of appearance, except in certain specified cases, and in these cases he may do so if he wishes. The Master then directs whether there shall be pleadings, orders further particulars, discovery, where and how the action shall be tried, and other matters. Pleadings are documents recording the precise facts on which parties intend to rely at the trial. They consist, principally, of :—
(1) Statement of Claim made by plaintiff within 21 days after order.
(2) Statement of Defence made by defendant, as a rule within
(3) Statement of Reply of the plaintiff, when specially ordered, within 10 days after delivery of defence.
(4) Rejoinder by the defendant within 4 days.
By what is known as procedure under Order 3, Rule 6, writs may be specially endorsed and the matter quickly disposed of where the action is for a liquidated sum under a contract, statute, or trust, and in certain other matters not within the purview of commercial law. The advantages of this procedure are that the special endorsement is equivalent to a statement of claim and no further statement of claim is permitted, and, even if defendant appears, an order may be made under Order XIV for plaintiff to have judgment, unless good cause be shown. There are other variations of procedure which are however somewhat outside the scope of this work and as, naturally, the commercial man would never contemplate taking legal proceedings without professional assistance, an intimate acquaintance with the details of procedure is not necessary to a knowledge of mercantile law.
As soon as issue is joined, that is, when the pleadings have
been closed, the plaintiff gives notice of trial within six weeks. If he does not, the defendant may do so or may apply to have the action dismissed. As a rule the notice is a ten days' notice, and the cause is entered for trial. When it comes to be heard, the whole of the matters in dispute are considered and judgment is given. If the plaintiff establishes his claim, he has judgment in his favour with costs: if he fails to do so, judgment is given against him and, as a rule, he will be required to pay the defendant's costs. Appeals may be brought to the Court of Appeal and thence to the House of Lords.
Judgment may take the form of an award of damages in cash; or of specific performance, that is, the actual carrying out of the contract in the agreed terms, although specific performance will not, as a rule, be granted if (1) consideration is lacking, (2) it would be inequitable, (3) supervision of the court is impossible, (4) it is unenforceable against the person asking for it; or the court may issue an injunction to prohibit a party from doing certain things.
Judgment may be enforced in several ways, the most common writs for this purpose being :
(1) Fieri facias, for the purpose of seizing the debtor's money and selling his goods-usually termed fi. fa.
(2) Elegit, for the purpose of seizing his lands.
(3) Garnishee order, an order obtained against a third party who owes money to the judgment debtor, commanding him to pay it to the judgment creditor instead.
(4) Charging order, for the purpose of seizing stocks and shares or a partner's interest. Six months must elapse from the date of order before the benefit can be taken. It is customary to obtain also a Stop order to prevent the income being paid away meantime. (5) Equitable execution, obtained in cases where there is no available remedy by execution at law. If money be due to the debtor from any source, a receiver may be appointed to receive the money and satisfy the creditor therewith.
(6) If the debtor does not pay, and it can be shown that he has had the means of doing so since the date of the judgment, he may be brought before the court on a judgment summons and be imprisoned for a period up to six weeks.
District Registries have been established in many parts of the country where actions may be commenced and continued as far as "entry for trial" and where, after trial, judgment may be entered and execution issued. Obviously this tends to facilitate proceedings and to lessen expense.
County Courts have been constituted for local jurisdiction. This jurisdiction is up to £100 in contract and tort; up to £500 in Chancery cases and, as a rule, in connection with the winding up of joint-stock companies whose paid-up capital does not exceed £10,000, and in Bankruptcy proceedings. The Metropolitan County Courts have no jurisdiction under the two latter headings. County Courts have exclusive jurisdiction in matters under the Employers' Liability Act and the Workmen's Compensation Acts. County Court Judges are appointed, each covering a certain district, and within his district the Judge goes on circuit periodically. In these courts the proceedings are usually commenced by what is called a Plaint, and there are no pleadings, otherwise the procedure is similar to that outlined above. In County Courts, too, there is an official termed a Registrar: undefended and admitted cases and disputed minor causes may, with the consent of the parties, be heard and determined by him. He also takes Bankruptcy examinations. Appeals may be made from the decision of a County Court Judge to a Divisional Court of the King's Bench Division, but not beyond that without special leave.
There is another method of settling disputes which is growing greatly in favour in the commercial world, that is, ARBITRATION, the procedure of which is now regulated by the Arbitration Act, 1889. This important subject will be considered in detail hereinafter (a).
The jurisdiction of the High Court extends only to England and Wales and to the town of Berwick-on-Tweed. however, take cognizance of matters arising abroad if the parties are within the jurisdiction, except in cases of actions relating to trespass to lands situate abroad and it may, under certain circumstances, give leave to sue here even though the defendant is abroad; but the Court has no jurisdiction in actions against independent Foreign Rulers or Foreign Ambassadors and their staffs, even if they are in this country, unless, of course, they choose to submit themselves thereto.
The majority of mercantile transactions are connected with the relations of mercantile persons and with movable property, although land is often acquired for purposes of carrying on a business; but, when so acquired, land is usually, for instance in a partnership, regarded as movable property for the purposes of the business. There are two classes of movable property :
(1) Choses in possession, that is, things which can be touched and handled-termed corporeal chattels such as a sack of corn or actual coins, and
(a) See post, p. 326.
(2) Choses in action-termed incorporeal chattels that is, rights in or over something, which rights can be enforced at law, such as debts, shares in joint-stock companies, patents, copyright, etc.
Mercantile law treats mainly of the acquisition of, or the dealing with, these two classes of property, and of the relations between the persons who perform acts in connection therewith.
Having noticed, in outline, the procedure by which legal proceedings are commenced and carried on, it will be useful now to consider what causes of action are such as are likely to arise in mercantile affairs and how best to avoid them by adherence to the rules in connection with that branch of the law. Practically the whole of commercial life is a series of agreements or the performance of matters in fulfilment thereof. The conditions under which such agreements are of legally binding effect will be considered in the ensuing chapters; but if they are binding agreements or contracts-then they will give rise to rights and obligations which may be the cause of actions if those rights are violated or the obligations disputed or ignored,