Paul Felthouse Vs. Bindley 153w5h

CONTRACT LAW-I PROJECT CASE COMMENTARY ON PAUL FELTHOUSE v BINDLEY 142 E.R. 1037 1862

BY: SYED MOHAMMAD KHURSHEED 13/B.B.A/054. 1|Page

TABLE OF CONTENTS FACTS OF THE CASE........................................................................................................................... 3 ISSUES FRAMED BY THE COURT. ................................................................................................... 5 DECISION OF THE HON’BLE COURT. ............................................................................................. 6 Willes J. .............................................................................................................................................. 6 Byle J. and Keating J. ......................................................................................................................... 7 REASON FOR THE DECISION OF THE COURT. ............................................................................. 8 PERSONAL ANALYSIS OF THE CASE. ............................................................................................ 9 CASE NOT A DEPARTURE FROM ANY PRECEDENT. ................................................................ 10

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FACTS OF THE CASE Paul Felthouse, the plaintiff, wanted to buy a sizing Europe horse from his nephew Mr. John Felthouse. The letters for this contract that were exchanged between the parties carried the following negotiations: January 1st 1861. “Dear Sir,—I saw my father on Saturday. He told me that you considered you had bought the horse for 30l. If so, you are labouring under a mistake, for 30 guineas was the price I put upon him, and you never heard me say less. When you said you would have him, I considered you were aware of the price, as I would not take less.” John Felthouse .

In reply to the aforementioned letter was:

January 2nd, 1861.“Dear Nephew,—Your price, I it, was 30 guineas. I offered 30l.,— never offered more: and you said the horse was mine. However, as there may be a mistake about him, I will split the difference,—30l. 15s.—I paying all expenses from Tamworth. You can send him at your convenience, between now and the 25th of March. If I hear no more about him, I consider the horse mine at 30l. 15s.” Paul Felthouse.

To this letter the nephew i.e. Mr. Paul Felthouse did not sent any reply.

On the 25th of February, Mr. bindley, an auctioneer, auctioned the stocks of Mr. Paul Felthouse. Although Mr. Paul, told bindley not to sell that specific horse but by mistake the horse in question was sold with the rest of the stock, and fetching, which sum was handed over to John Felthouse. On the following day, the defendant, being apprised of the mistake, wrote to the plaintiff a letter seeking apology for his mistake and assuring that he would do his best to get the horse back.On the 27th of February 1861, Mr. John wrote a letter to the plaintiff expressing his regret towards the sale of the horse by the defendant. He in his letter also mentioned “….i said the horse is sold….”1 Which acts as an evidence that he intended to sell the horse to the plaintiff and was satisfied with the bargains that took place before 25th February 1861. He also intended to compensate for the mistake of the defendant by mentioning “…..i have one horse …..if you like to have it for a few months, say five or six, you are welcome to it, free of any charge, except the expenses of travelling: and if, at the end 1

Paul Felthouse v Bindley (1862) 142 E.R. 1037.

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of that time, you like to return him, you can; or you can keep him, and let me know what you think he is worth…” 2.Mr. Paul Felthouse not satisfied with the compensation filed a case at the court of common pleas against Mr. bindley for the conversion of the horse. The case was heard by a three judge bench that included Willes J, Byles J and Keating J.

2

Ibid.

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ISSUES FRAMED BY THE COURT The court from the aforementioned facts derived the questions that

• Whether or not the silence of Mr. John till 27th of February makes a valid contract and thus gives the possession of the horse to Mr. Paul.?

• Whether or not the letter sent by Mr. John on 27th of February in which he showed intention leads the formation of a contract?

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DECISION OF THE HON’BLE COURT The hon’ble court gave the majority judgement in the favour of the defendant and denied the compensation for the plaintiff. The hon’ble judges gave the following judgments:

Willes J. • Firstly, He was of the opinion there was no complete bargain on the 2nd of January and it is also clear that the plaintiff had no right to impose upon Mr.john the sale of his horse for 30l. 15s unless he chose to comply with the condition of writing to repudiate the offer. Mr.john might, no doubt, have bound his uncle to the bargain by writing to him; the plaintiff might also have retracted his offer at any time before acceptance. It stood an open offer and so things remained until the 25th of February3, when Mr. John was about to sell his farming stock by auction. The horse in question being catalogued with the rest of the stock, the defendant was told that it was already sold. It is clear, therefore, that Mr. John in his own mind intended his uncle to have the horse at the price which plaintiff had named for 30l. 15s. But he had not communicated such his intention to the plaintiff, or done anything to bind himself. Nothing, therefore, had been done to vest the property in the horse in the plaintiff down to the 25th of February, when the horse was sold by the defendant. It appears to that, independently of the subsequent letters, there had been no bargain to the property in the horse to the plaintiff, and therefore that he had no right to complain of the sale of the horse.4 the letter of John Felthouse of the 27th of February, 1861, was not also issible in evidence against the defendant as after the sale of the horse by the defendant, it did not confer title on the plaintiff; and that there was at the time of the alleged conversion no sufficient memorandum in writing, or possession of the horse, or payment, to satisfy the statute of frauds. The hon’ble judge cited the case Carter v. Toussaint5 and Bloxam v. Sanders6 with refrence to the abovementioned lines.

• Secondly, he mentioned that the letter sent by Mr. John to the plaintiff on 25th of February may be considered as a completion of bargain under the statute of fraud but does not constitutes the formation of a contract.

3

Supra note 1. Ibid. 5 Carter v Toussaint (1822) 5 B & Ald 855. 6 Bloxam v. Sanders (1825) 4 B. & C. 941, 7 D. & R. 396. 4

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• Thirdly, by citing the case of Stockdale v. Dunlop7 he mentioned that “assuming that there had been a complete parol bargain before the 25th of February, and that the letter of the 27th was a mere expression of the of that prior bargain, and not a bargain then for the first time concluded, it would be directly contrary to the decision…”8 of the aforementioned case in which it was held that there can be no compensation for the breach of a contract which was made verbally and thus is incapable for being enforced9.

At the end, on the contrary to his whole judgement he stated that by taking the case of Coats v. Chaplin10 as an authority, there can be a remedy for the plaintiff against the defendants . In this case “the traveller of Morrisons, tradesmen in London, verbally ordered goods for Morrisons of the plaintiffs, manufacturers at Paisley. No order was given as to sending the goods. The plaintiffs gave them to the defendants, carriers, directed to Morrisons, to be taken to them, and also sent an invoice by post to Morrisons, who received it. The goods having been lost by the defendants' negligence, and not delivered to Morrisons,—it was held that the defendants were liable to the plaintiffs.”11 In the case in hand it can be observed that the plaintiff sent a letter to Mr. John for the purchase of the horse. Mr. John also intended to sell the horse to the plaintiff but due to the negligence on behalf of the third party i.e. the defendant, the plaintiff was not able to get the horse. On this ground and citing the above mentioned case the plaintiff may incur the compensation for the conversion of the horse.

Byle J. and Keating J. Both the hon’ble judges were of the same opinion as of the aforementioned judgement. In his judgement, Justice Keating emphasised and considered that the case can be judged by finding that who was in possession of the horse at the time when the sale took place and only question in case that arises is: Whether on 25th of February 1861, when the sale of the horse took place the plaintiff had the possession of the horse or Mr. John. The hon’ble court found that there wasn’t any contract between the parties directing the court to the conclusion that the possession of the horse was with Mr. John and thus the plaintiff cannot claim for any compensation on the basis of conversion of the horse by the defendant.

Final judgement Thus, the decision to this case was delivered in the favour of the defendant and no remedy or compensation was awarded.

7

Stockdale v. Dunlop (1840) 6 M. & W. 224. Supra note 1.. 9 Supra 3. 10 Coats v. Chaplin , 3 Q. B. 483, 2 Gale & D. 552. 11 Supra note 1. 8

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REASON FOR THE DECISION OF THE COURT For the case in hand the argument largely centred on the question of whether sufficient memorandum had been made to title to the uncle under the requirements of the Statute of Frauds for which the plaintiff would be able to claim for conversion. To prove such conversion the plaintiff had to prove that he possessed sufficient title of the horse in turn which depends upon the fact that whether there was a contract or not. The hon’ble court found that there had been no such contract was formed between the plaintiff and Mr. John and henceforth no memorandum that es the title of the horse to the plaintiff was formed. Even if the letter of 27th of February 1861 is considered as an evidence it was a mere expression of the bargain between the plaintiff and Mr. John and such bargain cannot constitute the formation of a contract or give rise to any compensatory remedy to the plaintiff if seen in accordance with the principles formed in the case of Stockdale v Dunlop . On the basis of this reasoning the court of common pleas held that the plaintiff cannot get any relief in the form of compensation. This judgement was affirmed by the exchequer court unanimously .

The principle or the ratio decidendi of the case formed is

“Mere silence to an offer, even though the party to which the offer is made intended to accept the offer ; does not explicitly accepts or does not show acceptance by any means does not form a contract between the parties.”

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PERSONAL ANALYSIS OF THE CASE The case being based upon the fact that if a party even tough intending to accept the proposal of the other party does not shows this by his speech, cannot form a contract. Acknowledging the judgement given by the honourable judges it can be said that the facts of the case and in the view of the precedent cases the judgement was very apt. 



The first contention is, The judgement unambiguously clears the fact that the contract cannot bind either of the parties to the contract. The fact that Mr.john intended to sell the horse to the plaintiff of the case leads to dilemma that will he surely sell the horse or not? Such term in cloud cannot be held as a binding contract for either of the parties. The second contention is, that party cannot impose the offer on the other part. The phrase “If I hear no more about him, I consider the horse mine at 30l. 15s.”12 imposed Mr. John to enter into a contract with the plaintiff. It is thus, unjustifiable to bind a party to a contract unilaterally.

Nevertheless, it is submitted that judgment was sound but the argument of professor Miller criticizing the judgment also seems relevant. He argues “The common pleas held for the auctioneer on the grounds that the plaintiff had no title to sue since the date of the auction the nephew had not effectively accepted the offer. Given that he ittedly told the auctioneer that the horse was reserved for his uncle and that the latter had equally assumed that it was so. It is not clear that why anything further should be regarded as essential to the formation of a contract. On balance it can be ed that the approach of the common pleas was wrong in principle and the actual result of the case can only be ed because there had been no delivery, part payments or memorandum in writing to satisfy the requirements of the statute of fraud.”13 Hence, from the aforementioned argument by professor miller the flaw in the judgment can be expressly showeth that when Mr. John himself mentioned that “...I said that horse is sold…”14 (with reference to the horse in question) to the defendant it can be inferred that he felt the contract to be complete on his part which was the same in the mind of the plaintiff. Therefore there was a definite meeting of minds of the party on the contract. This forms a clear evidence that there was a contract between the parties. If the court had given the judgment only on the reasoning that there was no written contract or any payment made by the party that could satisfy the statute of fraud, then, the reasoning behind the judgement could have been considered effective.

12

Supra note 1. Prof. C.J. Miller, The modern law review, Volume 35, 489 (1972). 14 Supra note 1. 13

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CASE NOT A DEPARTURE FROM ANY PRECEDENT The case in hand is not a departure from the any precedent case but an issue in itself without any precedent leading to the question of law. Although in the case of Brodgen v Metropolitan Railways15 was a bit similar to this but the objective question in the case was not that whether silence to an offer would lead to acceptance but whether the conduct of a person lead to the acceptance. The judgement remained within the framework of conducts and remained silent on the fact that is dealt in the present case. Though the judgement has been criticized on the basis that there was a clear intention of Mr. John it has been accepted as an authority.

15

Brodgen v Metropolitan Railways (1877) 2 APP cas 666.

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