*CASES

DETERMINED BY THE

COURT OF QUEEN'S BENCH

AND BY THE

COURT OF COMMON PLEAS

ON ERROR AND APPEAL FROM THE COURT OF QUEEN'S BENCH,

IN AND AFTER

HILARY TERM, XXXV VICTORIA.

[IN THE EXCHEQUER CHAMBER.]

*MOLLETT and others v. ROBINSON.

Law Reports, 7 Common Pleas, 84.

Principal and Agent - Contract by Brokers- Usage of Market.

[84

The defendant, a merchant in Liverpool, employed the plaintiffs, tallow-brokers in London, to buy tallow for him in the London market.

In an action brought by the plaintiffs against the defendant to recover the loss upon the re-sale of the tallow, which the defendant had refused to accept, it was proved "That there exists an established custom in the London tallow-trade, for brokers, when they receive an order from a principal for the purchase of tallow to make a contract or contracts in their own names without disclosing their principals, and also to make such contracts either for the specific quantity of tallow so ordered, or to include such order with others they may have received in a contract for the entire quantity, or in any quantities, at their convenience, at the same time exchanging bought and sold notes with the selling brokers, and passing to their principals a bought-note for the specific quantity ordered by them; and that, when a broker so purchases in his own name, he is personally bound by the contract; and that, on the usual settling days, the brokers balance between themselves the purchases and sales so made, and make or receive deliveries to or from

their principals, as the case may be, or, if their principals refuse to accept or deliver, then to sell or buy against them, as the case may be, and charge them with the loss, if any, or, if delivery is not required on either side, then any difference which may arise from a rise or fall in the market is paid by the one to the other."

All the dealings between the plaintiffs and the defendant were carried out in accordance with the above custom, which, however, does not exist in Liverpool, and was unknown to the defendant:

:

Held, by Kelly, C.B., Channell, B., and Blackburn, J., that the employment of the plaintiffs by the defendant was an employment to buy according to the usages of the London tallow-market, and that the defendant was bound by those usages, notwithstanding he was ignorant of their existence.

Held, by Mellor and Hannen, JJ., and Cleasby, B., that the plaintiffs, having been employed as brokers to make the contract for the defendant, and having professed to act as brokers, and charged brokerage for their services as such, were not entitled, as against a person unconnected with the London tallow-market and ignorant of its usages, to set up a custom or usage that they should fill a different character, and become themselves principals in the transaction instead of brokers.

APPEAL by the defendant against the decision of the Court of Common Pleas in discharging a rule to set aside a verdict found for the plaintiffs and to enter a nonsuit.

85] *The pleadings are sufficiently set out in the report of the case in the court below. (') The material parts of the appeal case were as follows:

6. The plaintiffs are sworn brokers carrying on business in the city of London under the firm of Mollett, Bull, & Unsworth, and the defendant is a merchant at Liverpool. The plaintiffs and the defendant had previously to the transactions in question in this cause had several dealings together in the buying and selling of tallow.

7. On the 2d of April, 1869, the defendant met the plaintiff Unsworth at Liverpool, and gave him an order to buy for him 50 tons of tallow, June delivery, at 46s. 6d., and the same day Unsworth telegraphed to his firm in London to execute the order.

8. On the same day, the plaintiffs, after the receipt of the telegram in London, wrote and sent to the defendant the following letter and bought-note:

(Law Rep., 5 C. P., 646.

"Sir,- We have received a message to buy for your account 50 tons tallow, June delivery, at 46s. 6d., and which we succeeded in doing, since when our market has further improved, and we close 46s. 6d. @ 46s. 9d. for April, June 47s., nearest price June 46s. for October, December."

"London, 2d April, 1869. "C. J. Robinson, Esq. -We have this day bought for your account 50 tons nett, in casks of St. Petersburg first sort yellow candle tallow, new, and of the brack of 1868-9, at 46s. 6d. per cwt. &c., &c.

(Signed) "Mollett, Bull, & Unsworth, sworn brokers."

9. On the 28th of April, the defendant sent a further order by telegram from Liverpool to the plaintiffs in London, as follows,— "Messrs. Mollett, Bull, & Unsworth, London. Buy 200 tons tallow for June, best terms:" and on the same day the defendant confirmed this telegram by the following letter addressed to the *plaintiffs, "I sent you a telegram this afternoon [86 to buy 200 tons tallow for June on best terms, which I now confirm 100 tons are for myself, and 100 for a friend of mine; but book them all to me or my firm.'

10. On the same day, and in reply to this telegram, the plaintiffs wrote to the defendant a letter inclosing a bought-note, as follows:

"London, 28th April, 1869.

"Dear Sir,We thank you for your telegram of to-day, to buy 200 tons tallow for June on best terms. Our market opened very good, and soon 44s. 3d. was paid for April, and 44s. 6d. for June; but, just before going on 'Change, we received your message, and, as there was a temporary dullness, we fortunately succeeded in picking up your 200 tons at 44s. 3d., and now have much pleasure in inclosing contract."

"London, 28th April, 1869. "C. J. Robinson, Esq.- We have this day bought for your account 200 tons nett in casks of St. Petersburg first sort yellow candle tallow, new, and of the brack of 1868-9, at 44s. 3d. per ewt., &c., &c.

(Signed) "Mollett, Bu 11, &Unsworth, sworn brokers."

11. Upon the receipt of the above-mentioned orders from the defendant, the plaintiffs made purchases of tallow from other brokers in the trade, in the manner hereinafter described.

12. On receiving the defendant's order of the 2d of April, the plaintiffs entered into a contract with one W. Sharman, a Russia broker trading under the firm of W. W. Simpson & Co., for the purchase of 150 tons of tallow, intending to appropriate 50 out of these 150 tons to the defendant's order, and 100 to another order which the plaintiffs had received from another person; and the plaintiffs made out and sent to Simpson & Co., a soldnote, and received from them a bought-note, in respect of these 150 tons, of which the following are copies :

"Messrs. W. W. Simpson & Co.

"London, 2d April, 1869.

"We have this day sold for your account 150 tons nett in 87] casks *of St. Petersburg first sort yellow candle tallow, new, and of the brack of 1868-9, at 46s. 6d. per cwt., &c., &c.

(Signed) "Mollett, Bull, & Unsworth, sworn brokers." "Brokerage, per cent."

"Bought for account Messrs. Mollett, Bull, & Unsworth, 150 tons nett in casks of St. Petersburg first sort yellow candle tallow, new, and of the brack of 1868–9, at 46s. 6d. per cwt., &c., &c.

(Signed) "W. W. Simpson & Co."

"Commission, per cent."

13. On receiving the defendant's second order, of the 28th of April, the plaintiffs entered into a contract with Messrs. Rayner & Co. for the purchase of 200 tons of tallow, and into a contract with Simpson & Co. for the purchase of 150 tons of tallow, intending to appropriate to the defendant's second order the 150 tons and 50 tons out of the 200 tons; and on the 28th of April bought and sold notes (in the same form as those above set out) were passed between the plaintiffs and Rayner & Co. and Simpson & Co.

14. Settlements of transactions in tallow are usually made in London in the months of April, May, and June, respectively; and on the May settlement Sharman, trading under the firm of

W. W. Simpson & Co., failed, and was unable to meet his engagements. Thereupon, the plaintiffs and Simpson & Co., having many transactions together outstanding in respect of the sale and purchase of tallow, balanced and settled an account thereof, wherein the quantity of tallow sold was set off against the quantity of tallow purchased by the plaintiffs on account of Simpson & Co., whereby it appeared that the plaintiffs had sold between 100 and 200 tons more than they had purchased on account of Simpson & Co.

16. On the 31st of May and 1st of June, the plaintiffs sent the defendant letters inclosing respectively notices that they were ready to deliver 117 casks or 50 tons of tallow in accordance with the defendant's order of the 2d of April, 1869, and to deliver 175 casks or 75 tons in part fulfillment of the defendant's order of the 28th of April.

*18. On the 8th of June the plaintiffs sent the defendant [88 a letter inclosing a notice that they were ready to deliver 170 casks or 75 tons more tallow in further fulfillment of the defendant's order of the 28th of April. Inclosed were two invoices, one, dated the 7th of June, in respect of the above 175 casks of tallow, and the other, dated the 8th of June, in respect of the 117 casks.

19. On the 9th of June, the defendant acknowledged the receipt of that letter and the inclosures.

20. On the 11th of June the plaintiffs wrote to the defendant a letter, inclosing an invoice in respect of the 170 casks of tallow.

21. On the 14th of June the plaintiff's sent a letter to the defendant, informing him as to the state and prospects of the tallow-market, and suggesting a remittance for the prompt payable the following day.

22. The defendant, having before the 15th of June ascertained that Simpson & Co. had failed and had not themselves tendered the tallow, gave notice to the plaintiffs that he would not accept the tallow.

23. On the 15th of June the plaintiffs sold out the 117 and 175 casks, together making 292 casks or 125 tons of tallow against the defendant, and sent him a letter inclosing a contract o sale, an invoice, and balance-account in respect thereof.

26. On the 22d of June the plaintiffs, having sold out the