Sourcebook on Obligations & Remedies 2/e
Sourcebook on Obligations & Remedies 2/e
Edition 1st Edition
First Published 1999
eBook Published 2 December 1999
Pub. location London
Pages 950 pages
eBook ISBN 9781843143161
Samuel, G. (2000). Sourcebook on Obligations & Remedies 2/e. London: Routledge-Cavendish, https://doi.org/10.4324/9781843143161
TABLE OF CONTENTS
The purpose of this first chapter is to set the law of obligations in the context of the common law as a whole. On the continent, a legal system is constructed through codes, which organise the law into highly systematic bodies of principles and rules. The various codes themselves define a particular domain: private law, civil procedure, criminal law, criminal procedure, and so on. In
unfit, there is liability irrespective of any fault on behalf of the supplier (see Frost v Aylesbury Dairy, p 47). At another level, however, law functions as a political and social institution, which requires it to focus around elements that stretch beyond individual persons and things to embrace the institutions of society itself. At this level, law is a matter of courts, judges, legislators and parties as a class. Accordingly, before one can understand the operation of particular areas of legal rules, it is first important to have some grasp of the role of the various social and political institutions as rule and decision makers. For between the law as social system and the law as institutional system, there is the reasoning system of the politicians and jurists themselves. This reasoning system acts, once again, as a bridge between social fact and legal conceptualisation. THE ROLE OF THE COURTS
Perhaps the central social institution of the law, for the English obligations lawyer at any rate, is the court. The foundations of contract, tort and restitution are to be found in case law and not in a statutory code of abstract principles (although this is not to underestimate the role of statute). On the continent, things appear a little different, since it is the legislator who has pride of place
decisionby throwing a dice or consulting an astrological chart? (Cf R v Young  QB 324.) 3 If a plaintiff is able to establish that there is a 51% probability that the defendant’s wrong caused his injury, ought the plaintiff to succeed (assuming all the other requirements for a cause of action are satisfied)? 4 Is it true to say that a court of law is never engaged in any search for truth?
civilianjudges—who do have much more active roles than their common law brethren—are not true judges, but partisan advocates? 3 Professor Jolowicz once observed how the disappearance of the jury in civil cases (defamation remains an exception) has hardly affected the procedural structure of litigation; one has to imagine that a jury still exists. Why do you think the jury has largely disappeared from non-criminal cases and why do you think that its ghost remains? 4 If the judge does not represent society, who does he or she represent when hearing a case?
Questions 1 Does Laws J have a different view of the role of a first instance judge than Vinelott J (in Derby v Weldon)? 2 Are judges under a duty to bring, if at all possible, the law into line with common sense? 3 Would a lawyer from a codified system ever see law and legal reason in terms of ‘navigation across an uncertainly charted sea’? 4 Is Lord Lowry’s view of the judicial role too restrictive in comparison with the role of judges in other EU jurisdictions? (b) Court of Appeal
Questions 1 What is meant by a ‘rehearing’? 2 Can the Court of Appeal hear witnesses? If so, could the appeal judges question these witnesses in any depth? (Cf Practice Direction (Court of Appeal (Civil Division))  1 WLR 1027.) 3 What is the role of the Court of Appeal in English law? (Cf Practice Direction, above.) 4 Can appeal judges decide cases on points of law not raised by the parties? What if they feel that a plaintiff has pleaded a case in the wrong sort of way? (Cf Esso v Southport, p 216 and CTN Cash and Carry v Gallaher, p 504.)
Notes and questions 1 How is a law reporter to know if a case is one of principle? At the time of the giving of the judgments, did (for example) Mint v Good (p 675) seem an important case of principle? 2 Is an unreported case incapable of acting as a precedent? 3 ‘[T]he Divisional Court…is not called a court of appeal for in my opinion it is not such a court. It is, generally speaking, a court of review having wide powers to countermand the decisions of others no matter where those decisions emanate from, be it below the High Court or outside the courts altogether. It should therefore, in my judgment, be regarded as sui generis, for such it is. At times, depending on the function it is exercising, I dare say it could, practically speaking, be called a Court of Appeal, at other times clearly not. What I am confident it can never, in any circumstances, be called is a court of first instance’ (Watkins LJ in R v Leeds County Court ex p Morris  1 QB 523, p 531). What is the difference between a court of review and a Court of Appeal? Is a Divisional Court a public (rather than private) law court? (c) House of Lords
the extracts ought to help explain why metaphors such as ‘uncharted seas’ are so easily applied to the common law. One question that the civilian might wish to ask is this. Is the mentality of the common lawyer too conservative to achieve much in the way of law reform? 5 What is meant by prospective overruling? (Cf Kleinwort Benson v Lincoln CC, p21.) 6 How can the executive make its view known in an English court? 7 How might the role of a court influence the development of the law of obligations? If the duty of a trial or an appeal judge were to change, would this, in the longer term, lead to changes in legal thinking itself? 8 Is Lord Simon saying that cases do not lay down general principles? THE ROLE OF PRECEDENT
On the continent, the civil codes are seen as providing both structure and stability to the law. In an uncodified system like English law, this structure and stability has, of course, to come from elsewhere and this is the reason why precedent assumes such importance in theory, if not so much in practice. It is important for law to appear as a rational discourse, and part of this rationality
(see Torts (Interference with Goods) Act 1977; Unfair Contract Terms Act 1977). But statute has intruded into so many particular factual areas that it has become possible to say that certain types of liability are now almost exclusively statute based. Thus, liability for things (cf Chapter 7) is now a form of liability that the courts are hesitant to develop themselves; it is something they prefer to leave to Parliament (see Cambridge Water, p 665). However, even where statute governs, the courts still have a major role to play in interpreting the words of the legislation, and this interpretative role is as important as any case law analysis (see Chapter 2). Does the word ‘offer’ in a statute mean the same as in a contract textbook? What objects are covered by the word ‘plant’ in a statute dealing with safety at work? Is a car park a ‘road’? In fact the approach towards legislation is often very similar to the one adopted by the courts in interpreting wills and contracts: the point in issue is what a particular word or phrase means in the context of a particular factual situation. Statute can also exert a negative influence. And so, in some recent cases, the courts have specifically refused to develop a common law principle on the basis that the factual situation has, in general, been taken into consideration by the legislator when formulating a statute (see, for example, Murphy v Brentwood DC  1 AC 398). In these situations, the courts often claim to be responding to the policy aspect that attaches to civil liability problems. However, the idea that the courts work in partnership with the legislator—an idea that forms part of the civil law tradition—is not something that is part of English legal history.
‘I must confess to having felt some attraction for this approach, as a matter of logic; but I have come to the conclusion that its practical consequences are such that I do not think that it can have been the intention of the legislature so to provide’ (Lord Goff in The Derbyshire  AC 276, p 302). If Lord Goff had to decide Fisher v Bell, would he have arrived at the same conclusion as Lord Parker? 3 ‘The duty of the courts is to ascertain and give effect to the will of Parliament as expressed in its enactments. In the performance of this duty the judges do not act as computers into which are fed the statute and the rules for the construction of statutes and from whom issue forth the mathematically correct answer. The interpretation of statutes is a craft as much as a science and the judges, as craftsmen, select and apply the appropriate rules as the tools of their trade. They are not legislators, but finishers, refiners and polishers of legislation which comes to them in a state requiring varying degrees of further processing’ (Donaldson J in Corocraft Ltd v Pan-American Airways  1 QB 616, p 638). What is the difference between a craftsman and a scientist? Do they operate according to quite different theories? 4 ‘There may be very sound social and political reasons for imposing upon local authorities the burden of acting, in effect, as insurers that buildings erected in their areas have been properly constructed in accordance with the relevant building regulations. Statute may so provide. It has not done so and I do not, for my part, think that it is right for the courts not simply to expand existing principles but to create at large new principles in order to fulfil a social need in an area of consumer protection which has already been perceived by the legislature but for which, presumably advisedly, it has not thought it necessary to provide’ (Lord Oliver in Murphy v Brentwood DC  1 AC 398, p 491–92). Are these the words of a craftsman or a scientist?
Notes 1 The first point to be made about the institution of the persona is that it acted as the foundation of one of the great categories of law: the law of persons. In modern civil law, the law of persons can be divided into two broad areas: legal personality and status. The former is concerned with the nature and definition of the legal subject (for example, children in the womb, companies, associations), while the latter is ‘the condition of belonging to a class in society to which the law ascribes peculiar rights and duties, capacities and incapacities’ (the Ampthill Peerage case  AC 547, p 577) (for example, children, citizens, aliens, etc). In truth, the law of persons is much more complex than this broad division suggests, in that it has come to embrace not just company law (and associated groups), nationality, aspects of mental health law and the like, but also family law, including the law relating to children. These subjects are often intimately tied up with the law of things (property and obligations) and law of actions (remedies)—indeed, persona and partrimonium are inextricably interlinked in a bipolar relationship. And thus, in some respects, the arbitrary allocation of a subject like company or family law to the law of persons can appear both conceptually and empirically artificial (cf CC, Art 1387). Nevertheless, there is a logic to the inclusion of family law within the law of persons, since marriage is more than a contract between two individuals; it is an institution capable of attracting its own rules and marriage itself is a form of status. Accordingly, viewed from the institutional scheme as preserved by the European codes, the law of persons remains a valuable category for orientating thinking towards the legal subject as starting point. 2 If the human (homo) is the starting point for legal thought, it should by no means be assumed that all human beings, even in modern law, automatically have legal personality. Unborn children present particular problems, in that they have interests, but not personality (as the 1976 Act above indicates, and see Dig 1.5.7); and death of a human does not always extinguish the right to sue (as the 1934 Act illustrates). That said, birth and death act as the fundamental factual determinants for legal personality (Código civil, Arts 30, 32) and thus detailed rules are required to deal with problems such as disappearance and the presumption of death. New technology is presenting new problems (Airedale NHS Trust v Bland  AC 789). The moment of death can also give rise to difficulties when it comes to succession (Re Rowland, p 166). Western legal systems once recognised civil death, but this has almost completely disappeared in modern liberal democracies.
Can an inanimate object ever have legal personality? Can an animal? (Cf Bumper Development Corporation v Metropolitan Police Commissioner  1 WLR 1362.) 7 Do companies actually exist or are they simply a name? Do classes (for example, consumers) exist or do only individuals exist? Do groups and classes have interests and rights? (Cf Jolowicz, “Protection of diffuse, fragmented and collective interests in civil litigation: English law 
(Post-Glossators), but in the 19th century, German theorists developed a realist approach whereby legal personality was founded on the notion that groups within society had a real existence. English law, which was slow at first to recognise legal personality, quickly developed the commercial company in the 19th century via legislation; and the courts still appear to favour the fiction theory (as Tesco indicates). 2 Several characteristics are particularly important with respect to the development of legal personality: independent patrimony; ability to own and to contract; not affected by death of humans; limited liability. Given these characteristics, the legal person (that is, corporation) has proved capable of assuming considerable legal and social dominance in both the legal and the social world. Nevertheless, the kinds of corporate structures are not the same in all systems. Moreover, in the common law systems, the trust has assumed roles played by the legal person in civilian systems. Does the law of trusts take anything from the law of persons (universitas personarum) or is it exclusively a creation of the law of things (universitas rerum)?
relationship between the family and its property is one important focal point for comparison; common law and civil law differ in their approach to matrimonial regimes (cf the notion of dowry: Dig 24.3.1). The French model has a notion of community property (CC, Art 1400, etc) whereas English law sees only two individuals governed by the ordinary law of property (Van den Boogaard v Laumen  3 WLR 284, pp 292–93). That said, a spouse in UK law may have a real right in the family home, just as a wife did in late Roman law with respect to her dowry (C 8.18.12), and there are statutory rights of occupation (Matrimonial Homes Act 1983). In addition, the law of remedies and the general private law might provide indirect protection of the family (see, for example, Barclays Bank v O’Brien, p 256). Does Jackson indicate that the law of obligations does not recognise the family as a formal institution? What about the law of remedies? 3 The status of individuals (in particular women and children) within the institution of the family is another focal point of comparison (cf Children Act 1989, s 1). What rights does the law of persons give children vis à vis parents and vice versa (cf CC, Arts 371, etc)?
The second element in the institutional scheme after persona is res. This latter term can loosely be translated as ‘thing’—although the Latin word is rather amorphous—and represents another focal point around which legal propositions can be grouped. ‘Things’ (res) act to some extent as a counterpoint to ‘person’ (persona) and thus the law of things cannot be understood divorced
with only from the angle of potential subjects of the law of property (Halpérin, Histoire du droit privé français depuis 1804, 1996, PUF, p 25). Equally, the law of things was, and arguably remains (in some systems at least), wedded to the law of actions. Moreover, the varying structural patterns of these interrelationships are the key to the different comparative models.
comparatist for a number of reasons: (a) the patrimony is particularly well developed in French law as a key institutional structure; (b) the idea of a universitas rerum can be found to underpin the Anglo-American trust; (c) the New Dutch Code has specifically incorporated the notion of patrimony as part of its system: Book III is concerned only with patrimonial rights and thus one finds in a single book all things, both corporeal and incorporeal; (d) the idea of a universitas rerum is fundamental to succession law.
between persona and res is inherent not just in the word itself, but also in the texts. This exclusivity and power was to become a key idea in Revolutionary France, dedicated to overthrowing feudal property ideas, and thus ownership is defined in the Code civil as the ‘right to enjoy and to dispose of things in the most absolute manner’ (droit de jourir et disposer des choses de la manière la plus absolue) (Art 544). Nevertheless, the exclusivity must never be overemphasised as a matter of history. For neither the Romans nor the French post-Revolutionaries ever accepted such an idea in everyday practice; dominium was always more of a bridge between the legal and the ideological worlds than between the worlds of law and social fact. 2 When one turns to the Waverley case interesting questions arise. Ought ownership (a property concept) to be determined by the status (law of persons) of the finder (that is, status of ‘trespasser’)? Did the council succeed because it was deemed the possessor of the brooch or because it was held to have a better right to possession? What if Mr Fletcher had some months previously lost a ring in the park and had repeatedly returned with a metal detector to search for it until he found it: could the council claim the ring if it had been recovered several inches below the surface? A homeless person in breach of the park bylaws enters the park each night to sleep on a park bench and one night finds a £10 note which he hands in to the local police the next day. If the note is never claimed, who will be entitled to it? 3 In addition to dominium (a legal relationship) the Romans also developed the relationship of possession: the factual relationship between person and thing (Dig 41.2.3). Physical (corpus) and mental (animus) control were vital (Dig 220.127.116.11; 18.104.22.168); and what, practically speaking, distinguished ownership from possession were two quite different sets of remedies. Ownership was protected by the actio in rem, whereas possession was protected by the public law remedy of the interdict. In civil law, possession and ownership were quite different notions (nihil commune habet proprietas cum possessione: Dig 22.214.171.124), but is this true of the common law? 4 Waverley involved a chattel. But what if the dispute involved land? What if a building contractor, who does not have actual possession of the land on which he is erecting a building, is prevented from working by trespassing squatters? Must the contractor, in order to get a repossession order from the courts, show that he had possession of the land or will a ‘sufficient interest’ be enough? (Cf Manchester Airport plc v Dutton  3 WLR 524.)
made of the common law before the procedural reforms of the 19th century. Yet how relevant is the remedy—the actio—to modern law? Is it simply a procedural institution confined these days to giving expression to pre-existing rights, or does it still have a more active role? English law presents a somewhat complex picture.
remedy of the injunction that determined the rights in Miller v Jackson? If so, what role did the cause of action in nuisance play? 3 How did Lord Denning know that the animals did not mind the cricket? 4 What if the Millers’ household insurance premiums had been raised as a result of the possible danger of cricket balls: could the Millers have claimed this expense from the club? 5 What if the Millers continued to sit in their garden during cricket matches and Mrs Miller was hit, and seriously injured, by a cricket ball: would the club be liable? Could the club raise the defence of contributory negligence? 6 Conversion requires an act denying the plaintiffs title in his movable property: is merely playing with another’s cricket ball conversion? Is it a trespass? If the owner of the land refused to return the cricket ball, would he be liable today for conversion? (Cf Torts (Interference with Goods) Act 1977.) 7 The court awarded modest damages: was this in lieu of an injunction? 8 What if the Millers had bought the house in the middle of winter? 9 How many separate reasons does Lord Denning give to support his decision? 10 Is this, in effect, an estoppel case? 11 Consider the notion of the ratio decidendi of a case. What is the ratio decidendi of Miller v Jackson? 12 Was it unreasonable of the female plaintiff to develop ‘a somewhat obsessive attitude’ given that the judge found that she was reasonable in her fear of serious injury? Is this case a good example of a court deciding a case through the manipulation of the facts rather than the law? What if the facts had involved some sport other than a ‘manly sport’: would the result have been different?
These English forms of action stand in rather stark contrast to developments on the continent. Even by late Roman times, actions had merged with obligations (Dig 44.7) and the emphasis was more and more on the systematisation of iura themselves increasingly being viewed as ‘rights’ attaching to the individual (persona, individuum). Nevertheless, this does not mean that the Roman forms of action have not left their mark on the codes. The law of contract remains divided into named and unnamed contracts, which is a hangover from the different species of contractual actions in Roman law, and these old Roman forms are to be found elsewhere in private law (see, for example, CC, Arts 1372, 1376). In addition, the ‘multiplicity of special proceedings deriving from the different legal transactions and situations of substantive law’ is ‘an unfortunate holdover from the old system of forms of action’ (Vescovi, IECL, Vol XVI, Chapter 6, para 381). Such special proceedings (actions) include the difference between possessory and revindication claims, commercial and ordinary proceedings, marital disputes, minors and guardianship and so on. Even more modern civilian thinking cannot always escape from distinctions between public and private actions, ordinary and summary proceedings or contentious and non-contentious jurisdiction (Vescovi, paras 382–85). Actions may have given way to a law of subjective rights, but beneath these rights, and their remedies, are to be found the traces, if not structures, of older forms of claim. THE ROLE OF LEGAL CATEGORIES (a) Introduction
In Roman law, the institutional system acted not just as a means of linking the social and the legal worlds: it also acted as the basis for legal classification. Law was to be divided into three areas, each representing the institutional emphasis: the law of persons, the law of things and the law of actions. Within
pronounced as it is in France—indeed, the division has traditionally been unrecognised at the formal level. Nevertheless, at the level of remedies there is an important distinction between judicial review and a claim for damages, and this remedial distinction implies that the common law adheres to a dichotomy between public and private interests (R v Secretary of State for Education ex p Avon CC  1 QB 558, p 561). Perhaps where the common law differs from the civil law is in its failure to develop, at the institutional level, a notion of the State: common lawyers, as Lord Diplock once recognised, continue to rely upon the notion of the ‘Crown
is still close in a number of areas. The crime of public nuisance will give rise to a damages action in tort if the plaintiff suffers special damage (see Mint v Good, p 675) and the breach of a criminal statute may give also rise to a damages claim in certain circumstances (see pp 758–60). A person who suffers damage, injury or loss while involved in a criminal activity may be prevented from recovering compensation either in contract or in tort; much will depend upon the circumstances (see, for example, Geismar v Sun Alliance Insurance, p 602). Consider some examples. D shoots P, a burglar who has just broken into D’s house: can P sue D for his injuries? P contracts with D for D to transport P’s very heavy piece of machinery from Liverpool to London and on the way the lorry crashes as a result of being overloaded: can P sue for his badly damaged machine if he acquiesced in the overloading? P, very drunk, encourages D, also very drunk, to drive badly; if the car crashes and P is injured, can he sue D? (c) Contract
Questions 1 How does one recognise a set of facts as being contractual? 2 In Fisher v Bell (above, p 24), if the owner of the shop had sold the knife on credit to the buyer, and the buyer had failed to pay the debt, could the owner have sued the buyer for a contractual debt? 3 If an employee of a supermarket steals goods from his employer and sells them to an acquaintance in his local pub, could the employee sue the acquaintance if the latter failed to pay for the goods? Could the supermarket sue the acquaintance? 4 Besides contract, what are the other parts of the law of obligations? Notes 1 The notion of a law of contract goes back to Roman law, from where it found its way into modern European law through the rediscovery in the 11th century of Justinian’s compilation of the writings of the Roman jurists and of imperial legislation published in 533AD (Corpus Iuris Civilis). The succession of continental jurists from medieval to modern times who worked on these sources took the Roman law of contracts from its fragmented nature to a general theory of contract (Samuel and Rinkes, Law of Obligations and Legal Remedies, 1996, Cavendish Publishing, pp 1– 9). A range of Roman characteristics are still to be found in the contract sections of all the modern codes, but a Roman jurist would not recognise the modern style of presenting private law in terms of codes. Nor, probably, would he recognise the notion of a general theory of contract based on the will theory (CC, Art 1134), although the idea is stimulated by a Roman text (Dig 50.17.23). In terms of legal style, the Roman jurist would be more comfortable in the common law system where contract is founded upon concrete cases (Weir (1992) 66 Tulane LR 1615). 2 Despite the historical emphasis on the form of the action, to say that contract was unknown in England before the 18th century would be to misinterpret legal history. The Court of Chancery had been familiar with (Romanist) contractual notions long before the industrial revolution and academic writing since the Middle Ages was well acquainted with Roman law (and thus the law of contract) (Gordley, The Philosophical Origins of Modern Contract Doctrine, 1991, OUP). But contract as a dominant legal institution is largely a creature of the 19th century common law, and it is during this period that it reached its ‘classical’ form (Atiyah, The Rise and Fall of Freedom of Contract, 1979, OUP). The basic principles of offer and acceptance, consideration, terms and breach were all worked out—or, more accurately, imported from the codes (Simpson (1975) 91 LQR 247)—during the period between the end of the 18th century and the beginning of the 20th century (Samuel and Rinkes, pp 75–82). The result was that many of the older forms of liability founded on status, debt and bailment became
completely submerged under the new doctrine. Indeed, even the non-contractual debt claims were rationalised in terms of implied contract or equitable property rights (Sinclair v Brougham  AC 398), and it is only today that the courts are beginning to rethink and reformulate at a theoretical level the categories of debt liability (Kleinwort Benson v Glasgow CC, p 71). Whether an English contract can be seen as a form of private legislation as in France (CC, Art 1134) is not easy to determine, since its basis is in promise rather than agreement (below, p 402). But freedom of contract was, until the consumer society of the postwar period, the dominant ideology of the courts. And, even today, contract, as an aspect of commercial law, is an instrument for businesses to establish their own rights and duties and it is for the courts to enforce these terms without regard to notions such as good faith (Photo Production, p 552; cf UNIDROIT, Art 1.1; PECL, Art 1:102). Only where consumers (interpreted widely?) are concerned will the courts take a more interventionist approach (Interfoto, p 409). 3 In all the continental codes, the part or book devoted to the law of obligations is dominated by the law of contract. In the French Code civil, non-contractual obligations take up only a few articles compared with the large number dealing with contract in general and with the various named contracts. Contracts are binding agreements—a legal chain (vinculum iuris) between two people (J 3.13pr)—which, in some systems, as we have seen, have the force of private legislation. Any failure, for whatever reason, to perform such an obligation is regarded as a non-performance (inexécution) with the result that liability for such non-performance starts out from the reason for non-performance (CC, Art 1147; PECL, Art 8:101). Was the non-performance the result of the contractor’s fault? Did the contractor undertake to guarantee a result or did he undertake only to use skill and care? This idea of liability being based on fault comes from Roman law (Dig 126.96.36.199, 7; below, p 389) and is still a central feature of the modern civil law (PECL, Art 8:108; Treitel, Remedies for Breach of Contract, 1988, OUP, Chapter 2). However, the actual position is more complex, since liability (la responsabilité contractuelle) in contract is linked to the formation and contents of the contractual obligation itself, and this may depend on the actual facts of the contract problem in issue (see, for example, Boy note to TGI Paris 5.5.1997, Dalloz Jur 558; cf Atias Dalloz 1998 Chron 137). The point to be stressed, then, is that contract and liability in contract must be distinguished to the extent that the former is concerned with rights (obligationes, iura, droits subjectifs) while the latter is primarily a matter of remedies (actiones). Thus, when viewed from the position of compensation based on either fault (obligation de moyens) or strict liability (obligation de résultat), there is little difference between contractual and non-contractual liability. This makes it possible for the
law of tort to ‘fill in the gaps’ of the law of contract (see, for example, White v Jones, p 702) (but cf ‘tort’, below). 4 In English law, the distinction between contract and liability ex contractu is particularly important, since the law of remedies (debt, damages, injunction, specific performance, rescission, etc) is relatively independent from the law of rights (contract and tort) (see, for example, Co-op v Argyll, p 253; cf PECL, Art 9:102). Certainly contractual liability in English law can, at first sight, appear to transcend the forms of action mentality, since contract is a subject seemingly dominated by rules which are capable of being codified in much the same way as in the civil codes (McGregor, Contract Code: Drawn up on behalf of the English Law Commission, 1993, Giuffrè). However, remedies respond not so much to rights, but to causes of action, and thus liability in contract is founded on the idea, not of nonperformance of an obligation as such, but of a breach of contract. This notion of breach is in turn related to the theoretical foundation of contract in English law, which is not conventio (agreement), but promise. Contractual liability arises from a breach of promise and historically such a cause (form) of action for breach was as much delictuel (tort of deceit) as contractual. Some contractual liability cases are thus difficult to distinguish from non-contractual compensation claims (see, for example, Blackpool and Fylde, p 436). 5 The idea of non-performance is not, however, absent from the common law of contract, since a contractor may be prevented from performing as a result of an event beyond his control (doctrine of frustration) or because the non-performer is under no actual obligation to perform as in a unilateral contract. Consequently, it is on occasions important to distinguish a claim based on breach of contract (usually a claim for damages) from one based on non-performance (usually a refusal to pay a debt) (see, for example, Vigers v Cook, p 516; Bolton v Mahadeva, p 226). Difficult questions can also arise not only about whether the nonperformance was a breach (Joseph Constantine, p 523), but also whether the defendant had actually promised the result claimed by the plaintiff (see, for example, Readhead v Midland Ry, p 543; Thake v Maurice, p 547; Supply of Goods and Services Act 1982) (cf obligation de moyens and obligation de résultat). (d) Tort
In 1897, a judge recognised a general right not to be physically harmed by an intentional (malicious) act of another (Wilkinson v Downton, p 640). But this would seem not to be reducible to a general pre-existing ‘duty’ (Stubbings v Webb  AC 498, p 508). However, in Donoghue v Stevenson, the House of Lords recognised a general duty of care not carelessly to injure another. It would appear, then, that English law has moved some way towards a general non-contractual obligation for physical damage based upon fault (Letang v Cooper  1 QB 232; cf CC, Art 1382). Damage is usually the starting point of tort (but cf defamation); however, economic loss presents problems when it comes to the tort of negligence and breach of statutory duty (and see Birse Construction v Haistie, p 617). With respect to liability without fault (liability for people or things under one’s control), it is by no means easy to establish any general principle similar to CC, Art 1384. The decision in Rylands v Fletcher (p 660) could have acted as the basis for such a general principle, but the House of Lords has consistently refused to develop any such strict liability principle (Read v J Lyons and Co, p 662; Cambridge Water v Eastern Counties Leather, p 665). The result is that the UK law is out of line with many of its EU partners. Tort thus remains a rather fragmented subject protecting a whole range of different interests and, as a result, it is impossible to think in terms of a general theory (as the notes that follow indicate; and see, in particular, Chapter 7). 3 ‘We have had several compendious theories as to the law of tort. Lynxeyed predecessors who noticed that a tort suit often resulted in a transfer of funds from the defendant to the plaintiff inferred that it was the purpose of tort law to effect such transfers: the more transfers the better, or tort was being false to its purpose. This was especially true if the defendant could spread the loss, very thinly like jam, so that no one could taste it… An appropriate basis for discriminating between plaintiffs would be according to whether they were the victims of misfortune or of mismanagement, of bad luck or of bad behaviour, that is, whether they have just a pain or a grievance as well, whether we can say of them that, the world being what it is, they should not have been hurt… The purpose of fault would be to determine not who must pay but who may claim, to distinguish between plaintiffs rather than between defendants. And we would also distinguish according to the nature of the harm in issue, and make the law reflect society’s proper value judgments by letting people recover more easily in respect of personal injury than financial harm, and for property damage only if it also represented financial loss to them…’ (Weir, ‘Governmental liability’  PL 40, pp 62–63). Is fault a realistic criterion for determining who should receive compensation in road accident cases? Was Mrs Donoghue the victim of misfortune or of mismanagement—of bad luck or of bad behaviour?
What if the manufacturer had been able to prove that, on average, only one bottle in a million was defective? 4 ‘It is submitted that a suitable criterion is to be found in the concept of risk and that a satisfactory body of legal rules could quite rapidly be developed by the courts if in every case they were to pose the question “Whose risk was it that this damage might occur?” in place of the present “Whose fault was it that this damage did occur?”. It is essential, however, that the traditional refusal of the courts to consider the factor of insurance be reversed. It is perhaps this refusal of the courts to face up to the facts of contemporary life which has led them to overlook loss distribution as it already exists and to insist on fault as the criterion of liability as if every defendant had to find the damages from his own pocket (Jolowicz,
Morris v Martin should also be read in the law reports (and see p 458 below), for in addition to the bailment question there was a problem concerning an exclusion clause in the contract between bailee and subbailee. Why was the plaintiffs right not affected by the clause? Was her status as a consumer relevant? 7 Are Diplock LJ’s last two sentences in the extract above of great relevance from a legal reasoning point of view? Is he basing his decision on a different legal notion from that of Salmon LJ? (h) Equity
) and the torts of breach of statutory duty and public nuisance. Do these kinds of claims raise both dominium and imperium issues? 3 Where the exercise of imperium prejudiced individuals, later civil law, with the help of canon law, developed specific public law procedures by which an interested party could appeal (appelare) against an administrative—or indeed judicial—decision (Mestre, Introduction historique au droit administratif frangais, 1985, PUF, pp 14CM1). Such an administrative appeal procedure has resulted, today, in two quite separate recours. There is, first, the normal appeals process; this process is now seen simply as part of civil procedure, that is to say the hierarchy of the courts. (But is civil procedure public or private law?) Secondly, there are separate public law remedies for use against administrative decisions: here the courts are reviewing, to put it in Roman law terms, the decisions of those charged with imperium (cf Dig 188.8.131.52) to see if they have exceeded their powers (recours pour excès de pouvoir). Equally, in the common law, the judicial review remedies (Supreme Court Act 1981, s 31), although quite separate from actions in debt and damages (cf Wandsworth LBC v Winder  AC 461), are not always easily distinguishable from appeals (cf Chief Constable ofN Wales v Evans  1 WLR 1155, pp 1174–75). Moreover, some remedies (habeas corpus, declaration and injunction) cannot, in themselves, be easily classified as either public or private. 4 Several specific questions arise. To what extent can, and should, private law remedies be available for the infringement of public law rights? To what extent should private law remedies be allowed to infringe constitutional rights? (Cf Derbyshire CC v The Times  AC 534.) Should public law remedies ever be available for the protection of private rights? Does the remedy of damages raise special problems with respect to imperium? Are relator actions public or private claims? (Cf Gouriet v UPOW  AC 435.) To what extent do these public and private law of actions issues interrelate with the law of persons (for example, with respect to dignity or privacy)? To what extent can the existence of public law remedies influence the availability of private law claims? Does the Human Rights Act 1998 add to these complications? 5 The confusion at the level of actions and procedure between the public and the private might suggest that the categories of public and private law are outdated (Harlow (1980) 43 MLR 241; cf Samuel (1983) 46 MLR 558; (1988) 8 LS 277). Yet the difference is fundamental to the French model, if not to civil law in general, and the difference has resulted in quite specific legal developments. The most notable is in respect of administrative liability, where compensation for damage resulting from State action in France is founded upon a quite different basis from ordinary civil liability. In particular, the role of the risk and the equality
principle stand in sharp contrast to the role of fault in English law (Jolowicz  CLJ 370). The public/private debate thus remains important for the comparative obligations lawyer. However, does the distinction between public and private law actually have any relevance in late 20th century economies? 6 The distinction is vague and tenuous, and perhaps arises not so much from the different matter of public and private law as from the different remedies which may be sought; the Divisional Court dealing with an application for [judicial review] seems to think differently from a puisne judge hearing a claim for damages (Weir, The common law system’, IECL,
para 52). Is a local authority entitled to refuse to contract with anyone it does not like? (Cf R v Lewisham LBC ex p Shell (UK)  1 All ER 938; Blackpool and Fylde Aero Club Ltd v Blackpool BC, p 436.) 3 The Cour de cassation, in consistent case law since 1876, has always forbidden judges to annul or revise contracts for imprévision, whatever the consequences might be… Contradicting the thesis upheld by the Cour de cassation, the Conseil d’Etat has elaborated since 1916 a theory of imprévision in administrative contracts… The interests of the public service require that this extra-contractual situation should not release the contracting party from his obligation. By way of compensation, the government has come to his help and take its share of the additional costs due to the imprévision… The basis for revision is precisely that the interests of a contracting party will be seriously prejudiced. It is a question of protecting an individual interest… This can thus be called protective public policy” (de Lamberterie, The effect of changes in circumstances, in Harris
In what circumstances should the State compensate citizens for damage arising through non-negligent government action? (Cf Rigby, below.) 5 Do you not find it disturbing that an innocent person can be held for three months in prison without any legal redress? Is this not a breach of the European Convention on Human Rights in UK law? Can one have faith in the English judiciary when it comes to upholding human rights? What might be the effect of the Human Rights Act 1998 on cases like Hill and Elguzouli-Daf when it finally comes into force? 6 Would it surprise you to learn that one plaintiff in Elguzouli-Daf was a political refugee from Sudan while the other was a resident of Northern Ireland?
am not asked to consider the issue of damages. Suffice it to say, therefore, that in the upshot I find the defendant liable in negligence to both plaintiffs. The damages issue must be tried by another tribunal unless agreed. Notes and questions
subrogated (see p 268) to the shop owner’s rights? If not, could it not be said that the plaintiff deserved to lose the case for having an uninsured building? Might he have been insured, but the company had refused to pay?
1 INTRODUCTION An understanding of the English law of obligations requires knowledge not just of the law applicable to factual situations falling within its province, but also of the application process itself. This may seem a statement of the obvious. Yet it is only in more recent years that the importance of legal method as an
has done more than anyone in the common law world to re-emphasise the role of adjudication in the formulation of philosophical theory, continues to subscribe to the thesis that legal knowledge is based on rules and principles (Susskind, Expert Systems in Law, 1987, OUP, pp 78–79). All the same, Dworkin has moved thinking away from the mechanics of the syllogism towards the interpretative role of the judge, and while this shift has not undermined, as such, the rule thesis, he has opened up the methodological debate in, for example, distinguishing between easy and hard cases (see Taking Rights Seriously, 1977, Duckworth, pp 24ff, 105ff). In easy cases, it may be that a legal rule applies itself in a mechanical fashion, but in hard cases—that is, cases where there is no easy correspondence between the rule and the facts—the interpretative role of the judge becomes the central object of study. The judge, according to Dworkin, involves himself in a process that is analogous to writing a chain novel. ‘In this enterprise’, writes Dworkin, ‘a group of novelists writes a novel seriatim; each novelist in the chain interprets the chapters he has been given in order to write a new chapter, which is then added to what the next novelist receives, and so on’ (Law’s Empire, 1986, Fontana, p 229). The difficulty with this otherwise valuable methodological analysis is that it assumes that legal reasoning is a matter of interpreting language—a matter of interpreting texts, of interpreting rules and principles (ars hermeneutica). There are two general problems with this approach. First, the hermeneutical (interpretative) method is just one of a number of different schemes of intelligibility that are used in social science reasoning. Thus the hermeneutical scheme can be contrasted with a functional approach or a structural approach or, indeed, with several other schemes of intelligibility. These various schemes have been identified and analysed by the French social theorist J-M Berthelot in his book, L’intelligence du social, 1990, PUF, Chapter II; and while this work is rather outside a course on the law of obligations, it cannot be completely ignored by lawyers. What Berthelot can teach lawyers is that their legal reasoning schemes are nothing special. The various approaches adopted by judges in their analysis of facts and their fashioning of solutions can be classed according to the same schemes of analysis as those used by social scientists in general. Thus, lawyers and legal theorists make use of the causal scheme, the functional scheme, the structural scheme, the hermeneutical scheme, the actional scheme and the dialectical scheme depending upon their standpoint and/or view of the world (see below, pp 169–77). When one judge differs from another in respect of the same facts, it is often because each judge is approaching the case from a different schematic viewpoint (see, for example, Re Rowland, p 166). Equally, there is little point in trying to reconcile the theory of Ronald Dworkin with the functional approaches of the American Realists or with scholastic (dialectical) methods of the medieval Glossators or with the structural approach of the semioticians. This is not to say, of course, that the various approaches are mutually exclusive. Criminal and tort lawyers use, for example, the causal (chain of causation) and the actional (reasonable man,
bon père de famille, etc) as well as a dialectical approach at the procedural level (accusatorial procedure). The Glossators, and in fact the Roman jurists themselves on occasions (see Dig 50.16), share with Dworkin the general hermeneutical assumption that the source of law is a text. Indeed all lawyers have to resort to the hermeneutical scheme when it comes to the interpretation of contracts and statutes. The point to be made, however, is that this is just one scheme of analysis amongst several. The second problem with the Dworkin approach is that it assumes that knowledge of law is knowledge of rules and principles (written or unwritten). Is this a satisfactory knowledge thesis? Can the hermeneutical analysis ever be the basis of an exclusive scientific analysis of method? Does not a science function at one and the same time at the level of a discourse (language and texts) and at the level of the facts themselves? Does not a science organise the facts? Law, of course, may not be a science in the natural, or hard, science sense; yet it does seem to construct its own facts, as the materials in this chapter will hopefully show. Now, when it comes to fact construction, two further points need to be stressed. First, as Berthelot concludes, if one had to abstract from all the various schemes one fundamental theme or dichotomy, it is perhaps that of the opposition between a ‘holistic’ and ‘atomistic’ analysis of social facts (Berthelot, pp 152–61). Does one view a series of facts as a ‘thing’ or event in itself, or only as a collection of individual and separate events? This kind of question has a long history in philosophy and epistemology (see below, p 128) and is beyond the scope of an obligations course. Yet the difference is crucial in legal analysis, as cases like Re Rowland (p 166) or Lazenby Garages v Wright (p 578) show. Secondly, the relationship between a ‘science’ and facts is an extremely complex one. Scientific theory does not have as its object actual facts, but what one leading philosopher of science has called virtual facts. That is to say, facts that are as much determined by the scientific model through which they are analysed as by any objective reality (Granger, La science et les sciences, 2nd edn, 1995, PUF, p 49). Thus, the object of science is not reality itself, but the schemes and models of science, and the effectiveness of such a model is determined by its ability at one and the same time to explain and predict (Granger, pp 70, 78–84). Law, as we have said, may not be a science in the natural science sense. But its history is not so different in many ways. This history is not a history of events as such; it is ‘above all a genealogy of “categories” which have successively made up the objects of a science’ (Granger, p 115; and see Bryant v Herbert, p 114). Legal method is thus not just about interpretation. It is equally about the construction and reconstruction of facts through the use of institutions (see Chapter 1), concepts and categories.
appears like a set of rules; yet… [t]he “rules” are…no more than renditions by later judges of patterns which they perceive as having emerged from discrete and particularistic judicial interventions… Common law “rules” having minimal prescriptive impact, the courts effectively make and unmake the law at will’ (Legrand, ‘European legal systems are not converging’ (1996) 45 ICLQ 52, pp 67–68). As legislation increasingly becomes the main source of English law, will this view of the common law have to change? Is Legrand saying that English law can be described by rules but does not consist of rules? 5 Professor Peter Birks has criticised Spring on the ground that two legal categories intersect. Defamation, which is an infringement of the reputation interest, intersects with negligence, which is a wrong based on a species of fault. According to Birks, this leads to a situation where a careless invasion of the reputation interest could give rise to two wrongs, namely defamation and negligence, when a rational system should see only one wrong. In order to give intellectual support to his criticism, he draws an analogy with zoology: ‘My canary is yellow and eats seeds. If all birds are seed-eaters, yellow, or others, my canary counts twice. Are there two birds or one? If there come to be two birds, the double-vision is due to the bent classification. There is only one bird’ ((1996) 26 UWAL Rev 1, p 6). Is this criticism based upon a sound epistemological (theory of knowledge) understanding of the role of taxonomy? Is there not an important difference between taxonomy schemes based on observable objects (plants, animals, rocks, etc) and schemes, like law, based on what Villa has called ‘atypical objects’, which cannot be observed without the aid of concepts and theoretical categories (La science du droit, 1990, Story/LGDJ, p 84)? Are not these concepts and theoretical categories part of the ‘science’ (that is, law) itself, thus making law the object of its own science? If so, is not the result as follows: that there is no rigour emanating from the object of science and that law is free to construct or deconstruct its own objects? Is this not what happened in Donoghue v Stevenson. Indeed, if Birks is right, could it
‘We think that the true rule of law is, that the person who for his own purposes brings on his lands and collects and keeps there anything likely to do mischief if it escapes, must keep it in at his peril, and, if he does not do so, is prima facie answerable for all the damage which is the natural consequence of its escape (Blackburn J in Rylands v Fletcher, below, p 000).
‘Politically conservative members of a former generation would doubtless find it unfamiliar that claims of civic or social right should nowadays be formulated in terms of the private law institution of property. But this merely goes to underline the fact that, in some important sense, all property rights enjoy an inherent public law character’ (Gray, ‘Equitable property’  CLP 157, p 211). Could one say that the reverse is equally true: all public law ‘expectations can be seen as forms of ‘property? And could
Notes and questions 1 Is the correlative of a right a duty? In other words, if D is under a duty to pay P £50, does this mean that P has a right to £50? Does a duty have the same history as a right? Did it develop out of the term ius? 2 If owners of vehicles for hire are under a duty to see that they are reasonably fit for their purpose, does this mean that consumers, as a class, have rights? 3 A road user owes a duty of care to other road users. What rights do road users have? Can they enforce any such rights easily? (b) Quasi-normative concepts
Legal concepts have been described as ‘knowledge instruments and instruments of expression of a knowledge’ whose main purpose is ‘to provoke the application of appropriate solutions’ and whose origin is both ‘institutional and doctrinal’ (Atias, Épistémologie juridique, 1985, PUF, pp 154–57). Now, a
With(i) Introductory note
, PUF, pp 15–18). One might also mention, alongside interests, notions such as ‘fault’ and ‘damage’ which are, in theory, merely descriptive. Having said that interest, fault and damage are in theory descriptive, in truth they often play a role that is at once descriptive and normative (Dubouchet, Sémiotique juridique, 1990, PUF, pp 144–45). Thus, to say that D has carelessly caused damage to P is to go far in implying that D ought to compensate P; in other words, the mere juxtaposition of the two descriptive concepts of ‘damage’ and ‘fault can endow them both with a quasi-normative
Interests and persons. Persons (personae) have interests and these are given expression as part of personality itself. Accordingly, children have their own interests which can be used to trump those of others (see, for example, CC, Art 388–2) and all humans might be said to have interests that are both subjective (reputation, dignity and the like: for example, CC, Art 16– 3) and objective (Airedale NHS v Bland  AC 789; In re S, p 281). Indeed, each person has his own mass of interests (CC, Arts 117, 232). What makes them particularly valuable as a legal notion is that interest can become a means of giving expression to a ‘person’ who has not as yet been endowed with physical or legal existence. Thus, one can talk of the interests of unborn children or even future generations (see p 32). One might observe, in this respect, how ‘best interests’ assumed a central mediating role, with a supposedly moral dimension, in the Tony Bland case (Airedale, above). The judges constructed a ‘virtual’ fact in turning the unconscious Bland into a non-persona (like an unborn child) whose best Interest’ then acted as the object of the legal decision (cf Py, La mort et le droit, 1997, PUF, pp 27–29). One can also use interest to give a class of persons such as the family (CC, Arts 220–1, 264–1), consumers, or more fragmented groups with an interest thus endowing them with a kind of legal personality (Jolowicz  CLJ 222). Legal (corporate) persons have ‘commercial interests’ which can act as the object of legal protection, although this may give rise to conflict with other interests, if not rights. 3 Public interest. Private interests are often contrasted with the general or the public interest. Thus imprévision in French contract law differs as between public and private law contracts since the courts must take account of the ‘general interest’ when deciding a problem of public law (CE 30.3.1916; D 1916.3.25). Often, cases can be made to turn on the conflict between public and private interests and when this happens, the notion of an interest becomes a means of giving expression to the community vis à vis the individual (see, for example, Miller v Jackson, above). Public interest can also be used to give expression to certain constitutional ‘rights’ or, indeed, as a reason for limiting such ‘rights’ (see, for example, Camelot plc v Centaur Communications Ltd  QB 124). 4 Property interests. Interest can also attach to the res. Thus, in English land law, ‘rights’ in land belonging to another are expressed in terms of interests and different kinds of losses can be analysed via different types of interest. For example, damages in English contract law are said to protect three different types of interest—expectation, reliance and restitution (Surrey CC v Bredero Homes Ltd, below, p 295). And in tort law, some argue that the whole objective of this category can be reduced to protecting interests of one kind or another (see, for example, Cane, Tort Law and Economic Interests, 2nd edn, 1996, OUP). Interest can be seen as the empirical foundation of a ‘right’ and, although it cannot obviously be synonymous with such a normative concept, interest is often used as
the basis for granting a remedy and thus erecting a right (Samuel and Rinkes, Law of Obligations and Legal Remedies, 1996, Cavendish Publishing, pp 66–68, 83–90). In contrast, the distinction between (legitimate) interest and right lies at the heart of the civilian principle of an abuse of a right. Animals, it seems, also have interests (Animals (Scientific Procedures) Act 1986, s5(3)(c)). 5 Actions and interests. The notion of an ‘interest is also important in the law
A bottle of orange juice explodes just as a customer in a supermarket is lifting it out of his trolley at the cash desk. The customer is uninjured, but his clothes are covered in orange juice. Do you think that the customer has suffered any damage, over and above the cost of cleaning the clothes? 8 What is the focal point of an action for private nuisance: the persona or the res? 9 A firm of solicitors specialising in defamation is hired by D to threaten one of D’s employees who has complained to the police about D sexually harassing her. The solicitors send a number of letters to the employee stating that the employee’s complaint to the police amounts to defamation and that unless she withdraws her complaint and apologises to D she will be sued for ‘six figure damages’. The employee suffers severe mental anxiety as a result of these solicitors’ letters. Can the employee sue the solicitors and/or D for damages (a) at common law; or (b) under the 1997 Act? Would your answer be different if the solicitors were aware that previous employees had tried to complain about being sexually harassed by D? 10 Can a group of employees harass their employer for better working conditions and/or higher wages? (v) Interests and damage
common mistake’ (Lord Westbury in Cooper v Phibbs (1867) LR 2 HL 149, p 170). What is meant by ‘private right’? Is this not a question of law? 3 P is able to prove that, but for D’s negligent failure to diagnose the correct medical condition, he would have had a 25% chance of recovery. In losing this 25% has P lost something that can be classified as damage? Is this a question of fact or law? (Cf McGhee v NCB  1 WLR 1; Wilsher v Essex AHA  AC 1074.) 4 ‘ZThe distinction [between mistake of fact and mistake of law]…does not turn upon the fact that the person making the payment could not have discovered the true state of affairs about the law any more than about the facts. It turns upon the purely abstract proposition that in principle (and leaving aside the problem of Schrödinger’s cat) the truth or falsity of any proposition of existing fact could have been ascertained at the time, whereas the law, as it was subsequently declared to have been, could not
find for the plaintiff or the defendant? Could it not be argued that where there is an equal balance of probabilities the risk should be on the defendant rather than the plaintiff? (Cf McGhee v NCB  1 WLR 1.) 4 If Mrs Ward had been injured by an exploding bottle of lemonade in the supermarket, could she have sued them in contract? If not, why not? 5 The relevant events took place in the course of a few seconds; all or some of them were seen by 12 different witnesses…and, as is inevitable when honest witnesses give their recollections of what occurred in a very brief space of time there were wide divergences in their respective accounts. In such a case an appellate court will not lightly disturb the findings of the trial judge as to what in fact occurred’ (Diplock LJ in Wooldridge v Sumner  2 QB 43, p 60). Is the court under a duty to attempt to establish the truth? If not, what is its duty with respect to the facts? 6 Does Ward v Tesco indicate that facts are much more important than law in the law of obligations? (c) Legal categorisation of the facts
Financings Ltd v Stimson  1 WLR 1184 Court of Appeal (See p 492.) Notes and questions 1 Would you classify the facts of this case as falling within the chapter on the formation of a contract or within a chapter dealing with rescission for mistake? 2 ‘Either there is a situation of isomorphy (lex clara est), that is, correspondence between the norm and the case, or else there is a situation of doubt which calls for interpretation in the strict sense; in this case directives of interpretation are needed, and the choice among them implies further evaluations’ (Bengoetxea, The Legal Reasoning of the European Court of Justice, 1993, OUP, p 130). Was there any doubt as to the rule applicable in Stimson? What about Fisher v Bell (above, p 24)? (d) Role of quasi-normative concepts
Questions 1 Is Bingham LJ adopting a similar reasoning approach to that adopted by Lord Denning in Re Rowland? 2 What justifies Bingham LJ’s move from ‘expectation’ to ‘right? What
One of the purposes of the foundational subjects is to develop ‘the intellectual and practical skills needed to research the law on specific matters and to analyse both statute and case law, to apply it to the solution of legal problems and to communicate…the results of such work’ (joint announcement issued by Law
The disadvantage of this otherwise rich Anglo-American tradition is that the actual (as opposed to the ideal) techniques employed in legal reasoning both today and yesterday have not, perhaps, been investigated in the depth they deserve. Or, put another way, techniques such as induction, deduction, syllogistic logic and analogy have perhaps been accepted at face value without proper investigation by the lawyers into the viability of transferring these scientific methods into law. There are, let it be said at once, honourable exceptions to this lack of literature. Yet often these exceptions have not been able to be incorporated directly into a foundational or other positive law subject. This is a serious omission, because the reasoning techniques employed by judges are as much a part of the ultimate solution as any legal precedent or statutory text. It has already been seen how judges can use quasinormative concepts such as ‘interest’ or ‘expectation to move from a
Questions 1 Lord Diplock suggests that, in form, legal method is a matter of induction and deduction, but that in substance, there is much room for choice. Is this space for choice something inherent in induction and deduction itself, or is it something special to legal reasoning? 2 Does Sherlock Holmes reason by induction or deduction? 3 If choice is to be determined by the making of a policy decision, does this in effect mean that all legal reasoning is, in the final analysis, a matter of policy? What do you think is meant by policy in this context? Notes 1 There is no science without method and, so it may be argued, there is no reliable method without science. Science and methodology are locked in a close embrace. Now, with respect to scientific research, method is usually presented via models which constitute at one and the same time both the particular science and its method. One can discover reliable new knowledge only by conforming to set procedures and these procedures relate in turn to a model which itself forms part of a scientific theory. Two stages are normally envisaged: induction and verification. That is to say, since Galileo, the scientist proposes a hypothesis and then subjects it to experimental proof (Bunge, Épistémologie, 1983, Maloine, p 31). If the hypothesis is confirmed, one can move towards a third stage: the hypothesis is translated into a scientific law and finally to an axiom from which one can then deduce knowledge. Induction, verification and deduction are, then, the methods commonly associated with all aspects of science (of course the position is, in truth, much more complex than this). 2 However, when one talks about methodology in the context of legal research, can it be reduced to induction, verification and deduction? Is there a single scientific method applicable to all sciences, including the social sciences? In a very general sense, induction is a word which gives expression to all reasoning which generalises. Aristotle defined it in his Topics as the passage from the particular to the general. However, induction is not a reliable form of reasoning in that general principles, laws or theories induced by observation of facts might ultimately prove to be mistaken. Indeed, in the area of politics it can be dangerous (for example, it can lead to discrimination on the basis of inaccurate inductions). With regard to law, induction as a methodological tool has a long history stretching back to Roman law. For example, the movement from a law of contracts to a law of contract could be seen in terms of induction; ‘agreement, originally
edition of Goff and Jones, Law of Restitution, 1966, Sweet & Maxwell, can be seen as a good example of induction as a research tool. The authors argued for a reinterpretation of a diverse range of common law and equity cases in terms of the unjust enrichment principle; in other words, this principle could be induced out of the English cases so as to act as a law capable of explaining and predicting. 3 Deduction is often seen as the reverse of induction: that is to say, it is a reasoning process by which one goes from the general to the particular. More precisely, deduction can be described as saying that certain pieces of knowledge being considered as acquired, other knowledge can be inferred as a consequence. Thus if A=B and B=C, then it can be deduced that A=C What is so valuable about deduction as a knowledge technique is that information can be acquired without recourse to empirical investigation, experience or any other exterior source (Oléron, Le raisonnement, 4th edn, 1995, PUF, pp 73–74). Thus, someone who lives far away from the UK and knows that cotton requires hot and dry conditions to grow can deduce whether or not cotton grows naturally in the UK. All that is needed is information on UK weather conditions. In law, the deductive method finds expression through the use of the syllogism (see below, p 183).
conclusion and without having operated a choice between two possible conclusions… The influence of dialectics on legal reasoning does not exclude, then, all intervention of formal logic. This implies a certain comprehensiveness to legal reasoning which gives it its specific character …’ (Bergel, Theorie generale du droit, 3rd edn, 1999, Dalloz, p 276). Is the specific character of legal reasoning simply the intermixing of the dialectical scheme of intelligibility with a structural (logical) scheme (cf above, pp 169–77)? Notes 1 It has long been thought that deduction was reducible to the syllogism. In its classical form (Aristotle, as developed by the medieval philosophers) the typical example is a structure of three parts: (a) all men are mortal; (b) Socrates is a man; (c) therefore, Socrates is mortal. The syllogism is thus composed of three propositions: (a) the major premise; (b) the minor premise; and (c) the conclusion. What makes this seemingly banal example so important is that the structure is entirely abstract and formal. The elements ‘man’, ‘mortal and ‘Socrates’ can be
has reached a certain level of sophistication. A Roman jurist was able to deduce that one does not lose possession of money one has buried in a place now forgotten: for otherwise one would lose possession of slaves when they wandered out of sight (Dig 41.2.44 pr). Such thinking requires a ‘structure’ whereby both slave and money are conceptualised as a res, thus allowing the structure persona-res to be applied to both situations (see Samuel and Rinkes, Law of Obligations and Legal Remedies, 1996, Cavendish Publishing, pp 4–6). The more that one wants to rely upon the deductive method, the more it has to be accompanied by systematisation of law into ever ‘harder’ models (see Wieacker, A History of Private Law in Europe, 1995, OUP (trans Weir), pp 239–56, 341–6). As Pédamon has summarised it: the ‘transposition, in the legal domain, to a mode of reasoning which was essentially deductive, applied in a rigorous manner and independently of all consideration drawn from experience or from social life could be labelled mos geometricus; it had important consequences for legal method’ in that it ‘orientated German legal science towards a kind of “conceptual hardening” (Holleaux) which foreshadowed the work of the Pandectic school and which still characterises today, at least in some respects, the German legal spirit’ (Le droit allemand, 1985, PUF, pp 15–16). The BGB was the final result of this modelisation.
Notes and questions 1 The syllogism is reliable only in certain situations. Because natural language is a system in itself, there are a number of dangers when it is used to give expression to other knowledge systems: (a) a mouse eats cheese; (b) a mouse is a word of one syllable; (c) therefore, words of one syllable eat cheese. In particular, the words employed must keep their same signification in the major and minor premises. If they do not, then the conclusion can be absurd, as the example indicates. Also care must be taken not to confuse genus and species: (a) cats eat meat; (b) cats are animals; (c) therefore, animals eat meat. This conclusion might not be quite as absurd as words eating cheese, but it is equally wrong, in as much as it does not accord with reality. Not all animals eat meat. In addition, there is the problem of the missing premise (tertium non datur): (a) smoking causes lung cancer; (b) Socrates died of lung cancer; (c) therefore, Socrates was a smoker. The missing premise is that lung cancer has other causes as well as smoking. 2 Harbour Assurance shows how the syllogism can prove particularly weak in law in as much as the structure or model is subject to little external restraint and thus proves a ‘movable goal post’. Intellectual systems can, in short, contain uncertainties and ambiguities. Does Harbour Assurance indicate that logic is simply a form of argumentation? Or does it indicate that legal reasoning should never be seen as a matter of logic as such, but a matter of what premise is to be adopted?
of their own’ (Lord Simonds, Read v J Lyons and Co  AC 156, p 182). Is liability for a dangerous animal in France based on a general principle? If so, why should this principle not be relevant to English law? 4 ‘[T]he law should if possible be founded on comprehensive principles: compartmentalisation, particularly if producing anomaly, leads to the injustice of different results in fundamentally analogous circumstances’ (Lord Simon, National Carriers Ltd v Panalpina (Northern) Ltd  AC 675, p 701). Does this statement undermine Hoffmann LJ’s approach? Does it conflict with the view of Lord Simonds in Read v Lyons (above)? Does compartmentalisation always lead to injustice? What determines if something is ‘fundamentally analogous? Is electricity fundamentally
Questions 1 If Lord Denning finds parasitic damages so offensive, why does he allow the plaintiff in Jackson v Horizon Holidays (below, p 220) to recover them? 2 Is this reasoning through painting a picture? 3 Is Lord Denning proposing a reason or putting forward an argument? 4 Read MG Duncan, In slime and darkness (1994) 68 Tulane LR 725. Are
‘There are several good things in life, such as liberty, bodily integrity, land, possessions, reputation, wealth, privacy, dignity, perhaps even life itself. Lawyers call these goods “interests”. These interests are all good, but they are not all equally good. This is evident when they come into conflict (one may jettison cargo to save passengers, but not vice versa, and one may detain a thing, but not a person, as security for a debt). Because these interests are not equally good, the protection afforded to them by the law is not equal: the law protects the better interests better. Accordingly, the better the interest invaded, the more readily does the law give compensation for that harm. In other words, whether you get the money you claim depends on what you are claiming it for. It would be surprising if it were otherwise’ (Weir, A Casebook on Tort, 7th edn, 1992, Sweet & Maxwell, pp 4–5). Does English law protect bodily integrity better than it protects reputation? Is it easier for an employer to obtain compensation for financial loss caused by a uncaring workers going on strike than it is for a worker to obtain compensation for personal injury caused by an uncaring employer? 3 Compare Blackpool and Fylde (p 436) with X (Minors) (p 727). If the results of these two cases are compared in terms of values, does it mean that the law gives greater protection to commercial interests than to the interests of children? 4 Do s2(1) of the Unfair Contract Terms Act 1977, and s5(1) of the Consumer Protection Act 1987 reflect values? (l) Appeal to policy
help to the law student? Is freedom of the press not the highest possible public interest? 4 What is meant by ‘justice’ in Lord Diplock’s and Lord Reid’s comment? What does Lord Denning mean by ‘commercial justice’? What is the relationship between justice and commercial justice? In White v Jones (p 702), Lord Goff talks of ‘practical justice’: is this something different from justice and commercial justice? 5 Can you reconcile the approach of Browne-Wilkinson VC in Christie with that of Lord Denning in Parsons? Is the approach of Browne-Wilkinson VC ubi remedium ibi jus? 6 Can you list the various different types of arguments and reasons set out in this sub-section on practical reasoning? How do they relate to each other and to the other methodologies set out in this chapter? 7 Is there a difference between reasoning, argumentation and justification? How would you classify the various statements in this section on legal reasoning? 8 ‘[A] theory dealing with human facts is constantly menanced, if one is not careful, with becoming an ideology, substituting myths for concepts and prescriptions for descriptions’ (Granger, La science et les sciences, 1995, PUF, p 99). Discuss in relation to the judicial statements set out in this chapter. Is Dworkin’s chain novel thesis in danger of reducing legal method to a ‘mythical’, rather than ‘scientific’, process? INTERPRETATION OF TEXTS
Questions 1 What prevented the plaintiff from recovering: (a) the small amount of water; (b) the wording of the policy; or (c) the visual imagination of the judges? 2 Would the result have been different if (a) the whole of the plaintiffs ground floor or (b) the whole of the neighbourhood had been submerged under three inches of water? What if the three inches of water had been caused by excessive rainfall? 3 What if the claimant had taken out his household policy on the basis of a television advertising campaign which stated that the insurance company ‘did not make a drama out of a crisis’: do you think the claimant would have a contractual expectation to be indemnified given the damage he suffered? 4 Imagine that the claimant had said to his partner on seeing the water: ‘the bathroom is flooded’. Would this have been a false description? If not, why, then, was the contra proferentem rule not applied? 5 An elephant is difficult to define but easy to recognise. Does this suggest that knowledge cannot be completely reduced to linguistic propositions? Did the judges stand back and paint a picture (cf above, p 188)?
1 INTRODUCTION One of the themes to have emerged from the previous chapters is the tension between rights and remedies. According to one judge, it is the entitlement to a remedy that defines the existence of rights, whereas, according to another judge, the idea of a legal right has now liberated itself from the law of actions.
What kind of damage did Southport Corporation suffer: physical damage or economic loss? 5 Read Benjamin v Storr (1874) LR 9 CP 400 in the law report. Why did Devlin J not draw an analogy with this case rather than with the traffic accident cases? 6 Did Esso have control of the tanker? Under what circumstances should control, of itself, give rise to liability on the part of the person in control when the thing controlled does damage? Should something more than control itself be required before one can attribute liability? (Cf Chapter 7.) 7 Do Esso and Cambridge Water (see p 665), when taken together, reject, as a matter of common law, the principle that it is the polluter who should pay?
In both Vigers and Mahadeva, it could be said that the consumer received something from the supplier. Ought they to pay for this something? If the houseowner in Mahadeva had brought another firm in to get the heating working for a price of £100 (1972 prices), would it be just and equitable that the owner could obtain a heating system so cheaply? Had he unjustly enriched himself at the expense of the first heating firm? What if the firm had been a cowboy firm of builders: can one unjustly enrich oneself at the expense of a cowboy firm of builders? 4 In Mahadeva, the refusal to pay was a particularly effective remedy. But what if the heating engineers had not only installed a bad system, but also had caused extensive damage to the owner’s house? In this situation, the owner would have had to sue for damages for breach of contract and such a remedy covers only the actual loss suffered by the plaintiff. Would the court, then, have set off the cost of the pipes, radiators, etc, against the loss suffered by the owner? 5 What if this case had come before the courts in the days when there were still juries in civil cases and the jury had decided that the heating engineers had substantially performed the contract: could the Court of Appeal have reversed their finding?
Notes and questions 1 The two causes of action, namely, that for debt or money due under the contract and that for damages for breach of contract, are quite different…’ (Davies LJ in Overstone Ltd v Shipway  1 WLR 117, p 129). Does this mean that if the plaintiff in White & Carter had lost his debt claim he could, at a later date, have brought a quite separate damages action? 2 Might it be an abuse of a right to sue in debt rather than damages? Does equity have a doctrine of abuse of rights? Does the common law? What about EU law? 3 What is meant by legitimate interest’ in this context?
Questions 1 What interest does an action in debt protect? Is this an interest that is always protected by an action in damages? What must the plaintiff show in order to succeed in protecting this interest via damages? 2 What was the cause of the plaintiffs’ loss? 3 Is Damon still good authority after Ruxley Electronics v Forsyth (below, p 301)? (c) Non-contractual debt
Questions 1 Is mutuality a general principle of the law of contract itself? 2 Could Mrs Beswick have been in breach of contract vis à vis the nephew? What effect would any breach have had on the nephew’s obligation to pay the annuity? Was there mutuality between Mrs Beswick and the nephew? 3 Contracts for the sale of an interest in land had to be in writing (Law of Property Act 1925, s 40, now replaced by the Law of Property (Miscellaneous Provisions) Act 1989, s 2). Why was it, then, that equity was prepared to enforce the oral agreement in Price v Strange?
Questions 1 Is Redgrave authority for the proposition that contributory negligence is never a defence against fraudulent misrepresentation? Is it a defence against negligent misrepresentation? 2 What if the defendant had not actually counterclaimed for rescission? Could the court have refused the plaintiffs action for specific performance on the basis that the contract was voidable at the defendant’s option (that is, without going to court)?
Is this case still a good precedent? (Cf Camelot Group plc v Centaur Communications Ltd  QB 124.) 4 Do these judgments conflict with the observations of Hoffmann LJ in the Central Television case (p 129)? 5 Ought one to be concerned about the English judiciary’s willingness or ability to protect human rights? 6 In refusing to disclose his source, is it actually true to say that the journalist was disobeying the law? If it transpired that he had the right not to disclose, is it not true to say that it was the judges who were in contempt of the law? 7 Was the plaintiff a ‘private citizen? Did it have the right to vote?
Questions 1 Did the plaintiffs (who were claiming the price of the swimming pool) substantially perform the contract? If they did, how could they be liable up to the whole cost of the pool? If they did not, why should the defendants have to pay for the pool? 2 If the plaintiffs were in breach of contract, why did the defendant not receive damages to put him in the position he would have been in had the contract been performed? Are the House of Lords saying that the trial judge did in fact compensate his expectation interest? Why do you think a majority of the Court of Appeal came to a different conclusion on this point? Ought damage to attach to the res (swimming pool) rather than to the persona (Mr Forsyth’s mental well being) in contract cases? 3 Read The Liddesdale  AC 190 in the law report. Has this case now been overruled by Ruxley? 4 Should the trial judge ever have been entitled in a contract case where the contract specified certain measurements to come to the conclusion that the swimming pool was reasonable? 5 Does Ruxley discriminate against the consumer? What if the defendant had been a commercial organisation or a local authority? 6 Read the French case of Cass civ 17.1.1984 to be found in Rudden, A Sourcebook on French Law, 3rd edn, 1991, OUP, p 501. Should Mr Forsyth have been entitled to the same kind of remedy? Why could he not have claimed specific performance? 7 Is there now a principle that contracts must be enforced in a reasonable way? 8 Is Ruxley a proportionality case? 9 PECL, Art 6:108 states: ‘If the contract does not specify the quality, a party must tender performance of at least average quality.’ Might it be said that the House of Lords was applying, indirectly (via the law of damages), the second limb of this article? But what about the first half: did not the swimming pool contract specify the quality? Does this mean that, in the common law, contractual rights are completely divorced from remedial rights? 10 Whose interests were being protected in this breach of contract case? (c) Tortious liability and damages
also a further general principle, that, when one is removed from the world of pecuniary loss and is attempting to measure damages for non-pecuniary loss, an element in reasonableness is the fairness of the compensation to be awarded. There must be moderation; some attention must be paid to the rights of the offending defendant as well as to the rights of the injured plaintiff…’ (Scarman LJ in Bone v Scale  1 WLR 797, p 805). What amount should be awarded to a person who has to put up with unpleasant smells from a neighbour’s pig farm? (Cf Hunter v Canary Wharf, below.)
‘I thought and still think that that is highly anomalous. It is confusing the function of the civil law which is to compensate with the function of the criminal law which is to inflict deterrent and punitive penalties… [But the] right to give punitive damages in certain cases is so firmly embedded in our law that only Parliament can remove it… Local government is as much government as national government, and the police and many other persons are exercising governmental functions…’ (Lord Reid in Cassell and Co Ltd v Broome  AC 1027, pp 1086, 1087, 1088). Do exemplary damages compensate the plaintiff or do they simply give the plaintiff a windfall? Is Parliament intending to abolish exemplary damages? Can a defendant insure against liability for exemplary damages? (Cf draft Damages Bill 1997.) 3 ‘Exemplary damages are anomalous. Indeed, it is difficult to find any satisfactory basis for allowing such damages against a small local authority and refusing them against a powerful international company. But the anomaly exists and governmental bodies, including local authorities, are treated as being in a special category. I do not find it possible to accept the suggestion that when the applicant was being interviewed the committee were carrying out some private function of the council… Cases where exemplary damages are justified will be rare, probably very rare. Before awarding such damages the court or tribunal will need to consider whether the conduct which is criticised falls within one of the special categories… It will also have to consider whether the award of compensatory damages, including aggravated damages, is not by itself sufficient to punish the defendant…’ (Neill LJ in Bradford City Council v Arora  2 QB 507, pp 518, 519). Are public bodies not in a different position from the private body? Do not organs of the State have a special duty to conform to the law? 4 Exemplary damages cannot be awarded in contract: Addis v Gramophone Co Ltd  AC 488. Why not? (But cf Mahmud v BCCI, below, p 322.) 5 Can punitive (exemplary) damages be awarded in negligence and/or trespass cases?
compensation for loss of earning power in the future…’ (Lord Goddard in British Transport Commission v Gourley  AC 185, p 206). To what extent is general damage compensation for mental injury? 2 ‘[R]ecent cases show the desirability of three things: First, assessability: In cases of grave injury…the award must basically be a conventional figure, derived from experience or from awards in comparable cases. Secondly, uniformity… Thirdly, predictability…’ (Lord Denning MR in Ward v James  1 QB 273, pp 299–300). Why have these three principles been ignored for so long in defamation cases? 3 Would it be cheaper, fairer and more efficient if liability for serious personal injury was placed on a no-fault basis? Does it depend upon the source of the personal injury (traffic, industrial and/or medical accidents, for example)? What about accidents in the home? What view do civil law systems take? (Cf Zweigert and Kötz, An Introduction to Comparative Law, 3rd edn, 1998, OUP (trans Weir), pp 646–84.) 4 Let us assume that law is a science and that the law of damages is a scientific rationalisation of a particular phenomenon. What is the phenomenon? Is it the actual injury suffered by a plaintiff, or is it some mathematical figure set by the Court of Appeal? If the latter, does this not mean that law is the object (that is, the phenomenon) of its own science? (f) Fraud
purposes. It is an action against him because he has had the benefit of the goods. It resembles, therefore, an action for restitution, rather than an action of tort’ (Denning LJ in Strand Electric and Engineering Ltd v Brisford Entertainments Ltd  2 QB 246, pp 254–55). Given that damages are designed to compensate for loss, would it not be better to see an action for a hiring charge, or sometimes an action for damages in trespass, as a claim in debt? 3 ‘[W]hat was in effect held in [the Strand Electric] case was that, in the case of conversion of a profit earning chattel which a defendant has used for his own benefit, the owner can recover by way of damages a hire charge plus either the return of the chattel or, if there has been a subsequent conversion by disposal, the value of the chattel at the date of such conversion… Although damages for conversion normally consist in the value of the goods at the date of conversion, consequential damages are always recoverable if not too remote… What the plaintiffs have lost is the use of the car over the whole period from the original conversion until ultimate return’ (Parker J in Hillesden Securities v Ryjack  1 WLR 959, p 963). Why should owners of profit earning chattels be treated more favourably by the law of damages than owners of non-profit earning chattels? Is it the role of the law of tort to protect expectation interests? 4 ‘In the field of tort, there are areas where the law is different and the plaintiff can recover in respect of the defendant’s gain. Thus, in the field of trespass it is well established that if one person has, without leave of another, been using that other’s land for his own purposes he ought to pay for such user… So, in a case of detinue the defendant was ordered to pay a hire for chattels he had detained: Strand Electric and Engineering Co Ltd v Brisford Entertainments Ltd…’ (Dillon LJ in Surrey CC v Bredero Homes Ltd  1 WLR 1361, p 1365). Should tort continue to play this unjust enrichment role now that there appears to be an independent category of restitution? (Cf Chapter 8.) (h) Loss of a chance
‘In cases like Hadley v Baxendale or the present case, it is not enough that in fact the plaintiffs loss was directly caused by the defendant’s breach of contract. It clearly was so caused in both. The crucial question is whether …the loss…should have been within his contemplation. The modern rule in tort is quite different and it imposes a much wider liability. The defendant will be liable for any type of damage which is reasonably foreseeable as liable to happen even in the most unusual case…’ (Lord Reid in The Heron II  1 AC 350, p 385). Is Lord Reid accurate; do not most contractors suffering direct damage get compensated? 3 If the vendor could contemplate the illness of the pigs, why not the farmer? If the farmer should have contemplated the illness of the pigs from mouldy nuts, could it not be said that, by continuing to use the nuts after noticing mould, he caused their death? Why could the seller of the hopper not have pleaded contributory negligence? It is these questions that make Parsons v Uttley Ingham an interesting (although by no means leading) case. The facts raise a paradox: if the defendant argues that they could not foresee or contemplate the illness and/or death of the pigs, then they cannot argue that the farmer should have foreseen or contemplated the illness or deaths. Equally, if the farmer claims that the sellers of the hopper should have contemplated the illness or death, then the farmer is leaving himself open to the accusation that he, also, should have contemplated the possibility. This is why it was better to try to argue that the loss was ‘directly and naturally resulting…from the breach of warranty’ (Sale of Goods Act 1979, s 53(2)). 4 If the court had insisted that, before the seller of the hopper could be liable, he must be found to have contemplated the possibility of the death of the pigs from E coli, would the result of the Parsons case have had to be different? Why did the court not insist on this? Does the approach taken in Parsons differ from the approach taken in Jolley v Sutton LBC (p 626)? 5 How much should the farmer in Parsons get for his dead pigs? Should he get (a) the cost of replacing the pigs; (b) the cost of replacing the pigs plus compensation for the trouble and mental distress at seeing, and clearing up, the dead animals; (c) the sale value of the pigs; (d) the sale value plus compensation for mental distress, etc? Does the distinction between damnum emergens and lucrum cessans have any meaning in the Parsons case? 6 What if a neighbouring farmer had borrowed (mouldy) nuts from the hopper: should he be able to sue either the vendor or buyer of the hopper? How much should the neighbouring farmer get if successful?
might be barred (although statute prevents this rule applying in respect of motor vehicles) (Morris v Murray  2 QB 6). A moment’s thought will reveal just how important consent is to the law of tort and, of course, it is an idea that is reflected in contractual exclusion and limitation clauses (see, for example, Photo Productions v Securicor, p 552). At what level does consent function in contract and tort: at the level of actionability, causation or damages? Can a dead person ever be deemed to consent?
The question has to be considered from the point of view of a businessman’ (Pearson LJ in Darbishire v Warran  1 WLR 1067, pp 1075, 1076). If the plaintiff is not entitled to rebuild a much loved chattel at the full expense of the wrongdoer, is the plaintiff entitled to damages for mental distress instead? If the tort of conversion distinguishes between profit earning and non-profit earning chattels, why cannot other torts distinguish between economic and non-economic chattels? 3 Is Rougier J appealing to values, or is it a form of practical reasoning? 4 Is Ruxley Electronics v Forsyth (see p 301) a mitigation case?
Why was the Act not applied to the facts of Parsons v Uttley Ingham (above, p 342)? 4 Should the Act be applicable to a plaintiff who is suing in debt? 5 To what extent should: (a) smoking; (b) drinking; (c) eating too much butter be treated as contributory negligence? 6 What about a plaintiff who is injured while indulging in unlawful behaviour? (Cf p 224.) (j) Damages in equity
If the court in Cantor had been prepared to utilise a public law remedy to enforce a private law restitution claim, would it logically follow that the court in Butler ought to have been prepared to use a private law remedy to support the public law debt claim? 4 Ought a court to have power to award damages or restitution in judicial review actions? ACTIONS IN REM
1 INTRODUCTION The law of contract has acted as the paradigm obligation in the civil law systems since the development of the law of obligations itself (see above, pp 63–65). Even in the modern codes, delict (tort) and restitution can still seem an
orientation and Lord Diplock’s comment might be said to be one starting point. Senior judges are now talking less and less in terms of a twofold division of contract and tort, and more in terms of a law of obligations, and doctrine is adopting the same attitude. This reorientation is partly the result of the increasing acceptance of restitution as an independent third category and, possibly, partly the result of a growing influence of Europe on the English legal mind. Nevertheless, the transplanting of a law of obligations category does not come without considerable conceptual problems. 2 Real and personal rights. In civilian legal thought, the law of obligations is part of a highly systematic structure of legal rights which rigidly distinguishes rights in rem from rights in personam (see the Roman jurist Paul, above). The law of obligations acts as the basis for all personal rights and thus, as a category, stands in contrast to the law of property; or, put another way, owing is kept quite distinct from owning. Such rigid systematics are inapplicable to the common law, since not only is much of the law of property to be found in contract and tort (see, for example, Torts (Interference with Goods) Act 1977), but the law of restitution is a mixture of personal and proprietary claims (see, for example, pp 794–819). A law of obligations, for the foreseeable future, can never have the same meaning for a common lawyer as it does for a continental jurist. 3 General principles of liability. Another characteristic of the continental codes is that liability in the law of obligations is expressed through general principles (and see, now, PECL and UNIDROIT). Of course, an important distinction is made between contractual and non-contractual liability. However, the notion of liability itself, that is to say, non-performance of an obligation, tends to be viewed as an abstract notion founded not only upon specific contract or delict rules but also upon general ideas, as we shall see, such as fault and impossibility of performance (see, for example, PECL, Art 8:101). In the common law, it is often much harder to isolate such general principles, since the basis of civil liability has grown up around different types of forms of action and different species of remedy. Certainly, there are generalities, as we have seen in Chapter 3, with respect to the remedy of damages (for example, mitigation) and fault itself is now more or less a general principle of liability (Donoghue v Stevenson, p 65; Supply of Goods and Services Act 1982, s 13). But the forms (causes) of action can still exert an influence, with the result that it remains difficult to talk about liability in terms of general obligations. Thus, Act of God, breach of contract, breach of duty of care, frustration, self-induced frustration, contributory negligence, mitigation, novus actus interveniens, remoteness and so on tend to be approached as discrete rule areas. Put another way, there is little symmetry in English civil liability (cf PECL, Art 8:108).
Nature of an obligation. A further difficulty with regard to an English law of obligations is that common lawyers have never worked with any notion of an obligation as a general legal bond (vinculum iuris). Certainly, they developed a general contractual duty (obligation) based on skill and care (The Moorcock, p 512; Supply of Goods and Services Act 1982, s 13) and it could be said that they even extended this general duty to non-contractual situations in most cases of physical injury (Donoghue v Stevenson, p 65) and some cases of pure economic loss when the relationship was close to contract (Hedley Byrne and Co v Heller, p 470; White v Jones, p 702). But, outside of negligence, it is almost impossible to conceive of any general pre-existing obligation, since strict liability is very much an exception, save perhaps in the area of supply of goods (Frost v Aylesbury Dairy, p 47). Strict liability is governed by discrete causes of action or statutes. Indeed, it has been specifically stated that the tort of trespass to the person cannot be envisaged in terms of a pre-existing duty (Stubbings v Webb  AC 498, p 508) and there is certainly no general obligational liability in respect either of individual acts or of damage done by things under the control of another (Read v J Lyons and Co, p 662). One problem with this lack of any obligational principle outside of negligence is that strict liability causes of action are being re-interpreted in terms of fault (Cambridge Water Co v Eastern Leather, p 665) and this rounding down towards negligence in the common law is probably against the general flow of obligational liability in continental legal thought (see, for example, Brasserie du Pêcheur v Germany  QB 404; Zweigert and Kötz, An Introduction to Comparative Law, 3rd edn, 1998, OUP, p 684). 5 Methodology. The idea of a vinculum iuris is, then, not easy to find in the common law. Now the absence of any abstract notion of a vinculum iuris is due not just to the lack of a Roman legal scholarship tradition in English legal history: it also results from a methodological approach which is somewhat different from that to be found on the continent. The styles of legal reasoning in the common law and in the civil law are, for some, evidence of contrasting mentalities which, in turn, reflect quite different understandings of what it is to have legal knowledge (Legrand (1996) 45 ICLQ 52). This view is not shared by all comparatists (see, for example, Bell (1995) 48 CLP 63). However, for the obligations lawyer there is, arguably, sufficient difference of style to raise a serious question about transplanting continental ideas about obligations on to the common law of civil liability. English lawyers simply do not reason at the abstract level of the codes where form and symmetry help shape the institutional structures. Indeed, for the English lawyer, arguments based upon formal consistency are apt to mislead (Read v J Lyons and Co  AC 156, p 175, above, p 662) and thus, legal reasoning is geared towards the search for the pragmatic solution. It is a question of proceeding one step at a time (Miliangos v George Frank, p 10) via analogy and metaphor rather than
logical consistency and conceptual dialectic. Ex facto ius oritur. None of this is to retreat from saying that English contract law must now be studied in the context of Europe; it is simply to issue a warning against simplistic harmonisation arguments. TYPES OF CONTRACT (a) Bilateral contracts
Notes 1 The piece of text from the Corpus Iuris might at first sight seem mundane, but it is the foundation for the modern civil law of contractual liability (about which there is still debate: see, for example, Savaux  RTD civ 1). It establishes that the starting point for such liability is fault and it shows how, at the level of liability, there is a close relationship between contractual and delictual (tortious) actions (see Treitel, Remedies for Breach of Contract, 1988, OUP, p 8). The Roman foundation is particularly evident in German law (BGB § 276), but it is implied by most of the other codes as well. This does not mean that contractual liability cannot be strict (that is, without fault); indeed, the Roman text itself indicates that this is possible. However, in the absence of agreement about the level of liability, fault will be the starting point. Or, put another way, when it comes to analysing facts in order to determine liability, one searches for individual fault linked to the damage via causation (the methodology applicable in the Roman law of tort: see Dig 184.108.40.206). That said, there has in the French model been a retreat from fault in as much as the codes (CC and PECL) themselves suggest that the onus of disproving fault is on the non-performing party. However, the position is more complex, in as much as the fault or strict liability dichotomy depends upon the nature of the obligation broken (see below, p 392, note 1). 2 When one turns to English law, the position is said to be different. Liability depends upon breach of promise rather than on the nature of the defendant’s behaviour (Treitel, above, pp 8–9). In practice, however, the role of fault is of equal importance, as the materials which follow (and later chapters) should indicate.
particularly evident in the 1982 Act extracted above: if goods are not of satisfactory quality then the bailor will be liable even if he himself was in no way to blame. The seller of goods incurs a similar liability (Sale of Goods Act 1979, s 14). This strict liability is justified on economic and social grounds in Hyman v Nye, but it still leaves open the question as to why, particularly in a consumer society, services are treated differently. Ought one to start off from the assumption that an action for breach of contract is based upon fault? Should contributory negligence be a defence? Does the Sale of Goods Act (see p 514) (and the Supply of Goods and Services Act) recognise contributory negligence as a defence? 2 One reason for the difference between goods and services is to be found in the wording and institutional structure of the statutory provisions. Section 9 of the Supply of Goods and Services Act 1982, like s 14 of the Sale of Goods Act 1979, is framed around the res (goods), rather than the persona (seller). Thus, liability becomes dependent upon the state and condition of the goods. In s 13 of the 1982 Act, however, the rule is framed around the persona (supplier), and this automatically brings into play the behaviour of the supplier. The obligation, in other words, attaches to the person rather than to the thing. Imagine that Parliament had wanted to introduce strict liability for services: can you redraft s 13 so as to reflect Parliament’s wishes? 3 English contract law is often said to be an obligation of strict liability rather than one that is fault-based; the civilian systems, in contrast, are said to be fault-based. There is truth in this at the level of contractual theory, but in practice it often comes down to interpretation. What did the parties actually promise (common law) or agree (civil law)? And policy has its role as well. Who ought to bear the risk of this damage or loss: the plaintiff or the defendant? Does, or should, insurance have a role here?
Are the following matters of status: (a) a Visitor’ and an ‘occupier’ in the Occupiers’ Liability Act 1957; (b) a ‘consumer’ in the Unfair Contract Terms Act 1977; (c) a ‘bailor’ and a bailee’ in the Torts (Interference with Goods) Act 1977; (d) a seller of goods in the ‘course of a business’ in the Sale of Goods Act 1979? Are there other law of obligations statutes that might raise questions of status? PROMISE AND AGREEMENT
denominator into a principle and the 19th century jurists who made it an axiom (Zimmermann, The Law of Obligations, 1996, OUP, pp 537–45, 559–69). The history of contract in the common law is founded on a rather different institutional basis: the role of covenant, deceit and assumpsit saw liability more in terms of broken promises rather than unperformed obligations (Zimmermann, pp 572–76). And while, at first sight, it may seem of little relevance whether the notion of contract is based on promise or on agreement, the difference can have practical effects. For example, agreement founded upon consent implies a doctrine of error (CC, Art 1109). How can there be true consent when one party is labouring under a mistake? A doctrine of promise, on the other hand, does not necessarily imply that mistake should undermine a contract. It is perfectly possible to say that a promisor takes the risk of error. Does this difference between promise and agreement mean that English and, say, French contract law are based on quite different foundations, possibly acting as an obstacle to harmonisation? 5 What is the value in distinguishing between representations and warranties? Was the court in Hopkins in effect treating the representation as a mere ‘puff, which would not attract legal liability? 6 Was Lord Denning attempting to replace the promise thesis with the theory that contract was a matter of agreement? Was this attempt rejected in the House of Lords? 7 Is contractual liability to be found within the actual facts of a dispute or is it to be found within the intention of the parties? In a case like Gibson, does a court have to look only at the documents, or must it look beyond the documents? 8 Read Clarke v Dunraven  AC 59 in the law reports. Is this one of Lord Diplock’s exceptional cases? FREEDOM OF CONTRACT
Why is it that many English contract textbooks do not have a chapter devoted to interpretation of contracts? 3 Do the rules applicable to statutory interpretation in English law apply equally to the interpretation of written contracts? 4 Is there a significant difference between the French and English approaches towards interpretation of contracts? If there was a difference, is English law now moving closer to French law?
Broadly, the law of contract can be divided into two parts. The first part deals with the formation of the obligation together with any obstacles and/or vitiating factors. The second part deals with performance, or indeed non- performance, of the contractual obligation. It is in the second part that one can look in some depth at the actual contents of the obligation, since contents
however, fraud does not, of itself, undermine agreement; it simply gives rise to the equitable remedy of rescission (cf p 256) which, when viewed from the position of the common law, means that the contract is ‘voidable’. In addition, damages may be available in tort. Of course, as Goff LJ points out, fraud may result in a court holding that there never was a contract, because the fraud prevented effective offer and acceptance, an essential requirement for most contracts. In this situation, one talks of a ‘void’ contract, even although this is actually a contradiction in terms. However, the courts are usually reluctant to hold that a contract for the sale of goods is void rather than voidable. Why? 3 In addition to offer and acceptance, there must also be consideration and intention to create legal relations in order that a valid contract be constituted. The sub-sections that follow examine some of these requirements, and additional sections look at the main factors that can vitiate a contract. One question that should be borne in mind while reading the materials in this chapter (indeed, in all the chapters on contractual and non-contractual obligations) is the extent to which the cases can be reduced to actual rules. We have already seen from Lord Simon in Lupton (p 183) that no case is an authority outside of its ‘material facts’. To what extent, then, is a subject like contract determined by the kind of transactional disputes that find themselves before the courts? And what factors, in addition to the strict ‘principles’ of the law of contract, might be relevant in determining the actual decision?
What legal problems might virtual reality shopping present to future contract lawyers? What about internet shopping? 5 A shopkeeper rings up on his till the price of a packet of cigarettes before realising that the customer buying the cigarettes is under age: must the shopkeeper hand over the cigarettes to the customer?
The case is also of importance in terms of the remedy. Was Mrs Carlill seeking compensation for breach of contract or specific enforcement of a contractual obligation based on the idea of non-performance? Could Mrs Carlill have sued the company in damages? If not, why not? 3 Under what circumstances might a manufacturer of a product be liable, on the basis of an advertising campaign, to compensate a consumer in damages? (Cf Wells v Buckland Saud  2 QB 170.) 4 Would these facts have given rise to a contractual obligation in a system where contract is founded on agreement rather than promise? 5 The defendants attempted to argue that there was no intention to create legal relations. Is such an argument ever likely to be successful (in the absence of a specific clause) in commercial and/or consumer transactions? 6 What if the advert had contained the following clause: ‘no statement whatsoever in this advertisement shall be capable of giving rise to any contractual relationship or any other legal rights or duties or to any liability in contract or otherwise? (Cf Jones v Vernon’s Pools Ltd  2
dictum in Entores. Thus, if the other party is somehow at fault and this fault can be seen as a cause of the plaintiffs expenditure loss, then an action might lie in the tort of negligence, although the economic loss rule will present a serious obstacle (cf Hedley By me, p 470). Alternatively, as we shall see, the plaintiff may be able to claim any benefit conferred on the other party via a quasi-contractual debt claim (cf Chapter 8). Another possibility, of course, is estoppel. Yet how can one be estopped from denying the existence of a contract? Does the existence of such an equitable principle confirm, yet again, that English law is based on promise rather than agreement? 2 Can a person be liable in damages for breach of a non-existent contract simply on the basis that such a person is estopped from denying the existence of a contract? If this kind of situation is possible, is it better to talk of equity awarding damages, or would such talk undermine the essence of the doctrine of estoppel? 3 Is Entores relevant for contractual negotiations carried out by fax? What about e-mail? 4 Why was the nephew in Beswick (p 249) not estopped from denying the existence of an obligation to pay Mrs Beswick?
contract rules, yet its process of reasoning is typical of the common law jurist. Bingham LJ starts from within the facts and works outward towards the notion of an ‘expectation’ which, in turn, rather by sleight of hand, becomes a ‘right’ (see Chapter 2). This methodology does not consist of knowing rules and applying them to a set of facts; and if Blackpool does nothing else, it certainly will prove a challenge to those who think that law is amenable to some existing artificial intelligence system. Can a ratio decidendi be drawn out of this decision? 2 Secondly, the case is important because it indicates the central role of the collateral contract in pre-contractual liability problems. Thus, in addition to the possibilities outlined above (in the note after Entores v Miles Far East Corpn), there is the possibility that the court can turn the pre-contractual behaviour into an independent contract in itself. Is the case, in effect, an example of a contract to negotiate? What damage did the plaintiff suffer? Was it caused by the defendants? 3 Thirdly, the case is interesting because of the status of the defendant. No doubt the decision deserves its place in law of obligations books, but one may ask whether its real place is in works on administrative law. The duty attached to the procedures rather than to the transaction, and while Bingham LJ recognised that a contracting party is under no duty to exercise his rights in a reasonable way, he nevertheless seems to be intervening to prevent an abuse of position. Note, also, how Stocker LJ refers to bona fides. Public law, both in the case law and in statute, has recognised for some time now that a public body does not have the same contractual rights and liberties as a private person, particularly at the pre-contract stage (see, for example, R v Eewisham LEC ex p Shell UK  1 All ER 938). If the defendant had been a private commercial body seeking tenders for a private commercial venture, would the result have been the same? 4 ‘The court should not subvert well understood…principles by adopting a woolly pragmatic solution designed to remedy a perceived injustice on the unique facts of this particular case’ (Bingham LJ). Did not the House of Lords do just this in White v Jones (see p 702)?
Johnson (p 425). The second reason is the ‘subject to contract rule. This rule can be seen within a variety of contexts. First, it can be seen as an application of the intention to create legal relations requirement; the parties (or one party at least) do not intend a binding contract until formal exchange of contracts. Secondly, it can be seen as a variation of the consensus ad idem rule; the parties are not to be considered ‘at one’ until exchange. Thirdly, it could, perhaps, be seen in terms of the rule of certainty; there is no contract until all the major terms are agreed upon and this does not happen formally until exchange of contracts. Thus, even if a party has ‘agreed’ a price with a buyer, this price is not regarded as a certainty until exchange. The point of raising these different contexts is that they are very important factual perspectives to contract. There are many relationships which are ambiguous: the ‘contract’ in which a price is yet to be fixed; the ‘contract’ where some further details are yet to be negotiated (see, for example, May and Butcher Ltd v R  2 KB 17); the ‘contract’ where parties have worked out all the terms in great detail, but still do not, as yet, wish to be contractually bound. How should the law of obligations deal with these kinds of situation? If one party to a sale ‘contract’ has actually delivered the goods to the other party despite the fact that the two parties have not agreed a price, is there a contract? In many situations, the question may not be that important; even if there were to be no contract, the buyer will normally be liable in restitution to pay a reasonable sum (but see Sale of Goods Act 1979, s 8, and see the next case, below). Yet often, there may just be a décalage between the formal rules of contract and commercial practice which only comes to light when things go wrong.
Notes and questions 1 D & C Builders is obviously a useful case to compare with Williams v Roffey. Why was the Court of Appeal prepared to find consideration in one, but not in the other? Did the parties in D & C Builders not receive a benefit? 2 Would the result of Roffey have been different if the plaintiff had simply threatened not to continue with the building work unless the plaintiff promised to pay more? 3 If the creditor’s debt claim had failed in D & C Builders, would the defendant have been unjustly enriched? In which chapter in a book on the law of restitution (unjust enrichment) would you expect to find this case? 4 If the plaintiff in D & C Builders had suffered considerable financial loss as a result of the defendant’s refusal to pay the full bill, could the plaintiff have sued for damages for breach of contract or for a tort? 5 The workers at P’s factory threaten to go on strike unless P agrees to pay them higher wages. P agrees to the demands, because he wishes to fulfil an urgent order. After the order is fulfilled, P wishes to know if he is bound by the promise to pay higher wages. Advise.
person could use contract to the benefit or the burden of a third party has been only reluctantly overcome and then, usually, by recourse either to fiction or to tort. The reason in the civil law for this reluctance is to be found in the idea of an in personam obligation itself: an obligation is a vinculum juris (legal chain) which binds only two named parties. If contract could confer rights or duties on third parties, then it would become a matter of iura in rem. In the common law, which did not inherit the legacy of Roman legal science, the problem of the third party is founded in the notion of consideration which must move from the promisee. Beswick indicates that the doctrine remains alive at common law, although legislation is set to intervene. Why do you think it is that the judges, who have often criticised the doctrine of privity, have not actually reformed the law themselves? 2 Jackson shows how the courts can outflank the doctrine if they wish. Sometimes this is done through the use of the tort of negligence (although the economic loss rule can present a problem) (see, for example, White v Jones, p 702). At other times, the courts find a collateral contract between one of the main contractors and the third party (see Lockett v Charles, p 161; The Eurymedon  AC 154). What is interesting about Jackson is that it uses the law of remedies (damages) to allow the third parties to obtain compensation. The reasoning in the case has been criticised, subsequently, by the House of Lords in Woodar Investment Development Ltd v Wimpey Construction UK Ltd (1980] 1 WLR 277, but the actual decision was upheld. Does Jackson confirm that the law of actions in English law continues to play an important, independent and creative role in the development of the law of obligations?
Questions 1 Imagine that this article was an English statute. Reconsider Beswick (p 249) and White v Jones (p 702). 2 Reform of the privity rule is imminent in England: see what will, hopefully, soon be the Contracts (Rights of Third Parties) Act. Do you think this statute will read like PECL, Art 6:110? MISREPRESENTATION (a) Definition of misrepresentation
Questions 1 Is equity confined to the remedy of account when it rescinds a contract and seeks to restore each party to its pre-contractual position? Or does it have a power to award damages? (Cf Mahoney v Purnell  3 All ER 61.) 2 Is Dedham Vale a case about ‘equitable’ misrepresentation? Does it represent another exception to the ‘silence is no misrepresentation’ rule? MISTAKE (a) Introduction
the formation of a contract, or implied condition precedent problems, where the court holds that there is an implied condition that, for example, the object of the contract is in existence or is of a certain quality (see Financings Ltd v Stimson, below). In these situations, the common law is saying either that there never was a contract or, if there was, it has imploded as a result of the condition precedent. The common law, in other words, is declaring the contract void. 2 Equity, however, can, since Solle v Butcher, intervene with its remedy of rescission (see p 256). Here, the contract will be voidable rather than void. Is this dual approach now outdated? Ought the courts to start thinking in terms of a substantive doctrine of error? 3 Before answering the questions posed above, consider the following problem. B sees an old painting in a junk shop and asks P, the owner, how much he wants for it. P says he thinks the painting is by a minor artist and is worth around £500, and he offers it to B for £480 which B readily accepts. Having purchased the picture, B takes it to an antiques expert for a valuation and the expert says that the picture is a missing masterpiece by a major artist and is worth at least £1 million. The find is widely reported in the press and P is much put out. Can P ask for the contract to be set aside? Would your answer be different if B had verbally agreed with P that the painting was by a minor artist knowing full well that it was not? 4 When viewed from the position of the English substantive law of contract, mistake may seem to lack any fundamental principles. If one shifts to the law of remedies, the position changes quite dramatically, in that there are a number of remedies which become available depending on the kind of error in issue. If the source of the error is a statement by one of the contracting parties (‘this painting is by Constable’ or ‘this car has done only 20,000 miles’) then there may be remedies for misrepresentation or, sometimes, for breach of contract (see Dick Bentley, above, p 467). If the source of the error cannot be attributed to a pre-contractual statement, then one of the parties will usually be seeking either to have the contract declared void (an action for a declaration) or to enforce a contract that the other party is refusing to perform (specific performance or damages). If the error concerns a document, a special defence of non est factum (this is not my deed) comes into play; and if the mistake concerns the identity of a person, the tort of conversion is usually the remedy in play, since mistake of identity often involves property problems. In fact, many cases involving non est factum and mistake of identity deserve to be classed more in the law of property than the law of obligations. Why do you think it is that the common law distinguishes between misrepresentation and mistake? 5 One fundamental remedy distinction that must always be borne in mind when dealing with mistake and misrepresentation problems is the difference between the remedy of damages at common law and the remedy of rescission in equity (see Chapter 3). A party who has entered a contract
under a misrepresentation made by the other party can in principle ask the court to rescind the contract in equity; and such rescission will be available irrespective of fault. Thus, even if the misrepresentation was made on reasonable grounds, the representee can, in principle, still ask the court for rescission. However, the court now has power to grant damages in lieu of the equitable remedy of rescission in non-fraudulent misrepresentation cases (see Misrepresentation Act 1967, s2(2)). If a contracting party suffers loss as a result of the misrepresentation, the common law remedy of damages might be available if the representee suffering the loss can establish: (a) the tort of deceit (as modified by the Misrepresentation Act 1967, s2(1)); (b) the tort of negligence (see Hedley Byrne, above, p 470); or (c) breach of contract (or a collateral contract). Before Hedley Byrne, it was extremely difficult to found a damages action in tort, since deceit required proof of fraud (see Bradford v Borders, above, p 469); and even after 1964, establishing all the requirements for an action in negligence was not easy. The effect of the 1967 Act is to remove the requirement of proving fraud or negligence in a damages claim for misrepresentation, although if a defendant can establish that he was not negligent, he will have a defence. What if a representee can establish all the requirements for the equitable remedy of rescission: ought this to be enough to found a damages action as well? (Cf Banque Keyser Ullmann v Skandia Insurance  1 QB 665 CA;  2 AC 249 HL.) 6 The equitable remedy of rescission may also be available for mistake as well as misrepresentation. Thus there are now, seemingly, two doctrines of mistake in contract: there is the position at common law (offer and acceptance and implied condition precedent) and the position in equity (remedy of rescission). When viewed from the position in equity, it may be that the courts take a broad view: rescission depends upon the circumstances of each case and is in principle available to prevent unjustified enrichment or to stop abuses of power or rights. When analysing factual problems involving error it is, then, worth keeping these two broad principles in mind. Is this distinction between common law and equity helpful, or should the courts move towards developing a single doctrine? (Cf PECL, Art 4:103.) (b) Error in corpore
Questions 1 Is the decision in this case inevitable, given that English law does not, in general, treat silence as a misrepresentation? 2 Did the plaintiffs consent to the payments to the directors? 3 Did the directors unjustly enrich themselves at the expense of the plaintiffs? 4 If these facts arose again today, would the contracts be voidable in equity?
Is the reference to Pothier misleading given Art 2279 of the Code civil, which states that possession is equivalent to ownership in the case of the sale of movable property? If English law had the same rule as the one to be found in Art 2279, what effect would such a rule have to the facts of Lewis? 3 Does this case belong more to the law of property than to the law of obligations? (e) Error in verbis
contract entered into as a result of a threat of industrial action? (Cf Dimskal Shipping Co v ITWF  2 AC 152.) 11 Is the threat of unemployment a form of duress? 12 Is the threat of legal action duress when the person making the threat knows full well that he has no legal basis for his threat? 13 Can a threat to withdraw from pre-contractual negotiations ever amount to duress? 14 Are there situations where one has a right to make threats? (Cf Thorne v MTA  AC 797.) 15 When there was actual duress to the person (that is, threats of violence), does this give rise only to an action in equity for rescission, or are there some forms of duress that will make a contract void? UNDUE INFLUENCE
Questions 1 Undue influence is an equitable form of duress which may give rise to the equitable remedy of rescission. In what circumstances can the relationship between a bank and a customer be subject to the doctrine of undue influence? 2 Was the husband in O’Brien acting as agent of the bank? 3 Could the bank sue the husband in O’Brien for all its losses arising out of the mortgage transaction? 4 Do the courts have a general equitable power to set aside unconscionable transactions? 5 Is Camfield actually an undue influence case? 6 What small changes of fact in Credit Lyonnais would be required in order to arrive at a situation where a court of equity might not be so prepared to set aside the transaction?
1 INTRODUCTION Contracts that are fully performed by both parties rarely raise problems involving the courts. There seems little point, therefore, in describing the contents of a contractual obligation in the abstract. Indeed, even when one party fails fully to perform his, her or its side of a contract, the two parties
although sometimes behaviour and fault can prove indirectly relevant (see, for example, Vigers v Cook, below, p 516). Equally, a debt claim can raise a question about just who has the right to claim performance of a contract, as in Beswick v Beswick (see p 249). This, in its turn, can give rise to the more abstract questions about the difference between rights and interests (see Chapter 2) and the relationship between rights and remedies (see Chapter 3). The point to remember in all this is that the type of damage suffered by a contractor or other claimant is an excellent starting point for an analysis of a set of facts. One then works from the damage towards the actors (personae, that is, parties), the props (res—for example, goods sold or hired, factory guarded and so on) and the possible actions (remedies—for example, debt, damages, injunction, rescission or whatever) that could come into play. And the interplay of all these should reveal the relevant relationships (contractual terms, unilateral promise, duty of care, bailment and the like) which will motivate and justify the granting or refusal of a remedy. LIABILITY AND IMPLIED TERMS
together: if, in Bolton v Mahadeva (above, p 226), a fire had accidentally started, the question of the level of duty (fault or strict liability) would have centred on the implied term. Did the heating engineers promise to use care and skill, or did they warrant that the materials they used were safe? 2 Is the implied term a means by which courts can remake contracts? 3 Do employees impliedly promise their employers in their contracts of employment that they will not be negligent? Does an employer impliedly promise to warn employees about any lack of insurance cover when the employer asks the employee to work abroad? Is a university under an implied obligation to take out insurance on behalf of its postgraduate students who go abroad to do research? (Cf Reid v Rush and Tompkins plc  1WLR 212.) 4 What if the owner of the ship had been compensated for the damage by his insurance company: would the court still have implied the term so as to allow the insurance company to recover from the wharf owner via the doctrine of subrogation?
the Carbolic Smoke Ball Co in breach of the contract with Mrs Carlill or were they guilty only of a non-performance? 2 From the position of the law of remedies, the difference between breach and non-performance can be important. If a contractor wishes to claim damages, it must be established that the other party is in breach of contract and that this breach has caused the plaintiffs damage. But what if the damage suffered by the plaintiff as a result of the other party’s failure to perform is less than the price that the plaintiff had agreed to pay for the performance? Is a claim in damages on the basis of breach the best way, from the claimant’s point of view, of conceptualising the problem? (Cf Bolton v Mahadeva, p 226.) 3 What if a contractor performs most, but not all, of his obligations under a contract: can the other party refuse to pay any of the agreed price?
fault (see above, p 389); accordingly, if the non-performance is due to factors that cannot be attributed to the fault of the non-performing party he has, prima facie, a defence (PECL, Art 8:108). Only if such a party has agreed to guarantee a particular result will the plaintiff be entitled to damages irrespective of fault. In English law, the normative dimension is provided by the notion of promise itself; thus, all that a contractor has, prima facie, to show in order in order to obtain damages for breach is a breach of promise. Whether or not the defendant is guilty of fault is, prima facie, irrelevant (Raineri v Miles  AC 1050, p 1086). However, as Vigers indicates, the English position is not quite so simple. Could it not be said that the undertaker was unable to claim in debt because he could not prove he was not at fault? To what extent is debt based on fault? 2 The position regarding fault in English contract law is not so simple because, although promise is a normative concept in itself, much will depend on what was actually promised. This problem has already been encountered under the heading of contractual liability (see p 389). In contracts where the object is a physical thing, the commercial supplier will usually be promising that the thing supplied will be reasonably fit and of satisfactory quality; if the goods are not fit, then there will be a breach of promise irrespective of the fault of the supplier (see Hyman v Nye, below, p 545, and Frost v Aylesbury Dairy, p 47). The supplier is liable because he is in breach of a promise now implied by statute (see the paradigm provision: Sale of Goods Act 1979, s 14, above, p 514). Where the object of the contract is a service rather than the supply of goods, a quite different promise is implied, as s 13 of the Supply of Goods and Services Act 1982 now makes clear (see p 391). A supplier of a service promises to carry out the service with reasonable care and skill. Accordingly, in order to show a breach of promise, the contractor suffering damage must show fault (that is, lack of reasonable care and skill). Is this the same requirement as for the tort of negligence? (Cf Attia, above.) 3 Where fault is relevant, upon whom is the burden of proving fault?
Questions 1 This modest case is possibly more important than it looks, in that it goes some way to tackling a problem exposed in the decision of Joseph Constantine SS Ltd v Imperial Smelting Corp.n Why could the owners of the motor launch not plead frustration? Could frustration be an effective defence in situations where a consumer product explodes for some unexplained reason? 2 Would the owner of the motor launch be entitled to the hire fee up to the moment the boat sank? 3 Has this decision been modified by the Supply of Goods and Services Act 1982? 4 Could the defendants have raised the defence of contributory negligence? 5 Does reasoning by analogy play an important role in Lewis J’s decision?
Notes and questions 1 It can easily be forgotten that it is a fundamental principle of the law of obligations that the breach of the obligation must be the cause of the claimant’s damage. Contributory negligence, as we have seen (Chapter 3), is simply one device for dealing with difficult causal problems. In Ingham v Ernes, did the claimant fail because the hairdresser was not the factual cause of the claimant’s dermatitis? 2 What if the claimant had forgotten that she was allergic to Inecto? 3 What if the claimant had suffered the dermatitis for the first time at the defendants’ salon but could not actually prove beyond doubt that Inecto causes dermatitis; she could prove only that there was a 50% chance that her illness was caused by the product? 4 Is a person with a bad cold or flu under a duty to disclose to the hairdresser that they have such an illness? If not, why not? 5 What if a hairdresser accidentally cuts the ear off a customer after having been startled by a car backfiring in the street outside? CONTRACTUAL LIABILITY FOR PEOPLE
the absence of a third category in the law of obligations is partly to blame: for categories allow jurists to think about the roles of each subject and the role of restitution is to prevent unjust enrichment. Allowing an insurance company to recover an indemnity from an employee via the equitable remedy of subrogation is to undermine the role of equity and the law of tort at one and the same time. Equally, it undermines the law of contract, because the implied term is contrary to anything that employees would have ever agreed to (as insurance companies recognised). It is often said that hard cases make bad law, but might it not be better to say that bad lawyers make bad law?
Questions 1 If the Keppel Bus Co case arose today, would the result be different? 2 Lord Diplock says that vicarious liability must be confined to tort. Does this mean that, when a victim sues a company in contract, the course of employment rule is irrelevant? 3 Could Photo Production have sued Securicor in trespass? CONTRACTUAL LIABILITY FOR THINGS
Notes and questions 1 Why is there one rule for goods and another for passengers? What justification(s) for the difference does Montague Smith J offer? Are they convincing? 2 Why should it be the passengers and not the railway company (and its shareholders) that have to carry the risks of faulty trains? 3 In order for a contractor to be in breach of contract he, she or it must be in breach of one of the actual promises (terms) which go to make up the contract. However, as the above case makes clear (‘after a consideration of the authorities’), this exercise is one of interpretation, not of the parties’ minds, but of the law. Yet the parties’ minds become one reason for not implying an absolute promise since that would, according to the court, lead to a situation where the parties have promised the impossible. Why, however, does Lindley J in the case below seem to take a different approach?
analysis—and, indeed, it is rather insensitive—then such insensitivity is meant only to underline the rather indelicate problem which cases like these raise. After all, the plaintiffs in such cases are claiming that the arrival of the baby is ‘damage’ for which damages should be awarded. This is to reduce the whole issue to one of partimonial loss. Is this desirable? EXCLUSION AND LIMITATION CLAUSES
‘Although the civil law is not, of itself, authority in an English court, it affords great assistance in investigating the principles on which the law is grounded.’ Is this statement still true today? Do the courts today often refer to doctrine, legislation and/or cases from civil law countries? Ought English judges to treat the systems of our EU partners as authoritative? 6 Could an English lawyer ever teach English law to a French or German lawyer without the English lawyer having a knowledge of the civil codes?
UNIDROIT principles are similar (Art 6.2.1). But where, say, inflation or Sourcebook on Obligations and Remedies shortages become so severe that they threaten the economic existence of one of the parties, it may be that it is not in the general interest that such a party should be allowed to go bankrupt. Where one or both of the parties is a public body, the general interest becomes of even more relevance. What is interesting about the Davis and the Staffordshire Waterworks cases is that they appear to be reflecting the dichotomy between hardship and impediment. But the question, of course, is the extent to which the PECL and UNIDROIT rules might affect the result of Davis. Would it still be decided the same way even if there was a right to request renegotiation? (Cf UNIDROIT, Art 6.2.3.) 3 Was Lord Denning, in Staffordshire Waterworks, in effect applying the old implied term theory of frustration? Does Staffordshire Waterworks conflict with the Davis Contractors case? Was Lord Denning getting close to utilising rescission in equity to deal with this contractual problem? Why should this equitable remedy not be available to deal with frustration problems? 4 Why should the contractor in Davis and not the local authority be the one to shoulder the risk of the unforeseen shortages? Would it be in the public interest to bankrupt the private contractor? Were the shortages to be foreseen or not? Ought they to have been foreseen? What if the houses had been only partially completed and the builders were facing bankruptcy unless the local authority agreed to pay more? 5 Do you find the reasons for abandoning the implied term theory of frustration convincing? If contract is based upon the act of the parties, is not frustration a matter of implied condition precedent with reference to the status of the parties? Or might it not be a question of level of duty, and is duty not a question of terms? 6 Does Davis introduce a new remedy of rescission at common law? 7 Is it a material fact that the builders were a ‘big firm of contractors’? 8 If, in Staffordshire Waterworks, the two parties had been private commercial bodies, would the result of this case have been the same? 9 How can a term of a contract ‘cease to bind’? Upon what legal authority does Lord Denning base his thesis that the golden rule of interpretation has been abandoned? What method of interpretation does Lord Denning replace it with? 10 Are the two cases dealing with the public rather than the private interest? Does the public interest have a role in frustration cases?
Questions 1 P contracts with D for D to transport P’s very heavy machine from Liverpool to London. D’s lorry arrives at P’s factory and the machine is loaded onto the lorry. However, it is evident to both P’s and D’s employees that the lorry is very overloaded. Nevertheless, the vehicle sets off towards London. On the way, the lorry overturns, owing to the negligence of the driver, and the machine is destroyed in the accident. Can P sue D for damages? (Cf Asmore, Benson, Pease and Co v AV Dawson Ltd  1WLR 828.) 2 Why should it be the insurance company that profits in the case of smuggled jewellery and not the public authorities? Could not the customs have claimed the money off the plaintiff once he had received it from the insurance company? 3 P, who does not have EU nationality and has entered the UK illegally, is injured while travelling on a bus, owned and run by D, which crashes owing to the negligence of the bus driver. If P tries to sue D for damages, will D have a defence based on illegality? CONTRACT: FINAL OBSERVATIONS
It would be idle to think that three chapters on the law of contract could ever possibly be exhaustive in scope. Indeed, a whole casebook devoted to the subject would, unless it were very large, be hard pressed to be comprehensive. Consequently, the purpose of the last three chapters has been to stress obligational structure, method and technique in problem solving, rather than
automatically to be deduced. One should not be surprised by this apparent structural coherence, since it is a subject trying to determine the future rather than the past, as a case like Davis Contractors v Fareham UDC (p 593) so clearly indicates. Nevertheless, this structural coherence can mislead. Certainly, it is a subject with many rules and, thus, when compared with the other law of obligations subjects of tort and restitution (see Chapters 7–8), it can appear detailed and complex. Yet, when viewed from the position of the remedy— ought the plaintiff to get damages from the defendant or ought someone to be able to escape from what they have undertaken to do?—the problem can often be reduced to some basic issue where the court has to make a qualitative judgment of substance rather than simply apply some formal rule. Ought the court to imply a duty into this agreement? Was the plaintiff the cause of her own damage (cf Ingham v Ernes, p 532)? What are the responsibilities of one person negotiating with another person? The key to problem solving is often to identify these substantive issues and to translate them into legal concepts such as the implied term, consideration or condition, not forgetting, of course, the role of quasi-normative notions such as ‘expectation’ and Interest which
When one turns from contractual to non-contractual obligations, the position, as we have already indicated in previous chapters, is complicated because the substantive categories of contract and tort did not develop within a broader generic category of ‘obligations’. This complexity has become more pronounced, in some ways, with the recent development of restitution as a
now possible to give a whole course on the law of tort simply on the basis of doctrinal writing about theories supposedly underpinning the law of tort (Weir  CLJ 388). English law is similar to Roman law in that the law of tort and the law of restitution rest on a few basic principles. What takes up the pages is the application and interpretation of these principles. In fact, because of the importance of method when it comes to analysing the facts of tort and unjust enrichment problems, many of the cases relevant to this chapter have already been set out in the chapters on remedies and methodology. This chapter and the next are, accordingly, more concerned with bringing these cases together under the law of obligations heading in the hope of illustrating the institutional structures that underpin these decisions. All the same, despite the development of contract, tort and now restitution as rational categories through which the cases can be understood, it is important to remember that the law of remedies still dominates. It is, therefore, vital to relate tort and restitution, as Lord Goff and others recognise (see below), not just to their historical foundation in the forms of action, but to the law of remedies in general (Chapter 3). The starting point for tort is always in the nature of the damage, for this can determine not just the cause of action, but also the intensity of the duty. The starting point for the law of restitution is, in contrast, the notion of benefit or profit. Is this a profit or benefit which ought in justice to be retained? What is the cause of the damage or the profit? A Romanist can certainly appreciate the symmetry between tort and restitution, even if the common law cannot always appreciate the differences between its very own remedies of debt and damages (see, for example, Auld LJ in Friends’ Provident, p 239). THE LEGACY OF THE FORMS OF ACTION
p 143). To what extent is this English approach an obstacle to harmonisation? 2 The causes (forms) of action approach can present particular difficulties in cases like Rigby which raise special public law problems. If public bodies such as the police—or, indeed, anyone public or private—are successfully to be allowed to raise the defence of necessity, this will mean that the loss must fall on an individual citizen. In an age of property insurance, this might not, of course, be such a bad thing. But where personal injury is concerned, even in a country with a National Health Service, it seems cruel that an individual and/or his or her family should be expected to carry the burden of injury and loss suffered in the pursuit of the public good (but cf Toynbee, above, p 395). Indeed, Miller v Jackson (p 51) raises a not dissimilar problem. It is in these kinds of situation that the French equality principle (see above, p 103) comes into its own as a legal device; it simply outflanks the defence of necessity. English law has to operate at the level of fact—that is to say, the judge usually has to make a finding of negligence—in order for a citizen to get damages in tort. While the judiciary may not, these days, be as unsympathetic as they once were (although much depends upon the status of the defendant), the fault requirement allows insurance companies to bully individuals into settlements (see Genn, Hard Bargaining, 1987, OUP). Who actually benefits from the fault principle? Is this a question that the judges themselves are prepared to ask?
If the stoppage had been caused, not by the cutting off of the electricity, but by a group of demonstrators blocking the highway outside the plaintiffs’ factory, could the plaintiffs sue one or more of the demonstrators for all their economic losses? 3 Can any ‘loss of a chance’ case be re-analysed into a factual causation problem?
Donoghue v Stevenson in many ways cuts across the old forms of action approach to liability, as Esso v Southport (p 216) itself goes some way in showing. In introducing fault as the cause of the action, it provided the courts with an alternative way of analysing facts. Indeed, the full impact of this alternative approach to liability is still in the process of working its way through the old causes of action, as the Cambridge Water case will show (below, p 665). Yet the requirement of a duty of care has kept the fault principle closely tied to the facts. The use of the word ‘proximity in
foreseeable) and they were in a position to control the availability of alcohol. Now this is not to suggest that the decision is wrong given the principles upon which the law of tort operates. But fairness and equity are double-edged moral weapons. Is it fair and equitable that the wife should be deprived of the greater part of the compensation when it could be argued that the defendant could be said to have gone some way in maintaining a culture of drinking? What if the defendant had been a private commercial employer instead of the navy? 2 Another interesting, but not uncommon, dimension to this case is that the defendant is guilty of an omission rather than a positive act. It did not directly cause the victim’s death; it just failed to do enough to save his life. The fact that this was a Fatal Accidents Act claim in itself makes it a three-party situation. However, in these mere omission cases, another permutation is often encountered: the claimant sues, not the person who directly caused the damage, but a third party who had a factual and/or legal relationship with the person who caused the damage. Such a situation easily arises once one thinks in terms of a ‘duty’ owed by organisations. In a road accident case, for example, it may well be that one driver carelessly injures another, but could it not be said that the local authority also had a ‘duty’ to make this particular stretch of road safer? (Cf Stovin v Wise, p 737.) Yet ‘duty’ also becomes the means of limiting such liabilities. In order to do this, ‘duty’ needs to be translated into a factual (empirical) connection and this is done, as we have seen, through the notion of ‘proximity’ (see p 136). However ‘duty’ and ‘proximity’ are quite different concepts, since one is normative, while the other is descriptive. Do the judges always appreciate this? 3 Study CC, Art 1382. Given that there is no concept of ‘duty of care’, how might Barrett be decided under this article? LIABILITY FOR PEOPLE
private insurance system when it comes to their property. Ought the courts to have considered this aspect of public law before holding the State liable to an insurance company in respect of property damage? 2 Are borstal boys analogous to defective bottles of ginger beer? 3 How do you think this case might have been decided in France? Would the risk and (or) equality principle (see p 103) have been applicable? 4 There are two liability for people’ aspects to Dorset Yacht. First, the direct duty of care owed by the Home Office to property owners up and down the country (or near prisons, at any rate) in respect of prisoners under its control. The question here is whether the Home Office as one person is liable for the act of a prisoner, another person, under its control. Secondly, there is the liability of the Home Office, as a ‘principal (employer?), for
‘a frolic of his own’, then there will be no liability. Why, then, did the House of Lords hold that the patrolman who burnt down the factory in Photo Production v Securicor (above p 541) was acting in the course of his employment? 2 The course of employment requirement is possibly one of the most difficult questions in vicarious liability problems. One difficulty for practitioners and other problem solvers is that the vicarious liability issue can blind the lawyers to the existence of other duties, as indeed we have seen with the Keppel case itself (see p 537). Is the employer of firemen liable to the owner of a factory burnt down because the firemen were on a goslow for more money and took hours to get to any fire? The answer is to be found in the law reports (General Engineering Services v Kingston and St Andrews Corpn  1 WLR 69), but is it the right answer in the light (one hesitates to say blaze of light) of Photo Production? What if the employer was paying miserable wages to the firemen? Does insurance play a role? 3 Certainly, one educated reflex is the judgment of Diplock LJ in the great case of Morris v Martin (see p 80), even if the ratio decidendi of the case turns out to be somewhat irrational (the result depends on luck—which employee actually steals the goods). Diplock LJ saw that the duty problem went beyond that of vicarious liability and into the law of property; the facts, in other words, demanded a reflex that went beyond the law of tort. What role should vicarious liability have outside the law of tort itself? Does it have any role at all in contract or bailment? Did Diplock LJ, in other words, go far enough? LIABILITY FOR THINGS
Notes and questions 1 This is one of the great cases of the 19th century and there is no 20th century judge who can rival Blackburn J. He knew his Roman and his French law and this case is undoubtedly an educated reflex to the facts (one might note also that, at first instance, Bramwell J found for the plaintiffs, but on the ground of trespass). It is very sad indeed that the English common lawyers of the 20th century failed to appreciate that here was the English equivalent of Art 1384 of the French Code civil. What if this principle of liability for things had been applied to Esso v Southport Corporation? 2 It is said in the judgment of Lord Goff (below, in Cambridge Water) that Blackburn J never thought he was making new law as such. No doubt. But that is because the answer to the problem seemed obvious to him, as indeed it would to many trained both in the civil law and in the common law. Damage done by things under one’s control is a great principle even if it is a principle that can give rise to hard cases on the odd occasion. And it is a principle that can allocate insurance risks. Was there, however, ever any need to treat the rule in Rylands v Fletcher as a separate cause of action? 3 ‘[B]ut which he knows to be mischievous if it gets on his neighbour’s land.’ Is the rule in Rylands v Fletcher based upon foreseeability?
Is the whole result of this case premised on the categorisation of the appellant as a Visitor’ or ‘invitee’ and the respondents as an ‘occupier’? Are such status categories realistic, given the actual occupations of each party? 4 Manufacturing munitions is a risky business, perhaps even an ‘ultrahazardous’ activity. Upon whose shoulders should the risk be put: on those of a wealthy legal corporation or a poor human worker? 5 Has English law really found a ‘middle way’ (or ‘third way’, to use a modern expression) between the two theories mentioned by Lord Simonds? 6 Why should beasts be put into a compartment of their own? Should a distinction be made between a person who keeps a tiger on his land, which injures a visitor, and a person who keeps bombs or fireworks on his land, one of which explodes and injures a visitor?
Notes and questions 1 Is this case authority for the proposition that English law refuses to recognise a liability for things similar to the principle to be found in the Art 1384 of the Code civil? 2 Does this case destroy the idea that it is the polluter who should pay? 3 Is fault the basis for all non-contractual compensation claims for physical damage? 4 Lord Goff says that ‘inapposite’ conclusions must not be drawn from the cases involving injunctions. Does this once again indicate (cf Miller v Jackson, above, p 51) that it is the remedy and not the right that is the main focal point of English law? 5 Hard cases, it is said, make for bad law. Well, Cambridge Water is a hard case in that the plaintiff is hardly the most deserving of companies (it might be useful to compare the salaries of the directors of CWC with those of the directors of ECL), and it does seem hard that a defendant should be held liable for something that happened way back in the past. Perhaps, then, the key to the decision is to be found under Lord Goff s heading The facts of the present case’. Yet this simply takes us back to the role of a court like the House of Lords (cf Read v J Lyons and Co, above); is it simply to decide particular cases between particular litigants? Was there not here an opportunity to do for strict liability what Donoghue v Stevenson did for fault liability? Lord Goff implied a role for comparative law in his Littlewoods judgment (and see his recent judgment in White v Jones, p 702), was there not the chance for the common law, perhaps in the spirit of harmonisation, to import the symmetry of the French Code civil? No doubt, names at Lloyds might not be so keen on an extension of strict liability, but the ordinary citizen crippled in a road accident and unable to prove fault (see p 760) might appreciate the symmetry of the Jand’heur case in France (Ch réun 13.2.1930; DP 1930.1.57; S 1930.1.121) which brought car accidents within Art 1384 (now mostly covered by separate legislation: loi 5 juillet 1985). The problem with the Cambridge Water case is that it is a case about pollution and the law of tort which does not, in fact, tell us that much about pollution and the law of tort. One can only hope that the ECJ will furnish English lawyers with some new ideas in the new millennium; for English judges seem paralysed when it comes to developing a law of tort in any direction other than fault. 6 Using materials to be found in Chapter 2, can you construct a judgment arriving at the opposite conclusion to Lord Goff s?
Questions 1 Are these cases examples of strict liability (liability without fault)? 2 What if the boy had been injured by a tree on the defendant’s land falling on him? 3 Under the Occupiers’ Liability Act 1957 an occupier owes a ‘common duty of care’ to visitors on his property; why should someone off the premises be owed a higher duty? Does Mint impose a higher duty? Does it impose a higher duty than s 4 of the 1972 Act? Does the difference mean that compensation can be made to depend upon where a plaintiff was standing when the injury occurred? 4 To what extent is the tort of public nuisance a form of action expressing a principle similar to Art 1384 of the Code civil? 5 Is the tort of public nuisance conceptually quite different from the tort of private nuisance? Are they, for example, quite separate causes of action? 6 Does Denning LJ use reasoning by analogy? 7 Why should a victim’s action for damages against an owner of defective property be dependent upon the nature of the contract between the owner of the property and his tenant? 8 What if a wall collapses onto the highway and blocks it off for several days with the result that some nearby shops suffer financial loss? Will the shop owners be able to sue the occupier and/or the landlord of the defective premises for these losses? 9 Will an occupier be liable for a public nuisance created by his independent contractor hired, say, to build a garage on the occupier’s land or to fell a tree? (Cf Rowe v Herman  1 WLR 1390.)
for the purposes of the law of obligations? (Cf Consumer Protection Act 1987, s 41.) 3 Is noise a thing? 4 Is Donoghue v Stevenson (above, p 65) an example of liability for damage done by a thing? What about Grant v Australian Knitting Mills (above)? 5 In breach of a statute, radiation escapes from a nuclear installation and contaminates local houses. The price of these houses falls dramatically. Can the owners sue the nuclear installation for their losses? (Cf Merlin v BNF  2 QB 557; Blue Circle Industries plc v MOD  2 WLR 295.) LIABILITY FOR WORDS (a) Defamation
private law, since the cases raise important issues of freedom of the press and, indeed, human rights (Tolstoy Miloslavsky v UK (1995) 20 EHRR 442). The House of Lords has gone some way in recognising this constitutional and human rights aspect (Derbyshire CC v Times Newspapers  AC 534), but the tort can still be used to stifle investigative reporting (see, for example, Pilger, ‘Letter’ (1991) The Guardian, 9 July). Recent statutory intervention has made life a little easier for the publisher, as opposed to the author, of a defamatory statement (Defamation Act 1996). However, the strictness of the liability results in a situation where injury to reputation once resulted in damages that were out of all proportion to those obtained in personal injury cases (cf Sutcliffe v Pressdram Ltd  1 QB 153). As the MGN case shows, Parliament and the Court of Appeal have now gone some way to remedying this situation. 2 There are three central defences to defamation: justification, fair comment and privilege. If the author or publisher of a defamatory statement can establish that it is true, then the claimant’s action will fail. The facts said to be true must, however, be correct (cf Defamation Act 1952, s 5). Fair comment is more difficult, because it attaches only to facts and not to the claimant himself; that is to say, it attaches to the objective conduct of the claimant. Thus, to say that C is an ‘incompetent nitwit’ is not fair comment; but to say that C’s textbook or performance in a play, or indeed conduct at a public function, gives the impression of being written or performed by an ‘incompetent nitwit’ may be fair comment. The comment must, in other words, attach to facts (conduct or whatever) in the public realm and these facts must be correct (cf Defamation Act 1952, s 6). Fair comment can be defeated by malice, but the burden of proving this is on the claimant. 3 Privilege is of two types: absolute privilege is a complete defence, while qualified privilege will fail as a defence if the plaintiff can prove malice. The key concept in this defence is ‘interest’. A person may be protected if he or she communicates a defamatory statement to a person who has an interest in receiving it. Thus, one director of a company might have an interest in receiving information, even if defamatory, about another director or employee (Watt v Longsdon  1 KB 130). More generally, it would be tempting to think that any comment in the public interest is covered by privilege; but this would be wrong. The defence is probably wider than it once was, but the idea of a ‘duty’ to publish in the ‘public interest’ is still very narrowly construed (Reynolds v Times Newspapers Ltd  3 WLR 862). Indeed, it has to be said that the courts rarely give preference to the public interest over the commercial interest (Camelot Group plc v Centaur Communications Ltd  QB 124), although the House of Lords may take the opportunity to adjust the balance in the light of the Human Rights Act 1998 ( 1 WLR 478). The fair and accurate reporting of certain
reports and activities is, however, covered by statutory qualified privilege (Defamation Act 1996, s 15 and Schedules). Yet public law has responded to this press liberty by granting courts the power to impose reporting restrictions and, in addition, other remedies may also be available to those disgruntled by the media (see p 285). The interesting question will be how these decisions, which impact on press freedom, will be affected by the Human Rights Act 1998 when it is fully brought into effect. 4 The Jonathan Aitken affair indicates just how defamation can be used to prevent the unmasking of cheats and liars in public life (see The Guardian, 9 June 1999). Claimants prepared to employ a little bit of perjury can, provided they are not found out, often find success in defamation actions, since the burden of proof is on the defendant. In American law, it is extremely difficult for public officials to sue in defamation, which is why the press were able to investigate the Watergate scandal. Ought similar rules to be introduced into English law? (Cf Reynolds v Times Newspapers Ltd  3 WLR 862.) 5 Note how defamation is a three party tort. There must be publication of the defamatory statement to a third party, however obscure: Morgan v Odhams Press  2 All ER 1156. This is where defamation can be distinguished from the Roman law delict of injuria, which was an action protecting the interest of dignity as well as reputation (Dig 220.127.116.11; cf CC, Art 16). It is tempting to say that defamation is a tort protecting a right of personality rather than patrimony, and this might help explain the continued use of the jury (s 69 of the Supreme Court Act 1981) and the absence of any requirement of proving damage in libel. However, this personality aspect is undermined by the fact that corporate persons can sue without proving damage. Ought this to be changed: ought proof of damage to be a fundamental element in the tort of defamation? 6 ‘Libel is often played as farce. Vain pop stars, self-important actresses and—yes—even editors can cut comic figures as they seek to protect their precious reputations in the mock Gothic majesty of the High Court. But the dishonest use of libel laws to suppress legitimate reporting activities of people in public life is no joke’ (‘Editorial’ (1999) The Guardian, 9 June, p 21). Is this fair comment? If so, how is it that the law of non-contractual obligations has got itself into this situation? Would a privacy law only add to the farce? Is it really decent that vain pop stars should be able to claim huge damages for being told they have a large bottom (or whatever), whereas abused children horribly molested by those employed by incompetent and uncaring local authorities get their cases thrown out of court (because it is not ‘just, fair and reasonable’ that they should succeed)? 7 Can defamation and the interlocutory injunction (see Chapter 3) be used by individuals to suppress publications that would be in the public interest to publish?
It is difficult to establish liability in respect of uncritical publications which do actual damage, even if they are made negligently, but very easy to establish liability in respect of publications which do no obvious damage but whose truth cannot be established in a court of law. Is this logical?
Notes and questions 1 As a result of the pure economic loss principle in the tort of negligence, many unthinking students state that the law of tort does not protect against economic loss. This is nonsense. In addition to misrepresentation cases, which usually lead to economic loss, there are the economic torts which have been fashioned to deal with the problem of strife in the world of business and industrial relations. The main question that the economic torts (inducing breach of contract, intimidation and conspiracy) seek to provide an answer to is this. When will D be liable for deliberately causing economic loss to P? Now, it might be tempting to say that all deliberately caused loss should be actionable, but this would clash with the ethics of capitalism where competition—that is, deliberately causing loss to another since one person’s profit is another person’s loss—is fundamental. 2 If one has the right to open a supermarket, even if it ruins all the other local food shops, does one have the right deliberately to ruin all the local food shops by opening a supermarket? The common law said yes, providing that no wrong was involved (Mogul SS Co v McGregor, Gow and Co  AC 25). But what is meant by ‘wrong’ in this context, given that, according to Bradford v Pickles (above, p 222), malice in itself is not a wrong? The tort of inducing breach of contract was the major starting point. Is there now a tort of economic duress? (Cf Dimskal Shipping Co v ITWF  2 AC 152.) 3 Do traders have a right to trade free from deliberate interference by others? Do trade unions have any rights at common law? 4 D writes an article urging his readers not to buy goods from P’s shop because P makes financial contributions to a political party of which D does not approve. Can P sue D for his economic losses? What if D urges people to demonstrate on the pavement outside P’s shop? 5 Is there a right to strike in the English common law? 6 Is a contractual right a property right as far as the English law of tort is concerned? 7 Research the economic torts in the library. What role has the interlocutory injunction played in the development of the economic torts? Which are the most useful concepts in the area of economic torts: (a) rights; (b) duties; (c) wrongs; (d) directness; (e) intention; (f) interests; (g) property? (d) Malicious prosecution
Questions 1 Does the tort of malicious prosecution protect constitutional rights rather than private rights? 2 Is there not a danger that a person who complains of sexual assault by someone known to her might find herself having to defend an action in the tort of defamation and/or malicious prosecution? 3 Could Mr Martin have sued Mrs Watson for defamation? (e) Trespass
Does White v Jones in effect extend s 13 of the Supply of Goods and Services Act 1982 (above, p 391) to third parties? 6 When a person dies, most causes of action (defamation remains an exception) vest in a new legal persona called the ‘estate’ (s 1 of the Law Reform (Miscellaneous Provisions) Act 1934, above, p 32). Is this an example, as one tort specialist once suggested, of the law allowing a ghost to sue and be sued? If so, what ‘damage’ can ghosts suffer? Why should ghosts not be allowed to sue in defamation? In allowing Mrs Beswick and Mrs White and her sister to sue, is not the law transferring a loss from the spiritual to the real world? Is this kind of fiction any less rational than the fiction discussed in Tesco v Nattrass (above, p 33)? 7 Could not White v Jones have been decided in equity: for example, would it not have been possible to say that the solicitors, vis à vis the beneficiaries, were estopped by their negligence from denying the validity of the new will? 8 Does White v Jones put the decision of the majority in Spartan Steel (above, p 194) in doubt? If not, why not?
D, suddenly taken ill with a heart attack, creates a dangerous hazard on the road by leaving his lorry in an unsuitable place and the police carelessly fail to deal with the problem with the result that P, a motor cyclist, crashes into the parked lorry. Could P successfully sue anyone? 3 What would be the position if the plaintiff passenger had actually been injured as a result of the motorcycle hitting the lorry because the street lamp had been broken by vandals? 4 What if a thief had stolen the lorry and later parked it in a dangerous position; would the owners of the lorry be liable if there was an accident? 5 Public nuisance may seem at first sight to be a cause of action very different from breach of statutory duty, but they share a common denominator. They are both causes of action dealing with damage caused unlawfully; for both public nuisance and breach of statute are crimes. The question, therefore, is whether there should be liability in private law for an infringement of a public law rule. One fundamental requirement is special damage suffered by an individual over and above the rest of the community. Note, also, the role of an interest (see pp 134–36). Can ‘special damage’ include pure financial loss? (c) Negligence
Questions 1 Is fear of inflation a good legal reason for not developing new principles of liability? Is it an economically sound reason? Will not such reasoning always act as a bar to judicial innovation? Given that inflation no longer seems a problem, is there now a case for re-establishing Lord Denning’s approach? 2 Does the present system of fault liability in traffic accidents encourage litigation? 3 Did the wife (owner) have any interest in the journey? Does a person not have an interest in the well being of his or her spouse? What if she had asked one of the group to bring her back a bottle of beer? 4 If one is strictly liable for keeping a dangerous animal or an animal with dangerous characteristics (Animals Act 1971, s 2), why is one not also liable for keeping a thing which is capable of just as much, if not more, harm? Where is the logic of having an Animals Act but not a Motor Vehicles (Compensation of Injuries) Act? 5 A pub landlord, having served many whiskies to a customer he knew was going to drive home, made no effort at closing time to stop the customer from driving his car out of the pub car park and home. If the customer killed a cyclist as a result of his drunk condition, can the customer’s insurance company, which has paid compensation to the wife of the cyclist, sue the landlord for contribution or an indemnity? 6 The case concerns the kind of traffic accident which happens every day. The young Sébastien, 12 years of age, crosses a trunk road on his bicycle just as a motorcyclist is coming along the road. The crash is inevitable. The child and the motorcyclist are injured… The young child will be compensated through the application of the law of 5 July 1985, dealing with the improvement in the situation of traffic accident victims. As far as the motorcyclist is concerned, he has to remain in the realm of the ordinary law dealing with parental liability…’ (Advocate General in Cass civ 19.2.1997; JCP 18.104.22.16848). This ‘ordinary law’ is to be found in Art 1384 of the CC: The father and mother, to the extent that they exercise the right of custody, are jointly liable for damage caused by their minor children living with them.’ Do you think the parents could escape liability by showing that they were not in any way at fault in the supervision of the young Sébastien? How would English law respond to these facts? What if the motorcyclist had been over the permitted alcohol limit?
Civil law systems divide their law of obligations into three main subdivisions. In addition to contract and delict (tort), there is the third category of quasi- contract (French model) or unjust enrichment (German model). The idea of liability quasi ex contractu comes from Roman law, but it did not meet with
Furthermore, it is not yet possible to abandon individual causes of action and individual remedies, since these terms still contain their normative potency. No doubt, some would like them to be replaced by the general principle of unjust enrichment. But lessons from the law of tort—the idea that an abstract principle like ‘damage wrongfully caused’ could replace the individual causes of action—should serve as a warning. Such thinking is epistemologically simplistic (see p 123, note 5). The remedies approach to restitution might be complex, but at least it is close to the facts and can distinguish the good claim from the bad (see, for example, Surrey CC v Bredero Homes, p 295). INTRODUCTION: NON-CONTRACTUAL DEBT CLAIMS
property right in the debt. Is this property idea any less of a fiction than an implied contract? 2 If the law of obligations has found categories for both contractual and non-contractual (tort) damages claims, why have they had such difficulty in finding a category for non-contractual debt claims? 3 Is a claim for salvage or expenses a claim in debt or damages? (Cf The Aldora, p 239.) 4 Debt claims are not the only remedies relevant to restitution. Damages, injunction, specific performance, rescission and so on (see Chapter 3) can all be used on occasions to prevent unjust enrichment. Tracing is of major importance, as we shall see. An excellent overview of all the relevant remedies, causes of action and techniques used in the English law of restitution can be found in McMeel, Casebook on Restitution, 1996, Blackstone, pp 27–36. These pages should be read in conjunction with this present chapter. QUASI-CONTRACTS (a) Introduction
Questions 1 ‘For my part, I think that the true distinction lies between a proprietary claim on the one hand, and a claim which seeks only a money judgment on the other. A proprietary claim is one by which the plaintiff seeks the return of chattels or land which are his property, or claims that a specified debt is owed by a third party to him and not to the defendant…’ (Staughton LJ in Republic of Haiti v Duvalier  1 QB 202, pp 213–14). Are all proprietary claims tracing actions? (Cf Ingram v Little  1 QB 31; Bowmakers Ltd v Barnett Instruments Ltd  KB 45.) 2 Is a tracing claim at common law an actio in rem or in personam? 3 What is the relationship, if any, between change of position and estoppel? 4 How can one own a debt? Why was it that the widow in Beswick v Beswick (p 249, cf p 78) could not claim that she was owner of the debts owed to her by the nephew? 5 Does one need a defence of change of position? Could it not be said that tracing, vis à vis any particular defendant, ends where that defendant in good faith has paid money forming the object of a tracing claim to a third party? 6 Should tracing attach to the money (or other tangible thing) or to the value? What difference would it make? Is the distinction between res and value important in respect of the defence of change of position? 7 Did the plaintiff in Rowland v Divall (p 236) have any property right in the purchase price while it remained in the defendant’s possession? 8 Are all debts, to a greater or lesser extent, based upon an undertaking to repay? If so, what is the basis of this undertaking? 9 Is the difference between tort and quasi-contract to be found in the historical difference between trespass and debt? 10 If the formal distinction between common law and equity were to be abolished, would an action in account become a quasi-contractual claim? (Cf English v Dedham Vale Properties, p 83.) Notes 1 One or two judges in the 19th century have observed that the debt action for money had and received is a common law version of the equitable remedy of account (see p 267). Certainly, money had and received is a useful claim for depriving those who have benefited through wrongs from retaining their profits, although its scope is wider than this. The action is useful, as Lipkin Gorman shows, as a kind of revindication claim for money paid to another by mistake, through duress or as a result of an ineffective or defective transaction. In the last situation, the plaintiff must show that the contract is ineffective and thus the quasi-contractual action is
dependent upon the requirement of a total failure of consideration (Rover International Ltd v Canon Films Ltd  1 WLR 912). 2 Both Rowland v Divall and Lipkin Gorman are not without their difficulties. In both cases, it could be argued that the plaintiff benefited from the success of each debt claim. One plaintiff got six months’ free use of a car, while the other got most its money back without too many questions being asked about its own responsibility in the whole sad affair. One may dream of hard and fast principles to govern these kinds of case, but the truth is that they are complex facts where the line between just and unjust benefits is almost impossible to draw. A similar difficulty is to be observed with the claim in Surrey CC v Bredero Homes (above, p 295), not, admittedly, a debt claim, but a damages action raising similar problems. Could it really have been right to allow a local authority to grab money in respect of a loss they did not suffer simply on the basis that the defendants had committed a wrong? Admittedly, a local authority could be said to represent the interests of the local inhabitants of its area (Local Government Act 1972, s 222) and thus, it might be the only institution capable of extracting an unjust profit. Yet, the law of tort does not allow a damages claim simply on the basis that a defendant has behaved unlawfully, nor perhaps should the law of restitution. Restitution lawyers might think differently, of course, but then restitution lawyers thought that the decision in Bolton v Mahadeva (p 226) gave rise to unjustified enrichment (Law Commission, Pecuniary Restitution for Breach of Contract, Report No 121, 1983). It took a practising lawyer to point out just how detached they were from the real world. (c) The action for money paid
If bailees have to expend money to protect, or upkeep, the bailor’s goods, can this expenditure be recovered by the bailees as a debt from the bailors? (Cf The Winson  AC 939.) 3 P, at considerable expense, patches up the roof of D’s house after it has been badly damaged in a gale. Assuming that D has gone away without leaving an address or telephone number with P, his neighbour, and assuming also that, if P had not acted, D’s house and contents would have been badly damaged by rain, can P recover his expense from D? 4 Was Lord Wright ahead of his time?
Notes and questions 1 The action for money had and received is a remedy which attaches itself, so to speak, to a specific amount of money in the defendant’s patrimony representing the unjust profit. The action for a quantum meruit looks to the more intangible benefit arising out of situations where one person confers upon another a service. Clearly, if I cut my neighbour’s grass while he is away, I have, in principle, conferred upon him a benefit. Should he have to pay for this benefit, however? English law takes the view that the mere conferring of a benefit upon another does not of itself give rise to a right to restitution (Falcke v Scottish Imperial Insurance Co (1886) 34 Ch D 234, pp 248–49). In order to trigger liability, there must have been either a request for the service or some kind of acceptance indicating a willingness to pay for what has been received. Such requests or acceptances can, of course, be implied, and this allows the court a degree of latitude when it comes to analysing the facts. All the same, it is unlikely that the plaintiff in Bolton v Mahadeva (above, p 226) could have succeeded in a quantum meruit debt claim in respect of the benefit (that is, work done) conferred upon the defendant; all that might be available in such a situation is a claim for materials left on the site and used by the occupier. Should the contractor in Bolton v Mahadeva have had the right to bring a quantum meruit claim for the work done? 2 Quasi-contract is most useful in situations of pre-contractual work undertaken with a view to a formal contract being concluded. However, once such a contract has been concluded it will, in principle, govern the rights and duties. If one of the parties wishes to sue on a quantum meruit, the contract must be got rid of, so to speak, either by recourse to frustration or by the court declaring that it is void. What is the restitution position if a contract is rescinded in equity? 3 D hires P to repair his chimney after P has given him an estimate of £400. While P is repairing the chimney, he notices that another one is in equally bad repair and he spends an extra day repairing the second chimney. P does not seek D’s permission, because D is difficult to contact and, in addition, P assumes that D would want the work done, because two-thirds of the £400 estimate is taken up with the cost of erecting scaffolding. P sends D a bill for £500. Must D pay this bill, or can he insist on paying only £400?
possessor (Dig 22.214.171.124). The idea of suing a thing rather than a person remains, however, a most helpful metaphor when it comes to distinguishing between personal and proprietary remedies. A proprietary remedy is where the claimant points to some thing or specific sum of money in another’s patrimony and says ‘that is mine, give it to me please.
Are cases such as Lewis v Averay (p 501) and Stevenson v Beverley Bentinck (p 400) tracing claims? 3 Did the Court of Appeal in Beswick v Besivick (p 78) allow Mrs Beswick to recover on the basis of tracing at common law? 4 P gives D a £5 note thinking D is T, to whom P owes £5. Does P remain the owner of the £5 note now in D’s possession? (c) Equitable proprietary claims
Capacity in French law is an essential condition of a contract (CC, Art 1108). However, in English law, with one main exception, incapacity usually makes a contract only voidable. Was there, accordingly, any real necessity for s 3 of the 1987 Act? Did not equity have the power to order the transfer of property so as to avoid unjust enrichment? 2 The one main exception to the voidable principle is a contract that turns out to be ultra vires because one party did not have the capacity to make such a contract. An ultra vires contract is void. Does this mean that any property transferred under such a non-existent contract remains in the ownership of the transferor? 3 Does one need a contract in order to transfer ownership in property? When might such a (non-contractual) transfer give rise to an unjustified enrichment on the part of the transferee? (f) Illegal contracts
action has become prevalent; indeed the French Cour de cassation has outflanked the specific instance approach of the Code civil by establishing unjust enrichment as a general principle of law existing independently of la loi. Does such a general action really help lawyers solve unjust enrichment problems? 2 When it comes to English law, the traditional position, until quite recently, was very clearly stated by Lord Diplock. Nevertheless, once one views the law from the position of the law of actions, including, of course, equitable remedies, the role of the principle of unjust enrichment becomes much more evident. It is the mirror image of the principle of wrongfully causing loss and it invites the court to look, not so much at the plaintiffs loss, but the benefit obtained without just cause. Indeed, one French professor once suggested the following principle to act as the mirror image of liability for damage in Art 1382: ‘Any human act whatsoever which causes an enrichment to another gives rise to a right on behalf of the person by whose act the enrichment has been procured to recover it.’ What problems does such a principle present when analysing factual situations? 3 Ought the court to look at the physical benefit itself (money in a defendant’s bank account or property bought with the enrichment money) or should they take an abstract view of benefit (for example, seeing it in terms of value)?
Change of position is now recognised as a defence in itself to a claim based on the principle of unjust enrichment. Did not the casino in Lipkin change its position when it gave the solicitor who had embezzled the cash the chance of winning a lot of money from the casino? 3 What does change of position do that the equitable defence of estoppel could not do? 4 Will change of position ever be available as a defence to an action for damages? 5 Is tracing an unjust enrichment claim or a claim belonging to the law of property? If a plaintiff can succeed in a tracing claim on the basis of title (ownership), what is the relevance of unjust enrichment? 6 What, if any, is the role of fault in unjust enrichment? 7 D, a manufacturer of ginger beer, deliberately puts only 98 centilitres of beer in bottles sold as litre bottles. Over several years, D makes a profit of £250,000 from this behaviour. Is D entitled to keep this profit? If not, who should have it? 8 D, an employer, deliberately fails to make his workplace safe for his employees. As a result of this behaviour, D makes a saving over the years of £1,000,000. No employee is actually injured, but they have all been exposed to much higher risks of injury than employees working in similar, but safer, workplaces elsewhere. Is D entitled to keep the £1,000,000? If not, who should have it? If the employees had threatened to go on strike and the court had given the employer an interlocutory injunction on the basis of threatened breaches of contract, ought the employer be able to set off against tax the costs of the injunction against his £1,000,000 profit? 9 These recent restitution cases are of interest from a legal system point of view in that they are cases that are openly influenced by academic writing (doctrine). Admittedly, Lord Goff himself is part of this doctrine, but the acceptance of an independent law of restitution appears to be taking English law beyond the position as seen by Lord Diplock in Orakpo v Manson Investments (see p 268). In some ways, this independence is a good thing, as indeed the Roman lawyers discovered. An independent law of restitution not only allows for an orderly distinction between contractual and non-contractual debt cases, but provides a category in which one can class a whole range of common law and equitable remedy cases devoted to the prevention of unjust enrichment. There are, however, problems. 10 The first problem is that an English law of restitution can never fully integrate itself into an English law of obligations, since it uses the law of property as one of its tools; such an intermixing of property and obligation notions is particularly evident in Lipkin Gorman (and see also Agip (Africa), above, p 240). Secondly, the idea that one can build up a logical model of rules founded upon the ‘axiom’ that no one should be enriched at another’s expense is impractical nonsense. Certainly, one may wish to take an Occam’s razor to the old forms of action, but it must be remembered that people who slash about with razors are likely to cut off their own vital
parts. The world of English law is not the world of German law, and the remedies approach to problem solving has its own strengths. The chapter on reasoning and method (Chapter 2) ought to show that ideas of axiomatic precision and logical rationality belong to legal history; scientia iuris and ars judicandi are now two separate processes, each with their own epistemological (theory of knowledge) standpoint. One great strength of approaching unjust enrichment through a law of remedies is that a law of actions provides great flexibility when it comes to analysing and categorising the facts. Thus, there is nothing wrong with the idea that tracing and rescission in equity should themselves act as focal points for their own particular rules. Of course, there are drawbacks to a form of liability approach, as the Esso case perhaps illustrates (above, p 216). Yet Denning LJ had little difficulty in this case in finding the just decision, indeed he used the old forms of liability to give expression to underlying legal rights (see above, p 613, note 1). The problem with the case was a House of Lords insensitive to its own role and the role of judges in the face of facts. Is not a law of remedies more sensitive than a law of axiomatic principles to the nuances of benefit in a society dedicated to the pursuit of profit? 11 This is not to say that one abandons a category of restitutionary rights any more than one abandons the category of tort; they both are useful for contrasting non-contractual obligations with contractual. But just as tort (and, in truth, contract) defies theory because it contains a range of cases which have quite different objectives (for example, the protection of constitutional rights as well as loss spreading), so restitution will always be a category with little theoretical cohesion. Indeed, one need only look at the case of Dimskal Shipping Co v ITWF  2 AC 152 to see what damage restitution lawyers have done with their ill-thought out theories of economic duress in a capitalist society. A traditional equity lawyer with a sensitive feel to the problems of industrial relations would never have allowed the remedy of rescission to be used in such facts. The law of obligations is about solving problems, admittedly with an eye to the future, and thus the emphasis needs to be on a legal reasoning which can handle social, political and economic complexity within its own model of concepts and relations. The problem with many restitution writers is that they think that their duty is to overcome complexity. Happily, practising common lawyers seem, on the whole, to have known better. Do we need a law of restitution based on rather meaningless abstract propositions? Are different species of debt claims which make various factual distinctions such a bad thing? LAW OF OBLIGATIONS: FINAL OBSERVATIONS
This collection of materials will not have provided much more than an introduction to the law of obligations and the law of remedies. Hopefully,
however, it will have provided a more thorough grounding in legal method and legal reasoning, at least in respect of problem solving in the law of obligations. Cases have been selected with this purpose in mind, and all of them are worth re-reading many times. For example, the factual problem in a modest decision like that of Poole v Smith’s Car Sales (above, p 533) or Reed v Dean (above, p 530) can prove richer than the facts of some of the major cases. Equally, some of the overturned Court of Appeal judgments can sometimes prove richer than the speeches in the House of Lords (see, for example, Lord Denning’s judgment in Beswick, above, pp 78, 163). These cases and judgments are worth returning to from time to time and the facts of all cases in this collection should be reflected upon, changed a little and mixed with facts from other cases (how else are exam questions compiled?). No judgment is ever valueless from a legal method and legal reasoning point of view. And the student who spends time reading, if only very quickly, all the reported cases in every weekly part of the All England or Weekly Law Reports will soon have a rich knowledge of the ars judicandi, if not of the scientia iuris, This collection of materials has also been compiled with Europe in mind. It must never be forgotten that many of the great judges of the second half of the 19th century—the judges who laid the main foundations for the modern law of contract and tort—had an excellent knowledge of Roman law and the Code civil (see, for example, Taylor v Caldwell, p 588). They may not have been faced with demands for harmonisation, but many of them recognised that legal knowledge was not strictly a common law phenomenon. What comparative law can bring to problem solving is the application of alternative models of analysis which, in turn, can stimulate alternative approaches to problems within the common law itself (Samuel (1998) 47 ICLQ 817). In addition, there is of course the question of harmonisation: is English law capable of developing a law of obligations that can be harmonised with the structured systems of the codes? This present work is deliberately ambiguous, for it is the student who must investigate the mentalité of the common lawyer so as to place it in the context of European law. Nevertheless, the collection ought to be used alongside copies of one or more of the great civil codes; legal knowledge is not equivalent to knowledge of a legal system. The whole question of legal knowledge is another theme that is underlying this collection of materials. Is knowledge of law knowledge of rules and principles? Or is it something more? This collection has been designed to suggest that something more is required: law may express itself primarily, and not surprisingly, through the written proposition but, as the Romans recognised, the law is not to be found in the rules (Dig 50.17.1). Ex facto ius oritur (law arises out of facts), as a famous medieval commentator on Roman law put it. Is such a maxim not the guiding principle of this collection? Certainly, when it comes to analysing factual situations, the syllogism is not enough, as this collection has hopefully indicated. An ability to understand the relationship between institutional focal points (persons, things and actions), legal relations
(contract, duty of care, possession and ownership), quasi-normative notions (damage, statements, fault, interest and expectations) and legal concepts (rights and duties) is the key to analysing factual problems. An exam question in the University of Cambridge’s Contract and Tort Paper II once invited candidates to discuss, in relation to an action for damages, the following statement: ‘Before the law can be applied to the facts, the facts must be categorised, but before the facts can be categorised, the law must be applied.’ Modern developments in (constructivist) epistemology (theory of scientific knowledge) and cognitive science have given us a major insight into answering this question. Science constructs its own models, which act as both the science and the object of science and thus, when it comes to law and legal science, what is required is the building of a model within the facts which will act at one and the same time as the means of understanding both the facts and the law (see above, p 170; and Petev (1999) 43 APD 27). In saying that all law is about persons, things and actions, the Romans, perhaps unconsciously, recognised this (see above, pp 27–31). At any rate, they certainly provided the tools and the insights for categorising the facts and applying the law.