terms of the agreement were set out in a letter as follows: 'He will supply the three meals, lunch, tea, and dinner, as per menu, at 12s. 6d. per head, &c., you guaranteeing not less than 600 passengers and paying for all over that number; wines and other drinks to be paid for by you at the company's ordinary tariff prices; 300l. to be paid to Mr. Elliott on account of the refreshments on the Monday previous to the review day.' There was a letter of March 5 written by the defendants on behalf of the Navy League in answer to this, which accepted the terms and contained a postscript: 'It is of course understood that in the event of the cancellation of the review before any expense is incurred by the contractor there shall be no liability on our side.' The plaintiff incurred on or before June 23 some expense in the purchase of extra knives, forks, and crockery, and in printing tickets, but some of this expenditure was for other steamers hired on a like errand, and I think it probable that the amount so expended for this steamer might be taken at 201.; but he expended nothing on refreshments, and he has possession of and can use in his trade the articles bought; so that no money can be said to have been thrown away except the cost of printing the tickets, which was about 21. "On June 23 the cheque in question was sent to the plaintiff, signed by the two defendants as officers of the Navy League. On the 24th it became known that owing to the illness of the King the review would not be held, and nothing more was done, the steamer never leaving the Thames, where she was lying. The defendants on the 25th wrote to the plaintiff saying that, as the arrangements for the naval review were cancelled, they thought that the greater proportion of the cheque should be refunded; but the plaintiff did not answer this letter. On July 15, however, he called on Captain Crutchley, who represented the Navy League, and contended that he was entitled as to this steamer (for he had contracts relating to others) to all the money which he would have received if the trip had been carried out. It is not quite clear what Captain Crutchley said, but according to the plaintiff he was willing to pay 2501. ; he was at all events willing to allow all expenses. But in the VOL. II. 1903. 2 K 2 1903 ELLIOTT v. CRUTCHLEY. conversation it came out that the plaintiff had not paid the cheque into his bank, and after he left Captain Crutchley stopped the cheque, so that when it was presented it was dishonoured, and upon it this action was now brought." Witt, K.C., and Poley, for the plaintiff. The plaintiff is entitled to recover. The contract gave him the right to a payment of 3007. in advance, and that right is not affected by the postscript to the defendants' letter, for expense was in fact incurred by the plaintiff before the review was abandoned, and the contract became impossible of performance in the manner contemplated when it was entered into. The plaintiff was entitled to sue in respect of that 3007. on the Monday before the day fixed for the review, and could have at once sued for it had the cheque not been sent to him on that day. Having a cause of action before the cancellation of the contract, the plaintiff's rights are not affected by the fact that the contract subsequently became impossible of performance, and the defendants could not legally stop payment of the cheque. Shearman, K.C., and Eustace Hills, for the defendants. Looking at the contract apart from any special terms in it, the authorities clearly shew that it could not now be enforced. The contract came to an absolute end by reason of its becoming impossible of performance, and in such a case neither party to a contract can sue upon it: Appleby v. Myers (1); Taylor v. Caldwell. (2) It is true that a cheque had been given by the defendants to the plaintiff; but payment of that cheque had been stopped, and the plaintiff was in no better position as the holder of a stopped cheque than he would have been if the cheque had never been given to him by the defendants: Cohen v. Hale. (3) The expenditure incurred by the plaintiff was not such an expenditure as was contemplated by the contract, for it was incurred in respect of articles which became a permanent addition to his stock-in-trade. Cur. adv. vult. (1) (1867) L. R. 2 C. P. 651. (2) (1863) 3 B. & S. 826. (3) (1878) 3 Q. B. D. 371. 1903 ELLIOTT v. June 13. The following written judgment was delivered by RIDLEY J. [The learned judge, after stating the facts as above, continued:-] In Taylor v. Caldwell (1) and in Appleby CRUTCHLEY. v. Myers (2) the law applicable to such cases as the present was laid down, and it appears to me to come to this: that where the performance of a contract without fault on either side becomes impossible by the destruction of premises, or by such an event as occurred in the present case, that "is a misfortune equally affecting both parties, excusing both from further performance of the contract, but giving a cause of action to neither." This principle was applied by the Divisional Court in Blakeley v. Muller (3) in a case similar to the present. There the plaintiff took seats on a stand to view the Coronation Procession on June 27, 1902, and paid for them. A suit was brought in the county court to recover the money, and judgment was given for the defendant. The Divisional Court, affirming this, said that where performance of a contract becomes impossible from some cause for which neither party is responsible, and the party sued has not contracted or warranted that the event, the non-occurrence of which has caused the contract not to be possible of performance, shall take place, then the parties are excused from further performance of the contract. But, they said, the consequence of that is that neither party can sue or be sued for anything to be done afterwards. The defendants could not be compelled to complete the seats, and the plaintiff could not be sued for the price thereof. Each party rests in the position in which he was found when the event occurred, unless there is something in the terms of the contract which gives a special right to either party. That is the effect of the judgment, though in a previous case (4) Darling J. appears to have thought differently, and to have allowed money paid to be recovered back. In the present case, if the 3007. had been paid in cash, it seems that it must have remained, according to the principle laid down by the Divisional Court, in the plaintiff's hands, (1) 3 B. & S. 826. (2) L. R. 2 C. P. at p. 659. (3) (1903) 88 L. T. 90. (4) Krell v. Henry, (1902) 18 Times L. R. 823. 2 K 2 2 1903 unless there be something special in the contract-a point with which I must deal later in regard to the postscript above CRUTCHLEY. mentioned. ELLIOTT v. Ridley J. But the cheque which was sent to the plaintiff having been stopped, what is the position of the parties? According to Cohen v. Hale (1), it is as though it had never been given; the debt remains in such a case as though there had been no cheque, and the party to whom it was sent is remitted to his original right on the consideration for the cheque. Adopting this (and I do not think it has been questioned), here, if each party is to rest in the position in which he was found when the event occurred, the defendants are entitled to succeed. Their right to do so depends on the accident that the cheque was not presented by the plaintiff; but it is none the less their right, and it is in accordance with the merits of the case, for the money was to be paid on account of the refreshments to be supplied, and the plaintiff has expended nothing on that account, and therefore has done nothing to earn it. But it was argued that while the above principle, as to the effect of such an occurrence on a contract to be performed, must be accepted, still here there.was a cause of action vested on June 23, before the event occurred, and that could not be taken away, the case being similar in effect to one of advance freight: De Silvale v. Kendall. (2) But the loss of freight owing to non-performance of a voyage is, to my mind, quite different from the performance of a contract being rendered impossible by the occurrence of such an event as we have to consider, and gives rise to quite different considerations. It may be, however, that there is a difference between the right to sue for a payment due on a fixed date before the event occurs, and the right to sue for anything to be done afterwards, and some colour is lent to this contention by some observations of Channell J. in his judgment in Blakeley v. Muller. (3) It seems, indeed, to be quite consistent with the judgment of the Exchequer Chamber in Appleby v. Myers (4) that, if the contractor in that case had made it a term of the contract that he (1) 3 Q. B. D. 371. (2) (1815) 4 M. & S. 37; 16 R. R. 373. (3) 88 L. T. 90. should be paid by fixed instalments for the work as it was done, instead of leaving the payment till completion of the work (as he did), he would have been able to recover such instalments as were then already due for work done when the fire occurred; and I think the observations of Channell J. must be read as having reference to such a condition of things when he said, "If it was payable prior to the abandonment of the procession, the position would be the same as if it had been actually paid and could not be recovered back, and it could be sued for." But in this case the 3007. in question is not payable simply as an instalment for work then done, as in the instance suggested, but "on account of the refreshments," i.e., the refreshments of the passengers on the voyage which has become impossible. I think, therefore, that this argument ought not to prevail, and that, unless the postscript to the letter of March 5 imports into the contract a special term, the plaintiff is not entitled to recover. That postscript was added on the defendants' behalf, and is a little difficult of construction. It was at one time argued for the plaintiff that the intention was, in the event of cancellation of the review before expense incurred, to relieve the defendants of liability; but in the event of cancellation after expense incurred, to leave them liable-liable, that is to say, to perform the contract or pay damages for not performing it. It must have been contended that that was the meaning by the plaintiff when the interview took place on July 15, for there is nothing in the letter of March 4 on which he can have placed reliance as having that effect. At the hearing, however, it was not necessary to press the argument so far as this, for the only question was the right to recover on the cheque. But upon that subject I am unable to find that the postscript has any bearing. I think it means one of two things: either, if expense shall not have been incurred before the event, the defendants shall not be liable, but that, if it has, they shall (that is to say, liable in damages for not performing the contract); or else that if expense shall not have been incurred before the event the defendants shall not be liable for anything, but that, if it has, then they shall, for the amount of such 1903 ELLIOTT v. CRUTCHLEY. Ridley J. |