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the statute, passed on the 3rd August, 1914, called the Postponement of Payments Act, 1914, which provided that
His Majesty may by Proclamation authorize the postponement of the payment of any bill of exchange or of any negotiable instrument or any other payment in pursuance of any contract, [notice, whether in existence at the outbreak of war or not) to such extent, for such time and subject to such conditions or other provisions as may be specified in the Proclamation.' The Act was expressed to remain in force for six months and numerous Proclamations were made under it. Both these and the Act itself soon expired, and provision to meet cases of hardship was made by a series of Courts (Emergency Powers) Acts. The Bills of Exchange Act, 1914, (which also was temporary) was passed to meet difficulties arising out of the war.
Now the point which concerns us is this, that these emergency statutes show that the general rule is that impossibility or inconvenience arising from war is no defence to an action for breach of contract, so that it is for us to find the exceptions to this rule. If authority is needed for this, it is to be found in the case of Paradine v. Janel an action in debt for rent, in which the defendant pled that he had been dispossessed by the army of a certain German Prince, by name Prince Rupert, an alien born. * And this difference was taken, that where the law creates a duty or charge and the party is disabled to perform it without any default in him, and hath no remedy over, there the law will excuse him. As in the case of waste, if a House be destroyed by Tempest, or by Enemies, the Lessee is excused... but when the party by his own contract creates a duty or charge upon himself, he is bound to make it good, if he may, notwithstanding any accident by inevitable necessity, because he might have provided against it by his Contract.' That is the general rule. There are however some exceptions:
(1) by the common law, a common innkeeper and a common carrier are not liable for loss of, or damage to, the goods entrusted to their care in terms of their common law liability
1 (1647) Aleyn 26.
when such loss or damage is caused by the King's enemies, which would include destruction and damage by air raids, bombardment, etc.:
(2) when the parties have expressly provided in their contract that the fact of war or the consequences of war shall afford a defence.
For instance, since the Agadir incident in 1911 it has become almost universal for marine insurance policies to contain some form of F.C. and s. clause—'Warranted free of capture, seizure, arrest, restraint, or detainment and the consequences thereof, etc... . ' leaving the owner of the property free to effect a separate insurance against war risks, or to arrange with his underwriters to delete this clause upon payment of an extra premium.
An early recognition of the need of making special provision against the occurrence of war is found in the year 1340 in Y.B. Pasch. 14 Edw. III. (Rolls Series, p. 128), where it appears that in a charter of the King granting to the Abbot of Ramsey and his successors the right of holding a fair at St Ives in return for a farm of £50 since assigned to the plaintiff in this case, it was provided in the King's charter that ‘if the merchants should be disturbed by reason of war in his realm, so that they could not come there nor make their profit, the suit of the fair should cease for the time.' The report continues ‘and we'(the defendant's counsel) tell you that by reason of the war between the King and the French the merchants, etc., have been hindered from coming there; judgment whether for that time we shall, in opposition to the charter, be charged.' Ultimately it was held that there had been no war 'in his realm,' and the plaintiff recovered.
(3) Where the outbreak of war renders the performance of the contract by one or both of the parties illegal, for instance, as involving intercourse by a ‘British or allied resident' with an “enemy resident.' Thus in Esposito v. Bowdenl where a British subject before the Crimean War broke out chartered an Italian ship to go to Odessa and there load a cargo, and war broke out before she reached Odessa, it was held that since the outbreak of war made it illegal for the British subject (though not for the Italian plaintiff) to trade with Odessa, he could not be compelled to pay damages for refusing to load.
1 (1857) 7 E. and B. 763. See also Avery v. Bowden (1856) 5 E. and B. 714. For an instance during the recent war, see Ross v. Shaw (1917] 2 I. R. 367
It is submitted that it would equally be open to an alien of any nationality other than enemy to plead illegality arising from a war in which his country was involved.
(4) Where impossibility arises from some act of the Executive done in pursuance of statutory powers, such as the Defence of the Realm Act, or in pursuance of common law powers to provide for the defence of the realm.
This is in effect equivalent to a change of the law of our own country which when producing impossibility amounts to a defence, and we may cite Baileyv. De Crespignyl as an authority. There a railway company acting under compulsory statutory powers purchased the defendant's land and built a railway station upon it contrary to the provisions of a restrictive covenant as to building which the defendant had given to the plaintiff, a prior purchaser of an adjoining plot. This was held to excuse the defendant, on the ground that Parliament has ‘repealed the covenant,' as it was put in Brewster v. Kitchina.
Instances occur to one of property being requisitioned though specifically subject to a contract for hire or sale: a reservist being unable to perform a contract of service by reason of mobilisation: a house being demolished as impeding the operations of a gun: the billeting of soldiers whereby a householder is unable to fulfil a contract with a lodger.
But the question of supervening impossibility of performance has demanded so much attention of the Courts during the war and bids fair to leave so permanent a mark upon our law that we have considered it deserving of separate treatment in the chapter now immediately following.
1 (1869) L. R. 4 Q. B. 180. 2 (1697) 1 Ld. Raym. at p. 321; 1 Salk. 198.
WAR-TIME IMPOSSIBILITY OF PERFORMANCE
Reprinted from Law Quarterly Review, xxxv. 84 (January, 1919).
THE object of these remarks is to take stock of the recent and numerous cases upon supervening Impossibility of Performance of Contract, to ascertain where we have got to, and whither we are going.
For this purpose it is useful to know where we stood at the outbreak of war, and it is proposed, taking Taylor v. Caldwelli (1863) as our principal starting-point, to consider how far we had travelled before the outbreak of the greatest and most disturbing war with which the Common Law of England has ever been called upon to deal.
In that case, the Surrey Music Hall, Newington, Surrey, of which the defendant had agreed to give the plaintiff the use for a series of concerts to be given by the latter, was destroyed by an accidental fire before the date of the first concert, and thus the defendant was unable to carry out his agreement. The agreement, which was in writing, contained no express reference to the destruction of the premises, though expressed to be made ‘God's will permitting. The plaintiff claimed damages for breach of the agreement. Blackburn J. (as he then was) after admitting that 'where there is a positive contract to do a thing, not in itself unlawful, the contractor must perform it or pay damages for not doing it, although in consequence of unforeseen accidents the performance of his contract has become unexpectedly burthensome or even impossible,' fortifies himself by reference to the Digest and Pothier's Traité des Obligations, and concludes a review of the English authorities by extracting the following principle:
13 B. and S. 826.
'In contracts in which the performance depends on the continued existence of a given person or thing, a condition is implied that the impossibility of performance arising from the perishing of the person or thing shall excuse the performance.' Thus the first serious breach was made after 200 years in the defences of Paradine v. Janel.
Four years later Taylor v. Caldwell was followed in another case of a contract de certo corpore, where A contracted to erect machinery in buildings belonging to B, payment to be made on completion, and, the buildings being burnt down before the work was completed, the contract was held to be discharged, and A was unable to recover payment for the work already donez. Lord Parker pointed out the difference between these two cases, namely that in Taylor v. Caldwell a condition precedent was implied, whereas in Appleby v. Myers the Court implied a condition subsequent.
Some years elapsed before any further extension of the Taylor v. Caldwell principle was made. Howell v. Coupland4 is a case of the actual perishing of the thing, a potato crop, which was not in existence at the time of the contract. In Robinson v. Davison5 (a case of a contract to play the piano), Mrs Davison did not perish before her concert, but became incapacitated by illness from performing. Taylor v. Caldwell was prayed in aid, unnecessarily, it is submitted, because contracts for personal services are governed by a rule which was laid down long before Taylor v. Caldwell, and may, indeed, be said to be partly responsible for Taylor v. Caldwell. Still, Robinson v. Davison is interesting as showing a readiness to extend the legal effect of the perishing of a person or thing to cover the case of a person or thing ceasing to exist in the state contemplated by the contract. Mrs Davison continued as a woman, no longer a piano-playing woman. Nickoll v. Ashton illustrates this extension in the case of a thing. The defendants had sold to the plaintiffs a cargo of Egyptian cotton-seed to be shipped
1 (1647) Aleyn 26.
(1916] 2 A. C. at p. 423. (1871) L. R. 6 Ex. 269.
2 Appleby v. Myers (1867) L. R. 2 C. P. 651. 4 (1874) L. R. 9 Q. B. 462; 1 Q. B. D. 258. 6 (1901) 2 K. B. 126 (C. A.).