Judge, in a case where the issues were fraught with great national moment, as "based upon wholly confused and confusing reasoning?”

This much to show the prevailing invasion by literary periodicals of the domain of the law. As to the converse case, the current number of the Juridical Review is a sufficient example. Out of a total of one hundred and twenty-five pages, just seven and a half are allotted to an article on the "Liability of Common Carriers," while four and a half pages are found sufficient in which to treat of leading Scots cases. The remaining pages are devoted to literary and historical contributions and notices of books. Mr. Roughead's historical account of the fifth Earl of Bothwell-most interesting as it is—has no practical value to the professional reader, yet it alone comprises over forty pages of the contents of the number.

This interchange of subject-matter between the professional and lay periodicals is not mentioned here in the way of criticism, but rather to indicate the broadening of intellectual interests which is a characteristic of our time.

LEGAL AND EQUITABLE JUSTICE.-When one or other of two honest men have to suffer in consequence of the fraud of some rogue it is often a very difficult thing for a judge to say on whom the loss should fall-usually the one who has enabled the rogue to deceive the other is the one whom the law considers should bear the loss; but although that principle seems to have governed the Appellate Court in the case of Jones v. Waring,1 we are rather inclined to prefer, as a matter of abstract justice, what we believe would be the equitable view of the matter. Lord Darling, who tried the case, gave judgment for the plaintiff and founded himself on a quotation from Romeo and Juliet-what the particular quotation was, unfortunately, does not appear in the report, but according to the view of the Appellate Court, whatever it may have been, it was not considered appo

The case at first instance was reported in the Times newspaper of December 12th, 1924, as follows:

Lord Darling:

It seemed to him (his Lordship) that there was no consideration as between the plaintiffs and the defendants for the giving of this cheque. There was no kind of contract between them. The first submission of Mr. Hills (counsel for plaintiffs) was a simple and narrow one. It was not so deep as a well nor as wide as a church door, but it would serve-and Mr. Thorn Drury's (counsel for defendants) position was that of Mercutio:-It was fatal to him. (Romeo and Juliet. Act 3. Scene 1.-"Tis not so deep as a well nor as wide as a church door; but 'tis enough.")

32-C.B.R.-VOL. IV.

site, and in their opinion, in the words of Mr. Gilbert, “it had nothing to do with the case."

In order that the reader may form an independent judgment in the matter it is necessary to give a short summary of the facts.

The knave in the drama was a man named Bodenham, who represented himself to the plaintiffs as the agent of a concern which he called "International Motors," which he alleged manufactured "Roma" motor cars, and which he alleged was desirous of appointing the plaintiffs its agents for the sale of its goods in certain parts of England and Wales. He also falsely averred that this concern had the defendant company or their directors "behind it." The plaintiffs agreed to accept the agency, and also agreed to buy 500 of the "Roma" cars, and gave Bodenham cheques for £5,000 as a deposit of £10 on each car. Whether there was in fact any "International Motors" or any Roma" cars does not appear. It is rather suggested that they were mythical.

Bodenham at this time was indebted to the defendant company in £10,000 for furniture supplied; and in part discharge of his liability to them, he tendered the cheques for the £5,000, but they on their face appearing not to be signed by all necessary parties, the defendants communicated the fact to the plaintiffs, and they agreed to remedy the defect. Bodenham, from the defendants' office, and on their writing paper, wrote to the plaintiffs, returning the cheques for correction, and the plaintiffs returned one cheque for the amount duly signed and payable to the defendants. At this time the defendants, in consequence of Bodenham's default, had seized some of the furniture which he had purchased from them under a hire purchase agreement and took it as far as the railway station, but on his tendering them the £5,000 cheques they had returned these goods, and on payment of the £5,000, had sold him more goods to the amount of £3,000. There was no evidence of the value of the goods seized and returned. The Appellate Court held in these circumstances that the defendants were entitled to the whole £5,000, and that the plaintiffs were not entitled to recover any part of it.

But in England as in Canada, where law and equity conflict the latter is to prevail, and if equitable principles had been applied in this case we think the result would, or ought to have been different.

We have, first of all, the fact that the £5,000 was the plaintiff's money, out of which they had been defrauded by Bodenham.

Then we have the fact that the plaintiffs had enabled Bodenham to deal with the money as if it were his own, and that in so doing

the defendants were induced to do things and alter their position which they otherwise would not have done and for all of which the defendants were reasonably and equitably entitled to be indemnified; therefore to the value of the property seized and surrendered, and for the £3,000 of additional goods sold to Bodenham in consequence of the apparent rehabilitation of his credit, the defendants seem to be entitled to be reimbursed, but to any surplus that might remain after satisfying these claims, we fail to see that they have any equitable right to profit by the fraud of Bodenham.

Lord Darling, who tried the case, seems to have dealt with it simply on the footing that the defendants gave the plaintiffs no consideration for the cheque; but, as Scrutton, L.J., points out, a want of consideration is no ground for recovering money paid, unless there was some obligation on the part of the payee to give consideration, and here there was none. LEX.

EDITOR'S NOTE.-See a note of the case before the House of Lords, post p. 497.

CASE AND COMMENT

THE BOOTLEGGER AND THE INCOME TAX.-On the 27th July, the Judicial Committee of the Privy Council delivered judgment allowing the appeal of the Minister of Finance v. Cecil R. Smith from the judgment of the Supreme Court of Canada, which reversed the judgment of Mr. Justice Audette at the trial of the case in the Exchequer Court of Canada. The case is popularly known as the "Bootlegger Case." The result of the appeal to the Privy Council is that the judgment of the Supreme Court is set aside with costs, and the judgment of the Exchequer Court restored. In the opinion of Audette, J., the illicit traffic carried on by Smith was not a criminal offence in itself (malum in se), and while illegal in Ontario, might not be so in other parts of Canada. Provincial legislation could not derogate from the right of the Dominion under its taxing Act, and the profits in question came within the ambit of the definition of "income" in the Act. This view was adopted by their lordships of the Judicial Committee (Viscount Haldane, Lord Atkinson, Lord Darling and Lord Justice Warrington). In delivering their judgment, Lord Haldane said:

Construing the Dominion Act literally,, the profits in question, although by the law of the particular Province they are illicit, come within the words employed. Their Lordships can find no valid reason for holding that the words used by the Dominion Parliament were intended to exclude these people, particularly as to do so would be to increase the burden on those throughout Canada whose businesses were lawful.

"Moreover, it is natural that the intention was to tax on the same principle throughout the whole of Canada, rather than to make the incident of taxation depend on the varying and divergent laws of the particular Provinces. Nor does it seem to their lordships a natural construction of the Act to read it as permitting persons who come within its terms to defeat taxation by setting up their own wrong. There is nothing in the Act which points to any intention to curtail the statutory definition of income and it does not appear appropriate under the circumstances to impart any assumed moral or ethical standard as controlling in a case such as this the literal interpretation of the language employed. There being power in

the Dominion Parliament to levy the tax if they thought fit, their lordships are therefore of opinion that it has levied income tax without reference to the question of Provincial wrong-doing."

Lord Haldane referred to the case of Inland Revenue Commissioners v. Von Glehn,3 where Scrutton, L.J., said: "I am inclined to think, without finally deciding it, that the Income Tax Acts are restricted to lawful businesses carried on in a lawful way." In this view Lord Haldane made it clear that the Judicial Committee did C. M.

not concur.

MONEY PAID UNDER MISTAKE OF FACT-FRAUD-ESTOPPEL"HOLDER IN DUE COURSE" OF CHEQUE.-In the case of R. E. Jones Ltd. v. Waring and Gillow Ltd.1 the House of Lords was concerned with the application of the rule as to the right of recovery of money paid under mistake of fact. Upon the facts, it appeared that one B., owed money to the respondents for furniture bought under a hire. purchase. Upon B's, failing to comply with the terms of the agreement as to payment, the respondents resumed possession of the furniture. B., then approached the appellants telling them that he represented a motor firm who were putting a new car on the market. He showed the appellants a specification of the car, together with an illustrated prospectus, and offered to appoint them sole agents for the sale of the car in a certain territory if they would undertake to order five hundred of such cars and pay a deposit of ten pounds on each car. He further stated that the motor company had not then been constituted, but assured the appellants that the respondents, who were a well-know firm, were behind the motor company and were financing it. There was no basis of fact in B's, statements, but appellants believed them and, without further inquiry, gave him a cheque for five thousand pounds. This was used by B., for the purpose of discharging his debt to the respondents. The respondents then returned to B., the furniture they had seized, and cashed the cheque. On the discovery of B's fradulent conduct, the appellants sued the respondents for the recovery of money paid.

On the trial of the action, Lord Darling, sitting as an additional Judge of the King's Bench Division, gave judgment in favour of the appellants. An appeal was taken to the Court of Appeal (Pollock, M.R., Scrutton, L.J., and Sargant, L.J.) which reversed the decision of Lord Darling.2