Practice and Procedure-Claim and particulars disclosing no cause of action­ Action dismissed Supreme Court (Civil Procedure) Rules, Order 32, rule 19.

The appellant had an agreement to buy launches from the respondent at £4,400 and gave [1,000 in advance; then he did not want the launches and sued for the return of the £1,000. The parties settled that suit on these terms: that the respondent should sell the launches for the highest possible value, of which the respondent would be the judge; if they fetched more than £4,400 the respondent would keep the excess, and if less the appellant would bear the loss. Some months later the respondent wrote to the appellant of the highest offer; this, answered the appellant, was too low and the sale should be delayed. Later the respondent had the launches sold by auction, and the proceeds were £750 gross and £672 5s. 0d. nett. The appellant then brought this new action claiming (1) to set aside the settlement in his former suit, and (2) to recover the [1,000.

At the trial the only evidence put in was the file of the former suit (and of another suit which is not relevant hereto); and there was argument partly on res judicata and partly on pleadings: the defendant wanted issues settled as the particulars of the claim were vague, the plaintiff was arguing that the claim and particulars disclosed a good cause of action. The Judge held that no cause of action was disclosed on claim (1) and consequently that claim (2) was res judicata; and he dismissed the action with judgment in defendant's favour. The plaintiff appealed.

In the appeal the plaintiff complained that he had not had an opportunity below to present his case fully: he would have tried to prove that the settlement in the former case had been entered into under a common mistake in both parties believing the market value of the launches was about £3,000.

In fact his particulars of claim narrated the events, then stated that £675 (the net proceeds) was ridiculously low and was grossly" below what was in the con­templation of the parties when arranging settlement ". and went on to allege fraud at the time of the sale of the launches.

For the plaintiff-appellant it was also argued in the appeal that he should have been allowed to amend his pleadings if they did not cover mutual mistake, and that in any event Order 32, rule 19, applied and the Judge should not have gone beyond striking the case out. In fact, however, no application was made on plaintiff's behalf in the Court below for leave to amend.

Held: (1) The appellant's writ and particulars of claim did not contain any averment which would have entitled him to raise the issue that the parties were acting under a mutual mistake at the time of the settlement. He had an oppor­tunity of applying in the Court below for leave to amend but did not so apply. And as for his allegation of fraud (to support which he was not in possession of any facts), it did not relate to the time of the settlement. His writ and particulars therefore disclosed no cause of action on the first part of his claim.

(2) Order 32, rule 19, which provides for the striking out of any pleading on the ground that it discloses no cause of action, goes on to provide that the Court may (inter alia) give judgment for the plaintiff or defendant,- and the Judge rightly dismissed the first part of appellant's claim and gave judgment for the respondent. [ pg 77 ]

Appeal by the plaintiff:-.3542.

F. R. A. Wiiliams, with him H. U. Kaine and T. O. S. Benson, for the

Appellant ..

D. H. E. Teesdale for the Respondent.

The following judgment was delivered:

Foster-Sutton, P. The dispute between the parties in this case commenced with suit No. 158 of 1947, in which the appellant sued the respondent for the return of £1,000, claimed to have been an advance made by the appellant in part payment of £4,400, the purchase price of four launches which the respondent had agreed to sell to the appellant.

The appellant considered that the launches offered to him by the respondent were unsuitable for the purpose for which they were required, and having failed, after demand, to obtain repayment of the advance of £1,000 which he had made, he sued the respondent for its return.

At the trial of the case a settlement was reached between the parties, and at their request its terms were embodied in the judgment of the Court. The relevant terms of settlement read as follows:-

" Defendant hereby agrees to sell all the four launches the subject matter of the said action at the highest possible value obtainable by the defendant who shall be the sole judge of the highest possible value obtainable:-

" (a) That after sale of the said launches if the value obtained by the defendant exceeds £4,400, such excess shall be retained by the defendant.

"(b) If the value obtained for the launches is below £4,400, then the loss shall be borne by the plaintiff, credit being given for the sum of £1,000 already paid by the plaintiff to the defendant."

The judgment in that case is dated 24th October, 1947. On the 6th April, 1948, the respondent informed the appellant by letter of the highest offer he had received for the launches and the appellant replied by a letter written by his solicitors, saying that the sale of the launches" should be delayed for a while as the price was too low".

The respondent alleged that on the 1st day of May, 1948, his solicitors wrote a letter to the appellant's solicitors informing them that unless the appellant would produce a purchaser with a higher offer than that already received by the respondent, he would proceed with the sale of the launches. That no reply was received to that letter, that on the 28th May, 1948, the respondent's solicitors again wrote a letter to the appellant's solicitors advising them that the respondent intended to proceed with the sale, and that no reply was received to the letter.

None of the correspondence to which I have referred was tendered in evidence at the trial. There has been a change of solicitors since the letters were written and appellant's Counsel was unable to say if the letters of 1st and 28th May, 1948, had been received.

The respondent also alleged that he then instructed an auctioneer to proceed with the sale of the launches and that after due notice and advertisement the launches were sold on or about the 7th October, 1948, to the highest offerer  for £750, and that the net proceeds of the sale, after deducting auctioneer's com­mission, cost of advertising and other expenses, amounted to £672 5s. 0d.

The next step in this dispute was taken by the appellant who then instituted the present proceedings by a Civil Summons under which he claimed:-

.• (1) For an order to set aside the settlement between the plaintiff and the defendant in suit No. 158 of 194""; and

"(2) for the recovery of £1,000, being the amount deposited by the plaintiff with defendant for the purchase of launches from the Marine Department.' , [pg 78 ]

The summons went on to say that the" defendant has faild to supply the launches of the quality required by the plaintiff ", and particulars of the claim are set out in ten paragraphs appended to the writ.

The case came to trial before Ames, ]., and the parties contented themselves with tendering in evidence the settlement and judgment to which "[ have already referred, and the case files in suits Nos. 157 and 158 of 1947, the former of which has no relevance to the matter we have to determine on this appeal.

After hearing argument by Counsel the learned trial Judge held that the writ of summons and particulars of claim disclosed no cause of action on the first part of the claim, that is to say the claim that the settlement be set aside, and consequently the second part of the claim was res judicata. He accordingly gave judgment for the respondent-defendant dismissing the appellant-plaintiff's claim, and it is against that decision that the present appeal was brought.

On behalf of the appellant it has been submitted that the only point argued before the learned trial Judge was the question of res judicata raised by paragraph ten of the Statement of Defence, that appellant's Counsel had no opportunity of dealing with the case on any other footing because the trial Judge delivered judgment dismissing the appellant's claim without hearing further argument, that had he been permitted fully to present his case the appellant would have endeavoured to prove that the settlement in suit No. 158 of 1947, was entered into under a common mistake, both parties being under the belief, on the day of the settlement, that the market value of the launches in question was approxi­mately £3,000. Appellant's Counsel argued that he should have been allowed to amend his pleadings if they did not cover mutual mistake, and that in any event" Order 32, rule 19 applies and the learned trial Judge should not have gone beyond striking the case out".

Counsel for the respondent submitted that only about 15 per cent of the argument in the Court below was directed to the question of res judicata, that every aspect of the appellant's claim was dealt with by appellant's Counsel, and that respondent's Counsel was obviously endeavouring to ascertain precisely what the appellant's claim was. He also argued that there was ample opportunity for the appellant's Counsel to make an application for leave to amend his pleadings, but he had not chosen to do so, that if mutual mistake was being relied upon it was appellant's duty clearly to plead it, and there was no such averment in his pleadings.

I am in no doubt as to the correctness of respondent's Counsel's contention regarding the ground covered by the arguments in the Court below. A careful perusal of the record discloses quite clearly that a great deal more ground was covered than the question of the respondent's plea of res judicata. Defendant­respondent's Counsel commenced by making an application to the Court asking that the issues be settled, on the footing that the particulars of claim were vague, and plaintiff-appellant's Counsel proceeded to argue in an endeavour to satisfy the Court that the claim with its particulars disclosed a good cause of action. It is true that appellant's Counsel submitted that the respondent's plea of res judicata should be settled first, but he also dealt with the question, inter alia, of mutual mistake at the time the settlement was agreed to.

I am also of opinion that the appellant's writ and the particulars appended thereto cannot be said to contain an averment which would have entitled him to raise the issue that the parties were acting under a mutual mistake. Paragraphs one to six of the particulars merely contain a narrative of events, paragraph. seven contains an assertion that the sum 'of £675 is " ridiculously low and is grossly below what was in the contemplation of the parties when arranging the settle­ment "; paragraph eight contains an allegation of fraud against the respondent, not at the time the settlement was entered into, but at the time of the sale of the launches, and paragraphs nine and ten refer to matters none of which could [pg 79] be said to have affected the validity of the settlement at the time it was made.