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COURT OF APPEAL CHARLES RICKARDS LTD OPPENHEIM KB

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					COURT OF APPEAL

CHARLES RICKARDS LTD v OPPENHEIM [1950] 1 KB 616

January 16 1950

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DENNING LJ:

Early in 1947 the defendant, Mr Oppenheim, wanted a new Rolls Royce
car, and he placed an order in two parts with the plaintiffs Charles
Rickards, Ltd, who are motor car traders. He first ordered the chassis, a
Rolls Royce Silver Wraith chassis, for estimated delivery in June, 1947,
but he also wanted a body built on the chassis, and he particularly wanted
to know the time within which that body could be made.

… The plaintiffs obtained an estimate from Jones Brothers
(Coachbuilders) Ltd, who said that they could do it within ‘six months or,
at the most, seven months’. Thereupon, the plaintiffs gave the same time
to the defendant and he gave them the order for the body on that footing.
…The plaintiffs sub-contracted it and put out the work with Jones
Brothers (Coachbuilders) Ltd…The chassis was actually delivered to the
sub-contractors on July 30, 1947, and, if that is taken as the date from
which the time ran, the seven months would be up at the end of February,
1948, but the specification for the body work was not finally agreed until
August 20, 1947. If that date is taken, the latest time for delivery would
be March 20, 1948. Whichever date is taken, though, is immaterial, for
the time was plainly exceeded. The body was not built on to the chassis
by March 20, nor, indeed, until many months later not until October 18,
1948, was the car completed.

It is clear … there was an initial stipulation making time of the essence of
the contract between the plaintiffs and the defendant, namely, that it was
to be completed ‘in six, or, at the most, seven months’ … If the
defendant, as he did, led the plaintiffs to believe that he would not insist
on the stipulation as to time, and that, if they carried out the work, he
would accept it, and they did it, he could not afterwards set up the
stipulation in regard to time against them. Whether it be called waiver or
forbearance on his part, or an agreed variation or substituted performance,
does not matter.
…
Therefore, if the matter stopped there, the plaintiffs could have said that,
notwithstanding that more than seven months had elapsed, the defendant
was bound to accept, but the matter does not stop there, because delivery
was not given in compliance with the requests of the defendant. Time and
time again the defendant pressed for delivery, time and time again he was
assured that he would have early delivery, but he never got satisfaction,
and eventually at the end of June he gave notice saying that, unless the
car was delivered by July 25, he would not accept it.

The question thus arises whether he was entitled to give such a notice …
the defendant was entitled to give notice bringing the matter to a head. It
would be most unreasonable if, having been lenient and having waived
the initial expressed time, he should thereby have prevented himself from
ever thereafter insisting on reasonably quick delivery. In my judgment, he
was entitled to give a reasonable notice making time of the essence of the
matter. Adequate protection to the suppliers is given by the requirement
that the notice should be reasonable.

The next question, therefore, is: Was this a reasonable notice? … In my
opinion … the words of Lord Parker of Waddington in Stickney v Keeble
[1915] AC 419 apply to such a case as the present…

Lord Parker said, ‘In considering whether the time so limited is a
reasonable time the court will consider all the circumstances of the case.
No doubt what remains to be done at the date of the notice is of
importance, but it is by no means the only relevant fact. The fact that the
purchaser has continually been pressing for completion, or has before
given similar notices which he has waived, or that it is specially
important to him to obtain early completion, are equally relevant facts.’

To that statement I would add, in the present case, the fact that the
original contract made time of the essence. In this case, not only did the
defendant press continually for delivery, not only was he given promises
of speedy delivery, but, on the very day before he gave notice, he was
told by the sub-contractors’ manager, who was in charge of the work, that
it would be ready within two weeks … In my judgment, there is no
ground on which this court could in any way differ from that finding. The
reasonableness of the notice must, of course, be judged at the time at
which it is given. It cannot be held to be a bad notice because, after it is
given, the suppliers find themselves in unanticipated difficulties in
making delivery.

The notice of June 29, 1948, was, therefore, a perfectly good notice so as
to make time of the essence of the contract...

The case, therefore, comes down to this. There was a contract by the
plaintiffs to supply and fix a body on the chassis within six or seven
months. They did not do it. The defendant waived that stipulation. For
three months after the time had expired he pressed them for delivery,
asking for it first for Ascot and then for his holiday abroad. But still they
did not deliver it. Eventually at the end of June, being tired of waiting any
longer, he gave a four weeks’ notice and said: ‘At all events, if you do not
supply it at the end of four weeks I must cancel’, and he did cancel. I see
no injustice to the plaintiffs in saying that that was a reasonable notice.
Having originally stipulated for six to seven months, having waited
eleven months, and still not getting delivery, the defendant was entitled to
cancel the contract.

Full text

DENNING LJ:

It is clear on the finding of the trial judge that there was an initial
stipulation making time of the essence of the contract between the
plaintiffs and the defendant: the body of the car was to be completed
‘within six, or, at the most, seven months.’ Mr. Sachs did not seek to
disturb that finding; indeed, he could not successfully have done so. But
what he did say was that that stipulated time was waived. His argument
was that, the stipulated time having been waived, the time became at
large, and that thereupon the only obligation of the plaintiffs was to
deliver within a reasonable time. He said that ‘a reasonable time’ meant,
in accordance with well-known authorities, a reasonable time in the
circumstances as they actually existed, that is, that the plaintiffs would
not exceed a reasonable time if they were prevented from delivering by
causes outside their control, such as strikes or the impossibility of getting
parts, and events of that kind; and that on the evidence in this case it
could not be said that a reasonable time was in that sense exceeded. He
cited the well-known words of Lord Watson in Hick v. Raymond and
Reid , that where the law implies that a contract shall be performed within
a reasonable time, it had ‘invariably been held to mean that the party
upon whom it is incumbent duly fulfils his obligation, notwithstanding
protracted delay, so long as such delay is attributable to causes beyond
his control and he has neither acted negligently nor unreasonably.’ These
words, he said, supported the view that in this case, on the evidence, a
reasonable time had not been exceeded.

If this had been originally a contract without any stipulation as to time
and, therefore, with only the implication of reasonable time, it may be
that the plaintiffs could have said that they had fulfilled the contract; but
in my opinion the case is very different when there was an initial contract,
making time of the essence of the contract: ‘within six or at the most,
seven months. ‘ I agree that that initial time was waived by reason of the
requests that the defendant made after March, 1948, for delivery; and
that, if delivery had been tendered in compliance with those requests, the
defendant could not have refused to accept the coach-body. Suppose, for
instance, that delivery had been tendered in April, May, or June, 1948:
the defendant would have had no answer. It would be true that the
plaintiffs could not aver and prove they were ready and willing to deliver
in accordance with the original contract. They would have had, in effect,
to rely on the waiver almost as a cause of action. At one time there would
have been theoretical difficulties about their doing that. It would have
been said that there was no consideration; or, if the contract was for the
sale of goods, that there was nothing in writing to support the variation.
There is the well-known case of Plevins v. Downing , coupled with what
was said in Bessler, Waechter, Glover & Co. v. South Derwent Coal Co.
Ltd. , which gave rise to a good deal of difficulty on that score; but all
those difficulties are swept away now. If the defendant, as he did, led the
plaintiffs to believe that he would not insist on the stipulation as to time,
and that, if they carried out the work, he would accept it, and they did it,
he could not afterwards set up the stipulation as to the time against them.
Whether it be called waiver or forbearance on his part, or an agreed
variation or substituted performance, does not matter. It is a kind of
estoppel. By his conduct he evinced an intention to affect their legal
relations. He made, in effect, a promise not to insist on his strict legal
rights. That promise was intended to be acted on, and was in fact acted
on. He cannot afterwards go back on it. I think not only that that follows
from Panoutsos v. Raymond Hadley Corporation of New York , a
decision of this court, but that it was also anticipated in Bruner v. Moore.
It is a particular application of the principle which I endeavoured to state
in Central London Property Trust Ltd. v. High Trees House Ltd.

So, if the matter had stopped there, the plaintiffs could have said,
notwithstanding that more than seven months had elapsed, that the
defendant was bound to accept; but the matter did not stop there, because
delivery was not given in compliance with the requests of the defendant.
Time and time again the defendant pressed for delivery, time and time
again he was assured he would have early delivery; but he never got
satisfaction; and eventually at the end of June he gave notice saying that,
unless the car were delivered by July 25, 1948, he would not accept it.

The question thus arises whether he was entitled to give such a notice,
making time of the essence, and that is the question that Mr. Sachs has
argued before us. He agrees that, if this were a contract for the sale of
goods, the defendant could give such a notice. He accepted the statement
of McCardie J., in Hartley v. Hymans , as accurately stating the law in
regard to the sale of goods, but he said that that did not apply to contracts
for work and labour. He said that no notice making time of the essence
could be given in regard to contracts for work and labour. The judge
thought that it was a contract for the sale of goods. But in my view it is
unnecessary to determine whether it was a contract for the sale of goods
or a contract for work and labour, because, whatever it was, the defendant
was entitled to give a notice bringing the matter to a head. It would be
most unreasonable if the defendant, having been lenient and waived the
initial expressed time, should, by so doing, have prevented himself from
ever thereafter insisting on reasonably quick delivery. In my judgment he
was entitled to give a reasonable notice making time of the essence of the
matter. Adequate protection to the suppliers is given by the requirement
that the notice should be reasonable.

So the next question is: was this a reasonable notice? Mr. Sachs argued
that it was not. He said that a reasonable notice must give sufficient time
for the work, then outstanding, to be completed. He says that, on the
evidence in this case, four weeks was not a reasonable time because it
would, and did in fact, require three and a half months to complete it. In
my opinion, however, the words of Lord Parker in Stickney v. Keeble
apply to such a case as the present just as much as they do to a contract
for the sale of land. He said that ‘in considering whether the time so
limited is a reasonable time the court will consider all the circumstances
of the case. No doubt what remains to be done at the date of the notice is
of importance, but it is by no means the only relevant fact. The fact that
the purchaser has continually been pressing for completion, or has before
given similar notices which he has waived, or that it is specially
important to him to obtain early completion, are equally relevant facts’ -
to which I would add, in the present case, the fact that the original
contract made time of the essence of the contract. In this particular case,
not only did the defendant press continually for delivery, not only was he
given promises of speedy delivery, but on the very day before he gave
this notice he was told by the works manager in charge of the work that it
would be ready within two weeks. Then he gave a four weeks’ notice.
The judge found that it was a reasonable notice, and, in my judgment,
there is no ground on which this court could in any way differ from that
finding. The reasonableness of the time fixed by the notice must, of
course, be judged at the time at which it is given. It cannot be held to be a
bad notice because, after it is given, the suppliers find themselves in
unanticipated difficulties in making delivery.

So here the notice was a perfectly good notice so as to make time of the
essence of the contract, subject, however, to another point that Mr. Sachs
made: he said it was bad because it was not given to the plaintiffs directly
but was given to the coachbuilders, the sub-contractors, and it would
appear that they did not send it on to the plaintiffs for another eight or
nine days. The answer to that argument is that the notice was given to the
people who were actually doing the work, and that the plaintiffs had,
from the beginning, authorized the defendant to give instructions direct to
them. This notice was, no doubt, important, and it would have been better
for the defendant to have given it both to the plaintiffs and to the
coachbuilders; but it seems to me that, in view of the authorization given
on August 7, 1947, it cannot be that that made it a bad notice. In any
event the plaintiffs got it within eight or nine days; and, even if it was
only received then, still there was more than a fortnight to go before July
25, and it would still be a reasonable notice. That point also, therefore,
does not hold good.

There was yet one remaining point: Mr. Sachs said that, even accepting
the notice of June 29 as one making time of the essence of the contract,
nevertheless even that notice was afterwards waived by the defendant. On
July 10, 1948, there was a discussion between the defendant on the one
hand and the plaintiffs’ representatives on the other as to what was to be
done about the car. They said that the defendant authorized the plaintiffs
to go ahead with the work, and promised to take delivery of the car after
he came back from his holiday and then to decide whether they should
sell it for him; whereas the defendant said that he only offered to do what
he could to help them, and that he suggested their best course was to go
on and complete it and sell it on their own account, not on his behalf, but
in order to save any loss. The judge took the view that the defendants’
memory about it was probably the more accurate, and I see no reason for
taking a different view. This interview was followed on July 16, by a
letter from the plaintiffs to the defendant in these terms: ‘In view of your
comments during our conversation on this subject last week, we assume
that you are prepared to leave the order with Messrs. Jones Bros. Ltd.
until your return from holiday, by which time the car should be ready for
delivery. Every effort will be made on our part to expedite delivery, and
we feel sure you appreciate our desire to settle this matter amicably.’ The
defendant did not reply to that letter, and Mr. Sachs says that the proper
inference was that he assented to it. Upon this point I would say that in
order to constitute a waiver there must be conduct which leads the other
party reasonably to believe that the strict legal rights will not be insisted
upon. The whole essence of waiver is that there must be conduct which
evinces an intention to affect the legal relations of the parties. If that
cannot properly be inferred, there is no waiver: see Foot Clinics (1943)
Ltd. v. Cooper’s Gowns Ltd., and Bird v. Hildage. In this case the
conversation and the letter do not show any intention to affect the legal
relations in the matter. They were only approaches with a view to
settlement from which nothing concrete emerged. I therefore agree with
the judge that nothing in them can really be said to amount to a waiver of
the clearly expressed notice given on June 29, 1948.

The case therefore comes down to this: there was a contract by these
motor traders, the plaintiffs, to supply and fix a body on the chassis
within six or seven months. They did not do it. The defendant waived that
stipulation. For three months after the time had expired he pressed them
for delivery, asking for it first for Ascot and then for his holiday abroad.
But still they did not deliver it. Eventually, at the end of June, being tired
of waiting any longer, he gave four weeks’ notice and said: ‘at all events,
if you do not supply it at the end of four weeks I must cancel the
contract’; and he did cancel it. I see no injustice to the suppliers in saying
that that wa, a reasonable notice. Having originally stipulated for six to
seven months, having waited ten months, and still not getting delivery,
the defendant was entitled to cancel the contract.

On the counterclaim the judge has held that the chassis should be returned
or its value paid. I assume that the plaintiffs will exercise their option of
paying for the chassis. They will then own the whole car which they can
sell for whatever they can realize. I cannot help sharing the regret of the
judge that this car was not sold before and the proceeds used to meet the
cost of the work. But we have only to determine the strict legal rights of
the parties. They are that the plaintiffs made a contract which they have
not fulfilled and which the defendant justifiably cancelled. I think the
decision of the judge was right and that this appeal should be dismissed.

SINGLETON LJ:

I am of the same opinion. I wish to say a few words because a case such
as this is of importance to the public as well as to the plaintiffs and to the
defendant. In my opinion, on the facts as found by Finnemore J., the
defendant was entitled to succeed on both claim and counterclaim. The
defendant obtained a Rolls Royce chassis through the plaintiffs, and it
was through them and on their behalf, really, that the sub-contract was
made for the building of the body. It was found that the coachbuilders in
question could give, or said that they could give, much earlier delivery
than other builders who were in contemplation, and it was upon that basis
that the defendant and the plaintiffs decided that Jones Bros. Ltd. should
build the body. The chassis was delivered in July, 1947, and the contract
in regard to the building of the body was entered into about July 11, 1947,
though the specification for the bodywork was not finally agreed until
August 20, 1947. It was understood then - indeed, it was said - that the
body should be completed within six or, at the most, seven months.’ That
did not take place. There were very many delays. Then in June, 1948, the
defendant was told by the manager of the coachbuilders, with whom he
had been put in direct communication and relationship by the plaintiffs,
that they could finish the body in two weeks’ time. Thereupon, he thought
it right, in view of what had happened, to write them the letter of June 29,
to which Denning L.J. has referred in his judgment. That letter gave them
virtually a month in which to complete the body. There was no answer at
all to that letter to the coachbuilders. He spoke to them on the telephone,
and he wrote again on July 7, 1948. Thereafter, they answered and said
that it was impossible to do what he wished.

The question that arises is: was the notice which he gave reasonable, or
was the time which he allowed them for completion reasonable in the
circumstances? The judge in his judgment said: ‘He then, on June 29,
called for the car within a month, namely, by July 25, which I think he
was entitled to do, being a reasonable time in which to call for delivery of
the car, which was then very considerably overdue.’ The evidence before
the judge justified him in coming to that conclusion, and I do not think
that this court has any right or duty to interfere with that finding. Mr.
Sachs in his argument raised the question whether the contract was a
contract for the sale of goods or a contract for work and labour. He
submitted that the judge was wrong in coming to the conclusion that this
was a contract for the sale of goods, and that, if it was, on the other hand,
a contract for work and labour, the principle applied by the judge did not
apply and ought not to be used for the purposes of a case of this kind. I
am not sure that I agree with the finding of the judge that this was a
contract simply for the sale of goods; but I do not think that matters. The
law as to a contract for the performance of work is stated in Halsbury’s
Laws of England, 2nd ed., vol. 3, at pp. 220 to 222, under the heading:
‘Building Contracts, Engineers and Architects.’ Paragraph 380 reads, and
I think that it is applicable to this case in every respect:

‘In cases where time has not been made of the essence of the contract, or
where, although time originally was of the essence of the contract, the
time so fixed for completion has ceased to be applicable by reason of
waiver or otherwise, the employer has still a right by notice to fix a
reasonable time for the completion of the work, and, in case the
contractor does not complete by that time, to dismiss the contractor just
as a vendor would be entitled to rescind the contract in case of a contract
for sale of land.’

The public point of view seems to me to be this, and the law ought to be,
and, I think is, sufficient to meet it: in such a case the person ordering the
work has the right in these circumstances to say, ‘I will not accept the
work unless you deliver it within a certain time’ - which must be a
reasonable time. I agree that the appeal should be dismissed.

BUCKNILL LJ:

I also agree that the appeal should be dismissed.

				
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