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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Philp v Knoblauch [1907] ScotCS CSIH_9 (31 May 1907)
URL: http://www.bailii.org/scot/cases/ScotCS/1907/1907_SC_994.html
Cite as: (1907) 15 SLT 61, [1907] ScotCS CSIH_9, 1907 SC 994

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JISCBAILII_CASE_SCOT_SALE OF GOODS_CONTRACT

31 May 1907

Philp & Co.
v.
Knoblauch.

Lord Justice-Clerk.—I am sorry to differ from the Lord Ordinary, who has carefully considered the case, but I am of opinion that the Lord Ordinary's interlocutor is erroneous. This first letter of 28th December 1905 is not a letter merely indicating that the defender had certain goods at his disposal and would be glad to enter into negotiations with regard to them, but stated, that he had “pleasure in quoting you (the pursuers) 100 tons (of linseed) at 41s. 3d., usual Plate terms,” and that he awaited “your esteemed reply.” That I think was clearly an offer of the 100 tons at a named price. Now, that letter was replied to by a telegram in these terms—“Accept hundred January/February Plate 41s. 3d., Leith, per steamer Leith.” That was a shorthand way of stating their reply to be followed by a letter. I think the telegram was a very plain acceptance of the 100 tons which the defender had quoted. I think it must be read along with the letter which followed, in which the pursuers say:—“We wired you as per enclosed copy, thus buying from you 100 tons Plate linseed January/ February steamer shipment usual contract.” The pursuers' telegram read with their letter is a very plain acceptance of what I consider is the plain offer contained in the defender's letter of 28th December. Without going nicely into the phraseology used I am distinctly of that opinion. The only difficulty is the question whether the words used by the pursuers involved an acceptance of the usual Plate terms as a condition of the contract. I

think they did when we read the telegram and the letter together. The telegram “accepts” without any reservation on this point, and the letter contains the words “usual contract,” which plainly mean the same thing as the words “usual Plate terms” in the offer.

The case of Harvey v. Facey which was quoted to us has no bearing. That was a case regarding an alleged purchase and sale of heritable property, not a transaction like this in re mercatoria. Further there was never really an offer. The telegram founded on as an offer was not an offer. It was merely an opening of negotiations. It offered nothing. It was merely an intimation of the lowest price which would be considered if anyone came forward offering it. I have no doubt that decision was right, but it has no bearing here.

Lord Stormonth-Darling.—I agree. I should like in addition only to make a single reference to Harvey v. Facey, in the Privy Council, cited by the Lord Ordinary. In that case a telegram was sent to the owner of a certain property asking whether he was willing to sell it to the persons making the inquiry, and also asking what was the lowest price; and the telegram in reply stated the lowest price for the property but did not answer the first question. The Privy Council there held (and I do not of course question their judgment in the least) that there was no contract, the ground of their judgment being that there was no answer to or agreement on the question first asked, which had to be express and could not be implied.

But here I am of opinion that the defender's letter to the pursuers of 28th December, and the pursuers' telegram of 29th December in answer thereto, contained all the conditions necessary to make a concluded agreement. There was no necessity or reason for the defender, in that letter, quoting to the pursuers a specific quantity and price unless he was prepared to make a contract with them if buyers, as to which he awaited their reply. That reply could only be received next day, and was sent by telegram as soon as possible. I am of opinion that a contract was thereby concluded, and on usual Plate terms. It is true the telegram does not repeat “on usual Plate terms,” but I think that pursuers' telegram plainly implied their consent thereto.

Lord Low.—I concur.

Lord Ardwall.—I agree. I think that the letter of 28th December 1905 contains in the first place a general statement that the defender is selling Plate linseed, and then goes on to make an absolutely definite offer of a specific quantity at a specific price. The defender says, “I shall be glad to hear if you are buyers.” This does not mean buyers in general, but buyers of the quantity specified at the price quoted, otherwise there would be no meaning in the phrase which follows, “and await your esteemed reply.” This offer was accepted by a telegram, dated 29th December 1905, sent before the offer was recalled, and the letter and telegram constitute, in my opinion, a concluded contract for the purchase of the linseed in question.

It was maintained by the defender that there was no concluded contract because the telegram did not fully meet the offer, in respect that it did not refer to “usual Plate terms”; but with regard to a document so plainly in re mercatoria as a telegram, I think the acceptance therein contained, which included a specification of the subject sold, the time of delivery, the quantity and the price, was sufficient, and that it implied an acceptance of the ancillary condition “usual Plate terms.” But further, the pursuers' letter of 29th December 1905 contained that condition, and moreover these “terms” being the invariable conditions for Plate linseed, they must be held to have formed an implied condition of the acceptance unless specially excluded. For these reasons I think it is vain for the defender to plead that there was no concluded contract in respect of the absence in the telegram of a reference to “usual Plate terms.”

[1907] SC 994

The permission for BAILII to publish the text of this judgment
was granted by Scottish Council of Law Reporting and
the electronic version of the text was provided by Justis Publishing Ltd.
Their assistance is gratefully acknowledged.


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