*435] *NEILL and Another v. WHITWORTH and Others. Jan. 26.

A. contracted to sell to B. 500 bales of cotton at a given price, to arrive at L. per ship or ships from C. The contract contained provisions as to quality, and for a reference in case of dispute; and then followed these words,-" The cotton to be taken from the quay: customary allowances of tare and draft; and the invoice to be dated from date of delivery of last bale:"Held, that the stipulation as to the place of delivery was not a condition precedent, but a mere stipulation in favour of the seller, and that the contract amounted in effect to a contract to deliver the cotton at a reasonable time and under reasonable circumstances, the article to be at the buyer's charge from the time of its landing on the quay.

THIS was an action for an alleged breach of a contract for the delivery of certain cotton.

The declaration stated that the defendants bargained and sold to the plaintiffs, and the plaintiffs bought of the defendants, certain cotton, that is to say, 500 bales of cotton, guaranteed to be October shipment, at 15 d. per lb., to arrive from Calcutta in Liverpool per ship or ships, and to be fair Bengal cotton: the said cotton to be taken from the quay: customary allowances of tare and draft; and the invoice to be dated from the date of the delivery of the last bale. The said cotton to be in merchantable condition: the damaged, if any, to be rejected, provided it could not be made merchantable. Should the said cotton be transhipped into other vessels arriving, the contract to hold good: but if any of the vessels should be lost, the contract to be void so far as regarded such ships only. Payment for the said cotton to be made in cash within ten days, made equal to ten days and three months; and cash on account to be paid before delivery, if required. Averment, that all conditions were fulfilled and all things happened, and all times elapsed necessary to entitle the plaintiffs to the delivery of the said cotton as agreed: Breach, that the defendants made default in delivering the said cotton, as agreed; whereby the plaintiffs had lost and been deprived of the profits which would have accrued to them from the delivery of the said cotton, and were prevented from fulfilling a contract entered into by them for the resale of the said cotton, and thereby lost great gains and profits, &c., and by reason of the premises the plaintiffs incurred expenses in and about endeavouring *to procure the delivery of the said cotton *436] by the defendants, as agreed.

The defendants pleaded,-first, that the defendants did not bargain and sell to the plaintiffs, and the plaintiffs did not buy from the defendants, the cotton in the declaration mentioned, upon the terms. therein alleged, secondly, that the defendants did not make default in delivering the cotton in the declaration mentioned, as therein alleged, thirdly, that the plaintiffs were not ready to accept the cotton. Issue thereon.

The cause was tried before Pigott, B., at the last Summer Assizes at Liverpool, when the following facts were taken by consent on the learned Judge's note:-The plaintiffs were merchants in London; the defendants were merchants at Manchester; and both dealt largely in cotton. On the 2d of October, 1863, the defendants, through their brokers, Trueman & Rouse, sold to the plaintiffs 500 bales of cotton, at 15 d. per lb. The bought note was as follows:

"Bought for account of Messrs. Neill, Brothers, of B. Whitworth

& Brothers, Manchester, 500 bales of cotton, at 15 d. per lb., guaranteed October shipment, to arrive in Liverpool per ship or ships from Calcutta.

"The cotton guaranteed fair Bengal. Any slight variation in mrk not to vitiate this contract. In case of dispute arising out of this contract, the matter to be referred to two respectable brokers, who shall decide as to quality, and the allowance, if any, to be made. "The cotton to be taken from the quay: customary allowance of tare and draft; and the invoice to be dated from date of delivery of last bale. "To be in merchantable condition; the damaged, if any, to be rejected, provided it cannot be made merchantable. Should the cotton be transhipped into other vessels arriving, the contract to hold good but, if any of the vessels be lost, the contract to be [*437 void, so far as regards such ships only. "Payment, cash within ten days, made equal to ten days and three months. Cash on account, before delivery, if required.

"TRUEMAN & ROUSE." On the 28th of October, 1863, the plaintiffs resold the cotton to one Clarke, through the same brokers, at 183d. per lb.

On the 8th of January, 1864, the defendants declared the Talavera and the Fort George as the ships by which the cotton was to arrive,— 250 bales by each. The Talavera arrived at Liverpool on the 3d of February, with a cargo of cotton which was landed on the quay there, and subsequently warehoused. Application was made on the part of the plaintiffs for delivery orders, but none were given or tendered until after the cotton had been carried to the warehouse. By the dock regulations at Liverpool, the authorities have power to ware house all goods after they had been twenty-four hours on the quay.

The Fort George was stranded in Carnarvon Bay, and her cargo was landed there, and forwarded by railway to Liverpool. Arrived there, it was put into the "wreck transit sheds" on the quay, which is considered as part of the quay. The 250 bales ex Fort George were afterwards removed from the wreck transit sheds to the warehouse.

On a subsequent day, the vendors (the defendants) offered to deliver the whole 500 bales from the warehouse, but at quay weights, and without any charge for warehousing, or to cart them back to the quay and deliver them there. The plaintiffs, however, refused to take them, insisting that the defendants had broken their contract by allowing the cotton to be warehoused, instead of delivering it on arrival from the quay."

*A verdict was taken for the plaintiffs, with 21097. 7s. 6d. [*438 damages, (a) leave being reserved to the defendants to move to enter a verdict for them, or to reduce the damages,-the Court to be at liberty to draw such inferences of fact as a jury might have drawn, and to make all such amendments as the Judge at Nisi Prius might have done.

Brett, Q. C., accordingly, in Michaelmas Term last, obtained a rule nisi to enter a verdict for the defendants, or to reduce the damages, on the grounds, as to the first point, that the stipulation in the con

(a) The difference between the contract-price (154d.), and the price at which the plaintiffs had resold the cotton to Clarke (184d.),—the average weight of a bale of cotton being 3 cwt.

tract that the cotton should be taken from the quay, was in favour of the vendors, or, if not, that it was a stipulation only, and not a condition in the contract; and, as to the second point, that the damages should be either nominal or at most the difference between the contractprice and the market-price on the day of the breach. He submittel, that, inasmuch as the plaintiffs might without any expense have had the very cotton contracted for at the price agreed on, viz. 15 d., they could only be entitled to nominal damages for the defendants' breach of contract: but that, in any event, they could not have more than the difference between the contract-price and the price at which they might have bought similar cotton in the market on the day of the breach, which was proved to be 17d.

Edward James, Q. C., Mellish, Q. C., and Baylis now showed cause.By the terms of the contract, the plaintiffs were entitled to have the cotton in question delivered to them from the quay, which would limit it to twenty-four hours after the landing, that being the *439] time which by the regulations of the docks goods are permitted to lie upon the quay, after which they are warehoused at the expense and risk of the owner: and the plaintiffs by their contract bound themselves in the same terms to deliver to their sub-purchaser. The defendants had notice of the sub-contract, and consequently were aware of the importance of such a delivery as would enable the plaintiffs to perform it. The stipulation for delivery from the quay was an essential part of the contract, binding the sellers to deliver and the buyers to take the cotton from the quay; and was not, as is contended on the part of the defendants, a mere stipulation introduced in favour of the sellers; for, if so, there would be no time or place provided for the delivery at all. This form of expression occurs in the contract in Moore v. Campbell, 10 Exch. 323. The more difficult question is, what is the proper measure of damages,-the difference between the contract-price (15дd. per lb.) and the price at which the plaintiff's had resold the cotton,-the difference between the contract-price and the market-price of the day on which the default in delivery of the cotton was made,—or nominal damages, because the cotton contracted for was actually tendered within three days of the landing, free of expense, and so the vendees sustained no damage? If the plaintiffs could have gone into the market and obtained cotton which would have enabled them to perform their contract with their sub-vendees, it may be conceded that they would only have been entitled to the difference between the contract-price and the market-price of the day. But here, relying upon the defendants' performance of their contract, they have made a contract which they could not possibly fulfil. They are therefore entitled to damages computed by the difference *140] between the contract-price and the price at *which they resold,-these being the damages which must be considered as fairly and reasonably resulting according to the usual course of things from the breach of the contract: Waters v. Towers, 8 Exch. 401;† Hadley v. Baxendale, 9 Exch. 341;+ Dalton v. The South Eastern Railway Company, 4 C. B. N. S. 296 (E. C. L. R. vol. 93); Hoey v. Felton, 11 C. B. N. S. 142 (E. C. L. R. vol. 103). At all events, the plaintiff's would, on all the authorities, and more especially according to the rule laid down by Willes, J., in Borries v. Hutchinson, post, p. 445,

be entitled to the difference between the contract-price and the marketprice on the day of breach.

Brett, Q. C., and Holker, in support of the rule.-Two questions arise in this case,-first, whether the defendants were guilty of any breach of contract,-secondly, what damages the plaintiffs are entitled to recover. The action is for the non-delivery of cotton, to arrive; and it is an admitted fact that the defendants did give the plaintiffs a delivery order before the commencement of the action. The contention on the part of the plaintiffs is, that the defendants did not deliver the cotton at the time and place when and where they bound themselves by their contract to deliver it. By the terms of the contract, the buyers were to take the cotton "from the quay." That, it is submitted, does not amount to a condition binding the sellers to deliver on the quay, but merely to a stipulation for their advantage, that, if they choose so to deliver, the vendees shall be there ready to receive it; the object being that the vendors shall not be at the charge of warehouse-rent, risk of fire, and the like. The distinction between stipulations which are conditions precedent and those which. may be compensated for by damages in a cross-action is very elaborately discussed by Williams, J., in a judgment *delivered by him in [*441 the Exchequer Chamber in a case of Behn v. Burness, 32 Law J., Q. B. 204, the result of which shows that this was a mere stipulation. introduced for the benefit of the sellers. Whether particular terms of delivery amount to a condition precedent or not, depends, according to the judgment of Lord Ellenborough in Ritchie v. Atkinson, 10 East 295, 306,"not on any formal arrangement of the words, but on the reason and sense of the thing, as it is to be collected from the whole contract." The like rule is laid down in Abbott on Shipping, Part 4, ch. 1, § 5: and see Tarrabochia v. Hickie, 1 Hurlst. & N. 183,† and Jonassohn v. Young, 32 Law J., Q. B. 385. At all events, the utmost the plaintiffs could be entitled to recover would be nominal damages.

ERLE, C. J.-I am of opinion that this rule should be made absolute to enter a verdict for the defendants. The action is brought for the non-delivery of 500 bales of cotton pursuant to contract. The defendants plead that they did not make default, and that the plaintiffs were not ready to accept the cotton. The objection urged on the part of the plaintiffs, was, that the contract contained a condition precedent which was not performed by the vendors, and therefore that they, the plaintiffs, are entitled to maintain this action: and the question is, whether the contract between the parties does contain a condition precedent to be performed by the vendors before they could call upon the vendees to accept the cotton. The words relied on as constituting a condition precedent are, "The cotton to be taken from the quay." It was in fact landed and warehoused: and the plaintiffs, finding that it had been taken to the warehouse, refused to receive it, although the defendants offered to deliver it to them at quay weights, and even to cart it back to the quay free of [*442 expense. The law upon the subject of what does and what does not amount to a condition precedent, or only to an independent stipulation, is laid down with much clearness by my Brother Williams in a very elaborate judgment delivered by him in the Ex

chequer Chamber in the recent case of Behn v. Burness, 4 Best & Smith 296 (E. C. L. R. vol. 116). The distinctions there pointed out are well worthy of attention. Looking at the contract now before us with the light afforded by that case, I am of opinion that the clause in question constitutes an independent stipulation introduced solely for the benefit of the vendors, and therefore is matter on which the vendees cannot rely as amounting to a condition precedent. See the nature of the contract. It is a contract by bought and sold notes for 500 bales of cotton to arrive, at a certain price and of a certain quality. Then comes a stipulation, that, "in case of dispute arising out of this contract, the matter shall be referred to two respectable brokers, who shall decide as to quality, and the allowance, if any, to be made." Then come the words in question,"The cotton to be taken from the quay." This comes after the more operative words, and among some provisions which are inserted in favour of the vendors. Looking at the nature of the stipulation itself, I cannot see how it can be of any importance to the vendees whether they receive the cotton from the quay or from the warehouse, provided the warehousing does not impose on them any additional expense or undue delay. It seems to me to be perfectly clear that it was a stipulation inserted for the benefit of the vendors, to enable them to call upon the vendees to take the cotton from the quay, in order to save them expense. I am also clearly of opinion that it was not intended to operate as a stipulation for time. There is nothing to show that the whole number of bales *stipulated *443] for were to be delivered out of the ship the moment she

arrived: they might be the first 250 unloaded, or the last. I see nothing, therefore, in the stipulation which points to the time of delivery, or shows that it was for the benefit of the vendees and I do see very good reason why the vendors should make it. I am therefore of opinion that it was not a condition precedent, that there has been no breach of the contract on the part of the vendors, and consequently that this action will not lie.

WILLIAMS, J.—I am of the same opinion, and for the same reasons. WILLES, J.—I am of the same opinion. It struck me at first that the expression "the cotton to be taken from the quay" must be construed as a stipulation on the one hand, accompanied by a corresponding promise on the other, that the delivery should take place upon the quay, and that, unless the vendors were ready to deliver the cotton there, they failed in the performance of their contract, and would be liable for all the consequences of such failure. But, upon consideration, I am satisfied that that literal construction of the words would be an incorrect one. There are several reasons for holding that it could not have been so intended. The stipulation does not affect the identity of the cotton, or its quantity, or its quality,—as, for instance, that it should be cotton from Mobile or from New Orleans, or the like. Then, does it amount to a stipulation as to time? Without it, the contract would stand as a contract for the delivery of the cotton within a reasonable time. The words were evidently introduced with reference amongst other things to who was to be at the charge of the warehouse-rent, insurance &c. These