ON APPEAL FROM CAMBRIDGE COUNTY COURT
DISTRICT JUDGE KIRBY
Strand, London, WC2A 2LL
B e f o r e :
THE RIGHT HONOURABLE LADY JUSTICE HALLETT
THE RIGHT HONOURABLE LADY JUSTICE BLACK
| RODER UK LIMITED
|- and -
|ANTHONY JULIAN WEST
2) DAVID MARTIN PHILLIPS
Mr Cameron Maxwell Lewis (instructed by Fowler De Pledge) for the Respondent
Hearing dates : 18th July 2011
Crown Copyright ©
Lord Justice Longmore:
"No action shall be brought whereby to charge any person upon or by reason of any representation or assurance made or given concerning or relating to the character, conduct, credit, ability, trade or dealings of any other person, to the intent or purpose that such other person may obtain credit, money or goods upon [sic], unless such representation or assurance be made in writing, signed by the party to be charged therewith."
i) Mr Phillips' representation that an insurance payout was pending was false to his knowledge;
ii) Mr West's representation that Titan was selling up and that everyone would be paid in full from the proceeds of sale was made recklessly without regard to the likelihood of Titan being, in fact, able to repay its creditors;
iii) in reliance on these representations Roder refrained from issuing proceedings in 2009 and also refrained from exercising their rights under the retention of title clause;
iv) the Directors could not rely on section 6 of the Act because the oral representations had not been made with the intent or purpose that Titan should obtain credit; Titan already had credit and the intent of the representations was to avoid Roder repossessing its goods, or suing for outstanding sums;
v) the Directors were accordingly liable in the tort of deceit for the amount of the value of the goods in respect of which Roder would have been able to recover under the retention of title clause; the judge gave judgment for £6,500 against the second and third defendants.
i) the words "credit, money or goods" in the Act must be read disjunctively so that it is sufficient for a defendant to show that he made the relevant representation with the intention that the debtor obtain "credit". He did not have to show that he obtained "money or goods upon credit" just that he obtained credit;
ii) there was no need for the credit to be obtained pursuant to any agreement; it was sufficient that it was obtained with the consent of the creditor;
iii) the fact that credit was obtained (for 30 days) when the goods were delivered did not mean that it was not obtained again when agreement was reached on the Payment Plan first for £1,000 and then for £500 per month; nor that it was not obtained again when Roder decided not to sue for the debts or to retake possession of their goods as a result of the fraudulent representations;
iv) the judge's finding that the Directors' representations had not been made with the intent that Titan should obtain credit but with the intent that Titan should avoid repossession or being sued for outstanding sums was illogical because an intent to avoid repossession or being sued was the same thing as an intent that Titan should obtain credit.
i) the true interpretation of the 1828 Act was that the representation must be made with the intent or purpose that the debtor should obtain "money or goods upon credit"; in this case even if the representations were made in order to obtain credit, they were not made with the intent to obtain money or goods since there was no prospect in 2009 that Roder would then supply money or further goods to Titan;
ii) if that was wrong, the judge's finding of fact that the intent of the Directors was not that Titan should obtain credit was conclusive of the matter;
iii) in any event, all that had happened in the present case was that there had been an extension of credit already obtained not an obtaining of credit; the intent or purpose of the Directors was at most that the period of the credit (already obtained) should be indefinitely extended; indeed the right interpretation of the facts was that, at the time the Directors made their representations, they intended to avoid payment altogether not that Titan should obtain credit with a view to payment at a later date.
"According to the view which I take of the act, the representation, in order to be within it, must, therefore, be of the third person's trustworthiness, as evidenced by his character, conduct, ability, credit, trade, or dealings, and must be one whereby, if true, that trustworthiness is increased. If indeed the real clause as drawn by Lord Tenterden stood thus, "To the intent that such third person might obtain money or goods upon credit," which is highly probable, this conclusion would be strengthened. But I do not rely on that which is, after all, only matter of probable conjecture from the ungrammatical state of the sentence as it now stands."
Parke B (than whom few judges have been more exact in matters of construction) said this (pages 115-116):-
"The words of the clause in question are, it is to be observed, clearly inaccurate, probably from a mistake in the transcriber into the Parliamentary roll. We must make an alteration in order to complete the sense, and must either transpose some words, and read the sentence as if it were "to the intent or purpose that some other person may obtain money or goods upon credit," or interpolate others, and read it as if it were "to the intent or purpose to obtain credit, money, or goods on such representation." If we assume Lord Tenterden's object to have been merely to prevent evasion of the Statute of Frauds, as we think it was, and use this a key for the construction of the clause, it would induce one to prefer the former alteration, by which the clause is made clearly to apply only to cases where the purpose of the representation is to obtain personal credit for the third person: but then, it would not apply to all cases of such credit, for it would include money and goods only, not work and labour done for the third person, or houses or land let to him, on the faith of such representation; which, however, are cases by no means of so frequent occurrence as transactions in money and goods. On the other hand, if we make the latter alteration, using the same key to the construction of the clause, we must reject the words "money or goods" as surplusage, as they would be included in the general term credit. I think it highly probable that the first correction would make the clause such as Lord Tenterden originally wrote it; …"
"With regard to the remarks which have been made upon the introduction into the statute of the word "upon", without any grammatical relation to the other words of the sentence, I must observe, that I am decidedly of the opinion that this word must be rejected as nonsensical, and that we cannot admit a conjectural transposition of it in order to interpret that statute. Neither do I think that either of the conjectures offered gives the most probable account for the introduction of the word. The manuscript of this clause most probably contained the word "thereupon"; on revising it, the author considered that the word was superfluous to express his meaning, and that it might possibly, if it had any effect, rather narrow the construction. He has therefore meant to strike it out, but has not carried his erasure with sufficient force through the latter part of the word. The word upon has, therefore, found its way into the print, and has escaped notice afterwards when the bill was in committee. The printers of bills for the two houses seldom commit an error on the side of omission. Every thing which is not beyond doubt erased in MS. is sure to be served up in print, and, if it should afterwards escape detection in committee, finds its way upon the rolls of Parliament, and into the Statute Book."
"to the intent or purpose that such other person may obtain money or goods upon credit."
"From and after the passing of this Act, all guarantees, securities, or cautionary obligations made or granted by any person for any other person, and all representations and assurances as to the character, conduct, credit, ability, trade, or dealings of any person made or granted to the effect or for the purposes of enabling such person to obtain credit, money, goods, or postponement of payment of debt, or of any other obligation demandable from him, shall be in writing, and shall be subscribed by the person undertaking such guarantee, security, or cautionary obligation, or making such representations and assurances, or by some person duly authorized by him or them, otherwise the same shall have effect."
There the word "upon" is omitted so "credit" is free-standing but there is an express provision relating to "postponement of payment of debt". One cannot, however, construe an Act of Parliament as if it said what another later Act says.
Lady Justice Hallett:
Lady Justice Black: