Scottish Court of Session Decisions

On 29th May 1907 the Edinburgh and District Tramways Company, Limited, brought an action against J. W. Courtenay, advertising contractor, Norfolk Street, London, and 34 St Andrew Square, Edinburgh, for decree (1) that the defender was bound to pay to the pursuer the cost—£279, 7s. 6d.—of the beadings or frames fitted to the windows of their cable cars for enclosing advertisements, or (2), alternatively, for the sum of £130 as recompense for their use, (3) that he was bound to pay to them the cost—£856, 2s. 6d,—of the wooden boards affixed to the handrails on the outside of the cars, to which the enamelled iron plates containing his advertisements were attached, or (4), alternatively, for the sum of £390 as recompense for their use.

The following narrative is taken from the opinion of the Lord President—“The pursuers here are the Edinburgh and District Tramways Company, and the defender is an advertising contractor. The Edinburgh Tramways Company are the successors of the Edinburgh Northern Tramways Company, and the defender had in the early days of the tramway enterprise a contract for advertising upon the tramway cars. Eventually he entered into a standing contract, which was dated in January and February 1898, under which the parties still are. That contract provided that the defender should have the exclusive right of advertising upon the cars for a fixed yearly rent, and it made particular stipulations as to what portions of the cars the defender was entitled to cover with his advertisements. The advertising was to be done partly on the windows and partly on the railings at the sides and top of the car, and there were minute stipulations as to the sort of advertisement that could be there displayed. I do not mean the character of the advertisements as advertisements, but I mean the method by which the lettering was to be devised, and in particular it was, among other things, stipulated that the advertisements on the top on the outside should be printed on wooden boards or on enamelled iron plates attached to wooden boards affixed to the supports of the handrail and to the gate panels respectively, and were not to be above a certain size. Just previous to this contract there was a transition state in the history of the tramways. The company were the successors of the Northern Tramways Company, and were running as such what I may call the original line of cable tramways in Edinburgh. They were also the successors of the other Tramways Company, which had originally been a horse company, and the whole system was in process of being cabled. Accordingly in connection with that a great many new cars were being ordered by the Tramways Company. Now when these new cars were turned out they were rather different in shape and size from the old cars, and in particular they had round them at the top a board which fulfilled the useful purpose of being what some of the witnesses called a decency board, and also no doubt served purposes of safety, because it would prevent a child slipping through the somewhat

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wide bars, and would also prevent persons putting out their foot per incuriam and getting it caught by passing tramway cars. These new cars also had what I may call a fillet at the top of the window neatly dividing off precisely the amount of space which was to be dedicated to advertising purposes and allowing the advertisement in the window—the glass bearing the advertisement—to be affixed by a simple process of nailing a small beading to the fillet.

Now the present action is raised by the Edinburgh Tramways Company in 1907 for the additional cost of these boards upon the outside and this fillet arrangement upon the window.”

The agreement, inter alia, provided—“( First) the second party's right to place advertisements on the first party's cars and buses shall be and is hereby limited (1) to the inside of the side windows of the first party's cars and buses on a space 6 1 2 inches in depth measured from the top of such windows to the upper edge of the beading after mentioned; (2) to the handrails at the sides and ends of the roofs of the cars; (3) to the gate panels; and (4) to one window at opposite ends on each side of the cars for temporary bill advertisements only; all other spaces on the cars are hereby expressly reserved to the first party, who shall have right to place traffic notices only thereon, but not so as to obscure any advertisements of the second party, whose right of advertising shall be exclusive. ( Second) The advertisements on the inside of the windows, excepting the temporary bill advertisements, shall be on coloured glass or gelatine transparencies, or such other substances as may from time to time be sanctioned by the first party, and shall be enclosed by a beading of such width and design as may be approved by the first party. The space on each pane may also be divided vertically into two equal portions by a similar beading. The glass transparency or other substance on which the advertisements are placed may be attached to the window frames of the cars or buses, but so as not to injure the wood, iron, glass, or paint work of the cars or buses, or to cause noise or vibration, or in any way interfere with the comfort of the passengers. ( Third) The advertisements to be placed outside the cars and buses, including those on the gate panels, shall be painted on wooden boards or on enamelled iron plates attached to wooden boards affixed to the supports of the handrail and to the gate panels respectively, which boards duly painted or boards and plates shall be supplied by the second party, and shall not extend longitudinally beyond the handrails or downwards beyond the upper edge of the car roofs, and shall be so placed as to leave a clear space of not less than 2 1 2 inches below the upper handrail. Such boards or places shall be maintained in proper condition and repair by the second party at the sight and to the satisfaction of the first party's general manager for the time being, and in the event of the second party failing so to maintain them the first party shall be entitled to do so, and to recover from the second party the expense thereof, as the same may be instructed by a writing under the hand of their general manager.… ( Seventh) Nothing contained in these presents shall prejudice or interfere with the right of the first party to build cars of a different type from those at present run by them or under order, and in the event of the advertising spaces on any cars to be built by or for the first party in future being different from or less than those hereby let to the second party, the second party shall have no claim against the first party in respect of such difference or diminution.”

From the correspondence it appeared that the defender had repudiated liability for the cost of the frames and boards in 1900 and 1901, when he was first called on to pay for them; that on 29th October 1901, while again repudiating liability, he offered £72, 10s. “in full settlement of all claims,” and that after receipt of this offer, which was not accepted, the pursuers did not communicate with him further on the subject till February 1907, when they sent him an account amounting to £1095, 10s. for frames and boards on 171 cars.

On 18th December 1907 the Lord Ordinary ( Johnston) pronounced the following interlocutor:—“(1) Decerns against the defender for payment to the pursuers of the sum of £169, 17s. 6d. sterling, with interest thereon at the rate concluded for from the date of citation till payment, in full of the sum sued for in the first conclusion of the summons; (2) decerns against the defender for payment to the pursuers of the sum of £427, 10s. sterling, with interest thereon at the rate concluded for from the date of citation till payment in full of the sum sued for in the third conclusion of the summons,” &c.

Opinion.—“… [ After narrating the circumstances and stating his reasons for holding that the pursuers were not entitled to a judgment in their favour based upon contract, his Lordship proceeded—] … But the circumstances which I have already narrated very clearly show the bona fide belief, not I think without justification, on which the company's manager acted in making the provision, which by the contract Mr Courtenay must have done himself, for the putting up of Mr Courtenay's advertisements, and lay ample foundation for a claim of recompense. Now Mr Courtenay has made no difficulty all the time about using the appliances provided for him, and in my opinion very much to his advantage. Mr Courtenay now advances two propositions:—

“First, that what he calls ‘decency’ boards are an integral part of every tramway car, and that in all his similar contracts in England, and he has many, he has been allowed by companies and corporations to make use of them for affixing to them his advertisement plates without any charge instead of being required to put up additional boards of his own. I do not think that concessions made to him by the parties to other contracts have any bearing on the question, and I do think that the

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history of the contracts with the builders shows that these boards were not in the present case ordered as an integral part of the cars but were specially ordered for advertising purposes, though I think that it must be admitted that if there had been no question of advertisements something in the way of weather boards, though not necessarily of the same kind or in the same form, would ultimately have been adopted by the company.

Second, that if he had been told at the beginning that he was going to be made to pay for what he describes as an integral part of the cars he would never have used these ‘decency boards,’ but would have hung over the side his old horse car boards altered where necessary to suit the purpose. This I must take leave to do more than doubt. Mr Courtenay is a keen man of business, quite alive to his own interests. He had not only to develop but to maintain his business. I gather from him that that development has not been so satisfactory as he could have wished, or quite corresponding to the great increase in the area for advertising afforded him both by the largely increased number of cars and the great extension of the tramway lines, and he rather hints that he has had hard work to maintain his business. But if this be so, I cannot give credit to Mr Courtenay that he would have maintained far less developed his business if he had continued to use the sort of sandwich board system on which he displayed his advertisements on the old horse cars. In a case of this sort I cannot put aside my own personal knowledge and observation. In making use of it I am not using any knowledge which is peculiar to myself and so making myself a witness, but merely declining to lay aside what is common knowledge to all residents in this city, viz., the knowledge that Mr Courtenay's advertising medium on the cars which have been put on the route since the commencement of his agreement is a very different thing from that which was afforded him by his former method of advertising on the old horse cars. No one can look at the cars as they at present run without seeing, as is indeed proved to be the case, that they are more than half as big again as the old cars, and that the mode by which Mr Courtenay is enabled to exhibit his advertisements is incomparably more attractive to the public and pari ratione must be so also to his customers. To this as an ordinary business conclusion one cannot help attributing much of the retention, if not development, of Mr Courtenay's business. I have come therefore to the opinion that Mr Courtenay has had and accepted a substantial benefit from expenditure of the company bona fide made on his account, though not capable of being charged against him as matter of contract, and that he must recompense the company accordingly. What that recompense should be is somewhat of a jury question, but giving the best consideration to the circumstances which I can, I think that a fair assessment would be £2, 10s. a car, on the footing that Mr Courtenay has the free use of the advertising boards for the remainder of his lease, but that the company maintain them, and are entitled to retain them for what they are then worth as their property at the conclusion of Mr Courtenay's agreement. I have taken a good many different matters into consideration in coming to that conclusion. While I discard Mr Drysdale's evidence as to cost, as Mr Drysdale betrayed unusually openly that he had come not to give evidence but to support a case, and the evidence of his colleague who came to support him must fall with his, I think there is a good deal to suggest that the work was gone about by the Tramway Company's builders with some unnecessary expense. The company, their manager, and their builders were all I think actuated by the laudable motive of making their new cars in all their details, so far as articles of that description can be so made, to do justice to the concession or lease which they had obtained. And in dealing with Mr Courtenay allowance must be made for this in arriving at the cost, which is one item in the estimation of recompense. Recompense, indeed, does not depend on the cost to the party claiming recompense but on the quantum lucratus of the party owing it. But the latter cannot be determined without having some idea of the value of the article for the supply or use of which recompense is claimed. I also have in view, on the one hand, that Mr Courtenay has already had a good many years’ use of the boards in question free of expense, and on the other hand that for what they may be worth at the end of seventeen years they will remain with the company. It was suggested to me that I might fix an annual percentage upon cost, but I think it better for all concerned to name a slump sum, and remove once for all this bone of contention between parties who have still a good many years to live together.

Now as regards the internal framing for the transparent advertisements the matter is somewhat different. I do not think that the company's manager can maintain anything of the nature of an agreement with regard to these, and I think that he somewhat impulsively took it for granted that the understanding which he believed in would cover these internal frames as ancillary to the more important external advertising boards. But they were definitely ordered as extras at a price of £1, 17s. 6d. in the case of one set of cars and of an indefinite portion of £7, 10s. in the case of the others, and they have been used without scruple or objection by Mr Courtenay. But while the case for the company is weaker in one respect in regard to the internal frames it is stronger in another. It cannot be suggested that Mr Courtenay could by any possibility have used anything old belonging to him in these new cars for his transparencies. The circumstances were quite different. He had now to deal with three windows fully forty-eight inches wide against double the number of windows only twenty-six inches wide, and the simple method of fixing his advertisements

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in the old cars could not have been adopted in the new. Mr Courtenay is not justified in asserting that any part of the new framing for his advertisements is part of the structure of the car. A passage in Mr Pitcairn's evidence which at first sight appears to admit that it is so is, I think, attributable to a misunderstanding of the question put to him. Mr Pitcairn is evidently speaking of the true window frame, and not of the detachable advertisement frame. Now the word ‘beading’ used in the agreement, cannot, I think, have its restricted technical meaning in joinery, but must be held to cover what is necessary to fix and enclose the advertisements. For it must be noted that they are to be ‘enclosed,’ and that could not possibly be done at any rate at the lower edge by a mere beading proper. I think, therefore, that something of the nature of what was actually done was reasonably necessary and could have been demanded under the contract, the approval of the company to the method adopted being required. While therefore I think, as in the previous matter, that the company, for the same reason, have, quite properly from their own point of view, supplied Mr Courtenay with rather better provision for his advertisements than he need have supplied himself, something a good deal more, and costing more, than what he and his witnesses speak to, was needed. Though as in the previous matter dealt with there is no case on contract, I think there is equally here a case on recompense, and taking the whole circumstances into consideration, I think a fair estimate of the recompense would be 22s. 6d. per car on the same conditions of the article being maintained by and left to the company at the conclusion of Mr Courtenay's agreement.

If the parties supply me with the figures I shall give decree accordingly, and as Mr Courtenay has wholly resisted payment he must pay the expenses of his unsuccessful defence.”

The defender reclaimed.

[At the hearing on the reclaiming note counsel for the respondents admitted that there was no proof of any contract as to the cost of supplying the frames and boards. He stated that his case rested on an “honourable understanding” between the parties that Courtenay was to pay for the frames and boards in question.]

Argued for reclaimer—There was no proof of such understanding on the reclaimer's part; the sole question therefore was whether he was liable in recompense. No claim for recompense could arise where, as here, the operations in respect of which it was claimed, were made in suo—Buchanan v. Stewart, November 10, 1874, 2 R. 78, 12 S.L.R. 43; Stewart v. Steuart, November 8, 1878, 6 R. 145, 16 S.L.R. 72. The respondents had supplied the frames and boards for their own convenience. In face of the correspondence the claim now made should be repelled.

Argued for respondents—The Lord Ordinary was right. Esto that there was no

proof of contract, there was an honourable understanding proved between the reclaimer and the respondents' manager that the reclaimer would pay for the frames and boards, and the respondents had incurred expense on the faith of it. In these circumstances, having acted in good faith, they were entitled to recompense—Ersk. Inst. iii, 1, 11; Bell's Prin. 538. The respondents' frames and boards had been taken advantage of and there ought to be a fair return for their use— Landless v. Wilson, December 15, 1880, 8 R. 289, per Lord Shand at 293, 18 S.L.R. 206. [The Lord President referred to Rankin v. Wither, May 26 1886, 13 R. 903, 23 S.L.R. 629.]

At advising—