Wakilii

Mantheakis v Custodian of Enemy Property (Civil Appeal No. 3 of 1943)

East African Court of Appeal · [1943] EACA 4 · 1943 Appeal Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from decision of High Court of Tanganyika
Decision
Appeal dismissed with costs

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Court held that the Custodian of Enemy Property owed no duty under the Trading with the Enemy Ordinance 1939 to perform obligations contained in a contract made by an enemy subject whose property had been vested in the Custodian. The executory contract was dissolved by the outbreak of war as it would have involved trading with the enemy and intercourse with the enemy. The force majeure clause in the contract indicated the parties contemplated war and agreed the contract should terminate in such event.

Outcome

Appeal dismissed with costs

Facts

In June 1939, the appellant Mantheakis, owner of the Lembeni sisal estate, entered into a contract with the Usagara Company, a German concern owning the adjacent Kissangara estate. Under the contract, the Usagara Company undertook to cut, manufacture and market sisal from the appellant's estate using its machinery. The appellant's estate had no machinery while Kissangara was fully equipped. Upon the outbreak of war in September 1939, the Usagara Company's property became vested in the Custodian of Enemy Property under the Trading with the Enemy Ordinance 1939. The Custodian discontinued performance of the contract. The appellant sued, contending the Custodian was obliged to continue performing the contract as receiver and manager of the enemy property.

Issues

  1. Whether the contract of June 1939 made between the appellant and the Usagara Company was automatically dissolved by the outbreak of war.
  2. Whether the Custodian of Enemy Property was bound to carry out the obligations the Usagara Company had undertaken by contract.

Orders

  • Appeal dismissed.
  • Costs to the respondent.
  • Taxing officer directed to allow respondents a sum covering expenses incidental to the attendance of Mr. Cadle, the Assistant Custodian.

Rules and key headnotes

Administrative Law — Custodian of Enemy Property — Powers and Obligations — No Duty to Perform Enemy's Executory Contracts
The Trading with the Enemy Ordinance 1939 does not impose upon the Custodian of Enemy Property any duty to perform or carry on obligations contained in a contract made by an enemy subject whose property has been vested in the Custodian.
Contract Law — Frustration — Outbreak of War — Dissolution of Executory Contracts
An executory contract entered into by an enemy subject is dissolved by the outbreak of war where performance would involve trading with or intercourse with the enemy.
Contract Law — Force Majeure Clauses — War as Terminating Event
A force majeure clause in a contract indicating that the parties contemplated the possibility of war demonstrates mutual agreement that war should terminate the contract.
Contract Law — Suspension versus Dissolution — Substantial Alteration Test
Where postponement of performance of mutual obligations or cancellation of obligations falling due during war involves a substantial alteration in the contract itself, no such postponement or cancellation can take place because an executory contract is suspended as opposed to dissolved only where suspension does not involve making a different contract between the parties.

Legislation cited (4)

  • Trading with the Enemy Ordinance 1939 s.9
  • Trading with the Enemy Ordinance 1939 s.4
  • Custodian of Enemy Property Order 1939 s.4
  • Custodian of Enemy Property Order 1939 s.5

Cases cited (6)

  • R & A Kohnstamm Ltd v Ludwig Krumm (London) Ltd [1940] 2 KB 359
  • Naylor Benzon v Krainische Industrie Gesellschaft [1918] 1 KB 331
  • Porter v Freudenberg [1915] 1 KB 857
  • Distington Hematite Iron Co Ltd v Possehl & Co [1916] 1 KB 811
  • Esposito v. Bowden, 7 E. & B. 763
  • Rio Tinto Co v Ertel Bieber (1917) 116 LT 810

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Mantheakis v Custodian of Enemy Property (Civil Appeal No. 3 of 1943) [1943] EACA 4 (1 January 1943)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.