Wakilii

Velji v Jivraj (Civil Appeal No. 41 of 1949)

East African Court of Appeal · [1949] EACA 18 · 1949 Appeal Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from judgment of High Court of Tanganyika arising from breach of contract suit
Decision
Judgment of the High Court of Tanganyika affirmed; plaintiff's claim for breach of contract upheld and defendant's counter-claim dismissed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Court held that ex-military tyres that were unused and not deteriorated in quality were 'new tyres' within the meaning of the contract. The ordinary meaning of 'new' as applied to manufactured articles is 'lately made or manufactured'. The appellant could not rely on an alleged special trade meaning that 'new' excluded tyres from military stocks, as none of the parties were regular dealers in tyres and no such custom was proven. Where the appellant inspected the tyres, found them to be new with 'Military' stamped on them, and the evidence showed the only tyres available for export to the Congo were from military stocks, the appellant was aware or should have been aware of the source.

Outcome

Judgment of the High Court of Tanganyika affirmed; plaintiff's claim for breach of contract upheld and defendant's counter-claim dismissed

Facts

The respondent sued the appellant for breach of two contracts for sale of new tyres and tubes documented in broker's notes. The appellant had contracted to purchase tyres for export to and sale in the Belgian Congo. The respondent supplied the correct quantity of tyres and tubes, which had been purchased from the Government Disposals Board and were ex-military tyres from Army surplus stock. The appellant inspected the tyres, found them to be new but with the word 'Military' stamped on them, and subsequently rejected them on grounds they were not in accordance with the contract terms. An expert engaged by the appellant reported all tyres were in new condition, unused, and showed no evidence of storage deterioration. The respondent sold the goods and claimed the difference between contract price and sum realised. The appellant counter-claimed for damages for loss of profits. Neither party was a regular dealer in tyres and this was a first transaction in tyres for both.

Issues

  1. Whether ex-military tyres purchased from Government Disposals Board and described as 'new' in broker's notes constituted 'new tyres' within the meaning of the contract.
  2. Whether there was fraudulent misrepresentation by the respondent in supplying ex-military tyres under a contract for 'new tyres and tubes'.
  3. Whether the word 'new' had a special meaning in trade custom requiring tyres not to have lost their 'commercialness' by being sold to and stored by the Army.

Orders

  • Appeal dismissed.
  • Costs awarded to the respondent.

Rules and key headnotes

Contract Law — Sale of Goods — Construction of Contract Terms — Meaning of 'New'
In a contract for sale of goods by description, the word 'new' as applied to manufactured articles means 'lately made or manufactured' and ordinarily encompasses articles that are unused and not deteriorated in quality, regardless of the commercial source from which the seller obtained them.
Contract Law — Implied Terms — Trade Custom
A clause will not be implied into a written contract of sale by description based on alleged trade custom unless there is the clearest evidence establishing that such custom was effective between the parties; where none of the contracting parties had ever dealt in the goods before, proof of custom among regular dealers in those goods does not establish that the custom applied to alter the express terms of their contract.
Contract Law — Misrepresentation — Fraudulent Misrepresentation — Burden of Proof
An allegation of fraudulent misrepresentation is a most serious allegation involving for the party making it a very heavy onus of proof, which cannot be discharged where the entire basis of the fraud allegation rests on a special construction of contractual terms that is not supported by the evidence.
Contract Law — Sale by Description — Source of Goods
In a sale by description under the description 'new tyres', it is not possible to exclude tyres which are in fact new merely because of the source from which they were obtained by the seller, absent clear contractual stipulation or proven trade custom binding the parties.
Contract Law — Consensus ad Idem — Lack of Consensus
The doctrine of lack of consensus ad idem does not apply merely because a defendant now says he did not expect the goods contracted for would come from a particular source; where the parties contracted for 'new tyres and tubes' and the articles supplied answered that description, the parties were ad idem as to the articles to be supplied.

Cases cited (1)

  • Anderson v Scrutton (E & E Digest 1940 Supp p 41)

Full judgment

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

Velji v Jivraj (Civil Appeal No. 41 of 1949) [1949] EACA 18 (1 January 1949)
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.