Contract-s-Construction of terms-Request for delivery of goods before date
specified=-Seller's attempted compliance to facilitate buyers

Sale of goods=-Delivery-s-Goods in the hands of warehouseman-Acts necessary
to effect delivery of possession to buyer

1. It is a mere facility to the buyer, and not a binding obligation, when
a seller who has agreed to deliver one ton of goods in April and another
ton in May subsequently, in response to a request from the buyer, gives
the buyer a delivery order for both tons in April, but fails to give deliv-
ery orders in proper form to satisfy the warehouseman so that the buyer is
forced to take delivery at a later date.

2. When the subject matter of a contract for the sale of goods is with
a warehouseman or other third party, actual delivery of the goods takes
place when the seller, the buyer and the third party agree that the latter
shall cease to hold the goods for the seller and shall hold' them for the
buyer.

• Court: Flaxman 1.

June 13, 1937. Flaxman J.: On March 11, 1937, by written
agreement the plaintiff sold to the defendants two tons of colocynth
pulp at an agreed price of £E.130 a ton, delivery to be at Port Sudan,
one ton in April and one ton in May 1937.

At a later date, April 15, 1937, a member of the defendant firm is
said to have requested the plaintiff to deliver the two tons in April if
possible, and following this request the plaintiff handed to defendants a
delivery order addressed to the Port Sudan Forwarding Co. requesting
the company to deliver 88 bales of colocynth pulp (of weight 2 tons 9
kilogrammes) to defendants at Port Sudan.

Nothing of the fate of this delivery order was heard by plaintiff
until about May 26, 1937 when he was informed at defendant's office
(where he appears to have gone to obtain payment for the balance of
price of the pulp and without any knowledge of delay in delivery) that
the order had not been accepted by the warehouse at Port Sudan as
sufficient authority for delivery. The plaintiff appears to have ap-
proached the Khartoum agents of the warehousemen without delay,
and as a result instructions were given by the company on May 26,
1937 in the form of a telegram to their Port Sudan branch enabling
defendants to receive two tons of colocynth pulp from stock.

At about the same time the defendants were notified of the dis-
patch of the telegram and of its contents, and the. plaintiff claims that
this constituted a good performance of his obligations under the con-
tract, the goods being available for delivery in Port Sudan on applica-
tion to the warehousemen before the end of May and with the defend-
ants' agreement.

There is no dispute about the agreed price or sum paid on account,
and it is admitted by the defendants that they took delivery of the
goods on or about June 8, 1937. They do not however admit liability
for the contract price of these goods, and counterclaim on the grounds
of a verbal agreement by plaintiff to deliver the two tons in April 1937,
stating that he in fact failed to do so until June 8th of that year. As
a result of this delay they suffered damages which they estimate as the
difference between the price at the time when the pulp should have
been delivered and it's price at the date of actual delivery. It may be
noted that there was an abnormal fall in the price of the commodity
between these dates; the price falling from £ E.120 per ton in April to
£E.50 in June. Such pulp is apparently subject to considerable mar-
ket fluctuations.

The defendants rely upon the failure of plaintiff to deliver the two
tons in April 1937, and not upon any failure to deliver the goods a~
originally agreed. It is therefore necessary to determine whether the
plaintiff accepted a binding obligation in the course of his conversa-
tion with Abdel Monim Mohammed at Shendi station to deliver the
two tons during the month of April.

Under the written contract he was bound to deliver one ton in
April and one ton in May. He says, and his evidence goes unrebutted
and I accept it, that "At about the beginning of April I met Abdel
Monim Mohammed at Shendi station and he asked me if I could de-
liver the goods before the contract. I told him I would do so if possi-
ble." And in cross examination, "I did not promise delivery in April.
I said I would deliver if I could. If circumstances permitted. I was
bound to deliver within the contract period. I gave the delivery order
in April although I was not bound to deliver."

In accordance with his promise he sent a delivery order for the
full two tons on April 27, 1937 and this was accepted by the defend-
ants. Under normal circumstances I assume that actual delivery of the
goods to the defendants would have taken place in the course of the
next day or two and the matter would have closed. Unfortunately,
there appears to have been failure on the part of both parties. The
plaintiff failed to give an order in a form acceptable to the warehouse-
men at Port Sudan. 'This of course is his responsibility. He was bound
to give a document to defendants with which they could effectively ob-
tain delivery; which that handed to them on April 27, 1937 did not.

At the same time there seems every reason to believe that had the
defect been brought to his notice he would have remedied it without
delay (as he eventually did). That the defect was not brought to his
notice for about a month seems clearly attributable to some neglect on
the part of the defendants, probably in their Port Sudan Office. The
plaintiff had every reason to assume that delivery had been duly made,
and his subsequent conduct clearly shows that until May 26, 1937 he
believed that he had performed his part of the contract.

I do not however agree that there was any acceptance by plaintiff
of a binding obligation to deliver all the pulp in April. He only under-
took to do so "if possible," and he endeavoured to do so. The circum-
stances of the failure have already been commented upon.

In view of the above it may be said that the counterclaim. is dis-
posed of. There is a reliance by defendants upon an undertaking

which is claimed to be a binding obligation, the breach of which gives
rise to damages. In my opinion there was no osuch obligation. A fa-
cility was given at the request of one of the defendants and it did not
assume the character of a legal obligation.

There are certain other aspects of the matter which should be
considered. The plaintiff should show that he delivered the goods as
agreed, or that they were accepted in circumstances showing that they
were received and accepted by defendants in fulfillment of agreement.

That they were so accepted is to a large extent shown by the de-
fendants themselves. One of the partners in cross examination made
admissions which I think effectually dispose of aoy doubts as to whether
there was, or was oat, a subsequent unconditional acceptance of the
goods in performance of the contract. He says, "Up to May 26, 1937
we were prepared to take the goods stated in the delivery order and to
pay for them as agreed" and "If the goods were at Port Sudan, and if

plaintiff instructed Messrs. Trucco to telegraph to their Port Sudan
office to deliver the goods to our branch, I agree that he had performed

all his obligations in the matter of delivery and that he was entitled to
payment under the contract." ,-

Out of this arises a further point which has not been argued. It
relates to a question in sale contracts which frequently causes difficulty:
when was delivery actually effected?

In this case the goods were not actually in the possession of the
vendor, but in the hands of a third party. It is a rule of law that when
goods are in the hands of a third person that actual delivery lakes place
when the seller, the buyer and the third party agree that the lat"ter shall
cease to hold goods for the seller and shall hold them for the buyer.

",0 Thus when goods are in the hands of a warehouseman an order direct-
ing him to deliver the goods to the buyer or hold subject to his control
effects a change of possession if the warehouseman consents to act in
accordance with the order. 1 therefore consider that there was an ac-
tual delivery of the goods by plaintiff to defendants on May 26, 1937
when the telegram, worded as follows, was dispatched by the Port Su-
dan Forwarding Company at Khartoum to their Port Sudan office with
the knowledge and assent of both plaintiff and defendants. This tele-
gram read, "Deliver Younis free account Iskander Michael ex Regeila
stock against receipt two tons net colocynth pulp stop telegraph quantity
remaining bags kilos astra."

That some muddle on the part of defendants may have then taken