Tesco v Constain - Thomson Reuters

[1961] 1 Q.B. 31 Page 111960 WL 18924 (CA), [1960] 3 All E.R. 332, [1960] 3 W.L.R. 504, (1960) 104 S.J. 704(Cite as: [1961] 1 Q.B. 31)conclusion that the defendant, through his servants who carried out the sale onhis behalf, deliberately shut his eyes to the true situation. Hardy sold the carin Blackpool, having a log book which showed that the first plaintiff was theowner of the car and that she lived on the south coast. The defendant bought itfor 605, over 100 less than the rogueHutchinson had purported to pay for it, and sold it for >760 afew months later - a large profit for a deal which was completed in about 40minutes with a stranger, who said that he was on holiday in Blackpool and gavehis permanent address as being in Hull. The defendant's servants did not evenlook at the log book or ask for any receipt to show that Hardy had bought thecar. Had they looked at the log book, they would have seen the first plaintiffwas the owner of the car. Failure to make inquiries regarding a log book if itcontains the name of a third person as owner of the car is evidence of lack ofgood faith: see per Lush J. in Heap v. Motorists Advisory Agency Ltd., [FN49]per Denning L.J. in HBishopsgate Motor Finance Corporation Ltd. v. TransportBrakes Ltd. [FN50] and per Morris L.J. in HCentral Newbury Car Auctions Ltd. v.Unity Finance Ltd. [FN51] The circumstances of the sale must have createdabundant suspicion in the minds of any honest dealer.FN45 H[1911] 1 K.B. 463, C.A.FN46 Ibid. 476, 478.FN47 (1877) 2 App.Cas. 616 , 625, H.L.FN48 Ibid. 628, 629.FN49 H[1923] 1 K.B. 577, 591; 39 T.L.R. 150.FN50 H[1949] 1 K.B. 322, 337, 338; 65 T.L.R. 66; [1949] 1 All E.R. 37, C.A.FN51 H[1957] 1 Q.B. 371, 397; [1956] 3 W.L.R. 1068; [1956] 3 All E.R. 905, C.A.Stephen Chapman Q.C. in reply.[SELLERS L.J. You need not trouble about the plaintiffs' cross-appeal againstthe judge's findings.]*46 The judge's finding of fact that the plaintiffs did not intend to contractwith the rogue Hutchinson was vitiated by the approach which he made as a matterof law. He founded himself on the false premises in Professor Goodhart's article,and applied the false test there propounded. The essence of the bargain was thatthe plaintiffs wanted cash, not that they were going to contract only with aparticular individual. When cash was not forthcoming, all that they wereconcerned with was the financial stability of the man facing them in the room.The question is whether the essential intention of the plaintiffs was to bargainwith the man in the room, or whether that prima facie presumption was overridenby something more fundamental, that is, that the man in the room should have aspecific identity. Where there are prima facie two persons bargaining about thetransfer of property, there must be a heavy onus on either of them to establishthat what has objectively emerged has been vitiated by something which is notapparent to third parties, and which is based on evidence that cannot beobjectively tested. In the present case, it was not vital to the creation of thecontract that the other party should be a particular person; the plaintiffs wereonly concerned that he should have credit.Cur. adv. vult.Copr. © West 2004 No Claim to Orig. Govt. Works