Mohori Bibee v/s Dharmodas Ghose suit relates to the nature of contracts of a minor,

fraudulent false interference by him, enforcement of the principle of Estoppel, sections 64, 65 of
the Contract Act, etc.

Name Of The Case: Mohori Bibee v/s Dharmodas Ghose

Citation: (1903)ILR30Cal539(PC)
Date Of Judgement: 04 March 1903
Name Of The Judges: Lord McNaughton, Lord Davey, Lord Lindley, Sir Ford North, Sir Andrew
Scoble, Sir Andrew Wilson.

Brief Facts And Disputes Of The Case:

The respondent was Dharmodas Ghose, who was a minor, received a loan from Brahmodutt, a
lender in Calcutta, by saying that he was an adult and had written a mortgage deed (Mortgage
Deed) in his favour to get a loan. At the time when the mortgage was being considered for
advance money, At the time of standing, Kedarnath, the agent of Brahmodutt, had received
information that the respondent was a minor; So, he cannot execute the deed. But still he
executed a mortgage deed from Dharamdos Ghose.

The minor then filed a suit against Brahmodutt by his mother and guardian in which he appeal to
the court to cancel the mortgage deed, as he was a minor at the time of the mortgage deed being
executed. Justice Jenkins (Jenkins J.) who was a judge of the trial court, Accepting the appeal of
the respondent, he cancelled the mortgage deed.

The appeal against the order was also quashed by the High Court; Therefore, the appellant
appealed to the Privy Council. Brahmodutt had died at the time of making this appeal. So, he
was replaced by his successor, Mohori Bibee.

The following arguments were presented by Mohori Bibee:

1. While cancelling the mortgage deed, the court should have forced the minor to pay the
money (Rs. 10,500) under the deed Return it. In favour of this argument, he referred to
the Specific Relief Act, 1963 under which the Court has the power to pass such an order.
2. Under Sections 64 and 65 of the Indian Contract Act 1872, the return of the money
received under the deed cancelled may be compelled.
3. According to the principle of 'Estoppel', the minor, who called himself a minor, cannot
now be allowed to argue that he was a minor while contracting.
4. The Contract made by the minor is null and voidable.

Verdict: The court dismissed the appeal.

Rule propounded:

1. The contract made by the minor is not null and void from the beginning
2. Section 64 of the Contract Act against the minor does not apply as these sections require
that the parties to the contract should be able to make contracts.
3. The principle of restriction cannot apply in this case because both the parties were aware
that the contract was being done with a minor.
4. Under the Specific Relief Act, 1963, the minor may be compelled to return the benefits
availed under zero contract. But in this case, the court does not think it appropriate,
because when Dharmodas Ghose was given a mortgage loan, the appellant knew that
he was a minor.

Conclusion:
Based on the above principles, the Privy Council rejected the appeal of the appellant.
Lalman Shukla vs Gauri Dutt case (1913) case
examines the existence of a contract if there is no
acceptance. Acceptance is that of a contract like a
lighted matchstick to a train filled with gunpowder.
No contract is complete without proper
communication of acceptance, as given under
Section 4 of the Indian Contract Act 1872.
FACTS

• The defendant’s nephew was absconded, and the defendant was unable to find
him anywhere. The defendant realized the same and sent his servants to search
for his nephew.
• Lalman Shukla (plaintiff herein) was one of the servants who had gone out to
search. The plaintiff eventually found him and brought him back.
• While the plaintiff had gone to Haridwar from Kanpur to search, he was handed
some money for his railway and other expenses.
• While Lalman Shukla was out, the defendant made an announcement to reward
Rs.501 to whosoever found his nephew. Lalman Shukla found Gauri Dutt’s
missing nephew and brought him back to his home in Kanpur.
• 6 months after the said incident, Gauri Dutt fired Lalman Shukla. After being
removed from the job, the plaintiff claimed the money, which the defendant
denied paying. Lalman Shukla filed a case against Gauri Dutt, his master, to
claim the reward money.

ISSUES

1. Whether Lalman Shukla is entitled to get the reward money for searching
missing nephew?
2. Whether there was valid acceptance between the two?
3. Whether there was a contractual relation between the two?

CONTENTIONS
Plaintiff’s contentions

• Lalman Shukla strongly contended that he was entitled to receive the reward
money from Gauri Dutt as he found the missing nephew.
• He stated that there is no need for prior knowledge emphasizing on Section 8 of
Indian Contract Act 1872 which says, “Performance of the act or the
acceptance of any consideration in a proposal is the acceptance of the
proposal”.
• He said, “to have the knowledge of the condition was immaterial”.

Defendant’s contention
 • The defendant strongly argued that the plaintiff had no knowledge about the offer
and was not aware of it before finding the missing nephew.
• So an offer without the knowledge of the offeree cannot be accepted or there is
no such condition where the plaintiff can accept the offer without its knowledge.
• Gauri Dutt emphasized Section 2(a) which said, “When one person signifies to
another his willingness to do or to abstain from doing anything, with a view
to obtaining the assent of that other to such act or abstinence, he is said to
make a proposal”.
• Further on Section 2(b) said, “When the person to whom the proposal is
made signifies his assent thereto, the proposal is said to be accepted. A
proposal, when accepted, becomes a promise”.
• Therefore, the plaintiff had no knowledge about the offer made and there was no
acceptance. So according to Section 2(h) of the Indian Contract Act 1872, since
there was no acceptance, there was no agreement to be enforced by a court
of law.

RATIO DECIDENDI
The case was filed in the Allahabad High Court and was presided over by Justice
Banerji at the Allahabad High Court. In this case, it is derived that-
In order to enter a contract, 2 aspects need to be fulfilled:

1. To have complete knowledge of the offer or the proposal.

2. Acceptance of the offer.

To form a contract out of an agreement, to have knowledge and acceptance must be

present. In this case, both were missing. When the plaintiff was searching for his
master’s nephew, his obligations and duties were as a servant. Thus the plaintiff,
Lalman Shukla was not entitled to get the award.

DECISION
The Court dismissed the appeal made by Lalman Shukla against Gauri Dutt. The
Judge analyzed the facts of the case and said that to enter into a contract, there must
be knowledge of the offer and acceptance of the said offer. Here both were
missing, and the plaintiff fulfilled his duties as a servant to his master. Therefore, Lalman
Shukla (plaintiff), was not entitled to get the reward money for searching Gauri Dutt’s
missing nephew.
CONCLUSION
This judgment indeed is important for understanding the law of Contracts. It clarified that
for an offer to be considered or accepted, knowledge and acceptance of the same is
needed. This case discussed upon basic concepts of contract and vital elements of
an agreement which are offer and acceptance. This is an important case of general
offer and laid down the principles of general offer. Rewards attached to an offer made
by advertisement or finding lost articles can be examples of general offer which is seen
widely in today’s world.
Hyde v Wrench (1840) 49 ER 132

Contract – Counter Offer – Acceptance – Offer – Negotiation – Breach of contract –

Specific Performance

Facts of Hyde v Wrench

The defendant, Mr Wrench, offered to sell the farm he owned to the complainant, Mr
Hyde. He offered to sell the property for £1,200, but this was declined by Mr Hyde.
The defendant decided to write to the complainant with another offer; this time to
sell the farm to him for £1,000. He made it clear that this would be his final offer
regarding the property. In response, Mr Hyde offered £950 for the farm in his letter.
This was refused by Mr Wrench and he confirmed this with the complainant. Mr Hyde
then agreed to buy the farm for £1,000, which was the sum that had previously been
offered. However, Mr Wrench refused to sell his farm.

Issues in Hyde v Wrench

The complainant brought an action for specific performance, claiming that as Mr
Wrench refused to sell the farm, this was a breach of contract. The issue in this case
was whether there was a valid contract between the parties and if a counter offer was
made in discussions, whether the original offer would still remain open.

Decision / Outcome of Hyde v Wrench

The court dismissed the claims and held that there was no binding contract for the
farm between Mr Hyde and Mr Wrench. It was stated that when a counter offer is
made, this supersedes and destroys the original offer. This original offer is no longer
available or on the table. In this case, when Mr Hyde offered £950, he cancelled the
£1,000 offer and could not back track and accept.
Carlill v Carbolic Smoke Ball Company [1892] EWCA Civ 1 is an English contract law
decision by the Court of Appeal. It is notable for its curious subject matter and how
the influential judges (particularly Lindley LJ and Bowen LJ) developed the law in
inventive ways. Carlill is frequently discussed as an introductory contract case, and
may often be the first legal case a law student studies.

A medical firm advertised that its new wonder drug, a smoke ball, would cure
people’s flu, and if it did not, buyers would receive £100. When sued, Carbolic argued
the ad was not to be taken as a serious, legally binding offer. It was merely an
invitation to treat, and a gimmick. But the court of appeal held that it would appear
to a reasonable man that Carbolic had made a serious offer. People had given good
“consideration” for it by going to the “distinct inconvenience” of using a faulty
product.

Case Facts
Court: Court of Appeal (Civil Division)

Full Case Name: Louisa Carlill v Carbolic Smoke Ball Company

Date Decided: 8th December 1892

Citations:

[1892] EWCA Civil 1,

[1893] 1 QB 256

Judges:

Lindley LJ,

Bowen LJ

And AL Smith LJ

Prior Actions: Carlill v Carbolic Smoke Ball Co [1892] 2 QB 484

Defendant: Carbolic Smoke Ball Company

The company made a product called “Smoke Ball”. It claimed to be a cure to

influenza and many other diseases, in the context 1889-1890: Flu pandemic which is
estimated to have killed 1 million people. The smoke ball was a rubber ball with a
tube fixed to its opening. The ball is filled with Carbolic acid (Phenol). The tube is
supposed to be inserted in one of your nostrils and the bottom part of the rubber
ball is to be pressed. The gas enters your respiratory tract and flushes out al the
viruses.

Advertisement:

The Company published advertisements in the Pall Mall Gazette and other
newspapers on November 13, 1891, claiming that it would pay £100 to anyone who
got sick with influenza after using its product according to the instructions set out in
the advertisement.

“£100 reward will be paid by the Carbolic Smoke Ball Company to any person who
contracts the increasing epidemic influenza colds, or any disease caused by taking
cold, after having used the ball three times daily for two weeks, according to the
printed directions supplied with each ball. £1000 is deposited with the Alliance Bank,
Regent Street, showing our sincerity in the matter. During the last epidemic of
influenza many thousand carbolic smoke balls were sold as preventives against this
disease, and in no ascertained case was the disease contracted by those using the
carbolic smoke ball. One carbolic smoke ball will last a family several months, making
it the cheapest remedy in the world at the price, 10s post free. The ball can be refilled
at a cost of 5s. Address: “Carbolic Smoke Ball Company, “27, Princes Street, Hanover
Square, London.”

Plaintiff: Louisa Carlill

She, believing in the accuracy of the statement made in the advertisement with
respect to efficacy of the smoke ball in cases of influenza, purchased one packet and
used it thrice everyday from mid November, 1891 until 17th Jan, 1892, at which latter
date she had an attack of influenza.

Thereupon, her husband wrote a letter for her to the defendants, stating what had
happened, and asking for £100 as promised in the advertisement. They refused and
this action was brought in court before Hawkins J. and a special jury. Arguments were
heard on both the sides and finally the verdict was given in favor of Mrs. Carlill.

The defendants appealed.

Judgments
The Court of Appeal unanimously rejected the company’s arguments and held that
there was a fully binding contract for £100 with Mrs. Carlill

Among the reasons given by the three judges were

(1) That the advertisement was a unilateral offer to the entire world
(2) The satisfying conditions for using the smoke ball constituted acceptance of the
offer.

(3) That purchasing or merely using the smoke ball constituted good consideration,
because it was a distinct detriment incurred at the behest of the company and,
furthermore, more people buying smoke balls by relying on the advert was a clear
benefit to Carbolic

(4) That the company’s claim that £1000 was deposited at the Alliance Bank showed
the serious intention to be legally bound.

The judgments of the court were as follows.

Lindley.L.J:

He dismissed the appeal. He, giving his decision first and reasons later, explained his
judgment answering to all allegations put up by the defendant’s counsel and
upholding the lower court’s decision. An excerpt which makes a short shrift of the
insurance and wagering contract that were dealt with in the Queen’s Bench

“I will begin by referring to two points which were raised in the Court below. I refer to
them simply for the purpose of dismissing them. First, it is said no action will lie upon
this contract because it is a policy. You have only to look at the advertisement to
dismiss that suggestion. Then it was said that it is a bet. Hawkins, J., came to the
conclusion that nobody ever dreamt of a bet, and that the transaction had nothing
whatever in common with a bet. I so entirely agree with him that I pass over this
contention also as not worth serious attention.

Then, what is left? The first observation I will make is that we are not dealing with any
inference of fact. We are dealing with an express promise to pay 100£ in certain
events. Read the advertisement how you will, and twist it about as you will, here is a
distinct promise expressed in language which is perfectly unmistakable —

“100£ reward will be paid by the Carbolic Smoke Ball Company to any person who
contracts the influenza after having used the ball three times daily for two weeks
according to the printed directions supplied with each ball.”

He discussed the following issues with respect to this case:

The advertisement was not a “mere puff” as had been alleged by the defendant. The
very fact that £1000 was deposited with Alliance Bank, Regent Street. So what is that
money for? What is that passage put in for, except to negative the suggestion that
this is a mere puff, and means nothing at all? The deposit is called in aid by the
advertisers as proof of their sincerity in the matter. What do they mean?-The
advertisement definitely means seriousness.

The advertisement was an offer to the world. It was contended that it is not binding.
It is said that it is not made with anybody in particular. In point of law this
advertisement is an offer to pay 100ℓ to anybody who will perform these conditions,
and the performance of the conditions is the acceptance of the offer.

Communication of acceptance is not necessary for a contract when people’s conduct

manifests an intention to contract. But then the defense council put forth a point
“Supposing that the performance of the conditions is an acceptance of the offer, that
acceptance ought to have been notified.” Unquestionably, as a general proposition,
when an offer is made, it is necessary in order to make a binding contract, not only
that it should be accepted, but that the acceptance should be notified. But in cases of
this kind, it is apprehended that they are an exception to the rule that the notification
of the acceptance need not precede the performance. This offer is a continuing offer.
It was never revoked, and if notice of acceptance is required, then the person who
makes the offer gets the notice of acceptance contemporaneously with his notice of
the performance of the condition before his offer is revoked.

The defense counsel has argued that this advertisement is a nudum pactum – that
there is no consideration. They say “it is of no advantage to them how much the ball
is used”. The judged answered “The answer to that I think is this. It is quite obvious
that, in the view of the defendants, the advertisers, a use of the smoke balls by the
public, if they can get the public to have confidence enough to use them, will react
and produce a sale which is directly beneficial to them, the defendants. Therefore, it
appears to me that out of this transaction emerges an advantage to them which is
enough to constitute a consideration.” But there is also another view to this point
which the Judge Lindley aptly asserts: what about the person who puts himself/
herself in an inconvenient, if not detrimental to his health, while inhaling potent
fumes of carbolic gas? So therefore there is ample consideration to this promise.

Bowen, L.J:

He concurred with Lindley, L.J. He was of the same opinion but he also discussed few
points with respect to vagueness and time period of the contract. His opinion was
more tightly structured in style and frequently cited.

In response to Defense’s council point that this contract is too vague to be enforced.
He, dismissing their claim, relied on his construction of the document and he said
that there is no time limit fixed for catching influenza, and it cannot seriously be
meant to promise to pay money to a person who catches influenza at any time after
the inhaling of the smoke ball. There is also great vagueness in the limitation of the
persons with whom the contract was intended to be made. But this document was
intended to be issued to the public and to be read by public. So it is very important
to understand how would a commoner interpret this advertisement? And the effect
of this advertisement was to attract people and make them use it, which would
amount to more sales, thus more profit. Based on this intention to promote the
distribution of the smoke balls and to increase its usage, the advertisement was
accepted as a contract addressing public at large but limited to those people who
are using it either for prevention or treatment of influenza and other mentioned
diseases.

Another point which was discussed in the court was that of the time limit of the
contract. How do you define reasonable time period? And after great discussion, the
respected judge came to a conclusion that the protection warranted by the contract
was to last during the epidemic (1889-90 Flu epidemic).If so, it was during this
epidemic that the plaintiff contracted this disease. So the contract holds.

A.L.Smith, L.J:

His judgment was more general and concurred with both Lindley LJ and Bowen LJ’s
decisions.

Aftermath
The appeal was dismissed unanimously by all the three judges and Mrs. Carlill finally
received compensation of £100. She lived to the ripe old age of 96. She died on
March 10, 1942; according to her doctor principally of old age. There was one cause
noted though: Influenza.

Mr. Roe, owner of Carbolic Smoke ball Co., continued with his aggressive marketing.
This time he increased the reward to £200 following the loss of the case.

Conclusion
This is the most frequently cited case in the common law of contract, particularly
where unilateral contracts are concerned. It provides an excellent study of the basic
principles of contract and how they relate to every day life. Essential elements of
contract including Offer & Acceptance, Consideration, Intention to create Legal
Relations, etc. were mentioned in this case. This case forms the foundation for
Contract Law.
Felthouse v Bindley [1862] EWHC CP J35

Contract – Offer – Tort of Conversion – Acceptance – Silence

Facts of Felthouse v Bindley

The complainant, Paul Felthouse, had a conversation with his nephew, John
Felthouse, about buying his horse. After their discussion, the uncle replied by letter
stating that if he didn’t hear anymore from his nephew concerning the horse, he
would consider acceptance of the order done and he would own the horse. His
nephew did not reply to this letter and was busy at auctions. The defendant, Mr
Bindley, ran the auctions and the nephew advised him not to sell the horse. However,
by accident he ended up selling the horse to someone else.

Issues in Felthouse v Bindley

Paul Felthouse sued Mr Bindley in the tort of conversion, with it necessary to show
that the horse was his property, in order to prove there was a valid contract. Mr
Bindley argued there was no valid contract for the horse, since the nephew had not
communicated his acceptance of the complainant’s offer. The issue in this case was
whether silence or a failure to reject an offer amount to acceptance.

Decision / Outcome of Felthouse v Bindley

It was held that there was no contract for the horse between the complainant and his
nephew. There had not been an acceptance of the offer; silence did not amount to
acceptance and an obligation cannot be imposed by another. Any acceptance of an
offer must be communicated clearly. Although the nephew had intended to sell the
horse to the complainant and showed this interest, there was no contract of sale.
Thus, the nephew’s failure to respond to the complainant did not amount to an
acceptance of his offer.
isset v Wilkinson [1927] AC 177

Whether a statement is one of fact or opinion for the purposes of rescinding a

contract

Facts
The defendant in this matter was the purchaser of land in New Zealand which was
purchased by the claimant for the purpose of sheep farming. The appeal, to which
this judgment relates, is on the defendant’s counterclaim. During the purchase
process, the claimant informed the defendant that the land being purchased was
capable of sustaining 2000 sheep. However, after the purchase the defendant
discovered that this was only possible if very careful land management was carried
out, and that the land as it stood could not sustain this number of sheep. The
defendant therefore sought to rescind the contract on the basis that the claimant’s
statement was a misrepresentation.

Issues
The issue in this circumstance was whether the statement made by the claimant
could be considered a statement of fact in terms of being a representation, or
whether it was simply an opinion held by the claimant.

Decision/Outcome
It was held that the claimant’s statement was nothing more than an opinion as to the
capacity of the land, based on the claimant’s knowledge of farming, together with
the defendant’s knowledge of the current stock. The statement was not therefore
held to be a representation. In any event, the defendant had not been able to
demonstrate that the land was not capable of carrying the 2000 sheep that the
claimant had stated, and therefore the claimant’s appeal was allowed and the
contract could not be rescinded.
Chikham Ammiraju V. Chikkam Seshama (1917) 41 Mad 33

Fact:

In the instant case, the Husband Held held out a threat of committing suicide to his wife and

son if they did not execute a release deed in favor of his brother. The wife and son executed the release

deed under the threat.

Issue / Questions:

The question was whether a threat of committing suicide amounts to coercion?

Held :

Court Held that the threat of suicide amounted to coercion within Section 15 of the Indian

Contract Act, 1872 and the release deed was, therefore, voidable"
Raffles v Wichelhaus (1864) 2 Hurl & C 906

Contract – Mutual Mistake – Contract Formation – Void Contract – Enforceability –

Objective Test – Certainty – Breach of Contract – Meeting of the Minds –

Facts
The complainant, Mr Raffles, offered to sell an amount of Surat cotton to the
defendant, Mr Wichelhaus. This Surat cotton would be brought to Liverpool by a ship
from Bombay, India. This ship was called the Peerless, but there were two ships that
had this name. The complainant and the defendant were both thinking about a
different Peerless ship when they agreed to make the sale. One of the ships was due
to leave Bombay in October, which was what the defendant had thought for his Surat
cotton delivery, but the complainant was referring to the ship that was to leave in
December. When the Surat cotton arrived in Liverpool, Mr Wichelhaus refused to
pay, as in his mind, it was months late.

Issues
The complainant sued the defendant for breach of contract. The issue in this case
was whether there was an enforceable contract between the parties.

Decision/Outcome
It was held that the contract between the complainant and defendant was not
enforceable. When the contract was being discussed, there was ambiguity in the
Peerless and what ship was being referred to, as well as no agreement on the terms
on the sale. There had been no consensus ad idem or meeting of the minds between
the parties to form a binding contract. The objective test made it clear that a
reasonable person would not have been able to identify with certainty what ship had
been agreed on.
The plaintiff in Dularia Devi v. Janardan Singh[15] was an illiterate woman who wanted to
leave her properties to her daughter. The defendants took her thumb prints on two documents
that she thought were in her daughter’s favour, but the second document was in the defendants’
favour, who were only supposed to execute the deed. She later filed a suit to cancel the sale
deed, and it was determined that because the woman was unaware of the nature of the second
document, it was void.

In the case of Bimla Bai vs Shankarlal[12] a father referred to his illegitimate son as “son” in
order to save his marriage. It was determined that the father knowingly concealed the son’s
illegitimacy with the intent of defrauding the bride’s parents, which amounted to fraud.

In the case of Lingo Bhimrao Naik v. Dattatrya Shripad Jamadagni[10] a mother was accused
of exerting undue influence on his adopted son when he reached the age of majority in order for
him to ratify the gift deeds regarding non watan property made to her daughters, as well as
obstructing his ability to consult his natural father. The court ruled that the adoptive mother
abused her position of authority to exert undue influence over his son in order to gain an unfair
advantage in having the gift deeds ratified. Furthermore, because the adoptive son was unaware
of his legal rights, the case was adjourned.
Sumpter v Hedges [1898] 1 QB 673

Partial performance of a contract.

Facts
A builder contracted to build two houses and stables for the lump sum of £565. The
builder only completed part of the work, after which he abandoned the contract. The
completed works amounted to a value of £333. A summary judgement found that
the builder abandoned the contract. The builder brought an action against the land
owner for the full payment of the £333 for his partial performance of the contract.

Issues
The question arose as to whether (1) the partial performance of the contractual
works entitled the employee for payment of the value of the work done; or,
alternatively, (2) there was a right to recover for value of the work separately.

Decision/ Outcome
Firstly, the Court held that, under a contract of work for a lump sum payment, the
contractual price cannot be recovered, neither in whole nor in part, until the
contractual work is complete. If the work was completed, yet with certain omissions
or defects, then the employer would take the benefit of the completed works and the
employee would be entitled to payment of the contract price with deductions.
However, on the facts, the employee abandoned the contract without completion.
This partial performance of the contract works does not entitle the employee to
recover any payment of the contract price under a lump sum contract. Secondly, the
Court held that, alternatively, quantum meruit payment would require the inference
of a new contract for the partial work, independent from the lump sum contract. Yet,
on the facts, there is no inference of a new contract for partial works. As the only
applicable contract is the lump sum contract, the employee was not entitled to
recover the contract price for his partial performance of the contractual works.
Bolton v. Mahadeva
The plumber (plaintiff) installed a central heating which cost $560. However, the
householder discovered some defects of the installation and the plaintiff refused to
fix it. The repair cost was $174. Therefore, the defendant (householder) refuses to pay
for the $560. The court said that it was a more serious breach, the plaintiff will not
entitle any amount of money, while the defendant will be discharged from any
obligation.

Ritchie v Atkinson (1808)

By contract the claimant agreed to carry a cargo of specified quantity of hemp and
iron. The price agreed was £5 per ton for the hemp and 5 shillings per ton of iron.
The claimant only carried part of the agreed quantity. The defendant argued the
contract had not been fully performed and therefore no payment was due.

Held:

The contract could be divided into separate parts as the parties had agreed a price
per ton. The claimant was thus entitled to payment for the amount carried although
the defendant was entitled to damages for non performance in relation to the
amount not carried.
Cutter v Powell (1795) 6 TR 320

Partial performance of a contract.

Facts
Mr. Cutter, a sailor, was hired for a voyage and given a promissory note from his
employment that ten days after the ship arrives at Liverpool, he will pay Mr. Cutter a
certain sum, “provided he proceeds, continues and does his duty as second mate in
said ship from hence to the port of Liverpool.” Mr. Cutter began sailing the ship as
second mate for about six weeks, yet died before its arrival in Liverpool. Mr. Cutter’s
wife brought an action for a proportionate part of his due wages for the substantial
amount of the voyage on which he acted as second mate.

Issues
The question arose as to whether the sailor was entitled to payment for his
substantial performance of the contract as an implied term within the contract.

Decision/Outcome
The Court stipulated that, where parties conclude an express contract, no terms can
be implied into the contract. On the facts, the contract between the parties expressly
provided that the payment was conditional upon the completion of the voyage and
only payable after the ship’s arrival. Thus, under the express terms of the contract,
the sailor was entitled to receive the payment if the whole duty of the contract was
performed, and not entitled to any payment if the contract was only partially
performed. The Court noted that the contract made payment conditional on
performance of the full voyage as a form of insurance for the employer. Accordingly,
the Court held that, even though the sailor was not to blame for failure to perform
the contract, the express terms of the contract renders payment conditional on the
full performance of the contract. Thus, on a construction of the express terms of the
contract, no payment was due for partial performance.