A D E H CA] F. E. ROSE, LTD. v. Wa. H. PIM, LTD. 739 FREDERICK E. ROSE (LONDON), LTD. v. WM. H. PIM, JUNR. & CO., LTD. [Courr ov Apprat (Singleton, Denning and Morris, L.JJ.), June 29, 30, July 16, 1953.] Contract—Rectification—Mistake—Written contract correctly stating terms agreed orally—Mutual error as to meaning of expression used. Having received an inquiry for a supply of “ horsebeans described here as feveroles”, and not knowing that feveroles were a special medium size variety of horsebeans, buyers asked sellers what they were and were informed that feveroles and horsebeans were the same thing. The two parties being under this misapprehension, the buyers entered into an oral agreement for the purchase from the sellers of five hundred tons of Tunisian horsebeans, the agreement being incorporated in a written contract. Tho buyers subsequently brought an action for the rectification of the written contract by the addition of the word “feveroles” after the words “Tunisian horsebeans ”. Herp: the oral agreement was for the sale of horsebeans, and, notwith- standing the mutual mistake as to the meaning of “feveroles” and “‘horsebeans”, as the written contract correctly expressed that oral agreement, it could not be rectified. ‘Per Denning, L.J.: A previous continuing common intention is not sufficient to justify rectification unless it has found expression in outward ‘agreement (disapproving a dictum of Snsonps, J., in Crane v. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 664), As To REcrrricaTiow oF A Wrirren Instrumenr, see HALSBURY, Hailsham Bdn,, Vol. 23, pp. 140-143, paras. 197-199. Cases referred to: (1) Crane v. Hegeman-Harris Co. Inc., [1939] 1 All E.R. 662; affd. C.A, [1939] 4 All E.R. 68; Digest Supp. (2) Bell v. Lever Bros., Ltd., [1932] A.C. 161; 101 L.J.K.B. 129; 146 LT. 258; Digest Supp. (3) Ryder v. Woodley, (1862), 10 W.R. 294; 17 Digest 45, 504. (4) Harrison & Jones, Ltd. v. Bunten & Lancaster, Ltd., [1953] 1 All E.R. 903; [1953] 1 Q.B. 646, (5) McRae v. Commonwealth Commission, (1951), 84 C.L.R. 377. (6) Couturier v. Hastie, (1856), 5 H.L. Cas. 673; 25 L.J.Ex. 253; 28 L.T.0.8. 240; 10 E.R, 1065; 35 Digest 103, 95. (7) Solle v. Butcher, [1949] 2 All E.R. 1107; [1950] 1 K.B. 671; 31 Digest, Replacement, 674, 7699. (8) Leaf v. International Galleries, [1950] 1 All E.R. 693; [1950] 2 K.B. 86; 2nd Digest Supp. (9) Shipley Urban District Councit v. Bradford Corpn., [1936] Ch. 378, 399; 105 L.J.Ch, 225, 232; 154 L.T, 444; Digest Supp. (10) Lovell & Christmas, Ltd. v. Wall, (1911), 104 L.T. 85; 17 Digost 46, 519. (11) Smith v. Jeffryes, (1846), 15 M. & W. 561; 15 L.J.Ex, 325; 7 L.T.0.8. 231; 153 E.R. 972; 35 Digest 100, 79. ArreaL by the defendants (the sellers) from an order of PrcHEr, J., dated Jan, 23, 1953, granting rectification of two written contracts of sale by the insertion of the word “ feveroles” after the words “ Tunisian horsebeans ” and “ Algerian horsebeans” in the specifications of the goods sold appearing respectively in the two contracts. ‘Tho sellers contended that there was no ground for rectification in law since the written contracts correctly stated the terms agreed orally between the parties.740 [Avovsr 13, 1958] ALL ENGLAND LAW REPORTS [Vol. 2 1. G. Roche for the sellers. Diplock, Q.C., Eustace Roskill, Q.C., and Bateson for the buyers. Our. adv, vult. July 16. The following judgments were read. SINGLETON, L.J.: This dispute arises out of two contracts for the sale of North African horsebeans. The buyers and the sellers carry on business in the city of London. ‘The representative of the former in these transactions was Mr. Hampson. The sellers have a considerable business in North African products, ‘The buyers have an associated company in Egypt, which is conveniently referred to as Rose (Middle East). On Oct. 26, 1950, Rose (Middle East) sent a cable to the buyers in these terms: “Have inquiry Egypt up to five hundred tons Moroccan horsebeans described here as feveroles. Please offer c.i.f. Port Said single and double bags indicating admixture.” ‘Mr, Hampson was ignorant of the meaning of the French word “ feveroles ”, and he, accordingly, communicated with Mr. Brooks, who was well known to him, and who was the representative of the sellers. As at the trial the judge accepted the evidence of Mr. Hampson, I think it desirable that I should refer to it. Mr. Hampson was asked: “Why did you pick on [the sellers] and Mr. Brooks ?”, and he answer: “ I chose [the sellers] because I have known for many years past that they have a very important connection in North Africa and I had always under- stood that the shippers in North Africa whom they represent are easily the biggest firm in North Africa. I also chose them because I have known Mr. Brooks for a matter of twenty-five years or more and, as I was in some little difficulty in dealing with something I had never handled before, I felt I could rely on Mr. Brooks as an old friend to help me to get the right thing. Q.—Had you ever come across the word ‘foverole’ before? A—No. I had never seen it in my life. Q.—When you rang up Mr. Brooks what did you do? A.—I am quite certain that I quoted to him that part of the tele- gram which says ‘five hundred tons Morocean horsebeans described here as foveroles’. I am about ninety-nine per cent. certain that I read the whole telegram. (PricHER, J.): The descriptive words? A.—Yes. (Counsel for the buyers): Did you refer to Egypt? A.—Yes. Q.—That is one of your one hundred per cent. certainties? A.—Yes, because I needed to buy them for shipment to Egypt. Q.—Having read out the telegram, did you ask him what ‘feveroles’ meant? A.—Yes. Q.—What did he reply? A.—Mr. Brooks said he did not know, but he would find out.” A fow days later there was another conversation, of which Mr. Hampson said: “T heard from Mr. Brooks that ‘ feveroles’ just means horsebeans, and that the commodity that I needed to buy was Algerian/Tunisian/Morocean, horsebeans.”” Thereafter there were offers and counter-offers which are shown in the docu- ments, of which copies are before the court. It is important to bear in mind that both the buyers and sellers were middlemen. If there came about a contract between them, the sellers were buying from North Africa, and the buyers wore to sell through Rose (Middle East) to Egypt. The matter came to @ head on Nov. 2, 1950, and there was another conversation between Mr. Hampson and Mr. Brooks, of which Mr. Hampson’s account is given in the transcript of the. evidence, and I read it as far as is material. Mr Hampson said: “On the 2nd [the sellers] came back and said they were unable to accept the bid of £30 10s., but they again made me a firm offer—all this was quite early in the morning—for reply back again in London at fiveCA.) F. E. ROSE, LTD. v. Wu. H. PIM, LTD, (Srveueron, LJ.) 741 o’clock on the same day, of Tunisian horsebeans, which they said were tho best of the three countries concerned, Algeria, Tunisia and Morocco, and they offered these to me at £32. I also heard—it is difficult to say whether from [the sellers] or on the market—that there was a possibility of all these kinds of beans being freed from control in this country and I knew that the United Kingdom was short of them and I felt that, as soon as that news was known, the price was sure to go up, so I added a comment in my telegram giving that news. ‘That was telephoned to the cable company at 10.50 in the morning. ‘The reply had to be back in [the sellers’) hands by five o’elock on that day.” On that Mr. Hampson cabled to Rose (Middle East) a document: “ Horsebeans firm here five today Tunisian which best quality thirty-two stop Believe about sellers’ lowest paragraph very confidentially rumoured our government will restore to private trade within few days when rush buyers expected.” He received a reply which reads: “ Yours today booked five hundred horse- beans.” ‘Thereupon he accepted the sellers’ offer, and there came into exis- tence a string of contracts, three in number. They are all dated Nov. 2. ‘The first is the sale by an Algerian company to tho sellers of five hundred tons Tunisian horsebeans, fair averago quality, at £32 a ton less 1} per cent. ‘The second records the sale by the sellers to the buyers of the like quantity and quality of Tunisian horsebeans at £32 a ton, and the third records the sale by the buyers to Noujaim of Port Said of the same quantity of horsebeans at £33 a ton, in each case c.i.f. Port Said. There was an arbitration clause in each of the contracts, which were on Form 62 of the London Corn Trade Association, and there was attached to each a slip containing provisions as to payment, and also providing: “ Cortificate: Certificate of cargo superintendents at shipment to be final as to weight, quality, condition and admixture. Cost of such certificate to be for sellers’ account, Admixture: Any admixture of dirt and other foreign substance over four per cent. to be allowed for by sellers on certificate of cargo superintendents.” Some four days later Mr. Brooks told Mr. Hampson that they could work a further two hundred tons of the same commodity, and there came into existence the contract of Nov. 7, 1950, between the buyers and the sellers for the sale of two hundred tons Algerian horsebeans, and corresponding contracts between. the sellers and their sellers, and the buyers and their buyer, who in this case was one Bassionini of Alexandria, to which port shipment had to be arranged. As in the case of the earlier contract there was a slip attached in the samo torms as before, It appears that the two hundred tons of Algerian horsebeans arrived first, and a complaint was made as to them, ‘This is shown by the letter from tho buyers, dated Dec. 11, to which the sellers replied. On Dee. 18 the buyers wrote to Rose (Middle East) a letter which relates to the five hundred tons of horsebeans which had been shipped in the s.8. Sylva. The buyers write “ We had arranged to assign the credit from Noujaim to [the sellers], but in view of the dispute over the Gunda [the ship on which the two hundred tons had been shipped] the writer went along to the bank this morning and inspected the certificate issued by cargo superintendents. A note of the salient points on the certificate (which is a printed form) is enclosed herewith. On seeing the goods described as ‘Feves de Tunisie’ we immediately objected and said that we would not accept ‘feves’ as equivalent to horsebeans. The bank thereupon refused to make a payment to [the sellers] and we understand this evening from [the sellers] that they are arranging to put the matter right, having telephoned to Paris on the subject. Exactly what steps their shipper is taking is not yet clear but we are742 [Avavsr 13, 1953] ALL ENGLAND LAW REPORTS [Vol. 2 watching the position very closely. We have been making a few inquiries on the Baltic from various people to check up on these matters, particularly as regards the nomenclature of the beans. One man tells us that there is only one sort of bean shipped from North Africa and that they are all horsebeans, Another man contradicts that and says that broad beans are also shipped and that they are known as ‘ feveroles ’ which is what you originally asked for in your cable of Oct. 26. We may mention here that we used the word ‘ feveroles’ when first speaking to [the sellers] and that they assured us that the translation of ‘ feveroles’ was ‘horsebeans’, It seems to be agreed that there are both f.a.q. horsebeans and ‘small horsebeans ’ to be had, but they are all ‘horsebeans’ and one has to specify ‘small’ if one wants that sub-division. Another comment is that whatever one may call them in English all the beans which are shipped from North Africa are called in ‘French’ ‘ feves’, In spite of this we shall not accept this word on the cargo superintendents’ certificate as being sufficient. It would be very interesting if you could let us know from your end, where it is much easier to get English/French translations accurately, what you consider is the exact equivalent of ‘horsebeans’ and ‘broad beans’ and also what ‘favettes’ or ‘ fevettes’ are.” This shows the complete uncertainty as to what was understood by the word “feveroles ”, and it brings in the question of “ feves”, also “ favettes ” and “ fevettes ”. That is after inquiries had been made in the market by the buyers. That uncertainty has not been cleared up, though it appears that both are horse- beans, and that “ feves” are larger than “feveroles ”, although that doos not appear from the letter which I have read, but rather the contrary. In the correspondenee there is a copy of a letter from the buyers to the sellers dated Dec. 18, 1950, which reads: “Our purchase of Algerian and Tunisian horscbeans. In view of the difficulties which seem to be arising in conriection with our two contracts with you, we should like to remind you of the cireumstances leading up to our transaction. We received on Oct. 27, from our Alexandria associates, the following telegram which we believe‘we read out in full to your Mr. Brooks: ‘Have inquiry Egypt up to five hundred tons Morocean horsebeans described here as feveroles. Please offer c.i.f. Port Said single and double bags indicat- ing admixture.’ We are quite certain that we told you that our inquiry was for feveroles, because we ourselves were not sure at that time of the exact translation, Mr. Brooks consulted others in the firm and told us that *foveroles ’ meant ‘ horsebeans ’ and that f.a.q. Algerian/Tunisian/Moroccan was the commodity intended. In telegraphing backwards and forwards to Alexandria wo used the word ‘ horsebeans ’ all through, and your contract to us was also on this basis and our contract to our buyers the same. On. examining the cargo superintendents’ certificate today for the shipment por Sylva we found that the description of quality was ‘ Feves de Tunisie’. Wo feel quite sure that you will agree that ‘ feve ’ is a word which can only be translated as ‘bean’ and that it covers quite a variety of different types, Clearly ‘ fove ’ is not the same as ‘ horsebean ’, and therefore we instructed the bank that we could not agree to their accepting this certificate. We aro pleased to note that you are arranging to put this right. The above cireum- stances naturally tend somewhat to make us feel that the buyer of the shipment per Gunda has right on his side in claiming that the beans shipped were not ‘horsebeans’. “However, we are purely intermediaries in the matter and have no desire to do other than clear it up as quickly and as satisfactorily as possible.” ‘The five hundred tons of Tunisian beans had been shipped in the s.. Sylva, and when the documents were presented it was seen that the cargo super- intendents’ certificate showed, not horsebeans, but “ feves de Tunisie”; andH CA] F. E, ROSE, LTD. ». Wa, H. PIM, LTD, (Stvoteroy, LJ.) 743 it is interesting to notice that the confirmation of sale between the sellers and tho Algerian sellers showed the description as “ feves” (horsebeans). Tho cargo superintendents’ certificate was altered so as to put the documents in order. No point is made of this, as the alteration was made with the approval of both the buyers and the sellers, None the less, it appears somewhat odd, in view of tho importance of the cargo superintendents’ certificate, Disputes arose between the buyers and the sellers and were referred to arbitration, ‘The award of the arbitrators in regard to the five hundred tons was given on Mar. 2, 1951, and it was in favour of the sellers, and an award to the like effect was made on July 18, 1951, in respect of the second contract. Appeals were entered, but stand adjourned. Proceedings were taken in the courts of Egypt by the buyers of the two hundred tons. After an incursion into the Chancery Court the buyers commenced this action against the sellers. By their statement of claim they claimed rectification of both contracts by the addition of the word “ feveroles” after the words “ Tunisian horsebeans ” and “ Algerian horsebeans ” respectively, and also damages for breach of warranty. The latter claim was based on an allegation in the statement of claim that Mr. Brooke had warranted that goods described as Algerian/Tunisian/Morocean horsebeans were goods commonly known in Egypt as “ feveroles” and could be re-sold in fulfilment of @ requirement for “feveroles”, and that in consideration of such warranties the buyers accepted the sellers’ offers, ‘During the hearing before Pricuer, J., the buyers abandoned their claim to damages for breach of warranty. It appears from the judgment that the reason given was that the sellers had pleaded s. 4 of the Sale of Goods Act, 1893, as a defence to the claim. ‘That could not provide an answer, in view of the fact that the goods had been delivered and payment had been made. It is unnecessary to consider the merits of the claim except to say that, though it might have been difficult to establish in law, it is something which cannot be overlooked, as the pleader seems to have thought at one time. The action was heard before Prrcuer, J., on Jan, 21 and 22, 1963, and he gave his judgment on Jan, 23, He held that the buyers’ claim must succeed, and that they were entitled to have the two forms of contract rectified by the addition of the word “ feveroles ” after the word “ horsebeans ”. The sellers appeal against that judgment. Apart from any question of law, one sees at once the difficulty caused by the uncertainty as to the meaning of “ feveroles”. The first cable of Oct. 26, 1950, mentioned horsebeans described in Egypt as “ feveroles”, and that cable led to discussions between Mr. Hampson and Mr. Brooks. I cannot say that it is clear from the evidence that the word “ feveroles ” has the same meaning everywhere, though it seems fairly clear that they are a type of horsebean, I have not thought it necessary to refer to the evidence of Mr. Brooks, as Pricurr, J., preferred the evidence of Mr. Hampson. It is, perhaps, not surprising that he did so, Some of Mr. Brooks’s answers were not convincing. They appear to me to show that he had very little knowledge of horsebeans, or of “ feveroles ”, what- ever impression he may have endeavoured to create. Nono the less, the judge said he had come to the conclusion that, at the time of the conversations, Mr. Brooks honestly believed that ‘ North African horsebeans described in Egypt as ‘foveroles’”” wero in fact the same commodity as “ North African horsebeans, fair averago quality.” ‘The judge said, further: “As I have already indicated, Mr. Hampson knew what was wanted. Mr. Brooks knew what was wanted by Rose (Middle East). But Mr. Hampson had no idea what it was and Mr. Brooks honestly thought that what was required was just North African horsebeans. He was wrong. He innocently, in my view, misled Mr. Hampson, with the result that the sellers bought from the Compagnie Algerienne horsebeans which were broad beans or feves and which were not feveroles. ‘They then passed this744 {Aveusr 13, 1953] ALL ENGLAND LAW REPORTS [Vol. 2 commodity on to the buyers, who in their turn sold it to their buyer. Tt is quite true that, from the moment people started putting pen or pencil to paper, the commodity was always described as Tunisian or Algerian horsebeans. That was solely because of the mutual mistake which had originated with Mr. Brooks and which had been accepted, as it were, by Mr. Hampson. In tho result I find that both the buyers and the sellers, through their respective market agents, made an oral agroement in which they intended to deal in horsebeans of the feverole type. All the documents thereafter, owing to mutual mistake, were made out as though the deal were an order for horsebeans or feves.” Innocent misrepresentation may give rise to a right of rejection. ‘That right was not exercised in this case, And it might have been possible to establish a breach of a collateral warranty. Neither of these questions arises. ‘The sole question is whether the buyers are entitled to rectification of the contracts. This depends, not on intention, but on proof that the written contract is not the contract into which the parties entered, and the terms of the contract: into which they had entered must be clearly proved. In Crane v. Hegeman-Harris Co. Ine. (1) Stwonps, J., said ({1939] 1 Al E.R. 665): “I would rather, I think, say that the court can only act if it is satisfied beyond all reasonable doubt that the instrument does not represent their common intention, and is further satisfied as to what their common intention was. For let it be clear that it is not sufficient to show that the written instrument does not represont their common intention unless positively also one can show what their common intention was. It is in the light of those principles that I must examine the facts of this somewhat complicated case.” When that case was before the Court of Appeal Str Witrrm Greene, M.R. ([1939] 4 All E.R. 71) spoke of the “high degree of conviction which unquestionably is to be insisted upon in rectification cases.” I accopt without hesitation the finding of Prtcusr, J., that both Mr. Hampson and Mr. Brooks were under @ mistaken view as to what “ feveroles ” or beans described in Egypt as “ feveroles ” were, and that that mistake came about as the result of what Mr. Brooks said. Still, it is necessary to ascertain what the contract was. That is shown by Mr. Hampson’s evidence as to the conversation on Nov. 2. It is really all contained in the passage to which I come again: “ On the 2nd [the sellers] came back and said they were unable to accept the bid of £30 10s., but they again made me a firm offer—all this was quite early in the morning—for reply back again in London at five o’clock on the same day, of Tunisian horsebeans, which they said were the best of the three countries concerned, Algeria, Tunisia and Morocco, and they offered these to me at £32.” I need not read further. ‘The offer clearly was Tunisian horsebeans. It was so treated by the buyors in their cablo to Rose (Middle East), who accepted it the same day. On acceptance by the buyers, a slip was made out in the sellers’ office, and that formed the groundwork of the contract, as Mr. Turner, the director, said. The oral contract between the buyers and the sellers was in fact for five hundred tons of Tunisian horsebeans, and the written contract is in the same terms. In those circumstances, a claim to rectify the written contract by adding the word “ feveroles” could not succeed. ‘The written contract is in the same terms as the oral contract. Whatever remedies the buyers might have, or might have had, rectification is not one of them. Counsel for the sellers submitted that either there was a contract for horsebeans or there was no contract at all. ‘That seoms to mo to be right. I cannot accept B D E F G HCA) F. E. ROSE, LTD. v. Wau. H. PIM, LTD. (Dewntne, L.J.) 745 the submission of counsel for the buyers that, because of the conversation somo days before Nov. 2 to the effect that ‘* feveroles ” meant: “ horsebeans ”, the oral contract was a contract for the sale of “ feveroles”. We know that the sellers passed on to the buyers an offer for the sale of horsebeans, If it had been sought to introduce the word “ feveroles ” into the contract, it is almost certain that inquiries would have been made in North Africa, and some information might have been forthcoming as to the varieties of horsebeans, in which event Mr. Hampson and Mr. Brooks might not have agreed on terms, or they might have agreed on terms other than those at which they arrived. ‘The same considerations apply to the second contract as to the first. I do not regard this as a case in which rectification can be granted. Iam in favour of allowing the appeal. DENNING, L.J.: The parties in this case have got involved over the mean- ing of some French words for some kinds of beans. The position is not altogether clear even now, but, so far as I understand it, it is this. In certain countries in North Africa, notably Morocco, Algeria and Tunisia, the people grow beans which are known in those countries as “ feves”, and in English as horsebeans. ‘There is a special kind of them known as “ foveroles ”, a word which has no exact equivalent in English, but which denotes horsebeans of medium size, There is another special kind called “ fevettes ”, which denotes the very small horsebeans. The medium size and small size are more valuable than the large ones, ‘The trouble in this case has all arisen because the English word “ horsebeans ” covers all the three varieties, “ feves ”, “ feveroles” and “ fevettes ”, and the English business men did not realise that there were those three different varioties. On Oct. 26, 1950, an English firm in Alexandria telegraphed to its London house in these words: “Have inquiry Egypt up to five hundred tons Moroccan hqnebeans described here as feveroles. Please offer e.i.f. Port Said.” ‘The London house of the buyers did not know what “ feveroles ” were. So their market clerk, Mr. Hampson, got into touch with Mr. Brooks, of the sellers, who had much knowledge of the North African trade. Mr. Hampson read the telegram to Mr. Brooks and told him that the buyers wanted to make an offer in accordance with it. They wanted to supply “ horsebeans described in Egypt as feveroles”, but did not know what “ foveroles ” were. Mr. Brooks made inquiries of his colleagues, and, as a result, told Mr. Hampson: “ What you want is horsebeans. ‘ Feveroles’ just mean horsebeans. We can supply you with them, and I will get an offer for you.” A few days later Mr. Brooks rang up Mr. Hampson and said that the sellers could supply five hundred tons of horsebeans at £33 a ton, whereupon the buyers, on Oct. 31, 1950, telegraphed to their Alexandria house a firm offer to supply “‘ horsebeans ” stating in the telegram: “Understand horsebeans exact translation feveroles.” ‘That was, of course, based on what Mr. Brooks had told Mr. Hampson. In all the negotiations thereafter the word “ horsebeans ” was used and not feveroles ”, becauso it was an English word and the parties thought that it meant the same thing as “ feveroles. Eventually, on Nov. 2, 1950, three written con- tracts were signed whereby: (1) the sellers agreed to buy from an Algerian company five hundred tons of Tunisian horsebeans at £32 per ton less 1} per cent.; (2) the sellers agreed to sell to the buyers of London five hundred tons of Tunisian horsebeans at £32 per ton; and (3) the buyers of London agreed to sell to Messrs. Noujaim of Port Said five hundred tons of Tunisian horsebeans at £33 per ton. Payment was to be made by net cash against shipping documents by confirmed irrevocable letters of credit to be opened by buyers with a London bank. In pursuance of these contracts, on Dee. 11, 1950, five hundred tons of horsebeans were shipped at Tunis for despatch to Egypt. ‘The certificate of746 [Aveusr 13, 1953] ALL ENGLAND LAW REPORTS [Vol. 2 the cargo superintendents at Tunis at first described them as “ Feves de Tunisie”, whereupon the buyers told the bank not to honour the credit, because they could not accept “ feves ” as equivalent to horsebeans (they still thought that “feveroles” were horsebeans and that horsebeans were “ feveroles ”), whereupon the cargo superintendents altered the certificate so as to describe the goods as horsebeans, which they in fact were. ‘Thereupon the conditions of the credit were fulfilled and the bank paid the price in exchange for the shipping documents, When the Egyptian buyer took delivery of the goods the mistake was discovered. He found that they were not “ feveroles ”, but only “feves”. He complained at once, but as he had already paid for the goods by means of the irrevocable credit, he did not reject them, but accepted them and claimed damages. It is quite plain that neither the Egyptian buyer nor the buyers could claim damages under the written contracts, because those contracts were contracts for horsebeans and the goods delivered were in fact horsebeans, and that has been so found by arbitrators in London. In those circumstances the buyers seek in this action to have their contract with the sellers rectified so as to make it refer to “ feveroles ” instead of horsebeans. If they get the contract rectified, they will claim damages for failure to deliver “feveroles”. ‘Their object in so doing is, of course, to cover themselves against a claim by their Egyptian buyers. We were told that the courts in Egypt have, on a similar parcel of two hundred tons, already held the buyers liable for not supplying “ feveroles ”, Hence the desire of the buyers to be able to claim over against the sellers. ‘The facts which I have stated raise nico questions on the law of mistake. It is quite clear on the evidence that the parties to the second and third con- tracts (though not to the first) were under a common mistake. The sellers, the buyers and Noujaim all thought that “ feveroles” meant horsebeans, and that horsebpans meant “feveroles ”. ‘They thought that if they got horsebeans they woull Jget the “ feveroles” which they wanted. It was under the influence of that mistake that they entered into those contracts for horsebeans. Tho sellers were, of course, the cause of all the trouble. ‘Thinking that “ feveroles ” just meant horsebeans, they asked their Algerian supplier to supply horsebeans, and he did so. They ought to have asked him to supply “ feveroles ”, and then there would have been no trouble. The Algerian supplier, no doubt, knew D the difference between horsebeans (“ feves ”) and “ feveroles”, If he had been . asked for “ foveroles ”, he would have quoted for “ feveroles” and supplied “ feveroles ”, but being asked only for horsebeans, he supplied horsebeans. What is the effect in law of this common mistake on the contract between the buyers and the sellers ? Counsel for the sellers quoted Bell v. Lever Bros., Lid. (2), and suggested that the contract was @ nullity and void from the beginning, though he shuddered at the thought of the consequences of so holding. I am clearly of opinion that the contract was not a nullity. It is true that both parties were under a mistake, and that the mistake was of a fundamental character with regard to the subject-matter. The goods contracted for—horse- beans—were essentially different from what they were believed to be— * feveroles ”. Nevertheless, the parties to all outward appearances were agreed. They had agreed with quite sufficient certainty on @ contract for the sale of goods by description, namely, horsebeans. Once they had done that, nothing in their minds could make the contract a nullity from the beginning, though it might, to be sure, be a ground in some circumstances for setting the contract aside in equity. In Ryder v. Woodley (3), where a buyer contracted to buy a commodity described “St, Gilles Marais wheat ”, believing that it was wheat when it was not, the contract was held to be binding on him and not a nullity. In Harrison & Jones, Lid. v. Bunten é& Lancaster, Ltd. (4), where parties contracted for the supply of “Caleutta Kapok ‘Sree’ brand”, both believing it to bo pure kapok containing no cotton, whereas it in fact contained ten to twelveCA] F. E. ROSE, LTD, v. Wu. H. PIM, LTD. (Denwrva, L.J.) 747 per cent. of cotton, Pr.cHer, J., held that their mistake, although fundamental, did not make the contract a nullity. In McRae v. Commonwealth Commission (5), where sellers contracted to sell a stranded oil tanker, described as lying at a specified point off Samarai, believing that there was a tanker at such a place ‘when there was in fact no such tanker there, or anywhere in the locality, the High Court of Australia held that the mistake, although fundamental, did not make the contract a nullity, and that the buyers were entitled to damages. ‘The court showed convincingly that Couturier v. Hastie (6) was a caso of construction only. It was not a case where the contract was void for mistake, The other old casos at common law can likewise be explained. At the present day, since the fusion of law and equity, the position appears to be that, when the parties to a contract are to all outward appearances in fall and certain agreement, neither of them can set up his own mistake, or the mistake of both of them, so as to make the contract a nullity from the beginning. Even a common mistake as to the subject-matter doos not make it a nullity. Once the contract is outwardly complete, the contract is good unless and until it is set aside for failure of some condition on which the existonce of the contract depends, or for fraud, or on some equitable ground: see Solle v. Butcher (7) ([1949] 2 All E.R. 1119). Could this contract, then, have been set aside? I think it could, if the parties had acted in time. This contract was made under a common mistake as to the meaning of “ feveroles ” and “ horsebeans ”. ‘This mistake was induced by the innocent misrepresentation of the sellers, made to the buyers and passed on to the sub-buyers. As soon as the buyers and sub-buyers discovered the mistake they could, I think, have rejected the goods and asked for their money back. ‘The fact that the contract was executed would not be a bar to rescission. But once the buyers and sub- buyers accepted the goods, and treated themselves as the owners of them, they could no longer claim rescission: see Leaf v. International Galleries (8). The buyers now, after accepting the goods, seck to rectify the contract. Instead of its being a contract for “ horsebeans” simpliciter, they seek to make it a contract for “horsebeans described in Egypt as feveroles ” or, in short, » contract for “feveroles ”. ‘The judge has granted their request, He has found that there was “a mutual and fundamental mistake” and that the sellers and the buyers, through their respective market clerks, “ intended to deal in horsebeans of the foverole type”. And he has held that, because that was their intention—their continuing common intention—the court could reetify their contract to give effect to it. In this I think ho was wrong. Recti- fication is concerned with contracts and documents, not with intentions. In order to get rectification, it is necessary to show that the parties wero in complete agreement on the terms of their contract, but by an error wrote them down wrongly. And in this regard, in order to ascertain the terms of their contract, you do not look into the inner minds of the parties—into their intentions—any more than you do in the formation of any other contract, ‘You look at their outward acts, i.c., at what they said or wrote to one another in coming to their agreement, and then compare it with the document which they have signed. If you can predicate with certainty what their contract was, and that it is, by @ common mistake, wrongly expressed in the document, then you rectify the document. But nothing less will suffice. Tt is not necessary that all the formalities of the contract should have been executed so as to make it enforceable at law: seo Shipley Urban District Council v. Bradford Corpn. (9); but, formalities apart, there must have been a concluded contract. ‘There is a passage in Crane v. Hegeman-Harris Co. Inc. (1) ({1939] 1 All E.R. 664, at “C”), which suggests that a continuing common intention alone will suffice, but I am clearly of opinion that a continuing common intention is not sufficient unless it has found expression in outward agreement. There could be no certainty at all in business transactions if a party who had entered into748 [Avousr 13, 1953) ALL ENGLAND LAW REPORTS [Vol. 2 a firm contract could afterwards turn round and claim to have it rectified on the ground that the parties intended something different. He is allowed to prove, if he can, that they agreed something different: see Lovell & Christmas, Ltd. v. Wall (10), 104 L.T. 88, per Lorp Cozens-Harpy, M.R., and ibid., 93, per Buckixy, L.J.; but not that they intended something different. ‘The present case is a good illustration of the distinction. The parties, no doubt, intended that the goods should satisfy the inquiry of the Egyptian buyers, namely, “ horsebeans described in Egypt as feveroles.” They assumed that they would do so, but they made no contract to that effect. Their agree- ment, as outwardly expressed, both orally and in writing, was for “ horsebeans ”. ‘That is all that the sellers ever committed themselves to supply, and all they should be bound to. There was, no doubt, an erroneous assumption underlying the contract—an assumption for which it might have been set aside on the ground of misrepresentation or mistake—but that is very different from an erroneous expression of the contract, such as to give rise to rectification. The matter can best be tested by asking what would have been the position if the contract between the sellers and the buyers had been for “ feveroles ”. Surely, then, the sellers on their side would have stipulated with their Algerian suppliers for the delivery of “ feveroles ”, and the buyers on their side would have agreed with their sub-buyers to deliver “ feveroles”. It would not be fair to rectify one of the contracts without rectifying all three, a thing which is obviously impossible. ‘There is one other matter I must mention. In the statement of claim the buyers originally claimed damages for breach of a collateral warranty—a warranty that the horsebeans would be a compliance with a demand for “ feveroles ”—but that claim was formally abandoned at the trial. I do not myself quite see why it was abandoned. Section 4 of the Sale of Goods Act, 1893, was no bar to it. Nor was such a warranty in any way in contradiction. of the written contract. (Smith v. Jeffryes (11) was not an action on a collateral warranty.) The only difficulty might be whether it was a contractual warranty ‘or merely an innocent misrepresentation, I should myself have thought that it had a'better chance of success than the claim for rectification. Tt was put forward by the buyers very forcibly in their letter on Mar, 12, 1951, but its abandonment at the trial makes it impossible for us to consider it. We have only to consider the question of rectification, and on that I think that the buyers fail. I agree that the appeal should be allowed and judgment entered for the sellers. MORRIS, L.J.: When the buyers received from their associated company in Alexandria an inquiry for “horsebeans described here as feveroles ” Mr. Hampson, being puzzled, sought the advice of Mr. Brooks. When it was ultimately given that advico was that “ horsebeans ” and “ feveroles” were interchangeable terms. With liberal opportunity of assessing the actions and bearing of Mr. Brooks, the learned judge was “ certain ” that he was an honest witness. Mr. Brooks knew precisely what was the inquiry received by the buyers. As “an honest man” he “honestly believed at the time that the commodity ‘North African horsebeans, f.a.q.’ was identical with ‘ North African horsebeans, described in Egypt as foveroles ’. So it came about that the parties proceeded on that basis. On Nov. 2, 1950, Mr. Brooks offered to Mr. Hampson five hundred tons of Tunisian horsebeans, and Mr. Hampson agreed to buy. It was understood between them that there would be a written contract on the appropriate corn trade form. When it was prepared and signed it related to Tunisian horsebeans. A later contract, dated Nov. 7, which (as in the case of the earlier contract) was on Form 62 of the London Corn ‘Trade Association, related to two hundred tons of AA] F. E. ROSE, LTD. v. Wu. H. PIM, LTD. (Morzs, LJ.) 749 Algerian horsebeans. Both buyers and sellers aro merchants engaged in the grain trade and dealing on the Baltic Exchange, and there can be no doubt that the buyers would appreciate that the sellers did business for forward shipment. The buyers would appreciate that the sellers bought and sold simultaneously and would buy from a shipper in order to sell to the buyers. The sellers knew that the buyers were buying in order to re-sell. ‘These cireum- stances do not, however, govern the determination of the issuo of rectification now raised between the parties. It seems to me clear beyond doubt that both parties proceeded on the basis that “ feveroles ” and “ horsebeans ” were the same. Mr. Hampson expressed the matter succinetly when ho said: “Thad agreed to buy because feveroles were horsebeans and horsebeans were feveroles.”” In that belief the parties came to agreement, and the formal written contracts were prepared and signed. ‘The parties had throughout a clear common intention and purpose of buying and selling horsebeans, and their written agreements faithfully embodied and exactly recorded what they had agreed. In these circumstances it seems to me that no claim for rectification can succeed. Both parties thought that the result of what they clearly understood and clearly expressed would be that the buyers as buyers would be able to satisfy the inquiry which, as the sellers knew, had been received.” In that they were mistaken as a result of the advice honestly given by Mr. Brooks. But the fact that they were under @ mistaken impression as to what their agreement would achieve does not disturb the clarity and the fixity of the agreement which they in fact made. The sellers intended to offer horsebeans and the buyers intended to accept horsebeans. The written agreements correctly reflected and incorporated what they had agreed. The learned judge, in the course of his judgment, said that “ Both the buyers and the sellers through their respective market agents made an oral agreement in which they intended to deal in horsebeans of the feverole type.” With respect, that was not quite the position. There was no question of contracting in reference to a “‘ type” of horsebeans. There was a joint under- standing that they should contract in reference to “ horsebeans ” simpliciter which they thought were the same as “ feveroles”. If, as now appears to be the case, they were wrong, it appears probable that they would not have acted as they did had they been enlightened. But this does not enable one party to convert the contract into something different from what it was, On tho assumption that “feveroles” are different from “ horsebeans ”, it cannot be said that the parties agreed on the sale of a commodity of the separate existence of which they had no knowledge. The sellers were selling “ horsebeans ”, and in order to sell they would have to acquire “horsebeans ”. If “ feveroles ” are different, then the sellers, and equally the buyers, never even gave their minds at all to the question of a sale of some products which are different from “horsebeans ”. I consider that the appeal should be allowed. Appeal allowed. Solicitors: Richards, Butler & Co. (for the sellers); Thomas Cooper & Co. (for the buyers). [Reported by F. A. Aumms, Esq., Barrister-at-Law,]