Fry v Byrne [1917] HCA 54; (1917) 23 CLR 589 (10 October 1917)

There are two phases in the case. The first concerns transactions between the parties up to 6th March. The conclusion to be drawn as to that part of the case depends very largely upon the versions of the parties, because the communications between them as to the retainer of the plaintiff as agent were verbal. In the second phase, the conclusion as to the transactions of 6th March between plaintiff and defendant depends principally on the view to be formed of the meaning of the documents of that date, in connection with the surrounding circumstances. Cussen J., in dealing with the first phase, pointed out that the plaintiff was admittedly employed by the defendant in connection with the transactions relating to the station properties. He concluded that on the whole of the evidence as to what occurred up to 3rd March, the date of the defendant's written contract with Browne Brothers, and after that date, the plaintiff was employed by the defendant on the ordinary contract of employment of a commission agent to bring about, if possible, the sale of Therribri and the lease of Blairmore. In the learned Judge's opinion it was also clear on the evidence that on 3rd March the plaintiff had done what he undertook to do, by bringing together the proposed vendor and the proposed purchaser, and that the vendor and the purchaser had both approved of the terms on which the one property was to be purchased and the other leased.

The plaintiff said that his employment was from the beginning at a commission of 2½ per cent. The defendant denied this, and asserted that on being told by the plaintiff that he would have to give a good commission, as other agents (who would want to participate with him) would work better for that, his reply was: "Well, you make a satisfactory sale, and we won't quarrel about commission."

The Judge, who heard the lengthy evidence, and was able to weigh the witnesses not only by their words but by their demeanour under forensic tests, appears not to have entirely accepted the plaintiff's version as to part of the case or the defendant's version as to the rest. But being satisfied that the plaintiff had by 3rd March performed the work for which he had been retained, but not satisfied that the retainer was at the rate the plaintiff claimed, he came to the conclusion that if the case had rested at that point the plaintiff would have been entitled to a reasonable commission.

The Judge was in the best position to appraise the evidence as to the nature of the retainer and the fact of its execution, and I do not think his conclusion can possibly be disturbed as to that part of the case.

Now, as to the remainder. The contract between the defendant as vendor and Browne Brothers as purchasers, which was signed on 3rd March, though of the documents together comprising it three were dated on 21st February and the fourth on 3rd March, contained a term that the purchasers should "take over" certain existing securities which the vendor had given to Dalgety & Co., and should also take all stock and working plant on Therribri at a valuation to be afterwards made. Dalgety & Co. would not agree to the substitution of the purchasers for the defendant as their debtor. As a result the contract of sale went off. There was a difference between vendor and purchasers as to who was to procure the "taking over" of the liability of the vendor to Dalgety & Co. Whichever of the parties was bound to procure it, the then accrued right of the plaintiff to a reasonable commission was not affected. He had brought the parties to the sale together and was not concerned in their conflicting views as to the meaning of this term in their contract. I am of opinion that it was for the defendant to render it possible for the purchasers to "take over" the liability, as they were willing to do. I think that is the meaning of the contract in that respect, and the defendant himself seems to me to have acted in that belief by his conduct. Dalgety & Co. were evidently also of that view after the defendant's interview with them on the subject, for in their letter of 20th March 1916 to Messrs. Harwood & Pincott, they speak of "the proposal fully set out to us by Mr. Fry" and also of "Mr. Fry's suggestions." The defendant indeed was their customer and the purchasers were strangers to them. These facts throw some light on the common acceptation of the term in question when it occurs in a contract for the sale of pastoral properties and stock.

Now, the sale contract having gone off, and that fact not affecting the plaintiff's true right, he was on 3rd March and afterwards entitled to a reasonable commission. But the failure to complete the sale left the defendant's properties on his hands, including his stock and working plant, and this fact in connection with the document Ex. E1 of 6th March, presently to be mentioned, seems rather to give a key to the meaning of the document Ex. G, also of 6th March. This latter document was as follows:—"In the event of the completion of the sale of my property Therribri and the lease of my property Blairmore to Messrs. Browne Brothers of Nerowie, I the undersigned hereby agree to pay Joseph Byrne of Balmerino Avenue, Toorak, the sum of (£2,815) two thousand and eight hundred and fifteen pounds representing commission due to him on these transactions this undertaking being given by me on the understanding that the said Joseph Byrne is prepared to accept a promissory note for the amount payable on 1st day of February 1917, with interest at the rate of five (5) per cent. per annum, if I wish to provide payment in this way. It is mutually understood that said promissory note shall be renewed until J. R. Fry receives enough money from interest and rent on said properties to liquidate same." The document was signed by the plaintiff and the defendant. The sum of £2,815 there mentioned represents 2½ per cent. on the purchase price of Therribri and 5 per cent. on the first year's rent of Blairmore. The question that arises is as to the meaning of the words "in the event of the completion of the sale."

Now, it is obvious that if the defendant could obtain an advance enabling him to pay off his liability to Dalgety & Co. he would have a prospect of getting the contract of 3rd March brought to fruition, notwithstanding the previous refusal of Dalgety & Co. to accept Browne Brothers as their debtor in place of the defendant; and if he could once get Browne Brothers to complete the purchase of the one property and the lease of the other he would have an equally good prospect of inducing Browne Brothers to buy the stock and plant on these properties. It is illuminating that on the same 6th March the defendant gave the plaintiff a document which apparently preceded or was concurrent with the document already quoted. It is Ex. E1, which was in the following terms:—"In consideration of Joseph Byrne securing me an advance of about (£20,000) twenty thousand pounds on the stock and working plant of Therribri and Blairmore, I the undersigned hereby authorize him to sell either directly or through an agent to Messrs. Browne Brothers of Nerowie the whole of the stock and plant on my estates of Therribri and Blairmore in New South Wales comprising approximately 20,000 sheep, 350 head of cattle, 165 horses and other livestock together with the whole of the working plant on the properties. Commission to be at the rate of 2½ per cent. to be paid by me on the amount realized through the sale. Any balance over and above amount of £20,000 I agree to share pro rata in the reduction of amount owing on the said stock. The said stock to be paid for out of the profits made off properties after interest on Therribri and rent on Blairmore and other charges are paid for. It is to be mutually arranged between all parties as to period in which the said stock shall be paid for. I further agree that I will not demand any portion of the purchase principal money from Messrs. Browne Brothers until the said stock, &c., have been paid for. Any security taken over stock and plant for the repayment of the value of the stock and plant to be taken conjointly.—J. Rood Fry."

Taking these documents together, I think that the words "in the event of the completion of the sale," with which Ex. G begins, mean that if the plaintiff could secure the defendant the advance of £20,000 which was to satisfy his indebtedness to Dalgety & Co., and could arrange a sale of the stock and plant to Browne Brothers, he was to get the large commission of 2½ per cent. on the sale and lease of the properties if he could also bring about in actual fact a contract freed of the Dalgety obstacle, and binding Browne Brothers to the purchase and lease respectively of the properties, obtaining also on his doing the work prescribed in Ex. E1 2½ per cent. on the price of the stock and plant. If the whole thing were completed he would obtain 2½ per cent. on each branch of it. It is to be observed that there is not in any of the documents of 6th March anything to show that the plaintiff was so very foolish as to throw away his accrued right to commission on the work he had completed on 3rd March, and I agree with Cussen J. that there is nothing to show that that original contract with the plaintiff was varied in any way. But there was superadded the opportunity of gaining a much larger commission if he achieved complete success. The plaintiff's efforts to secure the loan of £20,000 to enable the defendant to pay off Dalgety & Co. were, however, unsuccessful. Success in this matter clearly stood in limine. And in any event Browne Brothers declined, as they had always declined, to vary their original contract of purchase and leasing. It was thus impossible to bring about the "completion of the sale" mentioned in Ex. G. It follows that the plaintiff never was entitled to the £2,815 for which he sued, but to my mind it is equally clear that he remained entitled to a reasonable commission on the transaction which culminated in the contract of 3rd March. That reasonable commission has been assessed by the learned Judge on evidence at 1 per cent. on the sale of Therribri and 5 per cent. on the first year's rent of Blairmore. He thus arrived at the amount of £1,195, for which he gave the plaintiff judgment.

It should be mentioned that the plaintiff attributed a meaning to Exhibit G which was inconsistent with its terms. Anxious to recover the whole £2,815, he tried to treat Ex. G as a mere record of his original contract, and this involved him in the endeavour to treat the opening words of Ex. G as a mistake common to the parties. In this I think he fails. But even if Ex. G were interpreted strictly and without reference to the accompanying document E1 and the surrounding circumstances, it would be worse for the defendant, for in that view there is in the evidence good ground for saying that the defendant himself prevented completion by his failure to enable Browne Brothers to take over his liability to Dalgety & Co. by procuring the consent of those creditors to the change. On that interpretation the plaintiff might be entitled to the whole £2,815. But Ex. G, in conjunction with Ex. E1 and in the light of the surroundings, bears in my judgment the construction which I have above placed upon it. Thus considered, the documents negative, as his Honor rightly thought, the plaintiff's version of their meaning, and in the result the plaintiff is only entitled to the ordinary and not to any special commission.

I therefore think that the judgment of Cussen J. must be sustained and the appeal dismissed with costs.

I regret that I am not able to come to the same conclusion as my learned brothers. As personally I can see no features of difficulty, or any circumstance which disentitles the appellant to succeed, I must state my own opinion as I have formed it.

The material facts are very short, and in their main features are typical. The decisive facts are not in controversy, and in the view I take, the whole case resolves itself into pure questions of law—namely, the construction of a written contract, which is a matter of law, not of fact (Williams Brothers v. Agius[1]; Di Sora v. Phillipps[2]), and the question of whether there is any evidence to support the finding of a contract collateral to the written contract, which is also for this purpose a matter of law (Heilbut, Symons & Co. v. Buckleton[3]; Harekara Lal Roy Chowdhuri v. Hari Dasi Debi[4]). Unfortunately, in order to demonstrate this, the course taken in argument requires a somewhat detailed reference to the facts. I would add that I am also of opinion that so far as the matter depends upon inference the scale inclines heavily both as to law and justice on the side of the appellant. As it is conceded that the appellant is more credible than the respondent no difficulty exists in the way of a Court of appeal forming its own opinion even as to controverted statements if there are any.

Byrne is a farm and station salesman. Fry is a New South Wales station holder. In December 1915 Byrne was introduced to Fry with a view of obtaining a purchaser for Fry's two stations called "Therribri" and "Blairmore." They had three or four interviews between then and the early part of February 1916. Fry gave Byrne the particulars, and up to that time the idea was to sell both stations. Later, about 8th or 9th February, another agent, named Gemmell, brought forward as possible purchasers Victorian station owners, named Browne Brothers, who had already been negotiating with Fry, but unsuccessfully. Browne Brothers were possible purchasers of one station only, Therribri; they being willing only to lease the other, Blairmore. Fry agreed to this variation, but nothing whatever was said about remuneration for leasing. This is important to remember, because manifestly the expression of Fry, presently to be mentioned, cannot be taken to be the contract between them. Manifestly, too, the whole question of remuneration was intended to be open for future arrangement. Byrne said Fry would have to give a "good commission," as agents would work better for that. Fry replied: "Well, you make a satisfactory sale, and we won't quarrel over commission."

I stop there for a moment to observe, first, that that evidence, which is given by Fry, is directly contradictory of the story given by Byrne, the plaintiff; Byrne's story as to this part of the case, contradicted as it was by Fry, was disbelieved by the learned Judge who heard him; the only contract he set up and relied on was disregarded; and the whole case for the respondent Byrne in argument before us for supporting the judgment rests on the veracity of Fry, and the force and effect of the words I have quoted. It is to me an extraordinary result, that a plaintiff should fail utterly on every phase of the case presented by himself, but that one fragment of the defendant's evidence should be taken on which to base a new case for the plaintiff, and yet the rest of the defendant's evidence be in effect disregarded.

It is also to be observed that, accepting those words of Fry as true, Byrne was asking for "a good commission," evidently meaning more than the ordinary commission, and his reason shows why—namely, that "agents would work better for that." No other construction can reasonably apply than that agents work better for a "good" than an "ordinary" commission; in other words, the understanding was that the remuneration was not to be the ordinary commission. Fry's reply that if a "satisfactory sale" is made "we won't quarrel over commission" means that when the amount of commission comes up for discussion he would not be ungenerous. But to my mind it clearly also means that he is to have some voice in the future discussion about the amount. This inference is strongly supported by what the plaintiff Byrne says in cross-examination. He says:—"I don't think it was said that there would be no bother about commission if a satisfactory sale was effected. I recognize that Mr. Fry was willing to give exceptionally favourable terms so as he could get his price." No doubt, had no arrangement been arrived at, then, as the parties clearly intended that in the event of "a satisfactory sale" some commission should be paid, and not necessarily the strict usual commission—because there were some special features in the case—the law, in the event of a satisfactory sale or a satisfactory sale and lease, would have fixed the commission by rendering certain what was intended to be made certain in some way. In the events that happened the parties themselves, as will be seen, did arrange the matter and did make it certain. I think the observation which Lord Colonsay in Forbes v. Watt[5] made as to the lease in that case applies very cogently to the previously indefinite contractual relation in the present case.

Negotiations took place between Fry and Browne Brothers, aided by Byrne and Gemmell. A bargain was made of a very complicated nature. Fry agreed to sell Therribri to Browne Brothers and to lease Blairmore to him; Browne Brothers agreed to sell Nerowie (Browne Brothers' Victorian station) to Fry; and the terms and stipulations were numerous and complicated. Among others were stipulations that Browne Brothers were to take over the mortgage which Fry had given over Therribri—in fact for £38,000—and also to take over Fry's indebtedness to Dalgety & Co. for the stock on Fry's stations, a liability of about £20,000. During the negotiations, as Byrne admits (and his admission is supported by all the evidence), Fry said Browne Brothers were to be "in his place with Dalgety & Co. as to the stock." I pass by the question as to whether Browne Brothers were, or Fry was, to secure this substitution, but in any case it was an inherent and necessary condition known to all that Dalgety & Co.'s consent was essential, and without that consent the bargain was futile, and could not be carried out, and so there could not be "a satisfactory sale."

On 21st February documents were signed, but provisionally only, there being a condition as to Browne Brothers inspecting Therribri and Blairmore.

While the bargain was provisional only, and immediately after signature, Byrne says Fry said to him: "Well now, how do you want your commission? You will have to take a bill." Byrne answered: "Well, I am agreeable to do that if you go on the same terms as Mr. Browne and Gemmell, that is to give a bill with 5 per cent. added, payable about 1st February next year." Fry said: "All right." Observe, that at the time, the whole bargain was provisional—H. J. Browne swears that, and the documents say so—so that commission was not yet in any aspect earned by Byrne; his reference to Gemmell's commission from Browne Brothers must equally have reference to an unfinished negotiation; and, above all, the amounts of commission, either for sale or for sale and leasing, as between Byrne and Fry had never been discussed, and as to leasing no express reference as to remuneration had ever been made. Clearly the talk about the promissory note was anticipatory only.

Dalgety's consent being necessary, Fry said to Byrne—I am so far taking Byrne's own story, which in this respect is confirmed by Fry—that Dalgety & Co.'s representative wanted to see the contracts. Fry and Byrne went to Dalgety & Co.'s on 4th March. Dalgety & Co. would not consent. Apparently they had to be paid off, and either a loan of £20,000 had to be obtained or some other stock and station agent had to take Dalgety & Co.'s place and accept Browne Brothers in place of Fry, otherwise the transaction was a fiasco.

On 6th March Byrne set about trying to make the transaction effective for all parties, himself included. Without consulting Browne Brothers he got an authority in writing from Fry to borrow £20,000 on the stock and working plant of Therribri and Blairmore, and to sell to Browne Brothers the stock, either directly or through an agent at a commission of 2½ per cent. It will be at once plain that if Byrne honestly thought that property was already, by a definite concluded contract only awaiting execution on both sides, sold to Browne Brothers he could not have thought himself justified in accepting from Fry—without Browne Brothers' knowledge and consent—an authority to borrow on the stock and plant, and still less could he have stipulated for 2½ per cent. commission from Fry for selling to Browne Brothers what was already—as now assumed—sold to them and covered by the commission he now independently claims in this action. Assuming honesty, he could not have thought he was doing wrong to Browne Brothers, as he would have been, had he attempted to break in on a bargain that was only awaiting execution by both parties, nor could he have honestly asked Fry for two commissions for selling the same stock twice to the same purchasers, one commission included in sale and lease of land commission, and the other independent. What he must have thought was open was that Fry was free to use the stock to get enough money to pay Dalgety & Co., by raising money on it, or by selling it outright for a price to be paid in cash by Browne Brothers, instead of the stipulation as to Browne Brothers taking Fry's place with that firm, and paying Fry only the surplus, if any, between the amount of the debt and the valuation. But at the same time Byrne, in the midst of this complication, was naturally anxious to have his own position defined. Accordingly, without consulting Fry, he had suggested to his own brother—a journalist—what he desired to have signed by Fry as the contract between them in relation to Therribri and Blairmore, and the brother wrote it. Byrne had it in his pocket before the interview of 6th March, and therefore before the new arrangement as to raising the £20,000 and reselling the stock. On that occasion he produced it unexpectedly, and his own account of what took place is, in my opinion, conclusive against Byrne that the document was intended to be the reduction into writing of the very indefinite verbal or partly verbal and partly implicit understanding that already existed, limited first in terms as to a sale of both properties, afterwards varied necessarily by the leasing alteration. This reduction into writing of the contract took place at a time when the difficulties of the whole transaction could be better appreciated than at the beginning. After saying that Fry stated that he wanted £20,000 to satisfy Dalgety & Co., and that Byrne himself suggested raising it on the security of the stock and plant and then getting the authority to do so, Byrne said: "Well, Mr. Fry, this will give me additional work, and I would like you to give me an acknowledgment in writing setting out the amount, and how I am to be paid for the commission of the sale on Therribri and the leasing of Blairmore." Observe, Byrne's words cover the whole transaction, from first to last, and in every aspect. It is the first time any reference is made to the commission for leasing Blairmore. He then says: "I had in my pocket a document in my brother's handwriting which I thought was needed, and I gave it to Mr. Fry, and he looked over it and calculated commission and put amount in and made a few alterations about payment and signed it" (Ex. F). Byrne signed it also. It was stamped as an agreement. Fry wrote out a copy for himself (Ex. G), and both signed that. Now, why did both sign that document in duplicate, one part for each? Was it prepared beforehand by Byrne as a complete or as an incomplete record of their contractual obligations? It emanated from him alone, it was prepared before the document of authority for a loan was even suggested, and consequently was worded without any reference to the additional trouble agreed on and authorized the next day, though it was produced after that authority was given, and I confess that even if Byrne made no further admission I should consider him as a business man, and an honest man, bound to stand by that bargain as the true and complete contract with Fry. It exactly answers the description Byrne gave and already quoted: "I recognized that Mr. Fry was willing to give exceptionally favourable terms if he got his price." And unless the hitch was surmounted Fry could not get his price.

But Byrne does clinch the matter in his evidence. He says:—"I only wanted Ex. F" (that is the contract of 6th March) "as a record of the contract between Fry and me. I wanted it in writing. The contract had been made all along. I wanted to express the verbal contract in writing. I wanted him to confirm what he had already done. I wanted him to put in writing when he would pay me, and how he would pay me." He adds: "I wasn't worrying about the contract, I had a contract all along with Mr. Fry, he agreed to pay me 2½ per cent., and I wanted it in writing to show when and how I should be paid." Now, can words more plainly indicate that the writing was to relate back and record the already existing bargain? Not something collateral: but inclusive of everything.

So far I have taken Byrne's own story. It was admitted in argument before us that the learned primary Judge preferred Fry as a trustworthy witness, at least in relation to the contract and, as asserted by learned counsel for the appellant, wherever there was a conflict between him and Byrne. But even as to the contract, it includes the introduction of the documents of 6th March, and there is nothing in Fry's evidence to cut down that statement of Byrne. Fry's evidence as to this is even more favourable to him than Byrne's Fry says that when Byrne came to him on 6th March, he (Fry) said: "Now this hitch has occurred, what is the best to be done? The whole thing has fallen through"; and that Byrne replied, not by denying that the thing so far had fallen through, but by suggesting seeing the New Zealand Loan Co., and others, instead of Dalgety & Co.; that this was assented to, and the written authority given, and then Byrne said: "Well, what about my commission, you know I've got a lot of work to do in connection with the affair. I've done a tremendous lot of work, and I have had a lot to do, and I think it's worth 2½ per cent. commission, and 5 per cent. on the leasing of Blairmore." Fry said: "That is a very high commission, and I think it's too much." After some pressure Fry said: "I'll give you what you ask." Both parties agree that the contract of 6th March was then produced, that when it was produced a blank existed for the amount of commission, and that Fry figured out the amount and filled it in. It was signed and stamped, and no doubt can exist from Fry's evidence that that document was intended as the sole contract with regard to the land between the parties. That evidence strongly supports Fry's contention that the amount of commission was left for future arrangement, and bears out Byrne's expression "exceptionally favourable terms." He wanted them stated. Fry stipulated for the provision as to the promissory note, and Byrne agreed to it.

At this point, I would refer to the judgment of Pollock C.B. in Knight v. Barber[6], and to that of Bramwell B. in Wake v. Harrop[7], a case affirmed in the Exchequer Chamber[8]. Bramwell B. said of such a case as the present[9]: "They put on paper what is to bind them, and so make the written document conclusive evidence between them." The learned Baron, of course, grants that the parties may show whether or not the document is the binding record of their contract, but, as pointed out, both parties here admit that it was written for the purpose. The law makes the document conclusive evidence for the very purpose of shutting out such a controversy as has arisen in the present case. This position is reasoned out so fully and clearly and authoritatively in Inglis v. Buttery[10] in the passage quoted by Lord Blackburn from the judgment of Lord Gifford, that I simply refer to it without quoting it. In my opinion, as a matter of law, both parties are bound by the agreement of 6th March as to the whole terms of remuneration for sale and lease of the land.

The alternative view is that the contractual relations between the parties are to be found partly in the express terms of that written document, and partly in the express words used by Fry, modified by the implied alteration introduced by the leasing proposition. It is, that the written terms were to apply if the sale and leasing were "completed," whatever that term means, and that the verbal and implied terms were to apply if these were not completed. In other words, that the parties were anxious to have written evidence of the bargain for the event where the liability was so plain no one could dispute it; and, without saying a word to that effect, were content to leave it unrecorded to apply where there was certain to be a dispute as to liability and amount. Further, it assumes that where, as in case of a completed sale, the money was contracted to be paid by Browne Brothers to Fry, no payment to Byrne was to be made until 1st February 1917, but where the sale went off altogether and no money at all was coming to Fry, he was bound to pay at once the sum of £1,195. These are considerations which are so anomalous and unbusinesslike that I would in any case be unable to accept them as qualifying the written document, even if the rule of law to which I have referred permitted me to consider them for that purpose. The document contains, in my opinion, the whole contract of the parties.

Days and weeks passed after that document was signed, but Byrne's efforts to make the transaction effective proved ineffectual, and Fry has not received a penny from Browne Brothers. By June 1916 it had become plain that practically insurmountable difficulties existed in carrying out the transaction between Fry and Browne Brothers. Byrne on 8th June himself wrote to Fry demanding payment. It is of the highest importance—on the assumption that the document of 6th March can be displaced by parol—to see what he then relied on. It was the document of 6th March, and nothing else. The reply of Fry's solicitor admits the force of the document of 6th March, but relies on the fact that "there has been no completion." Byrne then places the matter in his solicitors' hands, and their answer of 20th June is significant. The contract of 6th March is still the only contract relied on, but the question of non-completion is dealt with in relation to it, and a writ is threatened by 26th June.

On 20th July the writ is issued. The claim still rests on the "agreement in writing dated 6th March 1916," and the amount therein mentioned, £2,815, is specially stated. Alternatively the same sum is claimed for "work done at request." No other contract is suggested, and the clear inference as to the alternative claim is that "non-completion" if it occurred was regarded as the defendant's own fault, and that nothing but a debt was left, but the amount claimed shows that the written contract was the basis.

The statement of claim, however, shows for the first time a distinct departure. It rests primarily on a verbal employment on 21st January 1916, at a stated remuneration of 2½ per cent. on the purchase money of Therribri, and 5 per cent. on a year's rent of Blairmore. Now, it is plain how the "non-completion" determined the plaintiff or his advisers at that point to jettison the written contract of 6th March; but it is not easy to understand how the plaintiff came to allege that on 21st January anything was said about 5 per cent. on the first year's rent of Blairmore. Admittedly, at that time leasing was not in question, and could not even be impliedly included, and according to both sides nothing was ever said about 5 per cent. on rent until 6th March, when the document was signed. Ex abundanti cautelâ a common count for work done is also inserted, but the whole argument is, and was, that the debt was due on 3rd March, immediately the bargain between vendor and purchaser was struck, and that therefore the agreement of 6th March had nothing to do with the claim as finally put in the statement of claim. Par. 2 of the reply alleges that it was without consideration. The consideration for every agreement to reduce a verbal contract to writing is the mutual undertaking that it shall be the exclusive evidence of the terms of the bargain, and the avoidance of controversy such as has arisen here. Par. 4 of the reply puts an interpretation on "completion" which is both inadmissible and untrue.

It is always dangerous to countenance the departure from a deliberate commercial written engagement and permit parol variation of a fundamental character to accompany it, unless the most clear, cogent and express testimony is given that the two things are intended to stand together as distinct and separate parts of one entire contract. I refer particularly on this point to the case of Heilbut, Symons & Co. v. Buckleton[11], and especially to the observations of Lord Moulton, at p. 47. No evidence whatever of any such intention is found. Byrne does not say a word to that effect, and, if he did, the assumption, which singularly enough is made in his favour, is that he is not to be believed. If his own evidence be accepted his case fails. So far from suggesting that the written document was true but relevant only to "completion," Byrne attempts to get rid of the words "in the event" &c., by swearing this: "In saying in the event &c., I made a mistake." He states what his mental condition was at the time, but that is quite irrelevant except as showing that he actually said what he did not intend to say. That is a common, and as I said earlier, a typical attitude for a signatory to a contract to assume when he finds the document less favourable to him than he anticipated. But it is no answer in law. It is one of the alternative positions put by Cussen J. when he observes: "or it is simply an illustration that the parties used language without any clear idea of what it did mean." That is very far from mutual mistake, giving rise to re-forming the contract. The rule of law, undoubtedly, is that so long as a written contract stands a man is bound by the true meaning of the words he put into it, even though he thought they would have some other meaning. It would be pedantic to quote judicial affirmations of this elementary rule; I simply refer to Halsbury's Laws of England, vol. vii., pars. 1032 et seqq. The suggestion of "mutual mistake" made in par. 3 of the reply is not supported by the evidence, and was not found by the learned Judge at the trial, or maintained in argument before us.

The parties, then, are in my opinion bound by the contract of 6th March. That is sufficient, from the way the case was conducted, to entitle the defendant to judgment. Byrne in his statement of claim and reply deliberately rejected that contract as the foundation of his claim. His quantum meruit he based on another foundation altogether, inconsistent with it. His main argument here is inconsistent with it. It is true learned counsel framed an argument before us which amounted to this: if the agreement of 6th March is the only one which binds the parties, the defendant was in fault as to non-completion, and so the plaintiff was entitled to recover on it. But that is an afterthought since the trial, not passed upon by the learned primary Judge, and ought not now to prevail. Nevertheless, I will examine the matter even on that basis.

What does "in the event of completion of the sale of my property Therribri and the lease of my property Blairmore" mean? "In the event of" means "conditionally upon." If no "completion" takes place both as to the "sale" and the "lease," no commission is payable. Reverting to the original statement, there is then no "satisfactory sale." If "completion" ensues, a very large commission is payable. The risk is met by the remuneration. Then, what does "completion" mean in that document? It cannot mean payment by the purchaser, because the purchaser was not to pay for ten years, and the promissory note which extended the time of payment was to be payable on 1st February 1917. It was contended that it meant delivery of possession on or about 1st April.

But there are several difficulties in the way of that meaning. First of all, the words "in the event of" point to a contingency which may or may not happen, and not a fixed and certain occurrence for which a date, though approximate, is fixed. Next, 1st April (approximately) is not the completion, but it is the date when the parties exchange possession of property, the land to the purchaser, the consideration to the vendor. It applies as much to the payment of purchase money as to possession of the land and stock. But payment of the purchase money cannot take place without the purchaser taking over the mortgage on the land and the liability to Dalgety & Co. in respect of the stock, and mortgages being executed for the balance of the purchase money. I say nothing about the difficulty of ascertaining what the beginning and ending dates of the lease would be, and certainty as to this is essential for a lease.

In my opinion "completion" of the sale and lease in the document of 6th March means making the contract of sale and lease effective, so that either could enforce it specifically if necessary. This could only be done by either getting Dalgety & Co. paid off for the stock or getting some other agent to take over the indebtedness with Browne Brothers as debtors instead of Fry. Either course meant a variation of the contract of 3rd March as it stood, and to do this constituted the "additional work" referred to by Byrne as a reason for inducing Fry to agree to pay £2,815 commission for the whole transaction. The event has admittedly not happened, and so far Byrne must fail.

Then it is urged that non-completion was the fault of Fry, and so he cannot urge it. If that be true and the point be now available, the judgment should be for £2,815. If it be not true and not proved or not available, Fry should succeed altogether. How was non-completion the fault of Fry? What since 6th March has he done to prevent Byrne making the bargain of 3rd March effective? Nothing is shown; nothing is suggested. All that is imputed to Fry is that he did not in fact induce Dalgety & Co. to assent, and it is said he was bound as between himself and Browne Brothers to do so. If that be Fry's duty now, it was his duty on 6th March, and in that case "completion" would mean the carrying the contract of 3rd March into execution. But that, as shown, is not consistent with the opening words of the document of 6th March, nor with Byrne's statement as to "additional work," nor with his attempting to vary the contract of 3rd March under the authority of that of 6th March.

On the whole and from every aspect, and even as a matter of law, my opinion is clear that the appeal should be allowed.

The learned Judge who tried this case and had the advantage of hearing the witnesses came to the conclusion that until 6th March 1916 neither the plaintiff nor the defendant had any intention of imposing the completion of the contract of sale as a condition precedent to the payment of commission. The plaintiff who is responsible for the language of the agreement of that date stated that he intended it to record a verbal contract which already existed as to commission, but added that the words "in the event of the completion of the sale of my property" were intended by him to express a meaning different from that which they do express. The defendant accepted the document without making any inquiry or comment as to its form or meaning, but at the trial admitted that on 6th March he realized that, in order to adjust the difficulty which had unexpectedly arisen as to taking over his liability to Dalgety & Co., it would be necessary for the plaintiff to do a considerable quantity of work after 6th March which, but for that difficulty, would have been unnecessary. In these circumstances the learned Judge thought that the introduction of such a condition into the agreement was explicable only on the hypothesis that there had been a misuse of language and that the words used did not express the true intention of one or both of the parties, or, in the alternative, that the agreement did not determine all the rights of the parties, but should be read as providing for a specific commission "in the event of the completion of the sale," whatever that might mean, leaving the parties to their then existing rights if the sale was not completed. He found it difficult to believe that the plaintiff, being entitled to the immediate payment of commission, had intended without pressure of any kind to abandon his right, or even that the defendant, who had never suggested that the plaintiff should abandon his right, had so understood the agreement. I confess that I have a like difficulty. The learned Judge adopted the second alternative, and in so doing chose that which was most favourable to the defendant. If there had been "mutual" or, to be more precise, "common" mistake and the agreement of 6th March stood free from the condition, the plaintiff would be entitled to commission at the rate of 2½ per cent on the price of the property sold. He would be in no worse case if there had not been such mistake and the condition stood, for the defendant prevented completion by refusing to proceed unless the purchasers paid off Dalgety & Co. or induced them to release the vendor from liability and take the purchasers' liability instead, and this I think they were not bound to do under the contract of sale. Apart from that agreement he was entitled only to whatever might be considered a reasonable remuneration, which the learned Judge has assessed at the rate of 1 per cent. instead of 2½. The choice is by no means free from difficulty, but on the whole I agree with the learned Judge in the view he has taken of the agreement of 6th March, and think that his judgment should stand, and that the appeal should be dismissed.

[1] (1914) A.C., 510, at p. 527.

[2] [1863] EngR 875; 10 H.L.C., 624.

[3] [1912] UKHL 2; (1913) A.C., 30, at p. 36 et passim.

[4] L.R. 41 Ind. App., 110, at p. 119.

[5] L.R. 2 H.L., Sc., 214, at p. 216.

[6] [1846] EngR 1010; 16 M. & W., 66, at p. 69.

[7] [1861] EngR 538; 6 H. & N., 768.

[8] [1861] EngR 538; 1 H. & C., 202.

[9] 6 H. & N., at p. 775.

[10] 3 App. Cas., 552, at p. 577.

[11] [1912] UKHL 2; (1913) A.C., 30.

High Court of Australia

Fry v Byrne [1917] HCA 54; (1917) 23 CLR 589 (10 October 1917)

HIGH COURT OF AUSTRALIA