DANIEL v. COORAY

108-NLR-NLR-V-42-DANIEL-v.-COORAY.pdf


422
Daniel v. Cooray.
1941Present: Howard C.J. and Keuneman J.
DANIEL v. COORAY.184—D. C. Colombo, 6,291.
Notary Public-Action for damages—Negligence in describing mortgagedproperty—Purchase of property in execution by mortgagee—Loss inconsequence—Loss too remotely connected with negligence—Contribu-tory negligence of plaintiff.
The appellant, a Notary Public, was employed by the respondentto invest Rs. 1,000 on the mortgage of the northern block of a certainland belonging to one P. By an error in. the appellant’s office, thesouthern block which was not owned by P was mortgaged instead of thenorthern block. The mortgagor having failed to pay interest, the bondwas put in suit and at the execution sale the respondent purchased theland. At the sale the respondent was represented by another Proctor,who was authorised by the respondent to bid on his behalf. TheProctor attended the sale when the conditions of sale and a descriptionof the property sold were read out by the auctioneer.
After his purchase the respondent discovered the mistake and claimeddamages.
Held, that the- damage sustained by the respondent was too remotelyconnected to the negligence of the appellant in wrongly describing theproperty mortgaged to entitle the respondent to succeed in his claim.
Held, further, that the respondent was guilty of contributory negligencein failing to exercise proper diligence before he purchased the property.
A PPEAL from a judgment of the District Judge of Colombo. Thefacts appear from the head-note.
H. V. Perera, K.C. (with him N. Nadarajah, E. B. Wikremanayake andH. W. Thambiah), for the defend ant, appellant.—That there was negli-gence on the part of the defendant in the legal sense is admitted, but
HOWARD C.J.—Daniel v. Cooray.
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defendant’s case is that the plaintiff being well aware, at the time of thesale, that the mistake had been made wanted to exploit the situationresulting from it. In any event plaintiff is not entitled to succeed because,if he had exercised due diligence, he could have avoided the result of thenegligence of the defendant. The District Judge has misapplied Fernandov. Menikrala Aracci' and Re Polemis *. See the comments on Re Polemisin Winfield’s Law of Torts (1937), pages 78-9. A purchase of propertyis a voluntary contract based on offer and acceptance. The plaintiff wasnegligent in his duty of informing himself of the terms of the offer whichhe accepted. The proximate cause of the loss which plaintiffincurred was his own negligence. See Perlman v. Zoutendyk 3.
The rule of contributory negligence is applicable—Beven on Negligence(1908), page 155 ; Winfield’s Law of Torts (1937), page 438 et seq.
C. Thiagalingam (with him T. K. Curtis), for the plaintiff, respondent.—On a question of fact, the plaintiff was not lacking in reasonable care atany stage. The District Judge’s finding is definitely to that effect.
Assuming there was negligence on the part of the plaintiff, it wasinduced by the appellant’s negligence. Plaintiff was thrown off hisguard by the conduct of the defendant and was induced to believe thatthere was no danger in purchasing the mortgaged property. In such acase the plaintiff’s omission to take ordinary care does not amount tonegligence. See Scott v. Shepherd4 ; Pressly v. Burnett5; Beven onNegligence (1928), pages 172-4.
The question of contributory negligence would not arise if plaintiff wasunder no duty to defendant to know what was in the conditions of sale.A man is entitled to be as negligent as he pleases towards the whole worldif he owes no duty to them—Le Lievre v. Gould °.
Where a solicitor invests his client’s money on an unauthorised security,he must repay it as if it remained uninvested in his hands—Cordery onSolicitors (1888), page 126. See also Whiteman v. Hawkins 7; Sawyer v.Goodwin'.
H. V. Perera, K.C., in reply.—This was an action of tort. The casescited from Cordery on Solicitors deal with actions for breach of contract.The compensation claimed in this case is for the loss of principal andinterest due on the decree. The proximate cause of that loss was thenegligence of the plaintiff in signing the conditions of sale. The plaintiffhad the last opportunity of avoiding the loss and his negligence cannotbe said to have been a direct consequence of defendant’s negligence in thepreparation of the mortgage bond.
Cur. adv. vult.
February 21, 1941. Howard C.J.—
This is an appeal by the defendant from a judgment of the DistrictJudge, Colombo, in favour of the plaintiff’s claim for damages for negli-gence in respect of the preparation of a mortgage bond undertaken onbehalf of the plaintiff. The facts were as follows: —The appellant, a
1 (1909) 5A. C. R. 54.6 (1914) S. C. 874.
(1921) 3K. B. 560.• L. R. (1893) 1 Q. B. 491.
=> (1934) Cape P. D. 328.1 L. R. (1878) 4 C. P. D. 13.
(1773) 3WiU. 403.8 (1875-6) 1 Ch. D. 351.
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HOWARD C.J.—Daniel v. Cooray.
Notary Public, was employed by the respondent in September, 1930, toinvest Rs. 1,000 on a mortgage of the northern block of certain land calledAmbagahawatta belonging to one Peter Perera. By an error in theappellant’s office the southern block of Ambagahawatta which was in theownership not of Peter Perera, but of his brother Marshal Perera, wasmortgaged instead of the northern block. The mortgage bond wasexecuted on September 1, 1930, part of the money being employed topay off a prior mortgage of Peter Perera’s. The mortgagor having failedto pay his interest the respondent instructed Mr. Oliver Fernando, anotherProctor, to put the bond in suit. On the defendant consenting tojudgment, decree in favour of the respondent was entered on August 16,1935. The property after advertisement was fixed for sale on November22, 1935. Mr. Fernando on instructions from the respondent obtained anorder for leave to bid at the sale provided he purchased at or above theamount of the claim and costs. Mr. Fernando was authorised by therespondent to attend the sale and bid on his behalf. According toMr. Fernando’s evidence, he, but not the respondent, attended the salewhen the conditions of sale and a description of the property sold were. read out by the auctioneer. The outsiders at the sale did not bid up tothe amount of the claim and therefore, on behalf of the respondent,Mr. Fernando purchased the property. Mr. Fernando states that theconditions of sale were signed by the respondent in his presence about6 p.m. in his office at Hulftsdorp and up to that point neither were awareof any difficulty regarding the corpus purchased. Before, however, anauctioneer’s conveyance was issued the error was discovered as the resultof prospective buyers leading to an examination of the title deeds byMr. Fernando. The latter states that he discovered the error towards theend of December, 1935. In the period between the sale by the auctioneerand the discovery of the error, the northern portion was by deed ofNovember 29, 1935, mortgaged by Peter Perera. The registration of thisdeed appears from P 9 to have been made on December 5, 1935. Accord-ing to the evidence of Mr. Fernando and the respondent, the former onthe latter’s instructions brought the error to the notice of the appellant inthe middle of January, 1936.’ After consulting Counsel, Mr. Fernandowrote a letter P 6 to the appellant claiming by reason of the latter’snegligence a sum of Rs. 1,930 and threatening legal proceedings if compli-ance was not made therewith. On February 7, 1936, the appellantreplied admitting that he drafted the mortgage bond, but denying thatthe loss suffered by the respondent was caused by his negligence andmaintaining thait it was due to the respondent’s own negligence.Subsequently on December 15, 1936, the respondent instituted theseproceedings.
In finding for the respondent the learned District Judge held that thedamage suffered and claimed by him was the natural and probable con-sequence of the appellant’s negligence. In coming to this conclusionhe followed the case of Fernando v. Menikrala Aracci The learnedJudge further held that if the damage was not the natural and probableconsequences of the defendant’s negligence, he would nevertheless beliable under the rule as laid down in Re Polemis ‘ if the direct‘ 5 A. C. R. 5*.* (1921) 3 K. B. 560.
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consequence of the defendant’s negligence caused the damage or ifit is directly traceable to it. These two decisions, one of the EnglishCourts and the other of the Ceylon Courts, in the opinion of the learnedJudge demolished the contention of the appellant that the damages weretoo remote. The facts in re Polemis (supra) were as follows : —The defend-ants were the charterers of a vessel from the plaintiffs to carry a cargo toCasablanca. The cargo included a number of cases of benzene and petrol.Whilst discharging at Casablanca a heavy plank fell into the hold inwhich the petrol was stored and caused an explosion which set fire to thevessel and completely destroyed her. In an action for the loss of thevessel the plaintiffs, the owners, contended that such loss was due to thenegligence of the charterers’ servants in dropping the plank. Thecharterers contended that the dacnages were too 'remote. In finding forthe plaintiffs Lord Justice Scrutton formulated the principle that shouldbe applied as follows : —
“ To determine whether an act is negligent, it is relevant to determinewhether any reasonable person would foresee that the act would causedamage; if he would not, the act is not negligent. But if the act wouldor might probably cause damage, the fact that the damage it, in fact,causes is not the exact kind of damage one would expect is immaterial,so long as the damage is in fact directly traceable to the negligent actand not due to the operation of independent causes having no connec-tion with the negligent act, except that they could not avoid its results.Once the act is negligent, the fact that its exact operation was notforeseen is immaterial.’’
The learned Lord Justice also stated that to say the damage must bethe natural and probable result was not useful. Moreover he impliedthat it was misleading inasmuch as it gave rise to the impression that toconstitute negligence the exact form of damage which was caused musthave been expected or anticipated. Lord Justice Bankes in the samecase also stated that the fire was directly caused by the falling of theplank and that in such circumstances- it was immaterial that the causingof the spark by the falling of the plank could not have been reasonablyanticipated. The same Judge also cited with approval the dictum ofLord Sumner in Weld-Blundell v. Stephens that “ direct cause is thebest expression …. Direct cause excludes what is indirect,conveys the essential distinction, which causa caxisans and caiLsa sinequa non rather cumbrously indicate, and is consistent with the possibilityof the concurrence of more direct causes than one, operating at the sametime and leading to a common result ”. In Re Polemis (supra) is, there-fore, an authority for the proposition that in an action for negligence thetest is not whether the damage is the natural and probable result of theact, but whether any reasonable person would foresee that such act wouldcause damage. Neither in Re Polemis nor in Fernando v. MenikralaAracci (supra) did any question arise as to the negligence of the plaintiffsnor as to what Scrutton L.J. has referred to as the “ operation ofindependent causes having no connection with the negligent act”.
1 (1920) A. C. 983.
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HOWARD C.J.—Daniel v. Cooray.
This question, however, does arise in this case. Moreover there remainsthe consideration as to whether, to use the words of Lord Sumner, thenegligent act ‘was the “ direct cause I am, therefore, of opinion thatthe two authorities on which the learned Judge has based his decisionhave not the decisive effect with regard to the conclusions at which hehas arrived. 0
The liability of a Proctor or Solicitor to his client arises both fromcontract and tort. In this case it is conceded by Counsel for the res-pondent that the claim is made in tort. The law with regard to suchliability is laid down in the 4th Edition of Beven on Negligence, Vol. II.,p. 1384, as follows : —
“ A Solicitor is liable for negligence both in contract and in tort.He is liable in contract when he fails to do some specific act to whichhe has bound himself. He is liable in tort where, having accepted aretainer, he fails in the performance of any duty which the relation ofSolicitor and client as defined by the retainer imposes on him. Wherethe liability is based on tort in order to enable the client to recover,damage has to be shown : further the damage must result from thenegligent act, and not be merely collateral to it.”
The liability of a Solicitor in an action for negligence based on tort isfully discussed in the note to Hill v. Finney In this note it is clearlylaid down that the injury or damage must be shown to have resultedfrom the wrongful act. Mr. Perera for the appellant contends that thedirect loss suffered by the respondent was caused by his purchase of thesouthern portion at the Auctioneer’s sale and that purchase was broughtabout by his negligence or that of his proctor, Mr. Oliver Fernando.In the alternative he maintains the respondent cannot recover becausehe has been guilty of contributory negligence in purchasing the southernportion. Mr. Thiagalingam on the other hand contends that, if therespondent was negligent in purchasing the southern portion at the sale,such negligence was induced by the appellant’s negligence. He maintainsfurther that the respondent has not been guilty of contributory negligence.Moreover he contends that the appellant cannot rely on the contributorynegligence of the respondent inasmuch as the latter was under no dutyas regards the appellant. In support of this proposition we were referredto Le Lievre and Dennes v. Gould *. In this case it was held that asurveyor not appointed by the mortgagees of the interest of a builderwho advanced money on the certificate of such surveyor owed no dutyto the mortgagees to exercise care in giving his certificates and theycould not maintain an action against him by. reason of negligence. Thisdecision was made on the ground that there was no contractual relation-ship between the surveyor and the mortgagees and hence a claim fordamages based on the former’s negligence would not lie. This, however,cannot be regarded as an authority for the proposition that in an actionfor negligence the defendant is disentitled to rely on the negligenceof the plaintiff when the latter owed no particular duty towards the defen-dant. The contention of Counsel for the respondent is moreover, contrary to
1176 E. R. 724-727.
* (1893) 1 Q. B. 491.
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the dicta of English Judges. Thus in Ellerman Lines, Ltd. v. GraysonLtd.1, the difference in the meaning of “ negligence ” as applied to aplaintiff and defendant is pointed out by Atkin L.J., when he says :
“The doctrine of contributory negligence cannot I think be basedupon a breach of duty to the negligent defendant. It is difficult tosuppose that a person owes a duty to anyone to preserve his ownproperty- He may not recover if he could reasonably have avoidedthe consequences of the defendant’s negligence.”
The decision of the Court of Appeal in this case was affirmed by theHouse of Lords (1920 ; A.C. 466) where Lord Parmoor, in his judgment,states as follows : —
“ I do not think that the question of contributory negligence dependsupon any breach of duty as between the plaintiff and a negligentdefendant; it depends entirely on the question whether the plaintiffcould reasonably have avoided the consequences of the defendant’snegligence.”
In cases where the defendant pleads contributory negligence the inquiryresolves itself in an elucidation of the question as to which party, by theexercise of ordinary care, had the last opportunity of preventing theoccurrence.
With regard to the contention of the respondent that his negligence,if any, was induced by the negligence of the appellant, we were referredby his Counsel to the case of Scott v. Shepherd In this case, however,the act of the plaintiff was held to be involuntary and so he was notdisentitled to succeed. So also in the case of persons who choose in asudden emergency the wrong course. In all these cases the very state ofincapacity to judge calmly is produced by the negligent act of thedefendant. I do not think these cases have any application to thecircumstances of the present case.
The questions, therefore, that require elucidation are whether therespondent (1) has established that the error in the deed was the cause ofthis loss, (2) is disentitled to succeed because of his own negligence. Wehave to apply the principles to which I have referred in the earlier partof this judgment. In this connection I may observe that the case ofPerlman v. Zoutendyk3 indicates that Roman-Dutch law is the same asEnglish law in regard to actions for negligence. With regard to (1)are the damages which the respondent claims too remote, or to put theproblem in another way, has the respondent proved that the appellant’smisdescription of the property mortgaged caused in the legal sense thedamage which the respondent seeks to recover ? The damage is the loss ofthe money expended by the respondent in the purchase of the property atthe auction sale. That purchase was made because the respondent thoughthe was purchasing the northern and not the southern portion of Ambaga-watta. Can it be said that when he purchased at the auctioneer’s salehe had in mind the mortgage deed and relie'd on an implied representa-tion of the appellant that the northern part, had been mortgaged ? Is
(1919) 2 K. B. 514.
* 3 WUs. 403.
(1934) Cape P. Div. 32S.
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Abdul Cafoor v. Packir Saibo.
the relation between cause and effect, that is to say between the allegedwrongful act and the damage, sufficient in law to entitle the respondentto recover ? In my opinion that relation is not sufficient and thedamage is too remote to enable the respondent to succeed.
I do not, however, base my judgment entirely upon the view that thedamage is too remote because it seems to me that the respondent’s casemust fail in any event on the ground of contributory negligence. HisProctor was present at the auctioneer’s sale when the conditions of salecontaining a description of the property with its boundaries yas readout. Moreover the respondent himself signed those conditions after thesale was concluded. Scrutiny of the description would at once havebrought the mistake to light. An examination of the entries made in theDeeds Registry with regard to the property would have also put therespondent on his guard. He and his Proctor seemed to have assumedthat- everything was in order and proceeded to bid at the auction andsign the conditions of sale without making any inquiry. How can therespondent in the circumstances be said to have exercised due diligence ?The respondent could reasonably have avoided the consequences of theappellant’s negligence and had the last opportunity of preventing theloss. In these circumstances the respondent is disentitled torecover. The appeal is allowed with costs in this Court and the Courtbelow.
Keuneman J.—I agree.
Appeal allowed.