William Morton & Co. v. Muir Brothers & Co. [1907] ScotLR 885 (13 July 1907)

William Morton & Co. v. Muir Brothers & Co. [1907] ScotLR 885 (13 July 1907)

A custom of trade in the Irvine Valley established an implied condition that pattern cards made from a manufacturer's designs could only be used to fulfil that manufacturer's orders unless he abandoned the design. This restriction was not contrary to law, bound the trustee in bankruptcy, and was enforceable against subsequent purchasers who had notice of the restriction. The defenders, having notice and having adopted the contract, were bound by the implied condition and interdicted from using the cards for their own benefit.

Citation
[1907] ScotLR 885
Parties
Pursuer: William Morton & Company; Defender: Muir Brothers & Company; Trustee: Alexander Mitchell, C.A., Glasgow
Jurisdiction
Scotland
Judgment Date
13 July 1907
Procedural Posture
Civil / Appeal
Outcome
appeal dismissed; decree of interdict affirmed
Legal Topics
Implied Terms, Custom of Trade, Sale of Goods, Confidential Employment, Bankruptcy Estate, Jus Quæsitum Tertio
Contract Law Commercial Law Bankruptcy Implied Terms Custom of Trade Sale of Goods Confidential Employment Bankruptcy Estate +1 more

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Parties

William Morton & Company

Pursuer

Muir Brothers & Company

Defender

Alexander Mitchell, C.A., Glasgow

Trustee

Procedural Posture

Civil / Appeal

Legal Issues

  1. 1 Whether a custom of trade can imply a restriction on use of pattern cards in lace manufacturing contracts
  2. 2 Whether such restriction binds a trustee in bankruptcy and subsequent purchaser
  3. 3 Whether pursuers have enforceable rights against defenders under implied conditions and notice

Ratio Decidendi

A custom of trade in the Irvine Valley established an implied condition that pattern cards made from a manufacturer's designs could only be used to fulfil that manufacturer's orders unless he abandoned the design. This restriction was not contrary to law, bound the trustee in bankruptcy, and was enforceable against subsequent purchasers who had notice of the restriction. The defenders, having notice and having adopted the contract, were bound by the implied condition and interdicted from using the cards for their own benefit.

Court Disposition

appeal dismissed; decree of interdict affirmed

Orders

  • Interdict granted restraining defenders from using pattern cards made from pursuers' designs except to fulfil pursuers' orders
  • Defenders liable in expenses of process