Westville Shipping Co., Ltd v. Abram Steamship Co., Ltd [1922] ScotLR 539 (17 June 1922)

Westville Shipping Co., Ltd v. Abram Steamship Co., Ltd [1922] ScotLR 539 (17 June 1922)

The pursuers were induced to contract by material misrepresentation as to the stage of ship construction, entitling them to rescind. Their temporary loss of title due to sub-assignation was cured by the rescission of the sub-assignation before the record closed, restoring their ability to make restitutio in integrum. The sub-assignees' request for a minor alteration did not amount to homologation, and the fall in value did not bar restitution. The pursuers had a good title to sue and were entitled to reduction of the contract and repayment of sums paid.

Citation
[1922] ScotLR 539
Parties
Pursuer: Westville Shipping Company, Limited; Defender: Abram Steamship Company, Limited; Defender (abandoned Before Record Closed): Thomas M'Laren & Company
Jurisdiction
Scotland
Judgment Date
17 June 1922
Procedural Posture
Civil / Appeal (reclaiming Motion) From Lord Ordinary to Inner House, Court of Session
Outcome
Appeal dismissed; interlocutor of Lord Ordinary affirmed.
Legal Topics
Misrepresentation, Rescission, Assignation, Restitutio in Integrum, Title to Sue, Homologation, Materiality of Misrepresentation
Contract Law Commercial Law Misrepresentation Rescission Assignation Restitutio in Integrum Title to Sue Homologation +1 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 18 Party arguments 2 Amounts and remedies 2
Sign in to unlock

Parties

Westville Shipping Company, Limited

Pursuer

Abram Steamship Company, Limited

Defender

Thomas M'Laren & Company

Defender (abandoned Before Record Closed)

Procedural Posture

Civil / Appeal (reclaiming Motion) From Lord Ordinary to Inner House, Court of Session

Legal Issues

  1. 1 Whether the pursuers had title to sue for rescission of the contract despite having sub-assigned their rights before discovering the misrepresentation.
  2. 2 Whether the misrepresentation as to the stage of ship construction was material and induced the contract.
  3. 3 Whether the pursuers were barred from rescission by homologation, delay, or inability to make restitutio in integrum.

Ratio Decidendi

The pursuers were induced to contract by material misrepresentation as to the stage of ship construction, entitling them to rescind. Their temporary loss of title due to sub-assignation was cured by the rescission of the sub-assignation before the record closed, restoring their ability to make restitutio in integrum. The sub-assignees' request for a minor alteration did not amount to homologation, and the fall in value did not bar restitution. The pursuers had a good title to sue and were entitled to reduction of the contract and repayment of sums paid.

Court Disposition

Appeal dismissed; interlocutor of Lord Ordinary affirmed.

Orders

  • Agreement of 20th February 1920 reduced (rescinded).
  • Defenders ordered to repay £26,700 to pursuers.