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VOL. 9182 THE MODERN LAW REVIEWthe Redundancy Payments Act 1965,29 a " court " in which theimmunity applies ? A solicitor is still liable in contract to his clientfor matters outside the scope of his new-found immunity as anadvocate; if he fails to bring a witness to court he is liable, but ifhe himself conducts the case and brings the witness but culpablyfails to call him, possibly he is not liable.30 If a solicitor himselfconducts in court a case which is far too difficult for him so thatit is not properly presented he is not liable. If a solicitor fails toappear at court when he has not retained counsel he is liable incontract ; if counsel fails to appear counsel is not liable for he hasmade no contract s 1 and the solicitor is not liable if he attends courtfor he is not in breach of contract.Lord Davey once said that the right to light has a ragged edgeto it.J2 So still has the immunity of advocates, but i t will be Bur-prising if Parliament sees fit to alter the position as now stated bythe Law Lords. H. W. WILKINSON.

CONCEPTUALIBMRIUMPHANTN THE COURTOF APPEALTHE judgments of the Court of Appeal in Uni ted Dominions Trus t(Commercial) L t d . v. Eagle Aircraft Services Ltd.' are a dismalillustration of the extent to which English legal method is stilldominated by conceptual techniques. What is particularly depres-sing is that the kind of problem which arose in this case has beenextensively discussed by American legal writers in an attempt todemonstrate the fallacies of conceptual thinking, and th at overthirty years ago American courts were dealing with this sort ofproblem with a sophistication which we seem to be unable tomatch today.The case involved the liability of a party to a hire-purchase" ecourse agreement." The defendants, Eagle, owned a Vikingaircraft which they wanted to sell. The aircraft was disposed ofby means of a sale to the plaintiffs, U.D.T., a finance company,followed by R hire-purchase agreement between U.D.T. and a thirdparty (Orion Airways Ltd.), and the recourse agreement in question,between U.D.T. and Eagle, whereby Eagle undertook to repurchasethe aircraft in certain circumstances. The full terms of the agree-ment are not given in the report, but the crucial clause providedthat if for any reason the hire-purchase agreement was terminatedbefore t.he whole amount payable thereunder had been paid, Eaglewould " when called upon to do so " forthwith repurchase the2 8 A par ty ma y be represented b y counse l or solioitor, rule 7 , t he Indus t r i a lT r ibuna l s (Employm en t and Compensa t ion ) (Eng land and Wales ) Rc gu la t i on ~1965 (S . I . 1968 No. 2018).30 Lord Pearson found this a ha rd p rob lem to answer , p . 1791.31 Lord Up john , p . 132 Collr v . H o m e and Colonial S t o r e s El9041 A.C. 179 a t p . 200.1 [1968] 1 All E.R. 104; [l968] 1 W . L . R . 71.

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MAY 1968 NOTES OF CASES 888aircraft from U.D.T. a t a price equal to the amount then outstand-ing on the hire-purchase agreement. There were a number of pro-visos to this agreement. Proviso (a) required the plaintiffs toassign to Eagle its rights against the hirers if called upon to do soafter Eagle had repurchased the aircraft. Proviso (b) is not givenin the report. Proviso (c) required U.D.T. to keep the aircraftinsured, and proviso (d) stated that U.D.T. would notify Eaglewithin seven days of any default made by the hirers in payment ofthe hire rentals. The hirers defaulted on the instalment due inAugust 1060, but U.D.T. did not inform Eagle of this untilOctober, whereupon Eagle repudiated all further liability on theground of breach of proviso (d). I n December 1960 U.D.T. ter-minated the hire-purchase agreement without informing Eagle.U.D.T. had some difficulty in locating the aircraft but i t was even-tually traced into the hands of a company called Airwork ServicesLtd., who were servicing it, and who claimed a lien on it for asubstantial sum. U.D.T. paid off the lien and had further workdone to the aircraft to make i t airworthy without informing Eagle.Eventually they called on Eagle to repurchase the aircraft underthe recourse agreement in May 1961, five months after terminationof the hire-purchase agreement. Eagle refused, and when sued,took two points: first, breach of proviso (d) ; and secondly, thati t was an implied term of the recourse agreement th at they couldonly be called upon to repurchase within a reasonable time, andthat such a time had expired by May 1961. The trial judge(Widgery J.) rejected these arguments, and held Eagle liable underthe recourse agreement, bu t he also held that U.D.T. were liablein damages (to be assessed) for breach of proviso (d). The Courtof Appeal allowed the appeal, holding that failure to call on Eagleto repurchase within a reasonable time was fatal to U.D.T.sclaim. The court expressed no final view on the effect of the breachof proviso (d) but inclined to think, by a two to one majority, thatEagle were also discharged by breach of this proviso.

Now if for a moment we pu t on one side our learning aboutlegal classifications and concepts- options, (unilateral con-tracts, conditions precedent and so forth-it is clear that thereal point a t issue was simply this: was Eagles obligation torepurchase the aircraft conditional (in the strictest and mostaccurate sense of the word) (a) on compliance by U.D.T. withproviso (d); or (b) on U.D.T. calling on Eagle to repurchase withina reasonable time ? This issue gives rise to two further questions :(1) had the parties expressly agreed that Eagles obligation torepurchase should be conditional on events (a) or (b), alwaysassuming that there was no overriding policy reason for refusingto give effect to the parties express agreement? (2) If not, shouldEagles obligation be treated as conditional by construction orimplication of law ?

The answer to question 1 was plainly No. The parties had

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334 THE MODERN LAW REVIEW VOL. a1not expressly agreed that Eagles obligation to repurchase should beconditional upon anything except on their being called upon todo so. I t was expressly agreed by proviso (d) tha t notice ofdefault should be given, but it was not expressly agreed that thisshould be a condition of Eagles obligation. And the secondpossible condition-that notice to repurchase must be given withina reasonable time-was not express a t all, let alone an expresscondition of Eagles obligation.Since, then, Eagles obligation to repurchase was not expresslymade conditional on event (a) or (b), the question was whether itshould have been treated as conditional by construction or implica-tion of law. This was, of course, a policy question, pure andsimple. Was it fair, just or reasonable, to treat it as conditional?In answeririg this question a crucial point was the nature of thetransaction. Now the transaction here looked like an option,and there is no doubt that in an ordinary option a stipulation asto the time during which the option must be exercised is a con-dition which must be strictly complied with. But, as Corbin pointsout, the reason for this is that in most cases the exercise of theoption within the stipulated time is elcpressly made a conditionof the option. In all the option cases cited by the court in theinstant caseYs he option was expressly made conditional on itsbeing exercised within a specified time, or on some other event, butthe court does not appear to have been referred to other authoritiesin which no time was fixed for the exercise of the option, and inwhich the court declined to read in an implication that the optionmust be exercised within a reasonable time. These cases involvedoptions to tenants, and admittedly i t is much easier to read in animplication that such an option must be exercised while the tenantis in occupation rather than that it must be exercised within areasonable time. It is not therefore suggested that these casesshould have governed the present case. But they do at leastshow that there may be a great deal of difference between anexpress time limit and an implied time limit.

But even if an implied time limit could often properly andfairly be treated as a condition of an option, this is because ofthe nature of most options. Generally, the right to an option ispurchased for a small consideration, and is given for a limited time,so that once the time has expired the option holder has in factreceived the full consideration which he purcha~ed.~But thecontract in the present case was not an ordinary option contract ;its fundamental purpose was to guarantee the performance of thea Contracts , Vol. l A , 5 278.3 Weston v. Collins (1865) 12 L.T. ; Finch. v. Underwood (1876) Ch.D. 310;Hare v. Nicol l [1966] 2 Q.B. 130; W es t Country Cleaners v. Saly [1966] 3 AllE.R.210.4 Heraey v. Oiblett (18G4)18 Beav. 174; M oss V. Barton (1866)L.R. Eq. 474;Buckland v. Papillon (1867)L.R. Ch. 67; Rider V. Ford [19231 1 Ch. 641.5 Corbin, loc. crt.

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MAY 1968 NOTES OF CASES 885hire-purchase agreement, as is manifest from the circumstances.To all intents and purposes it was a contract of suretyship orindemnity. The real consideration for the option was not somesmall or nominal sum, but the very fact that U.D.T. had originallybought the aircraft from Eagle for 20,000. The contract waswhat American lawyers would call an aleatory contract, i . e . , acontract in which one or more promises are conditional on thehappening of some fortuitous event.O Now it is well recognised byAmerican lawyers that stipulations as to time are not to be treatedas conditions in an aleatory contract, unless they are expresslymade SO.^ The reason for this is that in such contracts the per-formance of the promises made by the parties are not intendedto be exchanged as agreed equivalents. For example, the premiumin an insurance contract is not intended to. be exchanged as theequivalent of the policy moneys. For this reason it would be wrongto treat an aleatory promise as conditional on the performance ofthe other partys promise, unless the contract expressly so pro-vides.O A fortiori , the failure to perform a promise in due timeshould not discharge an aleatory promise.

The American approach to such a problem is well illustrated bythe decision of a Federal Court of Appeals in Southern Sure ty C o.v. Alacmillnn C0.O which raised a problem almost identical withthat involved in the breach of proviso (d) in our case. The defen-dants in the American case guaranteed performance of a contractentered into between the plaintiffs and a third party, whereby thethird party was to act as distributor for the plaintiffs books. Thethird party was required to render periodical accounts and stockreports to the plaintiffs, and in the event of any default the plain-tiffs were required to notify the guarantor within sixty days.Defaults occurred but owing to fraud on the par t of the thirdpartys servants, they were concealed from the plaintiffs, so thatnotice was given long after the sixty days had expired. The courtasked itself two questions: first, had the requirement of noticebeen made an express condition of the contract? Secondly, if thisrequirement was not an express condition, should it be treated asa condition by construction of law, or merely as a promise, breachof which might but need not discharge the guarantor ? After carefulexamination of the contract the court concluded that the term wasnot a condition but a mere promise, and that since the defendantspromise was aleatory, breach by the plaintiffs of their promisesounded in damages only.O

8 Re s ta te me n t . Contrac ts , 5 291; Corb in , Contracts , Vol. BA, 5 728 e t seq.7 Corb in , Vol. BA , $ 8 726, 788.8 Re s ta te me n t , Cont rac t s , 5 287.9 58 F. 2d. 641 (1032).

10 E n g l i s h courts have adopted s s imi la r a p p ro a c h in d e a l in g w i th in s u ra n c econtrac ts , in which terms requiring notice of loss wi th in a specified time nreno t t rea ted as condi t ions un less t he con trac t so provides by very c lear provi-s ions : nee MacCilZioray on Insurance L a w , 5th. ed.. Vol. 2 , 5 1713 e t s e q .

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386 THE MODERN LAW REVIEW VOL.81Compare this approach with that of the Court of Appeal in the

present case. The reasons given by the members of the court fortheir decision are almost entirely conceptual. The agreement torepurchase was not an ordinary bilateral contract but a unilateralcontract. It was an option and like all options must be exercisedstrictly in the time allowed. Since the obligation was unilateralit followed that it only became binding when the event specified(or implied) in the promise occurred precisely as stipulated. Suchevents were therefore conditions precedent and there was noroom for any inquiry as to whether non-occurrence of the event hadprejudiced the promisor, or could be remedied by a counterclaimfor damages. It need hardly be said that this form of reasoning-like all conceptual reasoning-is question-begging. Since the courtstarted with the assumption (which is indeed generally agreed) thatthe event on which the promise is to take effect in a unilateralcontract is always a condition in the strict sense, then of courseit follows, once we have classified the contract as unilateral, th at ifthe event does not occur precisely as stipulated, there can be noliability. Hut if policy, justice, fairness demand th at the promiseshould not be treated as conditional, then we should not classifythe contract as unilateral.2 Purely as a conceptual matter, thecontract could perfectly well have been classified as bilateral. Thusproviso (d) and the requirement to call on Eagle to purchasewithin a reasonable time could have been treated as promises,breach of which could have been remedied in damages.No hardship would have been done to Eagle had this coursebeen adopted in this case. If they were in fact prejudiced by thedelay they could have claimed damages for breach of contract, tobe set off against the price of the aircraft; but as the aircraft11 The cour t s approach i s a lso open to the obect ion that i t seems to leads t r a igh t to another of those preposterous Bridge v. Campbell Discount Co.621 A.C. 600 si tuations, in which a party is better off if a term is construedas a promise which he has broken, than if i t is construed as a condition whichhas no t occur red. Thus in the p resen t m e U.D.T.would have been better offif they h ad ac tually promised to call on Eagle to repurchase wi th in a reason-able t ime. and had broken tha t promise, because the could then at least haveargued that the breach sounded in damages on1 . dv en on th i s app roach , t headvantage to the protnisee of being held t o %ave mad e a promise himselfshould in theory be apparent and not real. Thin is because i t wil l only infact prove advantageous to him if t he brea ch of his prom ise is held not to dis-charg e the promisor, and in str ict logic the romisor must be held dischar edif the promise was conditional . B ut wh at gappe ns in str ict logic and w%athappens in pract ice are no t a lways the same, as is in fact i l lustrated by thedivergent views taken by Widgery J. and the C.A. in th is case. The wholedifficulty is avoided if we first inquire whether the promise was conditional,for if it wils condilional the promisee can never be better off, a n d m a y b e

worse off, if th e condition w as also a promise by him.12 Diplock L.J.s conceptual analysis is somewhat unconventional in that hot reats Ihe quest ion as bein whether an ob li a t ion ( ra ther tha n the wholecontract ) i s un i la teral o r b fateral . I th ink t i i s i s cont rary to the normalusage (cf. Restatement , Contracts , 12 ) but a more Berious objection is thatin a large number of si tuations i t would substi tute a conccptual , question-begging, iasue (is the promise bilateral or unilateral?) for the really impontantissue (is the promise condit ional?).

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MAY 19GS NOTES OF CASES 887

was eventually sold as scrap it seems very probable (unless U.D.T.were uncommonly incompetent) that the aircraft was virtuallyworthless anyhow when the hire-purchase agreement was termin-ated. The actual result thus seems unjust, though i t is in linewith the general tendency of the English courts ( to which theinsurance cases are perhaps exceptional) to treat stipulations asconditions rather than as promises, breach of which can be remediedin darn age^.'^ Is it too much to ask that the courts should justifythis tendency in rational terms rather than with conceptualmumbo-jumbo ? P. S. ATIYAH.

CHARITY ND THE WELL-TO-DO ICKTHE imits subject to which gifts for the relief of the sick willbe held to be made for charitable purposes were considered in tworecent and contemporaneous decisions, one of the Privy Counciland the other of the Court of Appeal.I n Le Cras v. Perpetual Trustee Co. L td . , one of the issues tobe determined was whether a bequest of income to the Sistersof Charity for the general purposes of a private voluntary hospitalwas a valid charitable gift. Lord Wilberforce, in delivering thejudgment of the Board, said: A gift for the purposes of a hospitalis prima facie a good charitable gift. This is now clearly estab-lished, both in Australia and in England, not merely because of theuse of the word mpotent in the preamble to 48 Eliz. c. 4,zthough the process of referring to the preamble is one often usedfor reassurance,s but because the provision of medical care for thesick is, in modern times, accepted as a public benefit suitable toattract the privileges given to charitrable institutions. But two1s F o r some othe r illustrations of th is tendency, see Tre i te l , 30 M.L.R. 139 a t

pp. 144-148.1 Le Cras v . Perpetual Truslee Co. L t d . [1967] 3 All E.R. 915, an appeal froma decre ta l order of the Supreme Court of N ew South Wales ; Re Adams(deceased) [l967] 3 All E .R . 286. Jud gm ent in the Adams case was deliveredbetween the hear ing and judgment in L e Cras c a w . I n ne i the r was anyreference made to the other.The preamble to the Sta tute of Elizabeth referred to I aged impotent andpoor people, adjectives which are interpreted disjunctively.3 There are few modern reported cases where a bequest or donation was madeo r an institution waa being carried on fo r a clearly specified objecl which wasfor the benefit. of the public a.t large and not for individuals , and yet theobject was held no t to be within the spirit and intendment of the S ta tu te 01Elizabeth. Th ere is , however, another l ine of cases where the bequest did notclearly specify the precise object to which it was to be appl ied, but le f t a

discretion to t rus tees or o thers to choose objects within a cert ain field. Th erethe courts have been much more strict , so that if it i.s possible that thoseentrus ted with the discret ion could , wi thout in fr inging th e tes ta to rs d i rect ions,apply the b which would not be charitable . . . then thecla im tha t %e bequest ia czaritable fails. Scot t ish Bunal Re orm andCremation Socie ty Ltd . V. Gtasgow City Corporation [lo671 3 Al,l L.R. 216,pe r Lord Reid a t p. 218.uest in an y wa

4 [ l967] 3 All E.R. 916 at p. W .VOL. 31 12