35 / 364
judge following (Smyth
v.
Streatfeild 1930) 3-K.B.
764 entered judgement and ordered costs of both
trials against the defendant. The three committee
members and
the assistant secretary
appealed.
Denning M. R. intimated that it was a mistake to
suppose that on a joint publication the malice of one
defendant affected his co-defendant. Each defendant
was answerable separately as well as jointly, for the
joint publication; and each was entitled to his
several defence. If the plaintiff sought to rely on
malice to aggravate damages, or to rebut a defence
of qualified privilege, or to cause a comment other–
wise fair or to become unfair he must prove malice
against each person with whom he charged it. A
defendant was only affected by express malice if he
himself was actuated by it; or if his servant or agent
concerned in the publication was actuated by malice
in the course of his employment. Three members
of the committee and the assistant secretary of the
Club were entitled to rely on the defence of qualified
privilege. There was no malice on their part such as
to defeat the privilege. (Egder
v.
Davies and Others,
Solicitors Journal
Qist July, 1964).
Solicitor—Negligence
THE plaintiff, an assignee under an under-lease of
certain premises, instructed the defendant solicitors
to negotiate the purchase of the head lease and its
resale to G. Both the plaintiff and R. who acted as
her agent, told S, a member of the defendant firm,
that the plaintiff would not purchase unless an
immediate resale could be effected since she did not
wish to redevelop the premises in accordance with
the terms of the head lease. By September, 1961, S
had negotiated a price of £7,500 subject to contract
on the purchase, and a price of £10,800 on the resale.
R. had agreed to accept a commission of £300 from
G. if the deal went through, but did not disclose
that fact to the plaintiff. On i6th October, 1961, S
inadvertently sent to the head lessors the draft
contract between the plaintiff and G in mistake for
that between them and the plaintiff. The head lessors
thus became aware of the profit of £3,300 the
plaintiff hoped to make and therefore demanded an
increased price of £9,000. To that the plaintiff had to
agree and contracts were exchanged in December,
1961. G paid a deposit of £900 to the head lessors
but failed to complete. After notices to complete had
been served by the head lessors on the plaintiff, and
by the plaintiff on G, a new date was fixed, but G
again defaulted and the plaintiff did not provide,
and was not asked by the defendants to provide the
necessary money to complete the purchase. The
whole transaction therefore fell through and the
plaintiff sued the defendants alleging negligence and
claiming £1,500 damages.
Melford Stevenson, J., said that it was conceded
by counsel for the defendants that they were in
breach of their duty of care but contended that that
had not caused the plaintiff any significant damage
since, by failing herself to provide the necessary
funds, she had brought the damage upon herself.
His lordship was satisfied that the plaintiff not only
understood that a notice to complete meant that the
money had to be produced but also, by a visit to
her bankers, had placed herself in a position to do
so should she so desire, but that she had not disclosed
this fact to the defendants, in the belief that G
would complete at the last moment.
He was
satisfied that the plaintiff had maintained the attitude
that she would not complete unless there was an
immediate resale. Accordingly the defendants were
not negligent in failing to obtain from the plaintiff
sufficient money to complete, as was alleged. Nor
did they fail to advise her properly. No doubt they
were negligent in sending the wrong draft contract,
but any loss the plaintiff had suffered flowed from
her own unwillingness to complete. There would
be nominal damages of 40.;. and no order as to costs.
Judgement accordingly. (Frank
v.
Seifert, Sedley
Solicitors Journal—
26th June, 1964 page 523).
Director's Defence Costs paid by Company—whether
Taxable
THE House of Lords has upheld a decision of the
Court of Appeal which restored the original assess–
ment of the Special Commissioners who had held
that the amount of £641 spent by the Company for a
director's defence at his trial for causing the death of a
pedestrian by reckless or dangerous driving was
spent for his benefit and was chargeable to income
tax under Schedule E. This case was reported in the
Gazette for April, 1963, at page 94 and again in the
Gazette for July 1963 at page 28.
Lord Reid delivering the judgement of the Court
said that the facts made it clear that the company did
incur expense in the provision of a legal defence for
their director and that that was a benefit within the
meaning of s. 161 (i) of the Income Tax Act, 1952.
It had been argued that the expense had been
incurred solely for the purpose of protecting the
company's interests. That might be so. But it could
not be doubted that in fact it was a benefit to R. If it
had not been provided by the company hewould have
had to pay for his own defence or take the risk that
lack of a proper defence might lead to his being
convicted and sent to prison. No one suggested
that he could have obtained legal aid. His lordship
could find nothing in the Act to support an argument
that a benefit in fact provided by the company
ceased to be a benefit within the section if it was
proved that the company's sole motive was to