86
[1970]
[COURT OF APPEAL] A
JOSCELYNE v. NISSEN AND ANOTHER
[Plaint No. X 2417]
1969 Dec. 1, 2; 19 Russell, Sachs and Phillimore L.JJ. „
a
Contract—Rectification—Oral agreement—Agreed provision not
expressly incorporated in written contract—No prior concluded
oral agreement—Whether rectification possible.
The plaintiff, the owner of a car hire business, and his wife
shared a house with their daughter, the defendant. In 1963
the plaintiff's wife was taken ill and the plaintiff, being unable _,
to carry on the business, discussed a scheme with the daughter **
whereby he would make over the business to her in return for
which she would pay certain household expenses, including
gas, electricity and coal bills. On June 18, 1964, the parties
signed an agreement transferring the business, clause 6 of which
provided that " [The defendant] shall discharge all expenses in
connection with the whole premises . . . and shall indemnify
[the plaintiff] from and against any claim arising in respect of
the same." After signing the agreement, the defendant paid D
several of the household bills but following a dispute with the
plaintiff she stopped paying them, contending that the agree-
ment did not on its true construction provide for payment of
the household expenses. The plaintiff brought an action
claiming a declaration that she should pay, inter alia, the gas,
coal and electricity bills and, alternatively, that the agreement
should be rectified to include a provision to that effect. The
county court judge found that there was no prior concluded E
contract between the parties but ordered the agreement to
be rectified so as specifically to include the costs of the house-
hold expenses.
On appeal on the grounds, inter alia, that the judge had
misdirected himself in ordering rectification in view of his
finding: —
Held, dismissing the appeal, that it was not necessary to find
a concluded contract antecedent to the agreement; that a court F
had jurisdiction to rectify an agreement if there was a common
continuing intention in regard to a particular provision of the
agreement, but that an outward expression of accord and con-
vincing proof that the concluded instrument did not represent
the parties' common intention were required.
Crane v. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 662;
[1939] 4 All E.R. 68, C.A. applied.
Frederick E. Rose (London) Ltd. v. William H. Pirn, Jnr. & G
Co. Ltd. [1953] 2 Q.B. 450; [1953] 3 W.L.R. 497; [1953] 2 All
E.R. 739, C.A. considered.
The following cases are referred to in the judgment:
Craddock Bros. v. Hunt [1923] 2 Ch. 136, C.A.
Crane v. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 662; [1939] 4 All
E.R. 68, C.A. H
Earl v. Hector Whaling Ltd. [1961] 1 Lloyd's Rep. 459, C.A.
Faraday V. Tamworth Union (1916) 86 LJ.Ch. 436.
Higgins (W.) Ltd. v. Northampton Corporation [1927] 1 Ch. 128.
87
2 Q.B. Joscelyne v. Nisscn (C.A.)
London Weekend Television Ltd. v. Paris and Griffith (1969) 113 S.J. 222.
A Lovell and Christmas Ltd. v. Wall (1911) 104 L.T. 85, C.A.
McCartney v. Brighton Corporation, The Times, May 20, 1904.
Mackenzie v. Coulson (1869) L.R. 8 Eq. 368.
Morelle v. Wakeling [1955] 2 Q.B. 379; [1955] 2 W.L.R. 672; [1955] 1 All
E.R. 708, C.A.
Rose {Frederick E.) {London) Ltd. v. William H. Pirn, Jnr. & Co. Ltd.
[1953] 2 Q.B. 450; [1953] 3 W.L.R. 497; [1953] 2 All E.R. 739, C.A.
B Schofield v. W. C. Clough & Co. [1913] 2 K.B. 103, C.A.
Shelburne v. Inchiquin (1784) 1 Bro.C.C. 338.
Shipley Urban District Council v. Bradford Corporation [1936] Ch. 375,
C.A.
Slack v. Hancock (1912) 107 L.T. 14.
United States of America v. Motor Trucks Ltd. [1924] A.C. 196, P.C.
C The following additional case was cited in argument:
Conway v. Rimmer [1967] 1 W.L.R. 1031; [1967] 2 All E.R. 1260, C.A.
APPEAL from Judge Granville-Smith sitting at Edmonton County Court.
The plaintiff, Laurence Henry Prince Joscelyne, and his wife were tenants
of a house, " Martindale," Stanley Road, Enfield, owned by their daughter,
T* Margaret Ellen Nissen, the defendant. In 1964, the plaintiff discussed with
his daughter a scheme by which she would take over his car hire business
in return for which she would pay him a weekly pension and household
expenses, including the gas, electricity and coal bills and the cost of a home
help. On June 18, 1964, the parties signed an agreement, which provided:
" Whereby it is agreed as follows: (1) Mrs. Nissen [that is, the daughter]
shall be deemed to have taken over from Mr. Joscelyne [that is, the
father] the business of a car hire proprietor hitherto carried on by
Mr. Joscelyne under the style of ' Station Hire' from ' Martindale'
Stanley Road, Enfield aforesaid under the style of ' Station Cars' as
from May 1, 1963. (2) Mrs. Nissen shall be deemed to have taken
over all the assets and liabilities of the business of self-drive and
chauffeur driven car hire carried on under the style and from the
F premises aforesaid as from May 1, 1963. (3) Mrs. Nissen shall indem-
nify Mr. Joscelyne and his estate and effects from any claim or payment
made in respect of the liabilities of the said business including all past
or future claims in respect of income tax and or surtax arising in
respect of the business. (4) In consideration of the transfer of the
assets of the self-drive and chauffeur driven portion of the said business
Mrs. Nissen shall pay by way of a pension to Mr. Joscelyne (such pen-
G sion to be payable for the life of Mr. Joscelyne or the duration of the
business) the sum of £3 10s. per week. (5) Mr. Joscelyne shall be
permitted to have the use of any of the cars of the business when not
needed for business work and to carry out driving work for Mrs. Nissen
subject to payment to him of one fifth of the charge made to each
customer. (6) Mrs. Nissen shall discharge all expenses in connection
JJ with the whole premises ' Martindale,' Stanley Road, Enfield aforesaid
and shall indemnify Mr. Joscelyne from and against any claim arising
in respect of the same. (7) Mrs. Nissen shall permit Mr. Joscelyne
during his life to have the uncontrolled right to reside at and occupy
88
Joscelyne v. Nisscn (C.A.) [1970]
the ground floor of ' Martindale,' Stanley Road, Enfield aforesaid or
such other property as may be agreed upon in writing free of all
rent and outgoings of every kind in any event. (8) Mrs. Nissen shall
be entitled to at least three annual weeks' holiday in each year. (9) Mr.
Joscelyne shall be entitled to at least three weeks' annual holiday in
each year. (10) Mrs. Nissen hereby agrees with Mr. Joscelyne that
she will not at any time sell the whole or any part of the said business
without Mr. Joscelyne receiving one half of the sale moneys or other- g
wise deal with the same or take in a partner without the consent of Mr.
Joscelyne which consent may be arbitrarily withheld by Mr. Joscelyne
without assigning any reason therefor."
At first the defendant paid the household expenses but she subsequently
stopped paying them and the plaintiff brought an action for a declaration
that it was an express term of the agreement that the defendant would C
discharge all expenses in connection with " Martindale " or, alternatively,
that it was orally agreed between the parties during the negotiations prior
to the making of the agreement that it should contain a provision that the
defendant should pay the plaintiff's household bills and costs, and that the
agreement should be rectified so as to contain a provision to that effect.
The judge found that although there was no complete concluded antecedent
agreement, the agreement should be rectified to provide for the payment of D
electricity, coal and gas bills and the costs of a home help. The defendant
appealed on the grounds, inter alia, that the judge had misdirected himself
in ordering rectification of the agreement in view of his finding of fact that
there was no complete antecedent agreement.
The facts are more fully stated in the judgment of the court.
E
Kenneth Zucker for the daughter. The judge ought not to have ordered
rectification in the light of his finding of fact that there was no previous
concluded agreement. There are two conflicting lines of authority, one
insisting on a complete prior agreement, the other requiring the concurring
intention of the parties at the time of executing the agreement. The first
proposition was correct since the second was opposed to two fundamental
rules of contract; that there must be a matching of offer and acceptance
and that parole evidence is not admissible to vary a written document:
Mackenzie v. Coulson (1869) L.R. 8 Eq. 368 and Lovell and Christmas
Ltd. v. Wall (1911) 104 L.T. 85. Faraday v. Tamworth Union (1916)
86 L.J. Ch. 436; Craddock Bros. v. Hunt [1923] 2 Ch. 136; and United
States of America v. Motor Trucks Ltd. [1924] A.C. 196 support the
proposition that there must be a prior concluded agreement. The dictum
of Clauson J. in Shipley Urban District Council v. Bradford Corporation
[1936] Ch. 375, that there was no such requirement was obiter and did
not take into consideration Lovell's case which was a decision of the
Court of Appeal. The view of Denning L.J. in Rose V. Pirn [1953] 2 Q.B.
450 p. 461 supports the proposition that there must be a prior concluded
agreement. Crane v. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 662
did not decide that point. The mere fact that a decision of the Court of
Appeal involved upholding the findings of the judge at first instance did
89
2 Q.B. Joscelyne v. Nisscn (C.A.)
not make those findings binding decisions of the Court of Appeal and
A
accordingly the question was open for the Court of Appeal to decide.
Rodney Box Q.C. and Derek Wood for the father. There are two ways
of looking at the matter: either to say that a prior concluded agreement
is necessary or, as is more likely, that an expressed mutual intention is
sufficient. The decision in Lovell's case (1911) 104 L.T. 85, C.A. was
obiter as the question did not arise. It is unnecessarily elaborate to lay
B down a principle that a prior concluded agreement is necessary and then
make exceptions.
In Rose v. Tim [1953] 2 Q.B. 450 there was no communication
of the parties' intention that they should deal with anything but horse-
beans. Crane V. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 662, was
binding on the Court of Appeal since the decision included the whole
of the judgment of the court of first instance.
^ [Reference was made to Conway v. Rimmer [1967] 1 W.L.R. 1031
and Morelle V. Wakeling [1955] 2 Q.B. 379.]
Cur. Adv. vult.
December 19, 1969. RUSSELL L.J. The judgment I am about to read
D is the judgment of the court.
This is an unhappy dispute between father and daughter which has led
to an investigation into differing expressions of judicial views upon what
is required before a contractual instrument may be rectified by the court.
The father with the mother were living as tenants of a house called
" Martindale " in Enfield. He carried on from there and from an office
at the nearest railway station a car hire business both self-drive and
** chauffeur driven, the cars being garaged at " Martindale." In 1960 he was
given notice to quit. The daughter and her husband lived in a house
belonging to her husband also in Enfield. To help her parents in their
difficulty the daughter bought " Martindale " with the help of a mortgage,
let her husband's house furnished to pay off the mortgage instalments, and
moved to " Martindale." The father and mother lived on the ground floor
p the daughter and son-in-law on the first floor. Each floor had its own
kitchen and bathroom facilities. The daughter helped with the car hire
business to some extent. In 1963 the mother was seriously ill with two
strokes, returning from hospital in January, 1964, unable to look after her-
self. The father, even with the aid of a home help, had to devote much of
his time to looking after her, his business was suffering as a result, and he
felt that he could not really carry on. Because of this he and the daughter
G discussed a scheme by which she should take over the business, a scheme
that culminated in the signing by them of an agreement on June 18, 1964.
For the present purposes it is sufficient to say that it was found by the
county court judge that at an early stage it was made clear between them in
conversation that if the business and its assets were, as proposed, made over
to the daughter she should in return pay him a weekly pension to supple-
JJ ment his old age pension and in addition pay the expenses in connection
with " Martindale " attributable to the parents' part of the house, and that
these expenses should include the gas, electricity and coal bills and also the
cost of the necessary home help. It is not before this court disputed that
90
Joscelyne v. Nisscn (C.A.) [1970]
it was expressly agreed and intended that these particular items should be
A
paid for by the daughter as such expenses and that they negotiated upon
that footing: it is not disputed that father and daughter continued in this
expressed accord thereafter and when they signed the agreement still intended
that it should provide for such payment.
It is however argued for the daughter that the contract signed did not
on its true construction provide for payment of these matters and that since
there was no complete concluded contract antecedent to the written agree- g
ment then in point of law the remedy of rectification is not available to
the father.
The various steps leading to the signing of the agreement need not be
detailed, since they do not touch on the particular matters. The agreement
signed was in the following form.
[His Lordship read the agreement and continued: ] For a time all went
well under the agreement, the daughter paying the gas and coal and elec- C
tricity bills attributable to the ground floor and also the weekly cost of the
home help, in addition to the pension of £3 10s. weekly, but, of course,
taking the profits of the business. (There were separate gas meters for the
two floors: but the ground floor electricity meter carried the electricity for
the garage while we were told the first floor electricity meter carried the cur-
rent for the ground floor immersion heater). Trouble then arose because of rj
incursions on the ground floor of drivers and customers of the business.
It was suggested that the parents move upstairs and the daughter and son-
in-law downstairs, in variation of the agreement. The parents refused be-
cause of the mother's difficulty in movement. The father went away for a
holiday and on his return found that the mother and all their belongings
had been moved upstairs behind his back. The fat was in the fire, pro-
ceedings started in the county court, and the status quo was restored as a E
result of interlocutory proceedings. However, the daughter was no doubt
then advised that the language of the agreement did not require her to pay
for the items that we have mentioned and she stopped doing so. (As
indicated, she necessarily continued to pay for the parents' immersion
heater: the father necessarily paid for the garage electricity: though who
was the gainer by this is not known.) p
The father, to meet this new attitude, amended his particulars of claim
to raise this point either as a matter of construction or by way of rectifica-
tion. The county court judge decided against the father on construction but
in his favour on rectification. A cross-appeal by the father on the question
of construction was not pursued. The relevant facts on the question of
rectification we have already stated.
For the daughter it is argued that the law says that the father cannot get G
rectification of the written instrument save to accord with a complete ante-
cedent concluded oral contract with the daughter, and, as was found by
the judge, there was none such here. For the father it is argued that if in
the course of negotiation a firm accord has been expressly reached on a
particular term of the proposed contract, and both parties continue minded
that the contract should contain appropriate language to embrace that term, u
it matters not that the accord was not part of a complete antecedent con-
cluded oral contract.
The point of law has a curious judicial history, involving apparently
91
2 Q.B. Joscelyne v. Nissen (C.A.)
the disappearance from professional sight of the case in the Court of Appeal
A
of Lovell and Christmas Ltd. v. Wall (1911) 104 L.T. 85 until its existence
was recognised in the judgment of Denning L.J. in Rose v. Pirn [1953] 2
Q.B. 450 apart from a passing reference in Slack v. Hancock (1912) 107
L.T. 14, 16, by Eve J., who had been the trial judge in the Lovell and
Christmas Ltd. case.
It is convenient to start with Mackenzie v. Coulson (1869) L.R. 8 Eq.
B 368, a decision of James V.-C. There a policy of insurance was in terms
in accordance with the wishes of the assured and the insurers sought recti-
fication based on an insurance slip which is not a contract: the facts are a
little complicated but it would seem that the insurers sought to impute to
the assured an intention (and mistake) based on knowledge of a junior
clerk of an agent of the assured of the contents of the slip. We should
have thought this a difficult proposition to sustain. In deciding against
^ rectification James V.-C. used this language, at p. 375:
"Courts of Equity do not rectify contracts; they may and do
rectify instruments purporting to have been made in pursuance of the
terms of contracts. But it <is always necessary for a plaintiff to show
that there was an actual concluded contract antecedent to the instru-
ment which is sought to be rectified; and that such contract is inaccur-
D ately represented in the instrument. In this instance there never was
any contract other than this policy which the plaintiffs have so
signed . . . It is impossible for this court to rescind or alter a
contract with reference to the terms of the negotiation which preceded
it."
This statement of the law supports the daughter's contention.
E We turn next to the lost cause of Lovell and Christmas Ltd. V. Wall
104 L.T. 85 in this court. A covenant not to be concerned in the
business of a provision merchant was held not broken by manufacturing and
selling margarine, and it was further held that there was no case for recti-
fication so as to provide that the covenantor should not compete with the
business of the covenantee company or its subsidiaries. We do not think
p that it is necessary to examine closely the facts of the case, save to say that
we do not think that the facts demonstrated that such a firm accord on the
relevant term had been reached in the course of negotiation as even on the
father's argument is required. There is no doubt, however, that general
statements of the law as contended for by the daughter were firmly made,
albeit obiter, and made in the face of the argument that is now put forward
by the father. Sir Herbert Cozens-Hardy M.R. said, at p. 88:
"The essence of rectification is to bring the document which was
expressed and intended to be in pursuance of a prior agreement into
harmony with that prior agreement. Indeed, it may be regarded as
a branch of the doctrine of specific performance. It presupposes a
prior contract, and it requires proof that, by common mistake, the
final completed instrument as executed fails to give proper effect to
H the prior contract."
He had in the course of argument said, at p. 88:
" Surely rectification ought to be looked upon as a branch of specific
92
Joscelyne v, Nissen (C.A.) [1970]
performance subject to an exception in the case of voluntary settle-
A
ments."
Fletcher Moulton L.J. said, at p. 91:
" Rectification can only come where there is a case of contract. And,
as James V.-C. put it so well in the case which has been cited of Mac-
kenzie v. Coulson (1869) L.R. 8 Eq. 368, the law does not make new
contracts for parties. All it does is to rectify an incorrect expression g
in writing of the contract that was made. And to my mind, it is not
only clear law, but it is absolutely necessary logic, that there cannot
be a rectification unless there has been a pre-existing contract, which
has been inaptly expressed. The consequence is that if you have to
ascertain whether there was or was not a pre-existing contract, for that
purpose you must look at what happened before the contract was
entered into. It is a very great mistake to think that that can lightly C
be done unless you can prove the existing contract. If the completed
contract is badly expressed, all the ' communings beforehand,' whether
you have gone into them or not, have to be rejected by the court in
deciding the nature of the instrument."
Buckley L.J. expressed himself somewhat differently, at p. 93:
" In ordering rectification the court does not rectify contracts, but what
it rectifies is the erroneous expression of contracts in documents. For
rectification it is not enough to set about to find out what one or even
both of the parties to the contract intended. What you have got to
find out is what intention was communicated by one side to the other,
and with what common intention and common agreement they made
their bargain." E
Next to be considered are obiter dicta at first instance of Younger J.
and Romer J. In Faraday v. Tamworth Union (1916) 86 L.J.Ch. 436,
the former expressed the provisional opinion that even had there been
mutual mistake the contract could not have been rectified since the Union
could not contract except under seal. In W. Higgins Ltd. v. Northamp-
ton Corporation [1927] 1 Ch. 128 (in which there was on the facts no F
mutual mistake) the latter, Romer J., said, at p. 136:
" But where, as here, there is no precedent contract between the parties,
I cannot see that I have any jurisdiction to make a different contract
between the parties from the only one which exists, merely because I
come to the conclusion that both parties previously to making that
contract had intended to make a different one. There is a pa ssage in Q
a judgment of Younger J. which was cited to me which supports the
view that I have expressed. It is only a dictum, because in th.it par-
ticular case he was able to set aside a contract entered into under a
mistake of one party, inasmuch as the mistake had been contributed to
or induced by, although innocently, the acts of the defendants; but he
did say in the course of his judgment that, had there been a mutual
mistake, he did not see how he could have rectified the contract." H
Romer J. then quoted from the judgment of Younger J. with approval
and disapproved a decision of Grantham J. in McCartney V. Brighton
93
2 Q.B. Joscelyne v. Nissen (C.A.)
Corporation, The Times, May 20, 1904, which might have been in the
A
opposite sense. In Schofield v. W. C. Clough & Co. [1913] 2 K.B. 103
Sir Herbert Cozens-Hardy M.R. quoted in argument from the judgment
in Mackenzie v. Coulson, L.R. 8 Eq. 368 but did not, curiously enough,
mention his own opinion to the same effect in Lovell and Christmas Ltd.
v. Wall, 104 L.T. 85. In Craddock Bros. v. Hunt [1923] 2 Ch. 136 we find
an obiter dictum of Warrington L.J., at p. 159:
B "The jurisdiction of courts of equity in this respect is to bring the
written document executed in pursuance of an antecedent agreement
into conformity with that agreement. The conditions to its exercise are
that there must be an antecedent contract and the common intention
of embodying or giving effect to the whole of that contract by the
writing, and there must be clear evidence that the document by com-
P mon mistake failed to embody such contract and either contained
provisions not agreed upon or omitted something that was agreed upon,
or otherwise departed from its terms."
The same view is indicated, again obiter, by the Judicial Committee in
United States of America V. Motor Trucks Ltd. [1924] A.C. 196 where it
was said, at p. 200:
D " Nor does the rule make any inroad upon another principle, that the
plaintiff must show first that there was an actually concluded agreement
antecedent to the instrument which is sought to be rectified; and
secondly, that such agreement has been inaccurately represented in
the instrument."
In the train of this undoubtedly formidable array of judicial opinion
E comes the judgment of Clauson J. in Shipley Urban District Council
v. Bradford Corporation [1936] Ch. 375. This again was obiter, since
the case was decided on the construction of the instrument in question:
but the case was very fully argued and the arguments very fully con-
sidered in a reserved judgment. (This case went to appeal and was
argued both on construction and rectification: but this court dismissed
the appeal on construction and expressed no opinion on rectification).
F This was also a case in which the parties could only contract under
seal. The absence of reference to Lovell & Christmas Ltd. v. Wall
104 L.T. 85 suggests that it had found no place in current textbooks,
which appear to have been fully combed by counsel, though not the
English and Empire Digest. Clauson J., after reviewing the authorities,
many of which do not appear to have been cited in the Lovell & Christ-
Q mas case, said, at p. 395:
"Notwithstanding these authorities, counsel for the corporation
argued as I understood them, that the jurisdiction of the court to
rectify a document is limited to the case where it is possible to prove
that before the execution of uie document there was in existence a
legally enforceable agreement, whether oral or written (or possibly
„ an agreement which would be legally enforceable but for some statu-
tory provision requiring special formalities) in terms which the
document was intendend to record, but failed by mutual mistake to
record. They argued, and in my view correctly, that, in view of the
94
Joscelyne v. Nissen (C.A.) [1970]
inability, which the plaintiffs admitted, of the council and the corp-
oration to bind themselves to such an agreement as that in dispute "
otherwise than under seal, it was impossible to predicate that there
was any agreement between the council and the corporation except
that constituted by the sealed document. They drew the conclusion
(which, indeed, appears to me to be, on their premises, inevitable)
that the court could not rectify an agreement between two such bodies
as the council and the corporation even on the clearest evidence that g
the document, even by the merest copying slip, failed to record what
all parties intended it to record. Even as regards such bodies as the
council and the corporation this would seem to be rather startling;
but it will be observed—and counsel for the defendants did not shrink
from accepting this conclusion—that in the case of ordinary individ-
uals, an instrument, on this theory, cannot be rectified except on proof
of a previously existing legally binding document, proof of which, in C
the case of most written contracts (though not, of course, as a rule
in the case of conveyances) is not usually available, simply because
negotiation has not, even where intentions have been found to coincide,
crystallized into contract, until the moment of executing the written
contract. It must be conceded that, whether or not it is difficult to
reconcile the defendants' argument with principle and with the long ^
and ancient line of authorities which I have summarized above, there
is some justification to be found in the books for their contention.
It is to be remembered that many, perhaps even most, rectification
cases deal with the reforming of a final instrument, such as a convey-
ance or a settlement, so as to accord with a previous instrument,
such as a contract for sale or articles for a settlement, and that the
high standard of mutual mistake which the court requires—Thurlow E
L.C. in Shelburne v. Inchiquin, 1 Bro.C.C. 338, 341 even used the
phrase ' irrefragable'—makes cases where mutual mistake can be
proved, in the absence of any previous written instrument, very rare,
and that where, in the absence of any previous instrument, mutual
mistake can clearly be proved, the matter may very often be put right
out of court without litigation. „
" It would thus not be surprising to find that, in cases where the
exact point was not material, language may be used in general terms,
in relation to cases of rectification by reference to a previous written
instrument, which is not strictly accurate in reference to a case where
rectification proceeds on proof of mutual mistake in recording the
concurrent intention of the parties at the moment of execution of the
instrument which it is sought to rectify." G
He then referred to the judgment in MacKenzie v. Coulson, L.R. 8 Eq.
368, 375 and continued, at p. 397:
" The language of the Vice-Chancellor was, if I may respectfully say
so, perfectly accurate in reference to the cases which he obviously
had in mind, where mutual mistake is sought to be established by _.
reference to the terms of a previous contract. His words, however,
apart from their context, have, there is no doubt, found their way
into works of no little authority in such a form as to suggest, as,
95
2 Q.B. Joscelyne v. Nisscn (C.A.)
indeed, the defendants' counsel argued, that the jurisdiction of the
A
court cannot be exercised, even in cases of clear mutual mistake, in
the attempt to embody in the instrument the concurrent intention of
the parties existing at the moment of the execution of the instrument,
unless a previously existing contract can be proved. It is sufficient
for me to say that, had it been necessary for me to decide the point,
I should not have felt justified in accepting this interpretation of the
B Vice-Chancellor's language as correct."
He then referred to other dicta that we have mentioned indicating that
he was unable to accept them as correct.
Next we have Crane v. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 662
decided by Simonds J. The facts need not be set out. The judge said,
at p. 664:
r
Q
" Before I consider the facts and come to a conclusion whether the
defendants are right in their contention, it is necessary to say a few
words upon the principles which must guide me in this matter. I am
clear that I must follow the decision of Clauson J., as he then
was, in Shipley Urban District Council v. Bradford Corpn. [1936]
1 Ch. 375, the point of which is that, in order that this court
D may exercise its jurisdiction to rectify a written instrument, it is
not necessary to find a concluded and binding contract between
the parties antecedent to the agreement which it is sought to
rectify. The judge held, and I respectfully concur with his reasoning
and his conclusion, that it is sufficient to find a common con-
tinuing intention in regard to a particular provision or aspect
of the agreement. If one finds that, in regard to a particular
E
point, the parties were in agreement up to the moment when they
executed their formal instrument, and the formal instrument does
not conform with that common agreement, then this court has jurisdic-
tion to rectify, although it may be that there was, until the formal
instrument was executed, no concluded and binding contract between
the parties. That is what the judge decided, and, as I say, with
p his reasoning I wholly concur, and I can add nothing to his author-
ity in the matter, except that I would say that, if it were not so,
it would be a strange thing, for the result would be that two parties
binding themselves by a mistake to which each had equally contrib-
uted, by an instrument which did not express their real intention,
would yet be bound by it. That is a state of affairs which I hold
is not the law, and, until a higher court tells me it is the law, I
G shall continue to exercise the jurisdiction which Clauson J., as I think
rightly, held might be entertained by this court.
" Secondly, I want to say this upon the principle of the jurisdiction.
It is a jurisdiction which is to be exercised only upon convincing
proof that the concluded instrument does not represent the common
intention of the parties. That is particularly the case where one finds
JJ prolonged negotiations between the parties eventually assuming the
shape of a formal instrument in which they have been advised by
their respective skilled legal advisers. The assumption is very strong
in such a case that the instrument does represent their real intention,
96
Joscelyne v. Nissen (C.A.) [1970]
and it must be only upon proof which Lord Eldon, I think, in a
somewhat picturesque phrase described as ' irrefragable' that the A
court can act. I would rather, I think, say that the court can only
act if it is satisfied beyond all reasonable doubt that the instrument
does not represent their common intention, and is further satisfied
as to what their common intention was. For let it be clear that it is
not sufficient to show that the written instrument does not represent
their common intention unless positively also one can show what their B
common intention was. It is in the light of those principles that I
must examine the facts of this somewhat complicated case."
It is, we think, probable that the eminent counsel concerned in the case
did not really dispute that Clauson J.'s opinion represented the law on
the relevant point: it does not appear from the judgment that they did,
and very many more cases would have been cited had they done so. c
Equally in that case in the Court of Appeal: [1939] 4 All E.R. 68. Sir
Wilfrid Greene M.R. said, at p. 71:
"Two arguments on behalf of the present appellant were before
Simonds J. and these arguments are before us. They were these.
First, that upon the facts of the case no case for rectification had
been made out: secondly, that the matter in question, namely, the ^
issue between the parties as to whether or not the agreement ought
to be rectified was a matter which fell within the terms of the arbitra-
tion submission, which could have been raised before the arbitrator,
and ought to have been raised before him, and could not be raised
after he had issued his award and was functus officio . . . Simonds J.
in a judgment of conspicuous clarity, rejected the appellant's argument
on both points. He found that the facts brought to his mind that E
high degree or conviction which unquestionably is to be insisted upon
in rectification cases."
Again, at p. 72:
" The case is no doubt one of importance to the parties and for that
reason I have thought proper to put in my own language my reasons
for saying that this appeal should be dismissed, but I might have been P
content to say that the judgment of Simonds J., both on law and on
fact, is one with which I am in entire agreement."
Clauson L.J. and Goddard L.J. agreed. In referring particularly to
the judge's rejection of the argument on rectification, in our view the
Master of the Rolls was referring in fact to his rejection of argument on
the facts, not the law. Accordingly we have in Crane v. Hegeman-Harris G
Co. Inc. [1939] 1 All E.R. 662; [1939] 4 All E.R. 68, in both courts an
acceptance of the law on rectification as not requiring a complete antecedent
concluded contract, in a case in which the decision must have been other-
wise if such an antecedent contract was essential to rectification. But it
seems to us that the contrary was not really argued, and we leave aside for
the moment whether in those circumstances the principles of precedent JJ
require us to be bound by this case on the relevant point.
Next we refer to the horsebeans case in this court, Frederick E. Rose
{London) Ltd. v. William H. Pirn Jnr. & Co. Ltd. [1953] 2 Q.B. 450. That
97
2 Q.B. Joscelync v. Nisscn (C.A.)
was a case in which there was nothing that could be described as an out-
" ward expression between the parties of an accord on what was to be
involved in a term of a proposed agreement. It turned out that locked
separately in the breast of each party was the misapprehension that the
word " horsebeans " meant another commodity, but as we understand the
case there was no communication between them to the effect that when
they should speak of horsebeans that was to be their private label for the
g other commodity. The decision in our judgment does not assert or rein-
state the view that an antecedent complete concluded contract is required
for rectification: it only shows that prior accord on a term or the meaning
of a phrase to be used must have been outwardly expressed or commun-
icated between the parties. Denning L.J. said, at p. 461:
" It is not necessary that all the formalities of the contract should
Q have been executed so as to make it enforceable at law (see Shipley
Urban District Council v. Bradford Corporation [1936] Ch. 375); but,
formalities apart, there must have been a concluded contract. There
is a passage in Crane v. Hegeman-Harris Co. Inc. [1939] 1 All E.R. 662,
664, which suggests that a continuing common intention alone will
suffice; but I am clearly of opinion that a continuing common intention
is not sufficient unless it has found expression in outward agreement.
D There could be no certainty at all in business transactions if a party
who had entered into a firm contract could afterwards turn around
and claim to have it rectified on the ground that the parties intended
something different. He is allowed to prove, if he can, that they
agreed something different [Denning LJ.'s italics]: see Lovell & Christ-
mas v. Wall (1911) 104 L.T. 85, per Lord Cozens-Hardy M.R., and
per Buckley L.J. at pp. 88, 93, but not that they intended something
E
different."
In so far as this passage might be taken to suggest that an antecedent
complete concluded contract is necessary it would be in conflict with the
views of both courts in Crane v. Hegeman-Harris [1939] 1 All E.R. 662;
[1939] 4 All E.R. 68, and is not supported by the other judgments. In so
far as it speaks of agreement in the more general sense of an outwardly
expressed accord of minds it does no more than assent to the argument of
Mr. Roche, at p. 457, as to the true width of the views of Simonds J.
We conclude this review of authority with a few other cases to which
our attention was drawn. In Earl v. Hector Whaling Ltd. [1961] 1 Lloyd's
Rep. 459, Harman L.J. said, at p. 470:
" As to the facts it does not appear to me that there ever was an
^* oral agreement. There was a common intention and that is enough.
In spite of Denning LJ.'s observations in Frederick E. Rose {London)
Ltd. v. William H. Pirn Jnr. & Co. Ltd. [1953] 2 Q.B. 450, 461; I think
that Clauson J.'s original decision in Shipley Urban District Council v.
Bradford Corporation [1936] Ch. 375 (as followed by Simonds J. in
Crane v. Hegeman-Harris Company Inc. [1939] 1 All E.R. 662, 664)
JJ that you do not need a prior contract, but a prior common intention,
is right: and here, as it seems to me, both parties always intended that
there should be a written agreement, and they came to a common
intention as to what that written agreement was to be, or thought they
98
Joscelyne v. Nissen (C.A.) [1970]
did: and if the evidence satisfied one that that common intention did
A
not appear in the written document, then you would have a case for
rectification."
We do not take Pearce L.J. to suggest the contrary view, at p. 468.
Lastly, reference was made to a decision of Megaw J. shortly noted in
London Weekend Television Ltd. v. Paris and Griffith (1969) 113 Sol J.
222. He expressed the view that the propositions of Simonds J. in Crane's
case [1939] 1 All E.R. 662 were binding as a result of their express "
approval by this court. He then used this phrase, according to the report, a
phrase which if correct covers the present case, at p. 222:
"Where two persons agreed expressly with one another what was
the meaning of a particular phrase but did not record their definition
in the contract itself, if one of the parties sought to enforce the agree-
ment on the basis of some other meaning, he could be prevented by C
an action for rectification."
In our judgment tbe law is as expounded by Simonds J. in Crane's
case with the qualification that some outward expression of accord is
required. We do not wish to attempt to state in any different phrases
that with which we entirely agree, except to say that it is in our view better
to use only the phrase "convincing proof" without echoing an old- D
fashioned word such as "irrefragable" and without importing from the
criminal law the phrase " beyond all reasonable doubt." Remembering
always the strong burden of proof that lies on the shoulders of those
seeking rectification, and that the requisite accord and continuance of
accord of intention may be the more difficult to establish if a complete
antecedent concluded contract be not shown, it would be a sorry state of g
affairs if when that burden is discharged a party to a written contract
could, on discovery that the written language chosen for the document
did not on its true construction reflect the accord of the parties on a
particular point, take advantage of the fact.
The contention in law for the daughter would, we apprehend, involve
this proposition, that if all the important terms of an agreement were set
out in correspondence with clarity, but expressly " subject to contract," F
and the contract by a slip of the copyist unnoticed by either party departed
from what had been " agreed," there could not be rectification. We have
been puzzled by the suggestion of the Master of the Rolls in the Lovell &
Christmas case 104 L.T. 85 that rectification should be regarded as a
branch of the doctrine of specific performance: we do not see any
necessary connection, more particularly since rectification is available in Q
the case of voluntary settlements. In our judgment the view of Simonds J.
and this court on the point were correct and on the facts found by the
county court judge the father established a claim to rectification. It is
not necessary, therefore, to decide whether we were bound in any event
by the decision of this court in Crane's case [1939] 1 All E.R. 662, not-
withstanding that (in our view) the contrary was not argued, the particular
point of law being in fact essential to the dismissal of the appeal. This
question of precedent was discussed at some length in this court in Morelle
v. Wakeling [1955] 2 Q.B. 379 and as at present advised it would appear
99
2 Q.B. Joscelyne v. Nissen (C.A.)
to us that it may well not be right to say that the decision in Crane's case
A
was made per incuriam: we refer in particular to the judgment of the
full court in Morelle's case at p. 406: though we are not completely content
on this point. The court is not omniscient in the law, nor are counsel,
however eminent. We work under great pressure from the lists, and
whilst not always ready to accept a concession on a point of law from
the Bar it is not infrequent to do so, and moreover on a point essential
B to the decision of the appeal, without further investigation. We are
attracted by a suggestion that the conceded point of law should be open
to argument in another case, provided it is made plain that that should
not be made the basis for the further suggestion that where an argument,
though put forward, had been only weakly or inexpertly put forward,
the point of law should similarly be open: for much uncertainty could
thus be undesirably introduced.
C We wish to stress that this is a case of rectification based on antecedent
expressed accord on a point adhered to in intention by the parties to
the subsequent written contract: we were in no way concerned with
arguments as to collateral terms of a contract.
The actual order of the county court judge would appear to have
rectified the wrong clause in the agreement, and to have omitted the refer-
j) ence in the accepted evidence of the father to payment of expenses being
made out of the business. Counsel were able to agree the proper form
of order. The order will be accordingly varied so as to provide that in lieu
of rectification of clause 7 of the contract thereby ordered, clause 6 shall
be rectified so as to read:
" Mrs. Nissen shall until she sells the business and out of the proceeds
of the business discharge Mr. Joscelyne's expenses in respect of gas,
** coal, electricity and home help incurred by him while occupying
' Martindale'. . . aforesaid or such property as may be agreed upon
in pursuance of clause 7 hereof and shall indemnify Mr. Joscelyne
from and against any claim arising in respect of the same."
We would add that we very much hope that the father and daughter
p will now be able to return to a proper familial relationship after their
differences, which will have given them the distinction, if such it be, of
being enshrined in the Law Reports. The appeal is dismissed. The cross-
appeal was not pursued.
Appeal dismissed with costs.
O Solicitors: Baylis Pearce, McMillan & Mott; Craigen, Wilders &
Sorrell.
J. W.