Pearlson Enterprises Ltd v Hong Leong Co Ltd

• Judge: M Buttrose J
• Judgment Date: 07 August 1967
• Neutral Citation: [1967] SGFC 18
• Citation: [1967] SGFC 18
• Court: Federal Court (Singapore)
• Subject Matter: Increase in price of bricks supplied,Contract,Sale of bricks at agreed price,Whether repudiatory breach of contract,Breach,Demand for immediate payment upon delivery and variation in price of bricks
• Published date: 19 September 2003
• Defendant Counsel: KS Chung (Chung & Co)
• Plaintiff Counsel: KA O'Connor (Drew & Napier)

This is an appeal by the appellants, Pearlson Enterprises Ltd, against a judgment of Winslow J in the High Court in favour of the respondents, Hong Leong Co Ltd for $11,575.45 and costs and dismissing the counterclaim of the appellants with costs. The facts which I shall attempt to set out as briefly as possible are these.

The respondents who are the sole selling agents of a company manufacturing, inter alia, bricks sold to the appellants who are a developing company building flats for sale or rental 600,000 pieces of bricks under a written contract in the following terms:

Singapore, 18 June 1964

Messrs Pearlson Enterprises Ltd of 18-L, Battery Road, Singapore (hereinafter called `the buyers`) hereby confirm having purchased this day from M/s Hong Leong Co Ltd of Singapore, (hereinafter called `the sellers`) the undermentioned goods at the prices and on the terms and conditions hereinafter appearing and subject to the general conditions printed on the back hereof, except where inconsistent with the following special conditions.

Quantity Description of Goods Price

(600) ,000 Alexandra Bricks

pieces No 3 Commercial

Quality @ $79.00 per 1,000 pcs.

Delivery as from June to December 1964.

Delivery

Payment as usual.

The material provisions of the printed general conditions are as follows:

Deliveries 2 Dates given for delivery are approximate only. The delivery of one instalment delivered of one instalment delivered under this contract shall be considered as a separate contract. Default in delivery of any instalment shall not enable the buyers to treat the contract as repudiated. ...

All payments for goods to be delivered in instalments to be made on due date otherwise the sellers may at their discretion refuse to deliver further instalments until such payments be made ...

Increase in prices 4(a) Should the cost of goods be increased by any circumstances of any kind whatsoever beyond the control of the sellers including (but not by way of limitation) variations in rates of exchange, devaluation of any relevant currency or increase in relevant rates of freight or insurance, such increase shall be borne by the buyers.

Sellers 8(a) This contract is subject to confirmation and acceptance

Agents and not by manufacturers or suppliers and is also subject to

themselves liable. any conditions contained in the manufacturers contract (Delete if sellers with the sellers if they vary or are inconsistent with the

contract as principals) general conditions herein contained and particularly the right of cancellation and restriction of liability contained in any manufacturers contract.

(b) The sellers contract as agents and are not to be bound under these conditions but notwithstanding this condition or the other conditions here appearing the sellers reserve to themselves the right to institute any action against the buyers under the contract of which these conditions form a part as though the sellers were principals should the sellers deem it necessary or expedient so to do.

(c) The buyers shall be entitled to the benefits of but subject to the conditions of sal of the actual manufacturer or supplier of the goods including all manufacturers and guarantees so far as the latter conditions are not inconsistent with the above conditions.

The material terms of the agreement between the respondents and the manufacturers under which the former became the selling agents of the latter provided as follows:

(1) You will be selling agents for Alexandra Brickworks Ltd from 1 February 1964.

(2) All bricks and tiles sold as from this date will be billed to you on our ex factory price less 6% commission to you.

(3) The price of the bricks are as follows:

No 3 quality ... $75 per thousand.

(4) Transport charges will be added and are as follows:

$6 per thousand within five miles limit and $7 per thousand beyond five miles. As stated previously where large quantities are involved, reconsideration may be given to the amount of transport charged.

(6) Terms of payment ... 60 days ... We trust with the above arrangements you will now endeavour to push the sales to the best of your ability ...

The appellants were not aware of the terms of the above-mentioned agreement until after the commencement of the action against them.

On 18 October 1964 the manufacturers wrote to the respondents that as they have to pay increased labour they have no alternative but to increase your supplies to the appellants by $3 per thousand bricks with immediate effect. The trial judge found that this increase of $3 per thousand bricks was communicated orally by the respondents to the appellants and that the appellants orally agreed to pay for future bricks delivered at the increased price...