i DARLING DARLING v. AURORA PACKING CO. LTD. JUDGMENT. ISAACS J. The ultimate question comes to this:=- Did the aurora Packing Company promise the appellant that it would take up and "finalise", that is, carry on to completion, the agency undertaking which the MeClure Company hed entered upon and partly performed, or did it promise an entirely separate and distinct agency undertaking, merely to sell and account for such portion of the appellant's fruit delivered to the McClure company as remained unsolé on August 26th 1924, leaving the McClure company to account to the appellant for all transactions up to the point of severance? The question has been answered in favour of the appellant, that is in the first alternative, by the Stipendiary Magistrate and Justices, and in favour of the respondent - = the second alternative - - by the learned Judges of the Supreme Court, though not altogether for the same reasons. The matter has been very ably argued on both sides on this appeal. It is with regret I find myself after the best consideration I have been able to bring to the case, at variance with opinions, all of which I sincerely respect. I therefore feel bound to express my own reasons with somewhat more detailed references than I could wish to those portions of the correspondence that have led me to the conclusion that the primary decision on what after all is as to how business men in the circumstances would read business letters, was correct. By general assent the matter depends on the proper censtructio: to be placed on some written business communications. It is further conceded that in order to arrive at the sense in which the parties understood, or must be taken to have understood, those communications, what are oalled the surrounding circumstances must be first ascertained. Words are always to be construed secundum subjectam materiam. In River Wear v. Adamson (2 A.C., at p» 763) Lord Blackburn in a classical passage emphasises this principle. Qe Now the circumstances so far as relevant are clear. They appear purtly outside the documents and partly from their contents. It is common ground that the agency undertaken by McClure company < or, as I shali call it, McClure, as I shall also refer to the respond ent 8s Aurora - was not an isolated egency. It was not as ifa producer simply employed an sgent to dispose of his goods according to personal instructions and subject to personal control, and unconnected with uny other person's goods and simply with the ordinary obligation to account for #11 moneys received, the agent owing in the transaction no obligations but these ordinarily due to the employer. * Growers had formed an association called the Australian Dried Fruitgrowers! Association ~ shortly, A.D.F.A.. Rules had been famed which neither side thought important enough to put in as a whole. But it sufficiently appears, and both sides rely on the fact ~ that though each grower selected his agent from among those duly constituted A.D.F.A. agents giving security to the Association <- the agency had to be executed consistently with the growerts relations to the sgsociated growers, and so the agent's ultimate accounting to his employer was to be subject to those relations. Both sides describe the sale of the fruit as for a "pool". There was to be in some sense a pool. realization for each season, which connotes an accounting for that purpose to the Association, and then in proportion to individual quantities end standards supplied + identity of fruit contributed being disregarded, and indeed impossible so far us pecuniary returns were concerned + @ distribution was to he made and the agent thereupon to account to his principal. It is manifest that at all events from the individual grower'ts standpoint, the process for wach season was in any case, and even if the agent kept tally of his sales of the principal's fruit, an entire undertaking, not expected to be segregated at any particular point. There was an interdependence of an indefinite number of individual sales, some in Australia dnd more in London, sll possibly entering as factors into the ultimate result for each. When McClure's agent, foi Be instance, in January 1924 requested Darling to entrust that company with the season's fruit, he as he deposes informed Darling that "we anticipated finalising in November". That phrase both exemplifies the necessity of waiting until the end of the season's operations before mowing the result, and also the sense in which NeClure and Darling used and understood the word "finalise". Obviously it meant, as between them, the bringing the agency undertaking as an entirety to completion. I would add that that is the sense in which I would ordinarily understand the word, which is certainly a convenient expression, and has now acquired a business significance in accordance with the sense in which it was used on the occasion referred to. I must also add by way of anticipation that the pool referred to = which may conveniently be called the AsD.FeA. pool = was not the only pool which we have to take into account. There was another ' pool - an inner pool = quite unnecessary from the association standpoint, but which McClure created for itself, and for the purpose of its own business convenienge, ani whch the Aurora took up and continued. This inner pool so entangled the MoClure "business for 1924 season" that, as Will be seen, it became utterly impossible to disentangle the so-called "unsold fruit" of any of MeClures' principals, from their fruit already sold. The matter had to be dealt with as an entirety - by amalgamating retums and paying on the final balance. {his will appear clearly. In the meantime I proceed with the circumstences attaching to all A.D.P.A. agencies, Advances by agents were made up to 30 per cent of the estimated net value of the fruit. The agents were manifestly secured by the proceeds both as to advances and any agency outlay. Interest on the advances was charged, because the money advanced was that of the agent. But later, when sales were actually made, progress accounts were rendered, and where practicable provisional payments were made, subject to agency debits in the meantime, and subject to revision on ultimate results, that is, on "finalisation", and of course, as these payments were out of moneys belonging really to the employer, no interest was charged. | ; i | {| ; ; | t a. Darling, in response to McClure's invitation, placed in their hands as his agent part of his "pack" for 1924, namely, 80 boxes of currants, 70 boxes of sultanas, and 103 boxes of lexias. He had sent them to a packer named Lehmann, who after packing them sent them to NeGluxe. Approximately, the fruit so sent came to tr tons of currants, 2 ton and a holf of sultanas, and two tons of lexias. Darling received from McClure about £76 as advances on account of this fruit. He had by the end of avigust received from them no account sales, and apparently MeClure had received no money from any purchasers on account of the fruit they had sold. In these cireumstances, the appellant Darling received simultaneously two documents, both 'dated 28th august 1924, one from MeClure and the other from Aurora. Those "doeunents are the first that call for coustruction, and as they convey both information and undertakings, it is desirable to separate these portions, and add in the first place the new information to the circumstances already statei, whereby the under= - takings will 'be batter understood. In point of fact, Meclurets per se is mainly information, end it is only so far as the Aurora letter constitutes portion of that information into a promise that there is an undertaking by Aurore at all. The MeClure document informs Tarling of the following circumstances:- (1) McClure's have already and without any prior communication with Darling, handed over his fruit to Aurora, on conditions. (2) This has been done "owing to certain recent devolopments", and to #xm better protect growerst interests." (3) McGlures have, by reason of having received the principal portion of their fruit for the 1924 season, and by resson of the : Aurora heving its head office at the same address as MeClure'ts office, and as Aurora has now being constituted A.D.F.A. agents, sufficient confidence in Aurora to make arrangements with them. (4) The arrangements have already been "finalised", and are "to earry on the business of MoClure Valentine and Company so far as the sompletion of the 1924 season is concerned". (5) The A.D.F.A. has agreed to this transaction and retain Be McClure's deposit as security for (i) due performance of "all A.D.F.As conditions", and (ii) accounting to growerst contracts with them. fie (6) All unsold fruit "is being transferred" to Aurora, who (i) will in future control same, (ii) will issue account sales, (iii) make payments, (iv) invoice to buyers, (vy) do all things, whatsoever necessery, for finalising the 1924 pack, and (vi) wili include in the finel account sales al] transactions _prior to this date as affecting your fruit. To this information three observations are added, namely:- (a) A hope is expressed that Darling will "approve of the action taken", and will feel that the best has been done that was "possible in your interest"; (b) that any otherwise disquieting rumours as to MoClurets may now be disregarded, as "the only effect on your good self will (we sincerely hope) be the more efficient, speedy and satisfactory handling of your fruit in the future, and the finalising of your accounts at all times with the least possible delay."; and (co) a hope that the aurora Company "will be authorised to finalise your 1924 fruit in the ordinary course." Now before coming to the Aurora letter, I would observe that the sentral feature of the McClure circular is thut the two companies for their own mutual reasons, with their own special Imowledge of each other's business and position, "fimlised" their arrangements for transferring the 1924 season's agency undertakings from McClure te Aurora, independently of any request by or communication with the individual growers. All the growers were asked to do wes to accept the substitution, without any detailed information as to the terms of the arrangement. Darling was assured he would not suffer - and I cannot hesitate to accept that circular as assuring him that his accounts, if he approves of the substitution, will he rendered and pai by the Aurora, so far as he is concerned "in the ordinary course", that ic, on exactly the same basis as if McClure had remained. ALL that is part of the "conditions" - as he is assured in the opening 6. paragraph - of the transfer of the unsola fruite The fact that the arrangements had been completed ~ "finilisei" - without consulting the growers, is a complete answer to the suggestion of improbability that any ordinary Agent No. 2 would as part of his undertaking to his principal accept responsibility for the financial obligations of Agent No. 1 who had failed. There is no parity of circumstances. The evidence of Mr. Wilkin, the secretary of Aurora, is instruetive as to this:- "When the growers agreed. to aurora Company's proposal, the Aurore Company did not know what fruit MeClure had sold or where some of it was. Aurora Company Imew in what places MeClures had stocks, but not to what quantities there were. Nor whom it belongs to, I should say MoClures did not Imow", : This accords with the statement in Aurorats letter of September 29 1924 in the second parsgraph, which will be presently referred to. It slso accords with the following 'statement in Aurorats letter of July 19 1926 (Exhibit DD.):=~ "The whole of tho fruit received by MoGlure, Valentine & Co. was, so far ss the identification of any particular growerts fruit was concerned, considered and treated as- one pool. This course was adopted among other reasons because (a) it was desired to follow as closely as possible the basic principle of the A.D.F.A., viz. a pool system for ensuring 'equity among all» growers!, and (b) because it was felt that under the circumstances then existing it would be practically impossible to identify either the fruit which had been sold by Mco@lure,Valentine, or the fruit remaining unsold as at 26th August 1924, which would be sold by Aurora", This passage is of the highest importance. 'The 'pool't, it will be observed, is not the a.D.F.A. pool. It is an imner fpoolt, constituted by McClure alone, in respect of the fruit entrusted to it by the various growers delivering their fruit to MeClure for sale, an(é McClure had constituted this pool by analogy to the general A.D.F.Ae pool. But the plain consequence was that no individual sale could be attributed to grower "A" or grower "B", and so the sales by McClure had to be worked out proportionately, certainly as to price, and apparently alse as to quantity. That appears further on in the same letter. Te Aurore followed this, it seems, ; until after McClure's diquidation. On legal advice it later corrected tee system as to the packing : charges, but as far as appears proportionate allocation had to continue as to other expenses and as to receipts. All this shews the general entirety of the accounting to Darling, and the impossibility of treating this case on the ordinary footing of separate agency for separate and distinct property. and particularly it shews that the expressions in the ketters of august 28th 1924, name] ar "hand over your fruit" and "unsold fruit", were metaphorical only, and- meant not the physical substance of the fruit belonging to any specific grower, but a proportionate interast 'in the inner McClure pool. asa matter of actual fact, it might have been true on August 28th 1924 thet either not a single case of Darling's frnit remained in McClurets possession, or that every conse of the fruit he had delivered wag still held by that company. And yet arrangements were "finalised" betwoen the companiss, clearly on the basis that McClure hea adopted, and that aurora had accepted and followed ana the growers were 'aaked to agree, to the transfer on terms which certsinly accord with what we now Imow were the methods of the agent, end which, to the least, fail to lay down in anything like clear terms what Aurora now insists upon. Now, the second document is from Aurora. It confirms the McClure document. It emphasises the salient points, including:- ee (a) The Avrora is now A.D.F.A. agent. (b) Security not lessened,beceuse McClurets security still hela "for the due and proper perfornance.of all their responsibilities to growers under their original agreement to sell growers! fruit". This would include settlemont on the footing of the finel accounts. It invites Darling "to leave your 1924 fruit transactions in our hands to finalise", and asks for confidence etc. "in completing the present season's transactions." The word ral and the word "transactions" are absolutely inconsistent with the segregation of some of those transactions from the rest. Before summarising the effect of these documents since they were merely an offer, let us look at subsequont correspondence. 8. + On September 12 Darling asks Aurora for Account Sales of past transactions,and as to payments to Lehmann, the packer. On the 18th he gets from McClure, not the statement asked for, but a reason for not maleing any progress payments, and a hope that account sales will be rendered in the near future. McClure never rendered any further accounts. Apparently however, no money had yet been collected by them, otherwise the information was altogdhcer misleading. The day before McClure had stated they hed debited his account with £35/16/10 paid to Lehmann for packing, and askea if that amount were jisputed te communicate with them direct. On September 20th Darling replied te the aurore with reference to McClurets account and letter of the 18th, which shews that at 811 events at that date, he regarded their suggestion - though so far nnecoapted - as amounting to a substitution all through. The expression "since 'gelivering the fruit now to be accounted for by you" is a clear intimation that he understands that the whole of the fruit "delivered" is to be accounted for by Aurora, and the account (#xhibit D. 2) shews delivery took place from April 25th to July 7th - and is according to the Aurora suggestion to be accounted for by them. The answer made by the Aurora on the 29th September is important, Mr, Cleland, of course, admitted that the bargain between that company and Darling must be interpreted by what that letter says. In my opinion, it is part of the contractual correspondence, but in either cass it has the same effect. The Company makes it clear:~ (1) That even then it does not iow how much fruit is unsold, and explains the impossibility of ascertaining it (except, of course, iu the way afterwards stated in July 1926 (Ixhibit DD.)). 'therefore it is clear to me the arrangement between the Aurore and MoClures must have been of the most comprehensive character que the growers. (2) That "Messrs. McClure, Valantine & Go. have paid" (meaning Tadvanced!) "you 30% of the Conmonwenl th Keyboard value of fruit delivered to them, and this Company is quite prepared to account to you for the balance due, representing the nett proceeds for Commonwealth and Export, when same are ascertained." That must mean when all final } | | 9s adjustments of the McClure agency pool and its construction under Aurora control are finally made and ombodied in the final secofint. Before proceeding further, it may be pointed out that that is all to assure the appellant that ignorance of the sctual sales up to the transfer makes no difference to him, because the Aurora will, as already state', eventually account to hin for the full proceeds, actual or as proportionately adjusted, of all his deliveries lesgthe advances and proportionately najusted expenses, "Accounting for" includes and connotes payment. See for instance Turner v. Burkmishaw (2 Ch. App., at 'pp. 491 and 492) end Harsant v. Blaine (56 L.J. Q.B., at pe 513). Continuing the letter, it points out thet both MeSlure and Avrora are bound by a deposit of £250 each to comply with A.D.F.A. terms and conditions, and it concludes with the very definite assurance that "Ag this season's sales have been conducted by both companies, the returns at the end of this season will be amalgamated, and growers will receive the full nett proceeds due to them." It concludes:- "You will therefore realise that your interests are fully protected." Observe it is the "returns" that are to be "amalgamated" = that is the productive results of sales are to be amalgamated, not that "accounts" are to be amalgamated 'as Mr. Sleland contends, for the mere useless purpos? of shewing what Darling would have received if one single agent hed acted all through, leaving the "amalgemation" to be split up afterwards, to be annulled in fact, so that Darling might have to pay Aurora s dabit against him and prove on MeClure for a eredit, though the nett proceeds in the amalgamated returns would shew @ consiferable credit to himsel?. For if growers ere to receive the full nett proceeds due to then, notwithstanding some finencial difficulties in which Aurora kmew MeClures found themselves, though apparently in August thought to be less serious then they turned out to be, it must mean that Darling is to receive the full nett procceds as' | shewn on the account which amalganates tae returns. And again, if his "interests are fully protected", that is, by the amalgamation of returns, it cannot in all reason and honesty be that 10, the net result is not to be paid to him as such, but that he is to be forced as to an unknown portion to take whatever he can get in competition with unknown creditors upon a proof of debt in the insolvent estate of the company with whom the Aurora is in intimate connexion, end with whem it finalised the transfer of business on its ovm terms, undisclosed to the appellant, That letter of September 29th 1924 seems to have satisfied Darling, and I apprehend since both sides reject the notion of ambiruig and I agree with thomas to this, whatever is the true construction of the correspondence up to that point determines the rights of the parties. The subsequent ovents, including correspondence, do not in my opinion slter the rights of the parties as they existed after the letter of September 29th 1924, which appears to have satisfied Darling and on which he spparently rested. Nothing took place until November 20th 1924, On November 20 1924 aurora forwarded to Darling a circular and two other documents enclosed, all of which appear to me utterly inoonsistent with the respondent's present contention. The circular stated that a Credit Note for progress payment on sultanas at £6 per ton, and on currants at £12 per ton, representing the amount due to growers "for sales up to and including 31st October last". Naturally, that would include sli seles from the beginning of the season. That implication is borne out by the credit note itself, because the sultanas referred to are 1 ton 15 ewt., and the currants @ tons, representing - go we were told in argument without -contradiction, and the evidence as to quantities supplied to McClures confirms it ~- the whole of the sultanas and currants delivered to McClure. : The Credit Note states "Crelit by Aurora Packing Co, Pty. Ltda." The circular also forwarded under date 20th November 1924, a debit note for the whole of the pavking etc. charges, including the £35/16/10 whioh McClure hed undertaken to pay Lehmann. The balance bringing the debit up to £49/10/11 represents railage and cartage, and the total represents the whole of the charges in connection with Darling's fruit. : | lie But the circular letter concludes with a most significant paragraph, seeing that not quite two months have elapsed since aurora was authorised to act. The paragraph runs thus:= "We are pleased to be able to advise that Account Sales are now coming forward steadily from London, ani we are very hopeful of being in a position to make a further distribution in the noar future." It is practically inconceivable that this should be limited to go00ds sold in Lowion by Aurora since September 1924, and it is altogether contrary to the notion that amalgamation of returns involved no liability to pay on the amalgamated result. The circular as framed applied primarily to growers in credit - as witness tho error infeopying the exhibit, and the word "distribution", for the eircular had to bo altered from its general terms so as to fit this case. lioxt day, November 21 1924, McClure Welentine & Co. went into voluntary Liquidation on account of "excessive liabilities". On Decomber 22nd 1924 Aurora sent to Darling a circuler letter which I think does not accurately state the position ag. constituted in August and September. It encloses 8 circular letter from the liquidator of Mc@luros, end seys the position of the growers had — been fully explained to him. It asserts that #11 that Aurora took over from McClure wes fruit unsold as at 26th August 1924 fe as advised in letters of 28th August. It ssys:~ "his Company there~ fore is responsible to growers only for the fruit which was actually received and sold by them." It adds:+ "It did not take over the business of McClure Valentine & Coe, nor its assets and liabilities." why all that explanation? In one sense ~ u very limited sense - it is true that the letter of 28th august 1924 advised that the unsold fruit was taken over. Of course, none olse could be. It is also no doubt true that Aurora did net teke over all the assets and liabilities of NeClure. But the intermediate position remains = namely, what is stated in the letter of 28th August 1924 in these words:~ "Arrangements have been finalised with them to carry on the business of McClure Valentine & Company so far as the completion of the 1924 season is concerned", and as later stated, Aurora will "do all things negessary for finalising the 1924 pack, and will include Le. in the final account sales all transactions prior to this date as affecting your fruit", and as conclusively, "finalise your 1924 fruit in the ordinary course." It is plain that in the expression "all transactions prior to this date as affecting your fruit",.means all the fruit delivered ab initio, and "transactions" means transactions of sale of Darling's fruit. Otherwise, "transactions" would have to mean all transactions. of sale of everybody's fruit in every agency so far as they affected the ultimate value of Darling's fruit, and in that case they would not be limited to those prior to August 26th. The new letter of December 22nd, seems rather an afterthought, intended to re-interpret rather anxiously the earlier correspondence, and to some extent force the position. Quite unnecessarily otherwise does Aurora go to the trouble of drafting a oleim and suggest it should be forwarded to the liquidator. It is not strange to me in the circumstances that the grower should do as directed md send in his "probable" claim, and subsequently support it. by affidavit. It hardly lies in the mouth of aurora to charge Darling with inconsistency throush acceding to theix request. For all we know, this may have been some protection to Aurora in relation to its arrangements with MeClure. In any avent, I cannot find in it any release from Aurora from its plain undertaking. Darling swore:~ "I sent a proof of 'gent to liquidators of Hcedlures. I do not claim that MeClures are responsible for the balance of fruit sold by them, the liquidators told me I was a creditor, therefore I sipned it... . the liquidator has sent me further statements, but I have not signed them." Indeed, on October 10th 1925, Darling by Exhibit "M" claimed from Aurora 215/3/- on the basis of their responsibility for prior transactions. By the Credit Note of November 20 1924, covering so far the whole of the sultanas and currants originelly delivered, a credit of 234/10/- for progress payments was shewn. This was converted into a debit of £15/~/11, but only by setting ageinst it £49/10/11 which were McClurets charges. But since the liquidator had Pere riwereer tence? 13. debited Darling in MeClure's account with £30/3/11 of the 2£49/10/11, Darling objected to a double debit. 'the correction of that reconverted the Aurora dabit of £15/~/11 into a eredit for £19/7/-, and in respect of McClure transactions, or at all events, partly MeGlure transsetionus, probably all, since prima facie it so appears and Aurora, who slone could have shawn the contrary, did not shew it. Aurora's answer of October bth is hardly understandable on their present viev. It sdmits the debits which in the note were claimed by Aurora, were for goods sola by MeClure; it says it was "pro forma" only ~ which is extraordinary; it says it withholds payment by instructions from Wedlurets liquidator, aud says that after adjustment of MeGlure's returns it will endeavourto "finalise your retuims for the whole season and pass over to you any proceeds due." On November 30th 1925 Darling 'objects to the withholaing the £15/3/+ and to Aurora yielding to the liquidator's instructions. On Decomber 7th 1925 Anrora writes to Darling a letter which I consider almost conclusive against the Company. It says that as the liquidator accounts ere not yot regarded as final, he holds a "lien oveyproceeds from sales of fruit held by us". Now over what proceeds could tho liquidator held a lien? Not over proceeds of fruit taken over by Aurora and sold by it? The proceeds must be of fruit sold by McClure snd collected by aurora - no doubt as part of "the business of the 1924 season". But, says the letter, as soon as the liquidator notifies the finality of the accounts, "we will proceed to issue finel returns to growers together with cheques where seme are due". Obviously edjustments as between MeClure and Aurora were necessary,.but whetever Aurorats anxiety to complete these before paying the growers, it is clear that Aurora did not then consider it was limited in its obligation to paying over proceeds of fruit sold by itself. On December 211925 Darling claimed from Aurora peyment as per Credit Note previously mentioned, and threatened proceedings. On December 24 1925 Aurora definitely took its stand that it would pay only in respect of fruit sold by itself, and referred 14. Darling to the liquidator. On January 5th 1926 there were sent to Darling what were called in a letter of the 6th "finel account sales" for such portion of your 1924 season fruit as was sold by this Company, .shewing s balance of £26/1/8 in his favour. but the description beavs no resemblance to what was promised as "include in the final account sales all transactions prior to this date as affecting your fruit." The reply reises some detailed objections and suggests there should be no repudiation of the Credit Note of November 20 1924. In answer, the Company on February 2 1924 says it was pro forma only. It may be so as to amount, but hardly so as to date of sales. The virtual impossibility of segregating "sold" 2rom "unsold" fruit, at lesst before December 24 1925,-is made quite clear. So it. is evident that whatever information is contained in Darling's proof in MeClure's liquidation must have come from Aurore. The claim oviginelly made by Darling in these proceedings certainly did not exteni so far as his present contention, but the position becsme somewhat complicated, and I think blurred, by the later attitude of Aurore efter MeClure''s liquidation. Lt is not necessary te reconcile Darling's larger claim with his more restricted one. A more careful examination of tue bargain as made by the correspondence disclosed to his legal advisers his larger rights and those have not been diminished by the earlier error. In any case there may by way of off-set be romembored those letters of Aurora already mentioned, which are inconsistent with their present contentia The appeal ought in my opinion to be allowed and the primary judgment restored. DARLING vs AURORA PACKING COMPANY PROPRIETARY LIMITED JUDGMENT KNOX C.J. The question for decision in this case turns solely on the true construction to be put on correspondence which is said to establish the agreement on which the appellsent relios. I agree with the learned Judges of the Supreme Court in thinking that this correspondence does not-bear the mesning which the appellant seeks to put upon it, but as the majority of this Court holds the contrary view, and as no legal question of generul importance has been ruised, no useful purpose would be served by my stating in detail the reusons which have led me to the conclusion that the appeal should be dismissed. Appeal allowed ~ order of Supreme Court set aside and order nisi discharged with costs. Respondent to pay costs of this appeal. te A PAGING COMPANY LTD, BIG InS J. Thie case has been well uergued on both siddés; but it ia my clear opinien that the spneal must be allowed. The facta I need not repeat. The insuef becomes finally en issue ne to the construction of the cone etract, and in particuler of exhibits A, PB, and FP. 1, exhibit B (which ie incorporeted by the dé@fendent in ite letter of the same date, 28th. Auguet 1924) McClure Volentine & Co. (Isshall asy "eClures for mht ghort) use words which in themselves eeem to be sufficient to show that the Aurora Packing Co., in taking over the control of the fruit as yet uneold, mkke& which hod been delivered by the gwovers a MeClures, cons etracted to accept liability for what MeCluree had sold es well as for what the comoany should eell. The compay sis to " garry on the busie enese of KeOlures so far as the completion of the 1924 season ie concern wad." Thie expression might be in itself ambigous; but there ore additional wordsie *All unsold fruit is being #ransfeered by MeClures to the aurora Packing Oo. whe will in future control sate, will issue account gm sales, make payments, invoice to buvers, and do all things whatsce wever necesenry for finslising the 1924 pack, and will inelude in the fianl account sslee 211 tranections prior to this date (28th, August 1924) os affecting your fruit, * A t that date, no account sales hed been rendered to the plaintife, DARLING yy BIGSTES J, by HeOlures or otherrise; Abe compeny contracts to include in ite final account sales sll transactions prior to that date « feote wing your fruit. * Sith 212 respect to Bapier J., I am unable to Limit the meaning ef the gords * your fruit " in thie clause to the unsold fruit; ee is shown by the 2nd. paragranh of the circular it means the fruit of the plaintiff " for 1924 season *. It is con ~tended, however, that it is one thing to include transactions prior to 28th. August in the final secount sales, and quite snatherx a different thing to promise to pay the full amount shown by the Raina final account. The vords of the third clause ere not confined to account gales for the unsold fruit, or the payments for the unsold fruit; but even if it be granted that the vords ss to final eccount sales Riot necessarily involve payment of what app- -ears in the fins] account sales, the intention ie mide clear by the lette# of 29th. s&t. following, written by the company to the plaintiff (ex. Flies " MeClures hove paid you 30peycent of the Commonvealth keyakeasds key-board value of fruit delivered to them, and thie company ie quite prenared to account to you for the balance due representigg the nett proceeds for Comuonwealth and export when same are ascertained. * These words mean 4 promise to pay the balence due for 211 the fruit that med been delivered to MeOlures, the balance due after DARLING ¥__AUROSA PAGKING A HIGGINS J. @@ducting the 30 fer cent already paid; they arofSbe limited to the balance due for the uneold proprotion; and the letter gqis onje "as this season's ealee have been conducted by both companies [ seciures and the defendant the returns at the end of the season vill be ppedeanated. nnd growers will receive the full mtt procecds due to thm then, Obviously these words refer, not to mre avalgamation by the pool of the grovers, but to amalgamation of the plaintiff's returns ae between the period before the 20th. Aagust and the period after; in other words, they refer to amalgamation of KeClures' sales und the company's saleg. The form of the credit note issued by the company in November 1924 for progres payments (Bkhibits G1, G2, G3) showythat the comeny treat the plaintiff as direct wrty vith the company even as to pe cht ming charges,éc. paid wn fruit sold by MeClures. Although "e are bound to give effect to the aeae used, ae they xx are Clear, 1t is reassuring to find that their meaning is quite cone esistent vith obvious business motives end probabilities. The compagl and McGlures had a common aeoretary end some coumon directors; the comany hed been acting os packing agents for MeQlures; and NcGlures being in difficulties it woe for the interest of the company thet the transsotions of MoClures as to the growers of fruit should not be mixed ur withgthe righte ef MeQlures! general creditors - either ae to fruit unsold or as to fruit sold. MeOluree went de DARLIYG ¥ AURORA PAackivG co, HIGIINS J. /idvenber into Liquidation on 2ist.ggpeyxl9e4. There is no question here of fraudulent preference of the compeny by the arrangement of eith. pugue¥p receding. voveoverpéapneara from the evidence of Wr. filkin, the comeny's secretary, (an well se secretary for ¥cClures) that the company had its eye on future business; and nothing was max wore likely to eid the company in HER nese thang to be treated by the growers an full succeecore to "cClures in the agency business as well ss in the mcking business, The promise as stated in ex. B was ade sta time yvhen the company was esger to seeure the consent of the individual growers to the transfer of the businese to the com apeny; and nothing was wore likely to secure that consent than a promise to give the srovers full satisfaction to what each grover was entitled to in respect of Hs 1924 crop, whether slready gold or in process of sale. At first I wae impressed by the gaekxk fact to which anges Fane =sons J. refers in his jadgrent thet in no part of the correspondence ie there any cugsertion by the plaintiff that he looked to the appele elant to mske good any deficiency whih might arise ae to NcOlures!ssk seles. Thies frct may not be relevant to the iseue'which re have to consider, the construction of the agreement; but it certainly should compel us to look wore closely into the language used. But even 1f the plaintiff hes not in his letters suggested thet he looke eed to the compamy to make good eny such deficiency he has m¢ said DARLING oV_ AURORA PACKING OO. i88 gs anything that ie inconsistent ith such a vier, In the same judgment it ie seid that tt is " shown by various statements [or the plaingad otire | in hia lettera Shut be repgerded the liability of the anpel- elant [tne cowpnny | ac United to the rortion of the 1924 cron BEXM which the ellent iteelf hondled ". I cannot find ony such tates a eeent in the plaintiff 's letters. The paeessge which moat nearly aopronches inxk such » statement seems to be tht at the end ef the letter of 18th. February 1926 (ex i) - * Ag regards other matcers mat mentioned in your letter, I cannot comment until seeing Mr. EEK vena, he hie wt revorte¢ in this district the result of his investigations » in the weantime, nlease forward p yment of £19/7/0 wrongly deducted t as referred to therein.* The sum of £19/ 7/0 represented woking charges,ée. which had been elready retained by McClures out of piocerde of fruit cold by them, and are now adaltted mt to be chargeable by the company ; but the apecific demand of thin eum * in the meantime " cannot in any fairness be treated eco an sdtiscion by Darling that payment of the £19/7/0 would exhaust all his cleins againet the coaeany. I conour with the opinion expressed by Angas Parsons J. that the principles for the Lnterpretition of 2 contrect laid down in Lroprietss,¢¢. of "nglish «nd Foreign Greditors ov ird@in L.A 5 BL. BO As not to be a-nlied unless and until it be shown the 6. DARLING ¥ AURORA PAQKING OO» HIGGINS J. * the offer is ambiguous, if it fairly and reasonably admite of two interpretations. " In wy opinion, the ambiguity does mt here exist. Bat, of course, if there is such an ambiguity, the principle is anpli~ cable in favour of the plaintiff. The point as to which I find my «self compelled to differ from the leraned judgee of the Supreme Court is thefpoint on which Piper J. expresses no opinion. I think that the words usédd by the company do import a promise to pay the balance which should eppear on the fianl account sles; and aa the decision in this case is likely to affect the claims of many other growers, I think it to be oy duty to state the grounds on which I base my opinion, Tn my opinion, the appeal should be allowed, and the verdict of the L¥cal Court for £43/11/3 restored.