R. C. Rickett Vs B. W. A. Ltd (1960)

LawGlobal-Hub Lead Judgement Report

HUBBARD, AG. F.J

This is an appeal by Mr. R.C. Rickett against a judgment of the High Court of the Northern Region sitting at Jos by which he was ordered to pay to the Bank of West Africa Ltd. in respect of an overdraft on a current account and interest thereon the sum of £3,871-15s-7d. That the account was overdrawn is not disputed, but the appellant denies any liability for the overdraft. The re-spondent bank has cross – appealed on the question of the interest allowed by the learned Judge.

The contentions of the parties may, I think, be briefly and correctly summarised as follows:-

1. The respondent bank states that it has at all times dealt with the appellant as its customer in respect of the account entitled “R.C. Rickett Estate of F.J. Wilson deceased” which the appellant opened on 28th May, 1955.

2. To this the appellant replies that he was not the customer of the bank, but acted solely as the agent of the beneficiaries under the intestacy of F.J. Wilson.

3. The respondent bank counters the allegation of agency by contending that as the appellant has intermeddled with the estate he is an executor de son tort, and, as such, cannot be the agent of the beneficiaries, since there can be no relationship of principal and agent between wrongdoers.

4. Finally, the appellant contends:-

(a). that since the banking contract between himself and the respondent was entered into in order to render possible and facilitate his intermeddling in the estate, and since for such intermeddling he is liable to a fine under 0.48 R.3 of the High Court Rules, the contract is illegal and unenforce-able, and also

(b). that since the respondent bank itself intermeddled by deal-ing with tin from the deceased’s tin mine, it was itself an executor de son tort, and the appellant and the respondent bank being “in pari delicto,” the bank cannot recover.

It will be convenient to deal with these contentions in the reverse order. With regard to the contention that the bank intermeddled with the tin, it ap-pears to me that this is due to a misconception of the bank’s function. The late Mr. F.J. Wilson was the proprietor of a tin mine. He ran a current ac-count with the respondent bank. The Bank was also his agent, as it was for certain other tin producers, for the purpose of arranging shipment and sale of his tin, which was physically delivered to and handled by the bank. The current account was debited with the costs of the bank’s operations on Mr. Wilson’s behalf and credited with the sums paid by purchasers of the tin. Cheques were drawn on the account for the payment of the mine wages bill. The appellant admits that the bank did nothing more in connection with the tin after Mr. Wilson’s death than it had been in the habit of doing before. It cannot be suggested that the bank was interfering in the running of the tin mine before his death, and, in my view, it cannot be said that by merely per-forming the same functions after his death it was doing any act which amounted to an intermeddling with the estate. On the day Mr. Wilson died his account with the bank was closed and the new account “R.C. Rickett Estate of F.J. Wilson” was opened. No balance from the deceased’s account was carried forward to this new account. It is possible that there might have been a technical intermeddling by the bank if it had had in its possession any tin at the time of Mr. Wilson’s death, but there is no evidence of this, nor can any inference be properly drawn from the statement of the account “R.C. Rickett Estate of F.J. Wilson deceased” (Exhibit BW8) that any sum al-ready due at the date of Mr. Wilson’s death was credited to the new account. In my view, the contention that the bank was an executor de son tort is with-out foundation.The contention that the banking contract between the parties was il-legal and unenforceable depends upon the effect of 0.48 r.3, which reads as follows:-

If any person other than the person named executor or administrator, or an officer of the Court or person authorised by the Court, takes possession of and administers or otherwise deals with the property of any such deceased person, he shall, besides the other liabilities he may incur, be liable to such fine not exceeding fifty pounds as the Court, having regard to the condition of the person so interfering with the property, and the other circumstances of the case, may think fit to impose.”

In Melliss v. Shirley Local Board (1885, 16 Q.B.D. 446, 451) Lord Esher M.R. said: “Although a statute contains no express words making void a contract which it prohibits, yet, when it inflicts a penalty for the breach of the prohibition, you must consider the whole Act as well as the particular enactment in question, and come to a decision, either from the context or the subject matter, whether the penalty is imposed with intent merely to deter persons from entering into the contract, or for the purposes of revenue, or whether it is intended that the contract shall not be entered into so as to be valid at law.” Although this passage deals with prohibited contracts, I apprehend that it is equally applicable to non-contractual acts, and ‘a fortiori’ in a case where the act is not expressly prohibited, but merely made subject to a fine. I have no hesitation in holding that the fine is imposed in 0.48, R.3 with intent merely to deter persons from intermeddling, and that the enactment does not absolutely prohibit intermeddling, which, if it did, all acts of an executor de son tort would, presumably, be void, whereas it was held as long ago as 1598 in Coulter’s Case (5 Co. Rep. 30a; 77 Eng. Rep. 98) that “all lawful acts, which an executor de son tort cloth, are good,” and it is not to be supposed that the legislature, still less a subordinate legislator (i.e., the Chief Justice of the former Supreme Court) would alter this ancient rule of the law without more express words. I am of opinion, therefore, that although the opening of the new account did assist the appellant in intermeddling in the testator’s estate and the fact that he was so intermeddling was known to the bank, the contract between the parties was valid and subject, to the question of agency, the appellant was liable on the overdraft.

The remaining questions are – was the appellant in law an executor de son tort, and did he act as agent for the beneficiaries under the intestacy of the deceased? To these questions the answers appear to me to be those given by the learned Judge. He said: “The defendant has admitted that he inter-meddled in the estate of the late Mr. F.J. Wilson; and on the evidence there is no doubt that he did. He said that he acted as agent for the beneficiaries and they ratified what he did. Each of the next of kin (who are also the be-neficiaries) knew the defendant was continuing to run the mining business of the late Mr. F.J. Wilson…… But assuming, as the defendant alleges, he ran the mining business and incurred the overdraft with the full knowledge and consent of the next of kin, what is the legal position as between the defendant and the next of kin? Mr. Wilson and Mr. W.A. Wilson by purporting to act as managers of the deceased’s mines have intermeddled in the estate. Mrs. Pidgeon by participating in the appointment and dismissal of managers has also intermeddled. The defendant has intermeddled. Each of them is an executor de son tort. It has long been settled law that the relationship of agent and principal has no application in the case of a wrongdoer (Sharland v. Mildon, 1846, 5 Hale 469; 67 Eng. Rep. 997).” 1 would point out here, with respect to the learned Judge, that the intermeddling of the beneficiaries themselves is not strictly necessary for the application of the principle to which he refers. Clearly, if the appellant himself is an executor de son tort, he can have no principal, since the principal would then also be a wrong-doer, and where they are both wrongdoers there is no agency. I am of opinion, therefore, that the learned Judge correctly found that the appellant was an executor de son tort that he was not the agent of the beneficiaries, and that he was liable on the overdraft.

The same result appears to me to follow from another line of argument, which was not raised in the Court below, but was put forward for the first time by Mr. Bentley, for the respondent bank, in this Court, namely, that an executor de son tort can be in no better a position than a legal personal representative, and a legal personal representative, apart from certain exceptions, is always personally liable on the contracts he makes. The exceptions would appear to be (1) where a personal representative has statutory authority to enter into a contract (Williams, 13th ed. 1028), and (2) where the con-sideration for the promise of the personal representative is a contract or transaction with the deceased (Farhall v. Farhall, L.R. 7 Ch. 123, 127). In other cases the authorities are clear that the personal representative is personally liable on his contracts. Farhall v. Farhall (loc. cit) is a case where an executrix kept an executorship account on which she drew cheques signed “Mary Farhall for executors of Richard Farhall.” This account was over-drawn. A decree of administration having been made, the bank claimed to prove for the overdraft. It was held that no debt was due from the estate to the bank. Sir W.M. James, L.J. said: “The contract is with the executrix; there is no loan to the estate; there is no credit given to the estate; the credit is given to the person who borrows, though the money may be borrowed for the purposes of the estate” (at p. 126.) In Labouchere v. Tupper (1857), 9 Moore, 198; 14 Eng. Rep. 670) it was held that an executor of a trader carrying on the trade after his death is personally liable for all the debts contracted in the trade after the testator’s death, whether he is entitled or not to be wholly, or to any extent, indemnified by the testator’s personal estate. On these authorities also the appellant is liable to the respondent bank for the overdraft.

I must add in fairness to the appellant that there is no suggestion that there was anything reprehensible in his carrying on the mining business as an executor de son tort. As he himself said: “I was the business manager in this country and it was my duty as I see it to do what I did, and I was acting as any other person in my position would have done.” An executor de son tort can properly do for the benefit of the estate anything which a legal personal representative can do (Williams, 13th ed. 34) and although the general rule is that a personal representative has no authority to carry on the business of the deceased (Williams, 13th ed. 1036), yet where the business is a valuable asset, he is entitled to carry it on for such reasonable time as may be necessary to enable him to sell it to the best advantage of the estate (ibid. 1037). The year 1955, in which Mr. F.J. Wilson died, was far from favourable for a sale. The appellant regarded himself as “agent for a prospective administrator,” to whose lot it would have fallen to deal with the mining concern as an asset of the estate. Why no administration had been taken out by November 1958, when this action was commenced, was not made clear in the course of these proceedings, and I do not propose to comment on the fact.

I come now to the question of the interest on the overdraft. The respondent bank appeals against the judgment under review on the ground that the learned Judge should have held that the bank was entitled to charge interest on the overdraft at the rate of 8 per cent with monthly rests. Compound interest on an overdraft is chargeable only where the customer has agreed to it or where he is shown or must be taken to have acquiesced in the account being kept on that basis (Hals. 3rd ed., 229). The learned Judge said: “There is no evidence of an express agreement between the parties that interest should be charged at this rate with monthly rests; nor is there evidence from which I can infer that the defendant acquiesced in interest being charged in this way.” The learned Judge was clearly right as to an express agreement, and, in my view, he was right also in the second fording. The appellant himself was never cross-examined as to the receipt of monthly statements, which, over a period of three and half years would, I think, have been some evidence of aquiescence, and all that the bank’s manager, Mr. Mus-grove, said, was, at one place: “Interest on overdrafts is calculated monthly and entered in the account, and shown in the monthly statement,” and at another place, in reference to certain cheques signed “J. C. Ticehurst Estate of F.J. Wilson” which the bank had cashed on the written authority of the appellant: “Statements have been sent out. No queries have been received on these cheques.” In my view, such evidence is quite insufficient to establish acquiescence.

In conclusion we should like to express to Mr. Hull, who appeared for Mr. Rickett, and to Mr. Bentley, our appreciation of the great assistance they have rendered us in dealing with this lengthy appeal.

For the reasons I have given, I would dismiss the appeal with one hundred and twenty-five guineas costs to the respondent bank and I would dismiss the cross-appeal with ten guineas cost to Mr. Rickett.

ADEMOLA, FCJ.

I concur.

BRETT, F.J.:

I concur.

Appeal Of defendant Dismissed.

Cross-appeal of plaintiff Bank dismissed.

Other Citation: (1960) LCN/0862(SC)