The Gazette 1967/71

Cheque as Valuable Consideration The plaintiff agreed to lend £1650 to H., a friend of his provided that H. arranged for the de fendant to draw a cheque for £1655 in the plaintiff's favour, and for that cheque to be in the plaintiff's possession before the cheque, which the plaintiff would draw in favour of H. was presented for payment. On July 22, 1960 (a Friday) the plaintiff gave H. a cheque for £1650, which H. presented for payment, but the plaintiff told the bank manager to stop payment on it until authorised by him. On July 26th, H. ob tained a cheque for £1655 from the defendant in favour of the plaintiff, and the plaintiff then authorised the bank to pay H. the cheque for £1650. Meanwhile, H. gave the defendant his own cheque for £1655, but this was dishonoured. When the plaintiff presented the defendant's cheque for £1650 for payment, this cheque also was dishonoured. So the plaintiff sued the de fendant on the cheque and claimed that under the Bills of Exchange Act 1882, s.27(2), he was "a holder for value as regards the acceptor and all parties to the Bill who became parties" before value was given for the bill. The defendant con tended that the plaintiff was not a holder for value because no valuable consideration had passed directly between the plaintiff and the de fendant. It was held by the Court of Appeal (consisting of Danckwerts, Diplock and Sachs, L.JJ.) on March 12th 1968 that the action succeeded. There was nothing in s.27 sub section (2) of the Act of 1882 which required that the value should have been given directly by the holder (i.e. the plaintiff) to the drawer (i.e. the defendant) so long as value had been given. Consideration had been given by the plaintiff to H. for the cheque and as a result the plaintiff acquired possession of the cheque and so became a "holder" of it within s.2 of the Act of 1882 and accordingly the plaintiff was a holder for value. (Diamond v. Graham [1968] 2 All E.R. 909 Law Journal, vol. 118, No. 5346, p. 660) Sale of Goods : undisclosed foreign principal An undisclosed foreign principal can under the law merchant sue and be sued on a contract negotiated with English sellers by English agents. But where the foreign buyer buys goods by des cription for re-sale in the markets of his own country which he knows, but which the seller does not know, it is not to be inferred that the buyer is relying on the sellers skill and judgment 56

Horseplay at School At a mixed school of 900 pupils between 11 and 18, a physical education instructor placed a 9- foot length of discarded elastic 'rope' (from a type of trampoline) neatly coiled in the bottom of an open, low-lying waste paper bin in a loggia where pupils congregated near the playground. The fol lowing morning at the beginning of a 20 minute school break the elastic was taken from the bin by some younger children and used in horseplay by them and older boys from some 7 or 8 minutes until one end of the elastic rope stuck the eye of a bystanding pupil so that he suffered, in effect, loss of its vision. He brought an action for damages for negligence against the authority responsible for the school, contending that they should have foreseen that, by leaving the elastic in the bin, some injury might be done to pupils at the school, and that if sufficient supervision had been exercised the horseplay would have been stopped before the accident happened. The general standard of discipline at the school was high, and 2 members of the staff on supervisory duty during the break, who were, as normal, en gaged for about the first 10 minutes in seeing that trie school buildings were clear of pupils, were assisted in maintaining discipline by 12 senior pupils. It was held that the standard of duty of care of a school-master which a reasonably careful and prudent father would take of his own children was helpful in considering individual instructions to individual children in a school, but when app lied to an incident of horseplay in a school of 900 pupils was somewhat unrealistic if not un helpful. In the context of the action the school master's duty, bearing in mind the known pro pensities of boys or girls between the ages of 11 and 18, was to take all reasonable and proper steps to prevent any of the pupils under his care from suffering injury from inanimate objects, from the actions of their fellow pupils, or from a combination of the two. The standard was high. Since the elastic was attractive to youngsters and the possibility was foreseeable that some physical injury might be caused by horse-play with it, the defendants were liable for major unforeseen in jury. Had the system of supervision been working properly and the horseplay had been stopped within 2 or 3 minutes of its inception by the younger boys, the accident would not have oc- cured. The defendants had fallen short of the high standard demanded of them. Judgment for the plaintiff. (Beaumont v. Surrey County Council. 112. S.J. 704).