[DIVISIONAL COURT]

PEARCE v. BRAIN.

Infant - Contract - Void Agreement - Exchange of Chattels - Consideration - Infants Relief Act, 1874 (37 & 38 Vict. c. 62), s. 1.

A contract for the exchange of chattels entered into by an infant is a contract for goods supplied and (if not for necessaries) is absolutely void under the Infants Relief Act, 1894, s. 1. But an action by an infant plaintiff for the recovery of a specific chattel transferred to the defendant under such a contract will not succeed, unless the plaintiff can show a total failure of consideration. The same principles apply in such an action as in an action for the recovery of money paid under a void agreement.

Valentini v. Canali (1889) 24 Q. B. D. 166 followed.

APPEAL from Clerkenwell County Court.

The plaintiff, an infant suing by his next friend, brought this action in the county court for the recovery of a motorcycle and side-car or in the alternative for their value on the ground that the contract under which he delivered the motor-cycle to the defendant was void under the Infants Relief Act, 1874, or in the alternative was voidable and had been avoided by him.

The contract in question was made on February 10, 1928, when the plaintiff exchanged his motor-cycle and side-car for a second-hand motor-car belonging to the defendant. For the purpose of the transaction it was agreed that each vehicle was of the value of 30l.

The plaintiff took possession of the car and drove it away, handing over his motor-cycle to the defendant.

On February 14, 1928, after being driven by the plaintiff for about 70 miles in all, the car broke down owing to a defect in the back axle. On February 16, 1928, the plaintiff wrote

repudiating the contract on the ground that he was an infant when he entered into the contract.

He claimed the return of the motor-cycle and offered to return the damaged car to the defendant. The defendant refused, and the plaintiff then brought this action in the county court, which was tried at Clerkenwell by a judge and jury. The jury found that the car was not a "necessary" for the plaintiff, that the defendant gave no warranty as to the car and that it was worth 15l. only, but that the motorcycle and side-car was worth 30l. It was admitted by the plaintiff that the defendant had acted in good faith.

The county court judge held that the contract was one of exchange and not, as the plaintiff alleged, a sale of the motor-cycle for 30l. with a sale of the car by the defendant for 30l.; that it was void under the Infants Relief Act, 1874, s. 1, but that as the plaintiff had enjoyed the benefit of the contract he was not entitled to recover the consideration which he had given: Valentini v. Canali. (1)

The plaintiff appealed from this decision, the material grounds of appeal being that the county court judge was wrong in law in holding (1.) that notwithstanding the proved inadequacy of the consideration the contract was for the benefit of the infant so as to disentitle him to the protection of the Infants Relief Act, 1874; (2.) that notwithstanding the defect in the rear axle of the car at the time of the contract, the plaintiff by using the car on five days without knowledge of the defect took benefit under the contract so as to deprive him of the protection of the Act; (3.) that the inability of the plaintiff to return the car in the same condition as at the contract disentitled him to the protection of the Act, although the defect causing the inability was in existence at the time of the contract.

R. J. White for the plaintiff. This transaction was void under the Infants Relief Act, 1874, s. 1, as being a contract for "goods supplied." No property passed under the contract, and the effect is that the defendant holds the cycle or its value to the use of the plaintiff. Had the claim in Valentini v.

(1) 24 Q. B. D. 166.

Canali (1) been put upon this ground, instead of on the ground of a total failure of consideration, it might have succeeded. The plaintiff here has not derived any pecuniary advantage from the contract and is entitled to succeed as on a void contract.

The effect of the proviso to s. 1 of the Act of 1874 is that contracts for the supply of goods to an infant are void, if apart from the Act they would have been voidable. If, however, it is held that the contract was not void but was voidable, the circumstances as at the date of the contract alone must be considered. If at that date the contract would, apart from the Act, have been voidable it was void, and subsequent events could not make it valid. The plaintiff was taking a car of 15l. value in exchange for a cycle of 30l. value, which cannot be regarded as a contract for his benefit.

In Steinberg v. Scala (Leeds), Ld. (2), an infant sought to recover money paid to a company upon an allotment of shares to her, but failed because she could not show a total failure of consideration. That case was not within the Act of 1874, and so the Court was dealing with a voidable and not a void contract; but even there Lord Sterndale M.R. in his judgment is careful to distinguish between the right to rescind (which is here claimed) and the right to recover money paid under it, which was there in issue. He cites Turner L.J. in Ex parte Taylor (3) as saying: "It is clear that an infant cannot be absolutely bound by a contract entered into during his minority. He must have a right upon his attaining his majority to elect whether he will adopt the contract or not. It is, however, a different question whether if an infant pays money on the footing of a contract, he can afterwards recover it back." "That," says Lord Sterndale, is "only stating in other words the principle which is laid down in a number of other cases that, although the contract may be rescinded the money paid cannot be recovered back unless there has been an entire failure of the consideration for which the money has been paid." (2) Here it is rescission which the plaintiff claims.

(1) 24 Q. B. D. 166.

(2) [1923] 2 Ch. 452, 458, 462.

(3) (1856) 8 D. M. & G. 254, 257, 258.

Alexander Anderson for the defendant. This transaction does not differ from a contract for sale of a chattel. Unless the plaintiff can show a total failure of consideration he cannot recover. In Steinberg v. Scala (Leeds), Ld. (1), Warrington L.J. said: "In the case of an infant plaintiff seeking to recover money paid, the question is not whether the infant has derived any real advantage from the contract. I cannot see myself, in the case of an action to recover money actually paid, any difference between the position of an infant and an adult, and an adult can only recover money actually paid if there has been a total failure of consideration." There has been no such total failure here. On the contrary, prior to the breakdown the infant had enjoyed and driven the car. That being so, he cannot recover money paid: Valentini v. Canali. (2) The contract here was a contract of exchange of chattels and not for the sale of chattels; but the principle must be the same, although there is no authority to that effect.

R. J. White in reply. Whether the contract was void or voidable the plaintiff here is entitled to recover the cycle. Valentini v. Canali (2) may have been wrongly decided, but whether this is so or not, it is distinguishable from the present case. For here the claim is for the return of a chattel which can be earmarked. This claim is distinct from a claim for the recovery of money, brought as on a total failure of consideration.

SWIFT J. [after stating the facts continued:] The only point left is the contention of the plaintiff that, as he was an infant at the time the contract was entered into, the contract was rendered void by s. 1 of the Infants Relief Act, 1874. It was said that the property in the motor bicycle never passed from the plaintiff to the defendant and that the plaintiff was entitled to have it back by virtue of s. 1 of the Act, which provided: "All contracts, whether by specialty or by simple contract, henceforth entered into by infants for the repayment of money lent or to be lent, or for goods

(1) [1923] 2 Ch. 452, 458, 462.

(2) 24 Q. B. D. 166.

supplied or to be supplied (other than contracts for necessaries), and all accounts stated with infants, shall be absolutely void: Provided always, that this enactment shall not invalidate any contract into which an infant may, by any existing or future statute, or by the rules of common law or equity, enter, except such as now by law are voidable."

In his able argument counsel for the plaintiff contended that the transaction was one which was void under that section, and that therefore the plaintiff had never ceased to be the owner of the motor bicycle and was entitled to have it back. I am quite clear that the transaction was, as the county court judge has found, a contract of exchange of goods. But it comes within the words "goods supplied or to be supplied," which are as much applicable to exchange as to sale.

If I were at liberty to decide this case without authority, I should be inclined to accept the argument for the plaintiff and decide that the contract being by way of exchange it was void under the Act and that no property passed. (1) But I cannot see any difference in principle between the recovery of a chattel given in exchange and the recovery of money paid as the purchase price of goods. If the contract were void by statute I should have thought, apart from authority, that money paid could have been recovered as money had and received to the use of an infant plaintiff. Money paid under a merely voidable contract is in a very different position. But there is direct authority that money paid under a void contract cannot be recovered unless there is a total failure of consideration. In Valentini v. Canali (2), which was decided by Lord Coleridge C.J. and Bowen L.J. sitting as a Divisional Court, Lord Coleridge said: "The construction which has been contended for on behalf of the plaintiff would involve a violation of natural justice. When an infant has paid for something and has consumed or used it, it is contrary to natural justice that he should recover back the money which he has paid. Here the infant

(1) [See contra Stocks v. Wilson [1913] 2 K. B. 235. - F. P.]

(2) 24 Q. B. D. 166, 167.

plaintiff who claimed to recover back the money which he had paid to the defendant had had the use of a quantity of furniture for some months. He could not give back this benefit or replace the defendant in the position in which he was before the contract. The object of the statute would seem to have been to restore the law for the protection of infants upon which judicial decisions were considered to have imposed qualifications. The legislature never intended in making provisions for this purpose to sanction a cruel injustice."

That case the county court judge treated as binding on him and adopted as the basis of his decision. He came to the conclusion that the plaintiff had had the benefit of the contract and that, although he had not had everything which he expected to get, there was not a total failure of consideration.

In view of Valentini v. Canali (1) I think his decision was right. I cannot distinguish between the recovery of a specific chattel under a void contract and the recovery of money. If the latter cannot be recovered, neither can the former. In order to succeed here it was incumbent on the plaintiff to show a complete failure of consideration; this he has failed to do, and in my view the decision of the county court judge was right and the appeal must be dismissed.

ACTON J. I agree.

Solicitors for plaintiff: Daphnes.

Solicitors for defendant: Swepstone, Stone, Barber & Ellis.

(1) 24 Q. B. D. 166, 167.

F. P. F.