PART III.
ACTS.

CAP. VIII.

Part III.-ACTS.

CHAPTER VIII.

CONTRACTS.

INASMUCH as the greater part of the contracts entered into in the transaction of the ordinary business of life relate more or less directly to property, of one kind or another, it has been necessary in the course of the preceding pages, while speaking of the operation of local and foreign laws upon movable and immovable property, to refer more than once to the relation to the same laws of the contracts by which such property is dealt with, and to show that the operation of those contracts is often modified and governed by the effect of the lex situs upon the subject-matter with which they are concerned. The necessity of treating of the rights and capacities of persons has similarly given rise to a discussion, which would otherwise have been premature, of the effect which such strictly personal qualifications have upon the contracts into which the persons enter. It is nevertheless possible, theoretically speaking, to consider the subject of contracts by itself, abstracting them in theory from the persons who make them and the property which they concern. In practice it will no doubt frequently be found that the law of persons, and the law of property, arise either singly or together to compete with the law of contracts for the ultimate decision of the particular case which is the subject of inquiry; but this is a difficulty which is not confined to private international jurisprudence, and occurs with equal frequency in the investigation of ordinary municipal law. But the inevitable result must be, that just as, in the consideration of

PART III.

Acts.

the claims of English law to regulate things and persons, it was not practicable to escape entirely from its operation upon contracts, so in the discussion of contract, it will CAP. VIII. be impossible uniformly to ignore the law of persons and things.

In considering the jurisdiction assumed by English law over contracts, and the extent of its right to determine. and define those which come before it, the following factors must be regarded as important: (i.) The place where the contract was made, or the locus contractus celebrationis ; (ii) the place where the contract is to be or was to be performed, or the locus solutionis; (iii.) the situs, or situation of the property which it is intended by the contracting parties to affect; (iv.) the status of the contracting parties themselves; and (v.) the operation of the lex fori upon the remedy which the litigants seek to obtain from the English Court. The questions of situs rei and status personæ have already been discussed, and the whole subject of remedies will be considered when treating of Procedure; (a) but it will not be practicable to keep the consideration of contract law as a whole entirely distinct from these last-mentioned branches of the subject. It is proposed to treat here of contracts from their inception to their enforcement according to the natural order in which the difficulties arising from the subject present themselves.

(i.) Jurisdiction as to Contracts.

It is not proposed to enter into the questions of jurisdiction which are peculiar to Roman jurisprudence and to the systems of those countries which are derived from the civil law. The distinctions between the forum rei, the forum domicilii, the forum actoris, the forum rei sita, the forum rei gestæ, and the forum rei solvenda are of little. practical importance to the English lawyer,(b) whose object it is to inquire simply how far the statutory and common

(a) Infrà, Chap. X.

(b) They may be found discussed in Story, §§ 532-538; Westlake, p. 83, p. 104; J. Voet, Pandect., tom. i. lib. 5, § 77, seq.

ContractsJurisdiction.

PART III. law powers of his own Courts extend, and over what matters they will assume and maintain jurisdiction.

ACTS.

CAP. VIII.

Rules of

venue.

The element of the English Common Law, which as a Contracts matter of fact prevented these questions from ever arising Jurisdiction. in its administration, was the technical rule of venue, which divided all actions into two exhaustive classes, local and transitory. Local actions were those connected in any way with the soil, which it was always necessary to bring in the country where the cause of action arose, and the distinction arose in the following way. By the old Common Law the jurors were to be summoned from the particular place or neighbourhood (vicinetum, visne) where the facts happened, it being then thought highly desirable that they should be cognizant of their own knowledge,(a) apart from the evidence, of the matters in dispute. It was therefore necessary, for the guidance of the sheriff in executing the writ of venire facias, that the pleadings should show what the place or neighbourhood was,(b) and the term "laying the venue" was given to the required allegation. But in course of time the jury began to be summoned no longer as witnesses, but as judges, to receive the facts from the testimony of others judicially examined before them, (c) and the necessity of their being summoned from the vicinctum where the facts occurred-in other words, the necessity for that reason of the venue being truly laid-ceased. It was from this time that the distinction between local and transitory actions began; the former including all matters necessarily involving the idea of a certain place or part of the soil, the latter those which affected the person, or the movables which follow the person, and which might therefore have happened anywhere. With regard to local actions, it was held that if the venue alleged in the margin of the pleadings was untruly laid—i.e., if on trial the action appeared to be connected with the soil of some place outside the county

(a) Co. Litt. by Harg. 125 a, n. (1).

(b) Ilderton v. Ilderton, 2 H. Bl. 161; Co. Litt. 125 a,
(c) Stephen on Pleading, 7th ed. p. 235.

b.

PART III.
Аств.

Contracts

of the venue as laid-the variance was fatal, and the plaintiff failed. If, on the other hand, the facts of the action were transitory-i.e., such as might have occurred CAP. VIII. anywhere-the fact that the venue, as laid, was not the place where they were actually proved to have happened, Jurisdiction. was immaterial.(a) The consequence was that any contract, not directly connected with the soil, could be sued on in an English court without regard to the place where it arose or was to be performed, if the defendant could be only rendered amenable to the court's process, and service could be effected upon him according to its regulations.

Common Law

The former practice of the Common Law and Chancery Courts differed in several essential points. At common law, personal service within the realm was necessary until 1852. The Common Law Procedure Act of that year Effect of permitted service abroad (except in Scotland or Ireland) Procedure in actions against both British subjects (s. 18) and Acts. foreigners (b) (s. 19), when there was a cause of action which arose within the jurisdiction, or in respect of the breach of a contract made within the jurisdiction; and the Court or a judge, on being satisfied by affidavit of these facts, and that reasonable efforts were made to effect service of the writ, which had come to the defendant's knowledge, were empowered to dispense with service. altogether.(c) It will be seen that the limitation confining this statutory power to cases in which there was a cause of action which arose within the jurisdiction, or in respect of a breach of a contract made within the jurisdiction, may be construed in two ways: first, as confining the statutory power in respect of actions on contract to cases where the contract was made within the jurisdiction; and secondly, as including cases where the contract was made abroad, but the breach took place in England-this second construction regarding the breach of a contract as cause

(a) Mostyn v. Fabrigas, 1 Sm. L. C. 607, and cases cited in note. So for torts to realty abroad, no action lay in England; secus, as to personal wrongs, Skinner v. East India Co., cited in Cowper, 167, 168.

(b) Foreigners resident in Scotland or Ireland might be served there, though British subjects were exempt: Day's C. L. P. Acts, p. 58, n. (c) Binet v. Picot, 28 L. J. Ex. 244.

Астэ.

Contracts

PART III of action" within the meaning of the first part of the limitation. Upon this question the Courts at Westminster CAP. VIII. at first held divided views; the Queen's Bench adhering to the view that it was insufficient that the breach of a Jurisdiction. contract should take place within the jurisdiction, if the contract itself was made abroad, (a) while the Courts of Common Pleas and Exchequer acted upon the opposite construction.(b) In consequence of these conflicting decisions a conference of the judges was ultimately held upon the subject, and the view taken by the Court of Common Pleas in Jackson v. Spittall was accepted as binding once for all; (c) so that according to this, the latest authority, a plaintiff was entitled under the Common Law Procedure Act, 1852, to serve the defendant abroad, if he could show that the contract was either made or broken within the jurisdiction.

The subject, however, is now regulated by Order XI. rr. 1-7, of the Rules made under the Judicature Acts, 1873, 1875, which is intended by the Legislature to be exhaustive, and to supersede the former practice.(d) By r. 1 service out of the jurisdiction may be ordered wherever (inter alia) "the action is founded on any breach or alleged breach within the jurisdiction of any contract, wherever made, which, according to the terms thereof, ought to be performed within the jurisdiction, unless the defendant is domiciled or ordinarily resident in Scotland or Ireland." Under this rule the breach is the only essential; and it has been held that an order was rightly made limiting the plaintiff's right of action after service was effected to the subject-matter in respect of which the writ could be properly served under this rule.(e) The rule is therefore one dealing with jurisdiction, not with procedure. There

(a) Allhusen v. Malgarejo, L. R. 3 Q. B. 340; Cherry v. Thompson, L. R. 7 Q. B. 573; and see Sichel v. Borch, 2 H. & C. 954.

(b) Jackson v. Spittall, L. R. 5 C. P. 542 ; Durham v. Spence, L. R. 6 Ex. 46; Vaughan v. Weldon, L. R. 10 C. P. 48.

(c) Vaughan v. Weldon, L. R. 10 C. P. 48.

(d) Re Eager, 22 Ch. D. 86; Supreme Court Rules, 1883, Order XI. r. 1 (e). (e) Thomas v. Duchess of Hamilton, 17 Q. B. D. 592. Cf. Harris v. Fleming, 13 Ch. D. 208.