c. 125.(a) The affidavit upon which the motion was founded stated that the action was brought in respect of matters which were by the contract agreed to be referred to arbitration, and the only matters in question in this cause were, the quality of the seed, and the *amount of the allowance (if any) to be made to the plaintiffs for the alleged [*572 inferiority of the said seed; that no sufficient reason existed why such matters could not or ought not to be referred to arbitration in the manner provided for by the contract; that the defendants before and at the time of the commencement of the action were and always had been desirous and ready and willing to refer all disputes arising out of the said contract to arbitration in the manner provided for in the contract, and to join and concur in all acts necessary and proper for causing such matters so to be decided by arbitration; and that the well-known and usual mode of arbitration was, for each party to name a colonial broker or other competent referee, and for the two referees thus named to appoint another colonial broker or other competent person as third referee, or umpire. [COCKBURN, C. J.-There being a suggestion of fraud, ought not the matter to be submitted to a jury?] If there had been a bonâ fide suggestion of fraud as between the parties to the contract, the court would not interfere: see Wallis v. Hirsch, 1 C. B. N. S. 316 (E. C. L. R. vol. 87). But no fraud is charged here; merely a breach of contract. Fraud is imputed only to the shippers of the seed.

H. James, at the call of the court, showed cause, upon an affidavit which stated, that, about four or five weeks before the arrival of the seed in this country, Mr. Page, of the firm of Laing & Campbell, through whom the contract was made, told the plaintiffs that he (Page) had been informed by one of the defendants that they were afraid that the sessame seed would not be white, but mixed, but requested them not to take any notice of such information until its arrival; that, in June, 1857, the defendants offered to deliver to the plaintiffs shipping documents of 4906

bags of sessame *seed ex 'Bombay,' which the defendants repre- [*573

sented to consist of white Bombay sessame seed of the quality described in the said contract, whereupon the plaintiffs paid the defendants the sum of 5365l. 108., being the amount of the invoice delivered by the defendants in respect of the goods comprised in the said shipping documents; that, upon examination of the said seed, the plaintiffs found that it was not white Bombay sessame seed, but was mixed in so large a proportion with black and brown sessame seed and dirt as to be quite a

(a) Which enacts, that, "whenever the parties to any deed or instrument in writing to be hereafter made or executed, or any of them, shall agree that any then existing or future differences between them or any of them shall be referred to arbitration, and any one or more of the parties so agreeing, or any person or persons claiming through or under him or them, shall nevertheless commence any action at law or suit in equity against the other party or parties, or any of them, or against any person or persons claiming through or under him or them in respect of the matters so agreed to be referred, or any of them, it shall be lawful for the court in which [such] action or suit is brought, or a judge thereof, on application by the defendant or defendants, or any of them, after appearance and before plea or answer, upon being satisfied that no sufficient reason exists why such matters cannot be or ought not to be referred to arbitration according to such agreement as aforesaid, and that the defendant was at the time of the bringing of such action or suit and still is ready and willing to join and concur in all acts necessary and proper for causing such matters so to be decided by arbitration, to make a rule or order staying all proceedings in such action or suit, on such terms as to costs and otherwise as to such court or judge may seem fit; Provided always that any such rule or order may at any time afterwards be discharged or varied as justice may require."

different article, and useless to the plaintiffs for the purposes for which they bought it; and that the plaintiffs verily believed, that, at the time the defendants so as aforesaid invoiced the said goods to them, and represented the same to be in accordance with the contract, they, the defendants, knew that the same was not white Bombay sessame seed. James submitted that this would be a very inconvenient case to refer. [COCKBURN, C. J.-Why, then, did you so agree?] The court has a discretion: and, from the frame of the declaration, it is manifest that difficult questions may arise as to the plaintiff's claim for damages, involving the principle in Hadley v. Baxendale, 9 Exch. 341.† [COCKBURN, C. J.-Is there anything in the affidavits to show that the defective quality of the seed was not discernible whilst it existed in specie and before it was converted into a new substance?] There is not; but the declaration so avers. Colonial brokers may be very proper persons to judge of the quality of seed; but may not be very fit to refer a question such as is likely to arise here to. [COCKBURN, C. J.-If it were clear that the inferiority of the quality of the seed was not discovered by the plaintiffs until after it had been converted into oil, there would be much weight in your argument, because a party might well be content to refer a dispute as to the quality of an article in its *natural

*574] state, to one with whose judgment of the thing in its manufactured

state, he would not be satisfied. But here you state that the objection was brought to your notice while the subject-matter of the contract still remained in specic. I cannot see that any injustice will be done by carrying out the agreement which the parties have entered into.] At all events, the court will not in the exercise of its discretion enforce a reference, where the inquiry involves a charge of fraud. It was upon that ground the court discharged the rule in Wallis v. Hirsch, 1 C. B. N. S. 316 (E. C. L. R. vol. 87). [COCKBURN, C. J.-There it was distinctly brought to the notice of the court that the plaintiffs meant to charge fraud. BYLES, J.-In that case there was a count for money had and received, under which the plaintiffs sought to recover back the money which they had paid, on the ground of fraud.]

COCKBURN, C. J.-I am of opinion that the rule should be absolute. The contract upon which the action is brought contains a clause whereby it is provided that any dispute arising thereout shall be settled in London by the usual mode of arbitration, that is, by colonial brokers. The contract relates to a parcel of sessame seed: and the ground upon which it is suggested that the court ought not to act upon the power conferred upon it by the 11th section of the Common Law Procedure Act, 1854, is, that, before the vendees ascertained the defective quality of the seed, they had converted a considerable portion of it into oil, and therefore it is contended, that, although the parties to whom it had been agreed to refer any dispute that might arise out of the contract, might be perfectly conversant with the quality and value of the article in the state in which it was contracted to be sold, they might not be so well acquainted with *575] the quality and *value of the article into which it has been converted. It may be, that, if the whole of the seed in question. had been converted into oil, there might have been great weight and cogency in the argument founded upon that suggestion. But Mr. James has been constrained to admit that there still remains a portion of the cargo which has not been so converted into oil, but which is still in the

form of seed: and there is nothing upon the affidavits to satisfy us that the brokers would not be perfectly capable of judging of the whole parcel by that which remains. The parties having, therefore, by their contract expressly agreed to withdraw all disputes and differences arising out of the contract from the ordinary tribunals, and to refer them to a tribunal specially selected by themselves, we ought to give effect to that agreement unless we are satisfied that the circumstances are so altered that justice cannot be done by carrying out the original intention of the parties. So far from thinking that such is the case here, I see no reason whatever for supposing that the brokers would not be perfectly capable of arriving at a correct decision, so that justice may be done in the manner agreed upon by the contracting parties. The only other point for consideration, is, whether a question of fraud is raised here, so as to make the matter more fit to be determined by a jury. But it does not appear upon the declaration that any question of fraud can arise directly or indirectly. And that distinguishes this case from Wallis v. Hirsch, 1 C. B. N. S. 316. I think the rule should be absolute, but without costs.

The rest of the court concurring,

Rule absolute, without costs..

*FREND and Another v. DENNETT. June 9.

[*576

By the 85th section of the Public Health Act, 11 & 12 Vict. c. 63, it is, amongst other things, enacted that "the local board of health may enter into all such contracts as may be necessary for carrying the act into execution; and every such contract, whereof the value or amount shall exceed 107., shall be in writing, and sealed with the seal of the local board," &c. :— Held, that a contract which did not comply with this condition is not capable of being. enforced.

THIS was an action brought by the plaintiffs, Messrs. Frend & Hamill, contractors, against the defendant as clerk to the local board of health of the town of Worthing, a non-corporate district,-to recover the price of certain works done by them for the board.

The first count of the declaration stated, that, by certain articles of agreement duly made and entered into by and between the plaintiffs of the one part, and the said local board of health of the other part, the plaintiffs did covenant and agree with the said local board to build, erect, construct, and complete for the said local board a water-tower, engine and boiler-house, chimney, coal-store, fitting-shop, and all other works that should be required by the said local board, and expressed in a certain specification, and as shown in certain drawings, and according to the same and certain plans and sections, at and for the respective sums of 17617. and 955l., and also to execute and perform all such additional works thereto as might be required by the said local board; and the said local board did thereby covenant and agree with the plaintiffs, that they the said local board would pay or cause to be paid unto the plaintiffs the said several sums of 17617. and 955l. for the building, erecting, constructing, and completing the said water-tower, engine and boilerhouse, chimney, coal-store, fitting-house, and other works as expressed in the said specification, and shown in the said drawings, plans, and VOL. IV.-23

sections, and would also pay or cause to be paid to the plaintiffs all such further sums (if any) as should become justly due or payable to the plaintiffs for or in respect of additional works, in accordance with the said specification, at certain times, *and according to a certain *577] scale, and in manner then agreed upon between the said local board and the plaintiffs: Averment, that the plaintiffs did build, erect, construct, and complete the said water-tower, engine and boiler-house, coal-store, and fitting-shop, and all such other works as were required by the said local board, and expressed and shown in the said specification and drawings, and according to the same and the said plans and sections, and did also execute divers additional works thereto which were required by the said local board; that, at the time of the commencement of this suit, a large sum of money, to wit, 3007., had become and was justly due and payable to the plaintiffs from the said local board for and in respect of such additional works, and in accordance with the said specification and the said covenant and agreement of the said local board; and that, although the said local board did pay to the plaintiffs the said sums of 17617. and 9557. for and in respect of the building, erecting, constructing, and completing the said water-tower, engine and boiler-house, chimney, coal-store, fitting-shop, and such other works as were expressed in the said specification, and shown in the said drawings, plans, and sections, and although the plaintiffs had done all things, and all things had happened and occurred, and all conditions precedent had been performed and fulfilled, and all necessary times had elapsed, to entitle the plaintiffs to be paid by and to receive from the said local board the said sum of money for or in respect of such additional works as aforesaid, yet the said local board had not at any time paid the same, or any part thereof.

The second count stated, that the said local board retained and employed the plaintiffs to do, execute, and perform for them the said local board certain sewerage and drainage works as mentioned and expressed *578] *in a certain specification; that the said local board did thereupon contract and agree to and with the plaintiffs to pay them for the same at and after certain rates thereupon agreed upon between them the plaintiffs and the said local board; that the said local board did also then contract and agree with the plaintiffs to pay them in cash for the first 500l. worth of such work, subject to a certain deduction, and also that, in case they the said board did not pay in cash for the work executed in excess of the said 500l., they would give to the plaintiffs at the end of each month a bond or negotiable security for the amount of work executed during the month, for periods expiring five years from the date of such document, bearing interest at 51. per cent.; and that the said local board did also then contract and agree with the plaintiffs, that certain then-existing sewers should be kept clear of water by the board: Averment, that the plaintiffs did execute and perform such sewerage and drainage works for the said local board, and that the price and value of the same much exceeded the sum of 500l., and that, although the said local board did pay to the plaintiffs in cash for the first 500l. worth of such work, yet, at the time of the commencement of this suit, there was, and still remained, justly due and owing from the said local board to the plaintiffs, beyond and in excess of the said sum of 5007., a large sum of money, to wit, 8001., for and on account of such

works; and that, although the plaintiffs had done all things, and all things had happened and occurred, and all conditions precedent had been performed and fulfilled, and all necessary times had elapsed, to entitle the plaintiffs to be paid the said last-mentioned sum of money, either in cash or by such bonds or securities as aforesaid, yet the said local board had not paid the same in manner aforesaid or otherwise howsoever; and further, that the said *local board did not nor would keep the [*579 said existing sewers clear of water according to their said contract and agreement, but wholly omitted so to do, by means whereof the plaintiffs were not only greatly hindered and impeded in performing and executing the said sewerage and drainage works, but also thereby the same were rendered much more difficult of execution, and the plaintiffs were put to and incurred much additional expense, labour, and trouble in executing the same than they would otherwise have incurred, and were forced and compelled to and did necessarily leave on the said works so executed by them divers large quantities of timber and other materials of great value, and which would not have been necessary if the said existing sewers had been kept clear of water by the said board according to their said contract and agreement.

There was also a count for money payable by the board to the plaintiffs for work done and materials provided by the plaintiffs for the said local board, and at their request.

The defendants pleaded a great number of pleas to each count, and amongst them a plea that they did not covenant and agree as alleged.

The cause was tried before Willes, J., at the sittings in London after Hilary Term last, when a verdict was found for the plaintiffs, subject to leave reserved to the defendants to move to enter the verdict for them upon certain points of law, one of which was, that the contract, being for a sum exceeding 107., and not being under seal, was void by the 85th section of the Public Health Act, 11 & 12 Vict. c. 63.

That section enacts "that the local board of health may enter into all such contracts as may be necessary for carrying this act into execution; and every such contract, whereof the value or amount shall exceed 107., *shall be in writing, and (in the case of a non-corporate district) [*580 sealed with the seal of the local board by whom the same is entered into, and signed by five or more members thereof, and (in the case of a corporate district) sealed with the common seal; and shall specify the work, materials, matters, or things to be furnished, had, or done, the price to be paid, and the time or times within which the contract is to be performed; and shall fix and specify some pecuniary penalty to be paid in case the terms of the contract are not duly performed; and every contract so entered into, and duly executed by the other parties thereto, shall be binding on the local board by whom the same is executed, and their successors, and upon all other parties thereto, and their executors, administrators, successors, or assigns, to all intents and purposes: Provided always, that the said local board may compound with any contractor or other person in respect of any penalty incurred by reason of the non-performance of any contract entered into as aforesaid, whether such penalty be mentioned in any such contract or in any bond or otherwise, for such sums of money or other recompense as to such local board may seem proper: Provided also, that, before contracting for the execution of any works under the provisions of this act, the