Practice and Procedure

C LTD & ANOR v ANAC (2003)

PUBLISHED November 5, 2003

The defendants' were entitled to rescind a contract that provided for the payment of fees and commission in respect of applications for fishing licences, which had been based upon false representations.Claim for non-payment of commission payments from an alleged partly written/partly oral contract made in May 1988 and supplemented in April 1989, and in respect of alleged breach in early 1992. The claimants alleged that a contract was concluded in 1988 between a predecessor in title of the first claimant ('P'), the second claimant, and the defendants. The claimants claimed that under the terms of the contract an individual ('X') was to assist the defendants with applications for fishing licences in the Falkland Islands and in return, a fee for X' s services was to be paid to P, and a commission in respect of successful licence applications was to be paid to P and the second defendant. There was a further agreement in 1989 that X would assist the first defendant ('ANAC') with future applications for fishing licences in the Falkland Islands, with a commission being paid to X by way of a percentage of the fish caught under any licence that he helped to secure. In this case it was agreed that X would be paid through P, the commission being for 1.25 per cent of catches. It was also proposed by X, and eventually agreed, that a further commission of 1.5 per cent of catches would be paid to the second defendant, with the sums then being divided equally between X and Y of a third party. In 1992 the defendants terminated all contracts on the basis that X had committed fraud.HELD: The defendants were entitled to rescind the contract. There had on the facts been no contract between the second claimant and the defendants but between X personally and the defendants. X had on the evidence made false representations. The commission agreements were so closely linked that the defendants were entitled to rescind in respect of both X and the first claimant. Further, if the false representation had not been made, ANAC would not have entered into the contract and was entitled to such damages as would return it to the financial position that it was in before the contract was made.Judgment accordingly.