Cutter Vs Powell (1795) 6 TR 320
Facts
Mr. Cutter, a sailor was hired by one Mr. Powell to sail as a second mate in the said ship from Kingston, Jamaica to Liverpool, London. Cutter was given a promissory note by his employer that ten days after the voyage reaches the agreed destination, that is when the ship reaches Liverpool, he shall receive 30 guineas as a consideration for his services. As agreed by both the party the voyage which was supposed to be of 10 weeks started, unfortunately, Mr. Cutter died in the Sixth Week of the voyage and failed to complete his side of the bargain. Powell refused to pay any consideration to Cutter’s wife based on the belief that the said contract was an express contract and any delivery of consideration required full performance and not past performance.
Issue
- Did Mr. Powell owe any wages to Sailor under the Contract Act?
- Was the deceased’s wife entitled to the sailor’s wages on the principle of Quantum Meriut?
- When can a contract be termed as substantially performed?
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Rule
- The above case was decided in the Court of King’s Bench that was majorly governed by the common law principles.
- Common law principles of Contract Law were applied acknowledging the arrangement between the parties to the contract.
- A Common Law Doctrine that “Entire Consideration cannot be apportioned”
Judgement
The court stipulated that the agreed terms of the contract were conditional in nature and absolute in existence. It never specified any remunerations based upon partial performance. Contract being express in nature was immune from any deliverance of consideration based on past performance, the court ruled in the favor of the defendant.
The court noted that the full payment after the completion of the voyage was likely to be insurance for the employer keeping in the mind the hefty amount that was to be received by the sailor as the consideration for the services rendered by him. Death of the Sailor might have rendered the performance of the contract impossible but it did not violate the express terms of the contract which specified payment of consideration only on the full performance of the Services.
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Reasoning
Whilst deriving the rationale behind the judgment lordships admitted that if there ever has been a case of hardship, this is it. Since the case was In Genere Suo, the considerations that laid down the foundation of this judgment were;
- Where the lump sum amount of consideration has been promised for rendering the services, the same cannot be apportioned if the services are disrupted.
- The substantial performance of the contract means the operative part, here if Cutter would have died after reaching Liverpool then he would have been accredited to his wages but Cutter’s death in the sixth week resulted in an act of breach.
- It was upheld by the court that the performance of the contract shall constitute a condition precedent
- The court formulated its ruling on the assertion of the full performance of the act and not a part performance where a lump sum amount is more than what is likely to be in the ordinary course of nature.
Current Day Significance
- In M. Chokalinga Mudaliar vs G. Mahomed sheriff Saib and ors the subordinate court acknowledged the principles that were framed in the case of Cutter vs Powell, but the higher court disregarded the principle and upheld that wages can be administered on the basis of Quantum Meriut.
- In Bolton vs Mahadeva the rule formulated in Cutter vs Powell was modified to an extent of substantial performance.
