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White & Carter (Councils) Ltd v McGregor [1962] UKHL 5

Contract law – Payments – Repudiation

Facts

White & Carter, the appellants, were advertising contractors that agreed with a representative of a garage proprietor to advertise for his garage for the period of three years. The respondent, the garage owner, wrote to the appellant on the same day of the agreement to cancel as the representative was mistaken during the negotiation. The appellants refused this and began advertising for the garage five months after the contract had been agreed between the parties. The respondent refused to pay and the appellant sued for the whole amount of the contract.

Issue

The court was required to understand whether the contract between the parties could be repudiated on the basis of the mistake that had been made by the representative of the garage owner. If this repudiation was not permitted, then it had to be determined whether the appellants could claim for the whole of the contract value or whether the damages would be limited. It was also argued by the respondent that where a party has no legitimate interest in performing the contract, the burden should not be placed on the other party unnecessarily.

Held

The court found that the appellants had the right to carry out the contract and claim for the entire value of the contract. On this basis, this did not require the appellant to accept the withdrawal of the contract by the respondent. The court did not accept the argument that was put forward by the respondent as to the enforcement by the appellant of the contract.


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