| Agency Law | | | | between the parties need not have been an agency |
| The origins of the doctrine of necessitous intervention | | | | relationship. Lord Diplock did suggest that the conditions |
| by someone who is in a legal relationship with the | | | | which need to be satisfied before an agency of |
| defendant lie in the principle of agency of necessity, | | | | necessity is established will not necessarily have to be |
| where an agent went beyond his or her authority by | | | | satisfied before the plaintiff obtains reimbursement |
| intervening on behalf of the principal in an emergency. | | | | from the defendant. Consequently, for example, |
| Because of the circumstances of necessity, | | | | restitution will not be denied simply because the plaintiff |
| particularly the impracticability of the agent | | | | was in fact able to communicate with the defendant, it |
| communicating with the principal, the courts were | | | | being sufficient, as occurred in The Winson itself, that, |
| prepared to treat the agent as though he or she had | | | | despite the communication with the defendant by the |
| the necessary authority to do what was reasonably | | | | plaintiff, the defendant had failed to give any |
| necessary to save the principal's property. If an | | | | instructions to the plaintiff as to what to do with the |
| agency of necessity was established, the agent would | | | | wheat. Where there is a pre-existing legal relationship |
| be reimbursed for the expense incurred in rescuing the | | | | between the parties, restitution may be awarded by |
| principal's property. | | | | reason of necessity if certain conditions are satisfied, |
| | | | as was recognised in The Choko Star . However, as |
| The doctrine of agency of necessity was then | | | | Lord Diplock recognised in The Winson, the key issue |
| extended beyond cases involving carriage of goods to | | | | for the courts to determine is whether the plaintiff's |
| other cases in which the plaintiff had been forced by | | | | conduct was reasonable, so the fact that one of |
| an emergency to act beyond his or her existing | | | | these conditions is not satisfied does not mean that |
| authority. This extension of the principle was | | | | the plaintiff's conduct must automatically be considered |
| recognised in Prager v. Blatspiel, Stampand Heacock | | | | to have been unreasonable . |
| Ltd. and Heacock Ltd., although the element of | | | | 1.There must be an actual and definite commercial |
| emergency was not established on the facts . In | | | | necessity for the plaintiff to intervene having regard to |
| Prager the defendant, who was a fur merchant, | | | | the particular circumstances of the case . It was for |
| bought and dressed skins on behalf of the plaintiff to | | | | this reason that an agency of necessity was not |
| be delivered to Romania. The outbreak of the First | | | | established in Sachs v. Miklos where the defendant |
| World War made it impossible for the defendant either | | | | had agreed to store the plaintiff's furniture free of |
| to send the skins to Romania or to communicate with | | | | charge . After a considerable time the plaintiff had not |
| the plaintiff. The defendant then sold the skins. When | | | | reclaimed the furniture and, since the defendant wished |
| the plaintiff eventually asked the defendant to | | | | to rent out the room where it was stored, the |
| transport the skins to him, the defendant argued that it | | | | defendant attempted to contact the plaintiff. Despite |
| had been forced to sell the skins because they were | | | | numerous attempts to make contact, the defendant |
| deteriorating, making it necessary that the skins were | | | | could not find the plaintiff and so he sold the furniture. |
| sold forthwith. On the facts of the case it was held | | | | The plaintiff then returned to claim his furniture and, |
| that the defendant was not an agent of necessity, | | | | when he discovered that it had been sold, he sued the |
| simply because, since the skins were dressed, they | | | | defendant in conversion. The defendant argued that |
| were in no danger of deteriorating. But it was | | | | he was an agent of necessity but the Court of Appeal |
| accepted that if the skins had been deteriorating | | | | held that this had not been established, simply because |
| rapidly the defendant would have been authorised to | | | | there was no need for the furniture to be sold. Similarly, |
| sell them by virtue of an agency of necessity. | | | | in Munro v. Willmott the defendant sold the plaintiff's |
| McCardie, J., showed that the doctrine could apply to | | | | car which had been left on his premises for a number |
| this kind of situation and might, for example, have | | | | of years . Again the defendant was not characterised |
| entitled the defendants to reimbursement of storage | | | | as an agent of necessity because the sale of the car |
| charges and other precautions to preserve the furs. | | | | was not required as a matter of real urgency but was |
| But on the facts there was no compulsion on the | | | | done simply for the defendant's convenience. It would |
| defendants to sell -- that is, there was no danger, as | | | | have been different in both cases if the plaintiff's |
| deterioration, to create a commercial necessity for this | | | | property had been perishable, such as fruit and |
| sale -- and, which is a separate point, the defendants | | | | vegetables, so that there was a commercial necessity |
| had not been motivated by their honest conception of | | | | for the property to be disposed of, otherwise it would |
| the best interests of the owners but rather by | | | | have perished. |
| considerations of their own convenience and | | | | 2.It must have been practically impossible to obtain the |
| advantage . | | | | defendant's instructions about what should be done in |
| This case shows not only that the doctrine extends to | | | | time . Restitutionary relief may, however, still be |
| land-based bailments but also that it serves purposes | | | | awarded where the plaintiff asks the defendant for |
| other than restitution. In particular, if he has been | | | | instructions and the defendant fails to respond . |
| compelled to sell the goods, an agent of necessity has | | | | 3.The burden is on the plaintiff to show that he or she |
| a defence to an action in tort; if he has had to make a | | | | was acting in good faith in the best interests of the |
| contract (as for repair or storage or even to borrow | | | | defendant . It follows that the plaintiff's action must |
| money) the outsider will be in direct contractual | | | | have been reasonable and prudent in the particular |
| relationship with the agent's principal; and, if he expends | | | | circumstances of the case and must have been taken |
| money on the safety of the goods, he will have a | | | | to protect the interests of the defendant, otherwise it |
| claim for reimbursement. | | | | will smack of officiousness . |
| Our concern is with this third consequence, the agent | | | | The problem with the action for reimbursement in |
| of necessity's right to reimbursement of his outlay. We | | | | circumstances of necessity where there is a |
| have already seen that in Prager, McCardie, J., would | | | | pre-existing legal relationship between the parties is |
| have allowed recovery of storage charges. He relied | | | | whether it really forms part of the law of restitution. |
| for that on Great Northern Railway v. Swaffield . The | | | | The difficulty arises from the requirement that there |
| railway was to deliver a horse to Sandy station for the | | | | must be a pre-existing relationship, whether it be |
| defendant. There was nobody to collect it when it | | | | agency or bailment or whatever. The effect of the |
| arrived. The defendant's servant did not appear till | | | | doctrine is that the plaintiff's authority under this |
| after the railway had incurred a stabling charge of 1s. 6 | | | | relationship is extended to include the reaction to the |
| d. He refused to pay the charge and finally left without | | | | emergency . This suggests that the doctrine is part of |
| the horse. Over the following days the defendant took | | | | the law governing the pre-existing relationship, such as |
| an increasingly intransigent position. The stabling | | | | contract, rather than the law of restitution, with the |
| charges rose to £17. The railway then decided to | | | | consequence that, if the plaintiff has a remedy, it will be |
| pay the bill and deliver the horse. It then reclaimed the | | | | contractual rather than restitutionary . Whilst this may |
| sum paid. The claim was upheld on the analogy of the | | | | be true in most cases, there is still a role for the |
| maritime cases, especially Gaudet v. Brown, Cargo ex | | | | doctrine to apply within the law of restitution. |
| Argos . The railway had had to take these reasonable | | | | This will particularly be the case where, as in The |
| steps to see that the defendant's horse was safely | | | | Winson, the pre-existing relationship between the |
| looked after. | | | | parties is not contractual but arises, for example, from |
| The principle underlying the doctrine of agency of | | | | a gratuitous bailment or where the previous contractual |
| necessity has now been extended beyond those | | | | relationship may have ended. In these circumstances |
| cases where there was a pre-existing relationship of | | | | the law of restitution intervenes to impose an obligation |
| principal and agent to where there was any form of | | | | on the defendant by operation of law to ensure that |
| pre-existing legal relationship, such as the relationship of | | | | the defendant does not receive enrichment without |
| bailor and bailee. This was recognised in The Winson, | | | | reimbursing or remunerating the plaintiff. |
| where the plaintiff, who was a professional salvor, had | | | | In China Pacific S.A. v. Food Corporation of India, The |
| entered into an agreement to salvage the defendant's | | | | Winson, the House of Lords applied these same cases |
| cargo of wheat after its ship had been stranded on a | | | | so as to allow the plaintiffs, who were professional |
| reef. The cargo was salvaged and taken to Manila | | | | salvors, to recover the charges incurred by them in |
| where it was stored under cover to ensure that it did | | | | storing the defendants' cargo of wheat after saving it |
| not deteriorate. The plaintiff informed the defendant | | | | from the stranded ship in which it was being carried. |
| that it was going to put the wheat into storage and the | | | | But in this case their Lordships took the opportunity to |
| defendant did not object. The plaintiff then sought to | | | | make an adjustment of terminology. They said that the |
| recover the storage expenses from the defendant. | | | | words 'agency of necessity' should not be used |
| Since the storage was not covered by the salvage | | | | except to denote the circumstances in which the facts |
| agreement, the plaintiff could not sue under the | | | | would allow a contractual relationship to be created |
| contract. However, once the wheat had arrived in the | | | | between the agent's principal and the outsider. The |
| Philippines the relationship between the parties was | | | | phrase should not be used where the only issue was |
| one which was founded on a gratuitous bailment. | | | | restitution in respect of such steps as had been |
| Consequently, the plaintiff argued that, in storing the | | | | reasonably necessary to preserve the owner's goods |
| wheat, it was acting as an agent of necessity. The | | | | . |
| plaintiff's claim for restitution of the storage expenses | | | | These two groups of cases -- those between |
| which had been incurred succeeded before the House | | | | strangers and those extending a pre-existing |
| of Lords, because the plaintiff's conduct was | | | | contractual relationship -- can be perceived as |
| considered to have been reasonable. But Lord Diplock, | | | | different applications of a single principle. That is to say, |
| who gave the leading judgment, stressed that the | | | | a pre-existing relationship appears to be no more than |
| plaintiff should not be characterised as an agent of | | | | one way, albeit the most common, of satisfying |
| necessity, since he considered that the notion of | | | | prerequisites of a restitutionary claim which can be |
| agency should be confined to where the agent was | | | | satisfied, more rarely, by facts other than such a |
| deemed to have authority to create contractual rights | | | | relationship. The notion of an agency of necessity |
| and obligations between the principal and a third party. | | | | could not be applied except where there was a |
| He did not regard the term as being appropriate where | | | | pre-existing relationship on which to build. The |
| the plaintiff's claim was for reimbursement, as it was | | | | consequent isolation of the relationship cases will not |
| here. Despite this change in terminology, it is still | | | | really be diminished if the phrase 'agency of necessity' |
| important to draw a distinction between those cases in | | | | is displaced by a new analysis in which the right to |
| which a stranger has intervened in circumstances of | | | | reimbursement is seen to be correlative with a duty to |
| necessity and those in which the plaintiff who | | | | keep safe. For the duty element will not easily be |
| intervened has a pre-existing relationship with the | | | | found without a pre-existing relationship between the |
| defendant. | | | | parties. Where a stranger intervenes, the duty upon |
| The change in terminology in respect of the latter | | | | him is moral, not legal. |
| doctrine emphasises that the preexisting relationship | | | | |