Bisset v Wilkinson

Bisset v Wilkinson
Court Privy Council
Full case name Robert Hugh Bisset v Thomas Vernon Wilkinson
Decided 20 July 1926
Citation(s) [1927] AC 17
Transcript(s) http://www.bailii.org/cgi-bin/markup.cgi?doc=/uk/cases/UKPC/1926/1.html
Court membership
Judge(s) sitting Viscount Dunedin, Lord Atkinson, Lord Carson, Lord Merrivale
Keywords
Misrepresentation, opinion

Bisset v Wilkinson [1927] AC 177 is a leading English contract law case on the subject of misrepresentation, establishing that a fairly given opinion cannot amount to a misrepresentation.[1][2][3]

Facts

Mr Wilkinson and Mr Bisset entered into a contract in May, 1919, whereby Mr Bisset would purchase two adjoining blocks of land called Homestead and Hogan’s, in Avondale, Northern Southland, New Zealand.[4] The two blocks comprised 2062 and 348 acres (1.41 km2) respectively, the two parties reaching agreement, for NZ₤13,260 (approximately $1.2 million in 2013). During negotiations Mr Wilkinson stated "that with a good six horse team, his idea was that the farm would carry 2,000 sheep". After 2 years of unsuccessful farming, it was realized that the land could not hold 2000 sheep, and the claimant (Mr Bisset) brought an action for misrepresentation to cancel the contract and get his deposit back.[5]

Advice

The Privy Council advised that the statements made by Mr Wilkinson were not intended to be a serious representation, qualified by any knowledge. It was known to both the parties at the time of contracting that the defendant had not used the land for sheep farming, and thus any statement as to the capacity would surely be an estimate. Lord Merrivale stated that important considerations were the ‘material facts of the transaction, the knowledge of the parties respectively, and their relative positions, the words of representation used, and the actual condition of the subject-matter spoken of…’ Then he said,

“ In ascertaining what meaning was conveyed to the minds of the now respondents by the appellant's statement as to the two thousand sheep, the most material fact to be remembered is that, as both parties were aware, the appellant had not and, so far as appears, no other person had at any time carried on sheep-farming upon the unit of land in question. That land as a distinct holding had never constituted a sheep-farm.[6] ”

In addition, it was noted that the ‘defendants failed to prove that the farm if properly managed was not capable of being occupied by two thousand sheep.’

Viscount Dunedin, Lord Atkinson, Lord Phillimore and Lord Carson agreed.

Significance

This result can be contrasted with other situations where one party has specialist knowledge of the subject, as in Esso Petroleum Co Ltd v Mardon.[7] Equally, if the opinion is one which - in all the circumstances - is unreasonable, then it may be seen as an active misrepresentation, as in Smith v Land & House Property Corp.[8]

See also

References

  1. ↑ [1927] AC 177, p. 184
  2. ↑ Walker, Campbell (2004). Butterworths Student Companion Contract (4th ed.). LexisNexis. p. 245. ISBN 0-408-71770-X.
  3. ↑ Gerbic, Philippa; Lawrence, Martin (2003). Understanding Commercial Law (5th ed.). LexisNexis. ISBN 0-408-71714-9.
  4. ↑ [1927] AC 177, 178
  5. ↑ [1927] AC 177, 179
  6. ↑ [1927] AC 177, p. 183-184
  7. ↑ Esso Petroleum Co Ltd v Mardon [1976] QB 801
  8. ↑ Smith v Land & House Property Corp (1885) LR 28 Ch D 7