Leaf v International Galleries

Court of Appeal

Citations: [1950] 2 KB 86; [1950] 1 All ER 693; [1947-51] CLY 9247.

Facts

The defendant sold the claimant a painting. They mistakenly represented the painting as having been painted by a famous artist. When the claimant tried to sell it five years later, they discovered that it was not painted by that artist. The claimant sought to return the painting and get a refund.

Issue(s)

1. Was the contract capable of being rescinded for misrepresentation?
2. Could the claimant reject the painting for repudiatory breach of contract?

Decision

The Court held in favour of the defendant. The defendant had made an innocent misrepresentation which induced the claimant to enter the contract. However:

• The claimant had taken too long to attempt to rescind the contract, so the remedy of rescission was not available.
• Assuming that the painter’s identity was a condition of the contract, the claimant had lost their right to reject the goods for waiting too long.
• If the painter’s identity was merely a warranty, then the claimant never had any right to reject the goods. Their only remedy would be a claim for damages.

This Case is Authority For…

A buyer is taken to have accepted goods after the lapse of a reasonable time. The lapse of a reasonable time is also a bar to claiming the equitable remedy of rescission.

This fact that rescission is not available after a reasonable length of time is distinct from the equitable bar of laches. Laches requires evidence of acquiescence. Jenkins LJ explained that the ‘reasonable time’ bar is justified by the need for finality in contracts.

Other

Lord Denning noted that this contract was not void for mistake. This is because mistake only applies to mistakes about the core subject matter of the contract. In this case, the mistake was merely one as to the quality of the goods. The subject matter was a painting, the identity of the painter a mere quality of that painter.