Phillips v Brooks Ltd
Citations:  2 KB 243.
A man entered the claimant’s jewellery shop and offered to buy a ring. He produced a cheque for £3000 and told the claimant: ‘You see who I am, I am Sir George Bullough.’ He then gave an address in St James’s Square. The claimant was familiar with the name and confirmed that someone with that name lived at the address. The man took the ring with him. The man was not George Bullough. The cheque was dishonoured. By the time the claimant realised that he had been swindled, the man had pawned the ring to the defendant.
The claimant sued the defendant for the return of the ring. He claimed that he would not have sold the ring if they had known who the man truly was. This meant, he claimed, that the contract was void for mistake. If true, this would mean that the ring still belonged to the claimant.
- Was the contract between the man and the claimant void for mistake?
The High Court held in favour of the defendant. In actuality, the claimant intended to sell the ring to the man in front of him – whomever that turned out to be. There was therefore no relevant mistake. Property had passed to the rogue, so the claimant was not entitled to recover the ring.
This Case is Authority For…
Where parties contract face to face, the courts will normally presume that they intend to contract with each other – regardless of whether each party is telling the truth about their identity.
Horridge J noted that the contract was voidable for misrepresentation, but this did not assist the claimant. This is because a voidable contract ceases to be voidable when a third party, such as the defendant, acquires rights in the subject matter of the contract (in this case the ring).