Routledge v McKay [1954] EWCA Civ 8 (10 March 1954)

A motor bicycle was sold through a chain of buyers, with each seller stating it was a 1941-1942 model based on the registration book, which was false. The Court of Appeal held that such statements were mere representations, not warranties, and the final seller was not liable in damages.

Facts

A Douglas motor bicycle combination, originally manufactured in October 1930, had been modified by an earlier owner who falsified the registration book to show it as a ‘late 1941 or 1942 model’. The machine was sold through a chain of buyers, each relying on the registration book entry. The Fifth Party (Mawson) sold the motorcycle to the Fourth Party (Ashgrove), stating it was a 1941-1942 model and showing the registration book. A written agreement was signed stating the exchange terms and concluding with the words ‘when the £30 is paid over that this transaction is closed’. The true date was subsequently discovered, and proceedings were brought down the chain of sellers.

The Written Agreement

The written memorandum recorded the exchange of vehicles and specifically corrected the cubic capacity from 500 c.c. to 600 c.c., but made no reference to the year of the motorcycle. It concluded that once payment was made the transaction would be closed.

Issues

The central issue was whether the statement about the motorcycle’s date of origin constituted a warranty (a contractual term giving rise to liability in damages) or merely an innocent misrepresentation (for which no damages could be claimed).

Judgment

The Court of Appeal allowed the appeal, holding that no warranty had been given.

The Master of the Rolls (Sir Raymond Evershed)

The Master of the Rolls emphasised the strict requirements for establishing a warranty, drawing upon Lord Moulton’s speech in Heilbut, Symons & Co v Buckleton. He noted that collateral contracts must be proved strictly and that there must be a clear animus contrahendi (intention to contract). The learned judge below had not properly directed his mind to whether there was a real intention to create a contractual warranty. The oral statement about the date was made before any bargain was concluded, and when the written agreement was eventually signed, it made no reference to the date. There was no evidence capable of supporting the conclusion that a warranty was intended.

Lord Justice Denning

Lord Justice Denning observed that in second-hand vehicle sales, sellers typically pass on information from registration books without personal knowledge of accuracy. Unless a seller expressly makes himself responsible for the statement’s accuracy, it remains a mere representation, not a warranty. He noted that an eventual buyer could sue the original wrongdoer in fraud, but could not sue innocent intermediaries who merely passed on the registration book statement.

Lord Justice Romer

Lord Justice Romer agreed, expressing some reluctance given that Mawson had given untrue evidence and had actually been informed by the manufacturers that the motorcycle was older than stated. However, as no charge of fraudulent misrepresentation had been made, the law required the appeal to be allowed.

Implications

This case reinforces the distinction between representations and warranties in contract law. For a statement to constitute a warranty, there must be clear evidence of an intention to create a contractual obligation to indemnify the buyer against loss. Mere statements of fact, particularly those derived from documents rather than personal knowledge, will not ordinarily amount to warranties. The case also illustrates how a written agreement may exclude or be inconsistent with an alleged prior oral warranty, and emphasises that courts must strictly scrutinise whether the requirements for a warranty have been met.

Verdict: Appeal allowed. The Fifth Party proceedings were dismissed. The Court held there was no warranty given regarding the motorcycle’s date of origin; the statement was merely an innocent misrepresentation for which no damages were recoverable.

Source: Routledge v McKay [1954] EWCA Civ 8 (10 March 1954)