Garnac Grain Co Inc v HMF Faure and Fairclough: PC 1967

The Board was asked what was necessary to establish the raltionship of principal and agent.
Held: In the essence of agency is the element of consent.
Where there is an available market for the goods, the market price is determined as at the contractual date of delivery, unless the buyer should have mitigated by going into the market and entering into a substitute contract at some earlier stage
Lord Pearson said: ‘The relationship of principal and agent can only be established by the consent of the principal and agent. They will be held to have consented if they have agreed to what amounts in law to such a relationship even if they do not recognise it themselves and even if they have professed to disclaim it . . The consent however must be given by each of them either expressly or by words and conduct. Primarily one looks to what they said and did at the time of the alleged creation of the agency. Earlier words and conduct may afford evidence of a course of dealing in existence at that time and may be taken into account more generally as historical background . . ‘


Lord Pearson


[1967] 2 All ER 353, [1968] AC 1130, [1967] 3 WLR 143


England and Wales

Cited by:

CitedBranwhite v Worcester Works Finance Ltd HL 1969
A dealer may for some ad hoc purpose be the agent of a finance company. In relation to a purchase of a motor vehicle through a motor dealer, where the prospective purchaser completes an application for hire purchase in the office of the motor . .
CitedNational Trust for Places of Historic Interest v Birden ChD 31-Jul-2009
The parties had entered into an old-form share farm agreement in 1994. The tenant later became a farm business tenant on other land. The claimant sought a share of the Single Payment Scheme calculated with reference to the period in which the . .
CitedBunge Sa v Nidera Bv SC 1-Jul-2015
The court considered the effect of the default clause in a standard form of contract which is widely used in the grain trade. On 10 June 2010 the respondents, Nidera BV, whom I shall call ‘the buyers’, entered into a contract with the appellants, . .
Lists of cited by and citing cases may be incomplete.

Agency, Damages

Updated: 12 April 2022; Ref: scu.269658