Cutter v Powell [1795]

Cutter v Powell [1795] 101 ER 573 is a significant English contract law case that deals with the concept of substantial performance of a contract.

Cutter agreed to sail with Powell from Kingston, Jamaica to Liverpool, England. The contractual note specified that Cutter would be paid thirty guineas if he proceeded, continued, and did his duty as the second mate during the entire voyage. Cutter unfortunately died after seven weeks of the ten-week journey. The ship captain refused to pay any wages, leading to Mrs Cutter suing to recover the wages for the part of the journey that her husband had survived.

Mrs Cutter argued that she was entitled to recover a proportionate part of the wages for the work and labor done by her husband during the part of the voyage he lived and served the defendant. It was contended that there was no known general rule of law or anything in the contract terms preventing such recovery. Mrs Cutter also asserted that the contract, being in the form of a promissory note, should be construed liberally.

On the defendant's behalf, it was argued that an express contract between the parties precluded the application of any implied agreement. Powell's promise to pay was contingent on Cutter performing his duty throughout the entire voyage, and the failure to fulfil this condition meant the plaintiff could not recover anything. Powell emphasised Cutter's express agreement to receive a larger sum if he completed the entire duty, making it a type of insurance.

Lord Kenyon CJ, delivering the judgment of the Court of King's Bench, held that Cutter was not entitled to wages because he had not completed the entire journey. The contract was deemed entire, and completion was considered a condition precedent to the obligation to pay. Lord Kenyon stressed the importance of not overturning received opinions in the mercantile world concerning such contracts and acknowledged that the decision might be confined to the specific words of this contract.

The other judges, including Ashhurst J, Grose J, and Lawrence J, concurred with Lord Kenyon's reasoning, emphasising the entire and indivisible nature of the contract and the importance of adhering to express agreements. The judgment concluded that part performance was insufficient, and Cutter's representative could not recover any amount. The judges considered the specific terms of the contract paramount in determining the outcome, leaving room for potential variations in other cases based on different contractual language or practices.
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