Malcolm v. Oxford: Judgment (Court of Appeal)

MALCOLM V. THE CHANCELLOR MASTERS AND SCHOLARS OF THE UNIVERSITY OF OXFORD
Court of Appeal CHF0480/90

COURT OF APPEAL JUDGMENT AND ORDER

Handed down 18th December 1990

Constitution: Mustill L.J., Nourse L.J., Leggatt L.J.

Click for Oxford's 'Public Apology' reference below or detailed account.

Mustill LJ:

Mr. Andrew Malcolm is the author of a work on philosophy, cast in an unusual form and entitled "Making Names". Mr. Malcolm submitted his book for publication by the Oxford University Press. During the Spring of 1985 written and verbal exchanges on the subject took place between Mr. Malcolm and officials of the Press. These culminated in a telephone conversation between (page 2) Mr. Malcolm and a Senior Editor in the General Books Department of the Press, which was immediately followed by a letter from the Editor which ended: "I'm pleased that we are going to do your book, and hope that it's a terrific success."

Two months later the Managing Director of the Press wrote to Mr. Malcolm stating that the Press would not publish the book in its present form, and that even if revised he could not hold out much hope that they would publish. Mr. Malcolm did revise the book, but the Press again declined to publish it. Mr. Malcolm commenced an action, which during March 1990 was tried by Mr. Gavin Lightman Q.C., as a Deputy Judge of the High Court. The learned judge found that a clear commitment to publish had been made by the Press, but concluded that for two reasons the negotiations had not led to legally enforceable contract. First, because the agreement between the parties did not comprise certain fundamental terms, in the absence of which there could be no contract. Secondly, because the crucial conversations had proceeded on the basis that there were matters to be agreed and incorporated in a contract, and that the book had been rejected before those matters could be agreed. The learned judge continued:

"I reach this decision with great regret. I think that Mr. Malcolm has been harshly and unfairly treated. I think he had a strong moral, though not (page 3) a legal, commitment. After reviewing the matter, it may be that the university will have second thoughts..."

He went on to say that if he had concluded that there was an enforceable contract he would not have considered an order of specific performance would be practicable, but that a substantial award of damages was called for. Mr. Malcolm now appeals.

The appeal and the applications to adduce further evidence with which it is linked turn upon a series of what are essentially quite short points, but they have a long history which must be examined in some detail. I will do so under the headings: (i) events leading to the dispute; (ii) the interlocutory proceedings; (iii) the trial; (iv) events since the trial.

Events leading to the dispute.

The appellant is a graduate in Moral Sciences of Cambridge University. During the early 1970's he conducted a series of adult education courses on the topic of philosophy, in the course of which he evolved some individual philosophical ideas of his own which he incorporated into the first draft of a book. This consisted mainly of essays, but contained two long (page 4) passages in the form of a dialogue. He submitted the draft to various publishing houses. One in particular was interested, and the persons concerned suggested that since the dialogues were the most interesting parts, the whole book should be re-cast as a conversation between two characters, a philosopher and a scientist. The appellant agreed and spent several years on this laborious task, only to find that in 1984 when he tendered the new text that the publishers had changed their minds and were no longer interested. It was against this background, after some other unsatisfactory experiences with publishers, that he made his approach to the respondents.

A brief explanation of the structure and personnel of the Oxford University Press must now be given. The affairs of this ancient and renowned body are by the Statutes of the University of Oxford entrusted to the charge of the Delegates. These are persons of the highest distinction in various fields of learning. According to the evidence of Sir Roger Elliott, currently the Secretary to the Delegates and Chief Executive, their function is to control the policy of the Press, both generally and through the acceptance of books for publication, to ensure that the Press complements the aims and standards of the University. In the nature of things these distinguished men and women cannot devote a (page 5) large proportion of their time to the detailed oversight of the Press but meet on a regular basis (we understand once a fortnight) to despatch what, judging by documents which we have seen, appears to be a large amount of business. One of the Delegates at the material time was Mr. A. J. Ryan who also acted as Assessor for the Press.

The responsibility for the day-to-day running of the Press is in the hands of a Chief Executive. The work of the Press is dispersed between various divisions. The Managing Director of the Academic and General Division at the time in question was Mr. Richard Charkin. Working under his direction were various Senior Editors and Editors. One such Senior Editor in the General Books Department was Mr. Henry Hardy. Another editor was Miss Nicola Bion.

The commissioning and publication of a book involves a good deal of internal paperwork. Three documents in standard form are material here. First, there is a Publishing Proposal Form. This consists (or consisted at the relevant time) of a blank form, into which were inserted by the commissioning editor details of the proposed format, print numbers, anticipated sales, castings, royalties, sale price and the like. This form was submitted in the first instance for approval to an editorial committee. The second document was a Note to (page 6) the Delegates in relation to each proposed book, containing a description of the book and the author, and an account of the opinions of the referees who had read the manuscript. There was also a coded reference to the prospect that, if published, the book would be profitable. This document was part of the materials Placed before the Delegates at their regular meetings, together no doubt with similar information concerning all the numerous other books brought forward for consideration by the Delegates.

The third document was the standard form of contract employed by the Press. I quote two clauses from this, emphasising as I do so that there is no suggestion that this document had been sent or shown to the appellant at or before the time when the contract was said to be made. I will return to its relevance at a later stage.

"1. The Publisher shall subject to his approval of the finished typescript publish at his own risk and expense a book of approximately [ - ] words (hereinafter called 'the Work') which the Author has prepared or is preparing and which is at present entitled [ - ]...

5. The Publisher shall print and publish the Work in such edition or editions as he considers (page 7) appropriate as soon as reasonably may be after the complete typescript (which term shall if appropriate include any illustrative material referred to in Clause 3 and 4 above) shall have been delivered to him and he shall have the sole control of all details of production advertising price sale and terms of sale of the Work and the right at his discretion to raise or reduce the published price of the work".

I now return to the course of events. The appellant's initial approach to the Press took place in August 1984, with the submission of a synopsis. The project was entrusted to Mr. Henry Hardy, because it was thought more suitable for the General Books Department than for the Philosophy Department. He liked the idea and asked to see the typescript. In due course the manuscript was referred to Mr. Alan Ryan, the Delegate and Assessor to whom I have already referred. He thought that the book was "rather good" and was "rather keen that we should have a go if its possible", although he regarded the book as vastly too long. In March 1985, Mr. Hardy wrote to the appellant in an optimistic tone, but complaining about the length of the book. The appellant replied on 24th March, responding in detail to Mr. Hardy's comments, and concluding with the following important passage (page 8)

"In conclusion then, I am adamant about nothing at the moment and I very much hope that we can agree some formula that will result in the book's publication. However, in the light of experience, one firm resolution that I have made is not to embark upon any further major polishing/rewriting exercise, which I reckon could well take up to six months of full-time work, without first securing a firm commitment from a publisher; I feel that there is already enough of value in the text to justify such a commitment."

On 26th April the appellant telephoned Mr. Hardy with a reminder. The resulting conversation was recorded by the appellant, and a transcript was before the judge at the trial. It is unnecessary to quote from the transcript, since it was principally germane to an issue concerning the Delegates' approval of the book which has now disappeared from the case. I would note in passing that in the context of a discussion about the length of the book, when the question of whether the book should be published first in hardback or paperback, the appellant said that he did not "know enough about the economics of it".

At the time of this conversation Mr. Hardy had not completed his reading of the typescript. He did however (page 9) manage to do so before the appellant telephoned with a further reminder on 20th May 1985. The resulting conversation is so important that I must quote from the transcript, whilst emphasising the ever-present risk that selective quotation (the transcript is too long to set out in full) may not give a fair picture of what transpired:

Hardy: Anyway, I have now finished reading the book.
Malcolm: Oh good.
Hardy: And like Alan Ryan who read it before, I feel much more warmly towards it having finished it. And we would like to do it. That is to say, I mean I know you want a commitment sufficient to take you through the last stage of revision and that's what I'm offering. I'm not offering a totally unconditional commitment because obviously if what you do seems to us to make it worse then we would write to say so.
Malcolm: Of course, yes.
Hardy: But we feel confident enough to say go ahead and do that.
Malcolm: Oh great. [There followed a long discussion about cutting, sub-titling and style]
Hardy: I can let you have it back, it's just that I (page 10) would like to have it accurately cast off so I can let you know that your 180,000 (words) is right.
Malcolm: No... Keep it and cast it off accurately.
Hardy: It won't take more than a week or so.
Malcolm: Yes, yes.
Hardy: Then we can do costings and I can talk to you again about length and then having got to that point let me revisit it and we'll talk about it some more. I mean the book has a natural length obviously and I don't want to ask for unnecessary cuts, but at the same time length equals cover price and of course...
Malcolm: Ya ya ya.
Hardy: I see much more having finished the book the point of the detail in some scientific sections, but the book could nevertheless bear some cuts.
Malcolm: Mm. Some of it can go.... Some bits I know can go.
Hardy: But at the same time I think there could be some trimming without destruction of... I wouldn't want to discourage you into making every statement a kind of grey standard length. I will let you know what the actual length is and then we'll have some costing done on the basis of the actual length and we'll talk more (page 11) precisely then about what kind of saving might yield what kind of price-reduction; that again depends on whether we do it in hardback only or in hardback or paperback. I'm still wavering on that one."
[There followed further discussion of length and style]
Hardy: ....Anyway, I will not go on at any greater length. I mean if you want I'll be getting in touch again when I've done the costs and cast-off and so forth and then we can er talk about some sort of contract.
Malcolm: Great! Fantastic news! Really good!
Hardy: It seems to me that because it's such a risky venture I'm nor going to be terribly generous financially, ermm... I mean what I think we should agree is that you have a fair royalty so that if the book is a success you will do well out of it.
Malcolm: Yes.
Hardy: ....but I don't want to pay you in advance money that's been very riskily invested.
Malcolm: Sure, sure I wouldn't expect that, yup.
Hardy: Okay?
Malcolm: Great! That's very good. I'm just in the middle at the moment.... I couldn't do anything immediately because we've got the (page 12) Brighton Festival going on here and I'm involved in all sorts of things, but everything finishes in a week or two... and by then perhaps I can get down to it.
Hardy: Right. Good.
Malcolm: Great!
Hardy: Okay, well if you have any further thoughts or questions do come back to me with them, in the meantime ...
Malcolm: In the meantime I'm waiting for you, you'll do the cast-off and...
Hardy: I'll write to you. Okay?
Malcolm: Splendid! Well thanks very much, that's er, that's made my day, (Hardy laughs) not to say my life.
Hardy: Well let's hope it does well.

On the following day, 21st May 1985 Mr. Hardy wrote asking the appellant to complete an Author's Publicity Form, and reporting that he had sent the typescript for cast-off. His letter ended:

"I am pleased we are going to do your book, and hope that it's a terrific success. As said, do get in touch if you have any queries as you work through it.(page 13)

On 30th May the appellant sent the form as asked, expressing his pleasure that the Press was going to do his book, after he had waited for over ten years for this moment to arrive. He explained that the rewriting would take some time, and that he was contemplating a move to the country for peace and quiet. Mr. Hardy replied on 14th June to the effect that the appellant should not worry about the delay: "its much more important that you get it right than that we should publish it a month or two earlier."

Four days later there was completed a Publishing Proposal Form in relation to "Making Names". This contemplated a hardback book of 400 pages, to be sold at £15 per copy, with expected sales of 2,000 copies. There was to be a flat royalty of 12 per cent on United Kingdom sales, with 10 per cent on overseas sales. There was to be no advance.

So far so good. It seems however from a handwritten memorandum that by the first week of July a member of staff was expressing reservations about the market for the book, so the manuscript was sent to another referee, who reported in generally favourable terms, albeit with some reservations. (page 14)

On 16th July Miss Bion produced a Delegates' Note in the usual form, describing the book, summarising the referees' reports, and giving a two-line sketch of the author. The coded particulars indicated good profitability.

The appellant then suffered a fatal reverse. The project was submitted to the Editorial Committee on 17th July, and was summarily rejected by Mr. Charkin the Managing Director. At the trial he was to give as his reason that he applied three criteria to decisions on books - "profitability, quality and author" - and that he was not satisfied on any of these criteria as regards "Making Names". He had not himself read the manuscript. Mr. Ryan tried to persuade the Press not to drop the book, but in vain. On 18th July Mr. Charkin wrote to the appellant explaining that doubts about market, extent and content had caused the meeting not to ask for a contract to be issued. He went on

"... I know that you propose working on the latter, but we would have to see the final typescript and have it fully refereed before committing ourselves to publish. Even then, there would be considerable commercial and sales problems and I cannot hold out much hope that we would publish. I would quite understand it you felt unable to (page 15) undertake the revision without a firm commitment from us."

He concluded by apologising on behalf of the Press for the unnecessary raising of the appellant's hopes of publication.

A furious row then broke out within the Press, leading to some abortive disciplinary proceedings initiated by Mr. Charkin against Mr. Hardy. These are quite immaterial here, save only that in his letter of rebuke Mr. Charkin complained that Mr. Hardy had given "a written indication to an author that Oxford University Press would publish his book" without having gone through the proper procedures, and had thereby "committed the Press to an investment of £10,000".

Returning to the appellant, he seems to have borne this latest reverse with resignation rather than anger. In a dignified letter of 22nd July to Mr. Hardy he indicated that he would try to improve the work, but that there was no point in returning any revised version to Oxford University Press: but he asked for Mr. Hardy's help in finding another publisher. Mr. Hardy replied with a letter which suggested that all was not yet lost, and on 30th July 1985 returned to the topic at much greater length, suggesting various possible revisions. (page 16) The appellant did begin work on revision. There was sporadic correspondence with Mr. Hardy who had by now changed jobs within the Press, but unofficially made encouraging noises. By the end of February 1986 the appellant had produced a revised version, reduced in length by 25 per cent, and he resubmitted it to the Press. To no avail. It was sent to Mr. Ryan who having previously done much to encourage publication now (as the trial judge put it) "rubbished" the manuscript, and soon afterwards Miss Bion wrote a circumstantial letter explaining why the Press did not wish to publish the work. At the outset she said that "the cuts and amendments you have made are undoubtedly an improvement", but that they still did not "feel that it works". The letter went on to explain this opinion, and also to assert that there had been a change of climate in trade publishing.

I pause to emphasise a point which will be no doubt be obvious. The pleadings raised no issue as to the worth or marketability of the book, and this was not explored at the trial. We have not seen it. We express no opinion, nor would we be competent to do so, on its merits as a work of philosophy, or on its prospects of success had it been published in 1986. (page 17)

Returning to the narrative, relationships between the parties soon broke down completely and on 23rd December 1986 the appellant commenced his action against the Chancellor, Masters and Scholars of the University of Oxford. Mr. Charkin was sued as second defendant but dropped out of the action after ten months and has played no relevant part in the litigation.

The Interlocutory Proceedings.

[A detailed chronology of the proceedings may be accessed as A Brief History of Making Names.]

In the initial stages of the action the appellant was represented by a solicitor, but for the greater part of the time he has acted as a litigant in person.

The statement of claim endorsed on the writ set out the appellant's version of the story at great length, pleaded a contract to publish the work, and concluded with a prayer for an order for specific performance requiring the defendants to publish the work, coupled with a claim for damages cumulatively or in the alternative.

The respondents' defence requires comment for what it did and did not say. It did say, by way of bare traverse, that the contract alleged had not been made, but gave no particulars of why this was so, although there was an explicit denial that the substance of the (page 18) conversations was as pleaded. What the defence did contain was a plea that in any agreement that was concluded there was a term to the effect that "the Defendants agreed to publish the work subject to their approval of the final revised version" and that they did not approve the final draft. By "the Defendants" the pleader cannot have meant the Chancellor, Master and Scholars, and was it would seem referring at this stage to the staff of the Press. The appellant seems however to have understood the plea to refer to approval by the Delegates so he then amended to allege that the Delegates had approved the work. From this point onwards this was in his eyes a vital part of his demonstration that there had indeed been a contract. In response the respondents amended to plead that the work was never submitted to the Delegates, and hence never approved by them, having been rejected at the editorial meeting on 17th July.

The pleadings thus threw into prominence the question whether and with what result the work had been placed before the Delegates. Thereafter the appellant had to suffer the prolonged and no doubt exhausting experience of trying to obtain from the respondents some proper measure of discovery on this issue. He had to face what the trial judge described as a failure by the respondents' solicitors to take sufficiently seriously their obligations in regard to discovery. Naturally (page 19) this served only to increase the suspicion which he holds to this day that he has been deliberately misled as to the dealings between the staff of the press and the Delegates in relation to his book. As will appear, this is no longer directly relevant, but it remains an important part of the background. A lawyer might perhaps have looked closely at the respondents' bare traverse of a contract, but it is understandable that an unrepresented defendant should enter the trial with the belief that the judge would principally be concerned with the question of what the Delegates had and had not considered and decided on 23rd July 1985.

The Trial.

The appellant's distraction from what subsequently proved to be the main point in the case must have been exacerbated by the respondents' application on the first day of the trial to amend the re-amended defence so as to plead that Mr. Hardy had no authority to conclude whatever contract he may have purported to make on their behalf. If there had been anything in this point one would have expected it to be so obvious to the respondents and so important that they would have pleaded it at the first opportunity. It is no surprise that the trial judge rejected this very late application. What is a surprise and a disappointment is that the Press ever (page 20) sought to repudiate the authority of the employee whom it had chosen to conduct the dealings with the appellant: and that they waited to take the point for three years after Mr. Charkin had indignantly rebuked Mr. Hardy for having "committed the Press" to an investment in the book.

The trial then proceeded. At the conclusion of the evidence Mr. Warby made his closing submissions, which was his first opportunity to expound the respondents' case in detail. From a very clear written summary with which he accompanied his submissions we can see that he advanced the following arguments:

1. The telephone conversations left unresolved:

(a) the form of the text;
(b) the number of copies to be printed;
(c) the format (hardback or paperback);
(d) the sale price of the book;
(e) the appellant's rate of royalty.

2. The contract was subject to conditions precedent or subsequent relating to:

(a) the approval of the work by the Delegates;
(b) the satisfaction of the editorial staff with the revised version; these conditions were not fulfilled.
(c) the tender of a revised draft which was "no worse" than the first version. (This was a (page 21) condition pleaded by the appellant himself.) These conditions were not fulfilled.

The judge found in favour of the appellant on points 2(a) and (b). These had been founded on evidence from Mr. Hardy which the judge disbelieved. As to condition (c), the judge found that there was no dispute that the condition had been satisfied, and rejected the submission that the presence of the condition made the contract too vague to be enforceable. The learned judge concluded the portion of his judgment which dealt with these points by saying this: "I am therefore quite satisfied that a clear commitment was made by the university".

[A complete transcript of Deputy Judge Lightman's judgment of March 1990 may be accessed at Lightman.]

The learned judge then went on to consider the respondents' first argument in a passage which is central to the present appeal. In the revised transcript of the oral judgment this reads as follows:

"This brings me on to the second issue, and that is whether the commitment constitutes a contract or gives rise to a contractual obligation. On this issue I must regretfully decide in favour of the university and against Mr. Malcolm, and I must do so on two grounds. The first is that, in the case of a contract to publish a book, there are (page 22) fundamental terms to be agreed beyond the matter of publication alone. These include the matters of royalty, the numbers to be published and the form of publication (e.g. whether hardback or paperback). The parties may expressly agree these terms or they may do so impliedly by reason of some trade custom or usage or established course of dealing between the parties. The parties may also agree a formula to resolve these matters, for example that they should be left to the publisher alone to decide in exercise of his judgment or discretion. (See, for example, Abrahams v. Herbert Reiach Ltd. [1922] 1 K.B. 477). But for there to be a valid contract these matters must be agreed or there must be agreed some formula for their resolution. In this case there is no agreement of the terms or a formula and there is no plea, evidence or suggestion of any trade custom or usage or any previous dealing between the parties. The internal documents of the university, setting out their proposals in this regard, since they were both tentative and never communicated to, let alone agreed by, Mr. Malcolm, cannot furnish any comfort in this regard. The second reason is that the conversations of 27th April and 20th May both proceeded on the basis that there were matters to be agreed between the parties and incorporated in a contract. Unfortunately, the (page 23) university rejected the work before these matters could be agreed, but in the light of what passed between the parties I cannot hold that the parties intended to enter into a legally binding contract, or did so, when the arrangement was that these fundamental matters were subsequently to be agreed between them and incorporated in a contract."

Events since the Trial.

The appellant lodged a notice of appeal against this judgment, very much on the lines which could be expected. There were however other developments.

In the first place the respondents on 17th May 1990 gave notice of additional grounds for affirming the judgment. These were two-fold:

1. They relied on certain new evidence which they sought to adduce (see post) to support the conclusion that no complete agreement had been reached.

2. They repeated the assertion that any agreement was subject to the following conditions precedent:

(i) that the Delegates would approve the publication

(ii) that the appellant would revise the work as specified by Mr. Hardy. (page 24)

(iii) that the Defendants would be satisfied in good faith that the work as revised was sufficiently improved to warrant publication.

These notices set in train a series of applications.

In the first place the respondents applied to call evidence of a fresh transcription of the crucial part of the 20th May 1985 conversation, based on a new study of the tape. This would have sought the addition of a few words to the transcript on which the entire proceedings had been based. The appellant opposed the application, relying on Ladd v. Marshall [1954] 1 W.L.R. 1489, and asserting (as was obviously the case) that this new information could have been brought forward at the trial, if the respondents had made a sufficient effort to check the transcription. Whilst recognizing the force of this objection, we might well have been inclined to admit the evidence if it had appeared at all likely to result in the reversal of the judge's decision, or at least to a retrial. Ladd v. Marshall establishes important rules, but they are not invariable, and must always yield to the demands of Justice. We should have been distinctly uneasy about preferring our own interpretation of the discussion between Mr. Hardy and the appellant if we were compelled to found it on a transcription known to be seriously inaccurate. In fact, however, the position (page 25) was quite different, for the additional words consisted only of the first part of an uncompleted sentence, uttered in the course of a conversation which (if written down literally) would be seen to be full of hesitations and false starts. No member of the Court thought it possible that the evidence, if admitted, could have any bearing on the outcome of the case and principle therefore demanded its exclusion.

The second application was made by the appellant. It will be recalled that by the respondents' notice the respondents had sought to uphold the judgment on the additional ground that, contrary to the decision of the trial judge, any agreement which had been made was subject to a condition precedent requiring approval by the Delegates, and that this condition had not been fulfilled. After the trial the appellant had accumulated several documents, some of them sent by anonymous well-wishers. The appellant set great store by this material for two reasons. First because it went to rebut the case raised by the respondents' notice; second, because it seemed to him that any gaps which there might have been in the contract would be repaired if it could be shown that the delegates had given their approval to a project presented to them under cover of a Delegates' Note which gave the details whose absence was said to have vitiated the contract. The first ground (page 26) would have been a formidable basis for the appellant to adduce further evidence, had it not been for a surprising event. On 9th October 1990, not very long before the appeal was due to begin, and after the appellant had served his new material, the respondents abandoned the contention that the alleged agreement was subject to the condition precedent about the Delegates' approval which had formed part of their case from the outset. When applying to amend the respondents' notice to make the deletion the respondents' solicitors deposed:

"For the avoidance of doubt, I should emphasise that the Respondents' abandonment of the contentions in paragraphs 2(l)(i) and 2(2)(i) of the Notice does not in any way imply their acceptance of the Appellant's contention that the Delegates did approve his book. The decision not to pursue this point on appeal has been taken as a result of a review of its legal merits and of the transcript of the learned Deputy Judge's judgment."

This amendment was fatal to the appellant's application to adduce further evidence for it eliminated the central issue around which the action had been fought, and left in issue only the existence of any sufficiently detailed contract. We understand why the appellant considered that the new evidence would strengthen his case on this issue, and we also understand why, if his evidence is reliable, he should be more than (page 27) ever aggrieved about his treatment. But the approval by the Delegates, not at that stage communicated to the appellant, of a bargain containing too many gaps to be enforceable in law, could not in logic build a new and complete agreement, even if the proposal which had been approved had by now had the gaps completed with figures for the print run etc.

We therefore dismissed this application. Since, however, the appellant is concerned about the fact that, before the trial began, the court set aside certain subpoenas, on the basis of evidence which, according to the appellant, he can now demonstrate to have been false, we record that in dismissing the application we express no opinion on the substance of the material which he tendered, which we have not examined in any detail.

Next, there was an application by the appellant to argue a point not previously raised, namely that he is entitled to recover in quasi-contract a reasonable sum to reflect work done and expenditures incurred in anticipation of a contract which did not in the event materialise. That a recovery in such circumstances is feasible cannot be doubted (see Goff & Jones on Restitution, 3rd Edn., Chapter 18), and we had ourselves speculated on whether if such a claim had been put forward at the trial, it might have had some prospect of (page 28) success. But it was not, and it would not in our judgment have been just to admit a claim which had never been pleaded, raised at the trial, or ever mentioned in the notice of appeal, the more so since it depends upon facts which could only be explored at a re-trial.

Lest the appellant should think that he has lost a claim which, if he had not been representing himself, would have yielded a substantial recovery I should make it plain that even if we had allowed the issue to be raised at this very late stage there is no basis upon which it would even have been arguable that recompense for the wasted time and effort spent in re-writing the work could be recovered, for the Press made it clear that it was for the appellant to take the risk of re-writing, and that the prospects of success were not good. The claim might perhaps have had some plausibility in relation to the appellant's activities between 20th May and 18th July 1985, but the appellant did little during this period except unfortunately to establish a country retreat in anticipation of the re-writing process. We could not properly open up a wholly new claim where the financial recovery could at best be so modest.

We should mention at this point another way in which the appellant's case might have been put, namely that the parties having conducted themselves on the basis that (page 29) they stood in a binding contractual relationship there is an 'estoppel by convention" which precludes the respondents from now denying the existence of such a relationship: see for example Amalgamated Investment & Property Co. v Texas Commerce International [1982] Q.B. 84. Whilst speculation on these lines is tempting we believe that an appellate court should not as a rule be drawn into raising on behalf of an unrepresented party issues of mixed fact and law which have never been canvassed at any prior stage. We therefore say nothing about it, save to observe that so little was done by one party to the knowledge of the other between the conversation of 20th May and Mr. Charkin's letter of 18th July that any argument based on estoppel must have had only a modest prospect of success.

Resuming, we come to the last of the applications before this court, whereby the appellant sought leave to adduce further evidence as to a "custom and usage" concerning the need for agreement on a print run and other matters. This needs some explanation. It will be recalled that the respondents' bare denial of a concluded contract was not developed until the closing stages of the trial, when counsel submitted that there could not as a matter of law be a contract unless these matters were agreed. what the appellant made of this we do not know. Probably not very much, given that he was (page 30) understandably preoccupied with the issue as to the approval by the Delegates which then seemed to be the main point in the case. A lawyer might well have reacted differently, by exclaiming at the contrast between this new submission and the terms of the respondents' own standard form of contract. He might have asked the Court to consider how the Press was arguing that it could not bind itself without having agreed with the author a price of £X, a print-run of Y copies, and a format of (say) hardback, in face of the fact that once these matters had been agreed, the Press would have gone on to demand a formal contract which by virtue of clause 5 cancelled all these supposedly essential terms and left the whole affair to the judgment of the Press? Out of a rhetorical question such as this there might have arisen a debate about how in the publishing business these things are dealt with in practice; and this would no doubt have led to submissions as to the way in which the judge could be appraised of the practice, whatever it might be.

None of this happened, and the hearing concluded without any mention of the possibility that evidence might be needed, or any reference to custom or usage. The matter was argued and decided as a question of pure law. It was not until the learned judge added the reference to custom or usage when revising the transcript (page 31) of his oral judgment that the appellant realised that the respondents might assert against him on the argument of the appeal, that something on those lines ought to have been proved.

Upon the transcript of the judgment being delivered the appellant set about filling the gap which had thus unexpectedly appeared in his case, and obtained affidavits from Mr. Giles Gordon (a literary agent) and Mr. Mark Le Fanu (the General Secretary of the Society of Authors). These dealt, not with informal arrangements of the type here in issue, but with written contracts and memoranda of agreement between author and publisher. They were to the effect that print run (both affidavits), format (both affidavits) and price (Mr. Gordon's affidavit) are rarely stipulated. The appellant then sought leave to adduce this evidence on the hearing of the appeal. The respondents objected, because (i) the evidence might have been called at the trial, and (ii) the practice which the deponents described lacked the attributes of certainty notoriety and universality which are essential to a legal custom.

We did not accept these submissions. The fact that the evidence could have been obtained for the trial was not a sufficient reason for shutting it out, given the history which we have described. Nor in our judgment (page 32) were the formal requirements for proof of a custom of relevance here. No criticism can be made of counsel for linking his argument to the requirements of a legal custom, since this is how it has been put by the appellant - following the learned judge. Indeed the objection might very well have been sound, if the sole relevance of the new evidence had been to the establishment of a custom, properly so called: and hence to amplify or explain a contract whose existence was undoubted. In the present case, however, the evidence had another function, namely to provide a background of practice against which the court could decide whether certain aspects of performance were so fundamental that the absence of any provision for them was fatal to the enforceability of the bargain. We saw no reason why the technical rules governing the proof of custom should apply so as to rule out information of this kind, so necessary to a just resolution of the dispute; and we therefore determined to admit it. Once we announced this decision the respondents made it plain that they did not wish to have the deponents produced for cross-examination, or to adduce rebutting evidence. We may therefore proceed on the footing that the practice is as the deponents have described. (page 33)

Contract or No Contract?

After this long introduction, I come to the central issue, which is quite short. In the passage already quoted, the trial judge recognised that the issue had two aspects:

1. Even if the appellant and Mr. Hardy intended to make a contract which would be immediately binding in law, albeit subject to a condition precedent, did the absence of agreement on certain matters entail that they had failed to do so?

2. Were the gaps in the bargain so large that the appellant and Mr. Hardy cannot have contemplated that they were making an immediately binding contract, before the gaps were filled by further agreement?

Although distinct, these aspects of the problem are closely linked.

I will begin with the first, dealing at the outset with the point on which we admitted new evidence. The authorities on incomplete bargains such as May and Butcher v. R. [1934] 1 K.B.17, Foley v. Classique Coaches [19341] 1 K.B. 1, Scammel v. Ouston [1941] A.C. 251 are familiar and the general principles are well established. (page 34) What is not so fully discussed is the manner in which, in order to apply these principles, the court decides how a term is so "fundamental" that its absence wrecks the bargain. It seems that four situations may be distinguished.

1. Where the courts have already decided that in relation to a particular type of contract a particular term is or is not fundamental. The most conspicuous example is the rule that absence of agreement on a price does not vitiate a sale of goods. Where precedents exist the court will apply them directly or by analogy.
2. Where the contract is of an everyday kind, with which the judge is familiar in ordinary life. Here, it seems that he uses a common-sense intuition to assert, usually without elaborate reasoning, that the omitted terms fall into one category rather than another. It appears here that the process is similar to that by which a judge decides whether a term is a "condition" or a "warranty".
3. Where the subject-matter of the bargain lies in a specialist field with which the judge is familiar. Here the court uses its own informed intuition to categorise the omitted term, often without detailed exposition.
4. Where the contract is of a specialist kind with which the court is not familiar. (page 35)

The cases have little to say about this fourth category, which is the one with which we are concerned. Given the procedural history of this action the trial judge cannot be criticised for doing his best to deal with this late addition to the respondents' case as best he could, especially as he does not seem to have been pressed with the significance, which now seems obvious, of the respondents' own standard form of contract. I believe that even without the further information I would have formed a different view from the judge, but this does not matter. We are now aware of a practice which even in formal contracts leaves matters like print run, etc., to the discretion of the publisher. In my judgment this makes it impossible for the respondents to argue that in an informal bargain, otherwise possessing the attributes of a binding contract, the failure to agree on these matters entails that no contract can exist: for either the parties will later agree upon them, or the publishers will decide. Any doubts on this score are to my mind removed by Abrahams v. Herbert Reiach Ltd. [1922] 1 K.B. 477. Although the headnote of the report might indicate that the contract expressly left the format, price, print run and date of publication to the discretion of the publishers, but I do not so read the judgments - see especially the statement of Scrutton L.J. at page 481 that "nothing is said" about these matters. I understand this to have been a bargain where (page 36) nothing was agreed except the undertaking to publish at an agreed royalty. It is true that the argument was confined to the measure of damages, but I think it inconceivable that if Mr. Jowitt arguing for the publishers, and Bankes, Scrutton and Atkin LJJ. charged with the appeal, had thought that the absence of the terms which I have mentioned might have been fatal to the existence of any cause of action at all, the possibility would never have been mentioned.

I therefore differ from the learned judge on this point. I pause to sound another note of concern. The defence that insufficient terms had been agreed was made explicit much too late, but it was a perfectly fair point. What I do find disturbing, however, it that when the appellant attempted to meet it with evidence from the trade the respondents stoutly resisted its introduction: and yet, when it was introduced they caved in and made no attempt to controvert it. The respondents had ample notice of the application and the fact that they had not come to the hearing of the appeal armed with evidence to the contrary must show that there was no such evidence to get. The Press is one of the longest-established publishing houses in the United Kingdom, and no doubt in the world. They must have been aware from the outset that the absence of agreement on the matters in question was not, in the trade, regarded as preventing a formal (page 37) agreement from coming into existence. Candour would, I believe, have required that this should have been made clear to the judge and ourselves, rather than a determined refusal to let the true position come to light.

This is not at all the end of the matter. The new evidence does no more than confirm that an agreement plainly intended to have legal effect, and otherwise complete, will not be nullified simply because it does not state the format, print run and price: and, I would be prepared to hold, because it does not expressly state that such matters are left to the judgment of the publisher, for such a term would in my view readily be implied. It might seem logical to proceed, from deciding that one set of terms is not essential, to consider whether another term is essential, and so on through all the terms which are missing. We were rightly brought up short by Mr. Warby who reminded us of what Lord Roskill had to say in Aoterroa International v. Scancarriers [1985] 1 N.Z.L.R. 513:

"But the first question must always be whether any legally binding contract has been made, for until that issue is decided a Court cannot properly decide what extra terms if any must be implied with what is ex hypothesi a legally binding bargain, as being necessary and reasonable to make that binding (page 38) bargain work. It is not correct in principle, in order to determine whether there is a legally binding bargain, to add to those terms which alone those parties have expressed, further implied terms upon which they have not expressly agreed and then by adding the express terms and the implied terms together thereby create what would not otherwise be a legally binding bargain."

It must be recognised that there cannot be found in this passage the route to a decision on whether there is a contract or not, since it requires the court to assess the contractual efficacy of express terms which the court knows, ex hypothesi, could be bulked out by implied terms. Still, it provides a valuable reminder of the risks involved in the exercise of taking potential implied terms one group at a time, implying them, moving on to another group, implying those, and so until a contract is built up out of implied terms, from no express bargain at all.

We must therefore consider whether there was a sufficient skeleton of express terms to be fleshed out by implication. The judge has found that Mr. Hardy made a commitment, conditional only on the revised text being no worse that the one which had been submitted. In addition it was agreed that the appellant should have no advance, but a fair royalty so that if the book was a (page 39) success he would do well out of it. Nothing more. No document showing a clear intent that, if at all possible, the parties should be legally bound.

Let us first consider the "commitment". It is argued that there are only two possibilities: that this signified an intention to make a legally binding contract, or that Mr. Hardy was dishonest in giving an undertaking which his employers would be totally free to disregard. I cannot agree. I entirely accept that what the appellant wanted, after his previous unhappy experience, was an assurance that time spent on revision would not be wasted. That is what he got, and I have no doubt that Mr. Hardy was sincere in giving it. Such a commitment might have founded a claim, if one had been put forward and if the facts had supported it, for a recompense in respect of time spent on revision before the arrangement fell through. But I cannot extract from the use of the word commitment, or from the Judge's finding that a commitment had been made, sufficient to show that however obviously deficient the bargain might have been the parties contemplated that come what may, so long as the revision was satisfactory, the Press must publish or be sued.

There remains the undertaking that the appellant would have a fair royalty. It seems to me that this is (page 40) far distant from a situation where, in a formal document obviously intended to be binding, the parties agree that (for example) "a reasonable price" should be paid. What happened here was simply that Mr. Hardy was very properly giving a warning that the project was risky; that it was too risky for an advance to be paid; but that the appellant would have fair shares in any success which both of the participants in the telephone conversation hoped would be achieved. Was this enough to insert a concrete express term, upon which an edifice of implication could be built? I am afraid that I cannot think so.

Thus, with equal reluctance to that expressed by the trial judge I must agree that the claim fails. In terms now no longer fashionable, the Press through its representative made a gentleman's agreement, and broke it. No legal remedy ensues.

This is not quite all. I do not know whether an outsider studying the history of this transaction and of this litigation would feel that, in his self-financed struggle with the assembled Chancellor, Masters and Scholars of the University of Oxford the appellant has had a fair crack of the whip. I certainly do not. (page 41)

If the evidence adduced by the Press is to be relied upon, the project was never the subject of grave deliberation by the Delegates on whether the intellectual merits of "Making Names" would measure up to the high standards which the Press had always set for itself. The staff of the Press stopped the project before it ever reached the Delegates. Mr. Charkin took the decision, not because he thought the book was no good - he had never seen it and the reports were favourable - but because he thought it would not sell. Let there be no mistake about it, the failure of this transaction was about money, not prestige. Nor does the course of the litigation give any reason to suppose that the Press had any interest but to resist the claim, no matter on what grounds, so long as they succeeded.

I recognise that there is a great risk in a court, not privy to what is going on behind the scenes, making pronouncements about the desirability that the parties should have reached an accommodation. The judge made it plain that there could be no question of the respondents being ordered to publish the book. We did the same. The Press was never at risk in this respect. As to the financial side, although the trial judge said that if he had found a breach of contract the damages would have been "substantial", too much should not be built on this. "Making Names" might have been one of the rarities in the (page 42) field of mathematics, logic and metaphysics which captured the attention of the non-specialist purchaser. Equally, it might like its distinguished predecessor* have "fallen dead-born from the press". Contingencies of this nature must have entailed that even if the appellant's action were to succeed the financial recovery could not be on an extravagant scale. This being so, a settlement fair to both sides should not be beyond reach. Further than this it would not be proper to go: for after all, we do not know what negotiations there may have been.

It cannot be denied that during the argument of this appeal what are called "the merits" of the dispute were constantly in our minds, as they were with the trial judge. Where a large corporation represented by counsel is faced with a litigant in person in circumstances where the justice of the case may seem to favour the litigant there is always a risk of unfairness - not to the litigant in person, but to the corporation and its counsel. As to the latter, I would wish to acknowledge the courtesy and determination with which Mr. Warby faced up to a court, not always disposed in his clients' favour. We were however very conscious of the risk. The history of the interlocutory proceedings suggested that there was a failure of communication between the respondents' legal advisers and those in charge at the (page 43) Press. Could it also be that the Delegates whose interests are so directly in suit were out of touch with what was going on in the action? Could it be that they did not know what had been, what was being, said about the stance adopted by the Press?

With this in view we suggested to Mr. Warby, on the penultimate day of the argument, that he might wish to take final instructions on his clients' position, so that we should not fall into the error of intemperate comment. On the following morning he put before the court a statement, upon which he wisely declined to elaborate. It is this: [in fact, Oxford's orated statement was even more shocking than the version retyped overnight and which Mustill LJ reproduces below. - A. M.]

"Oxford University Press has defended itself in this action to defend the status of its imprint which Mr. Malcolm has coveted. Notwithstanding what has been said in the evidence, all new titles published from Oxford have to obtain the approval of the Delegates. They are particularly concerned to maintain the high academic reputation of the scholarly and pedagogical books published in the name of the University. All the evidence available on Mr. Malcolm's final manuscript indicated that it did not reach the appropriate standard. Many manuscripts of greater merit have to be rejected by OUP every year.

It was not until after court proceedings were (page 44) instigated that the senior Officers of the Press were aware, through the tape recordings, that the editor had made statements which could be interpreted as a commitment to publish. This was completely beyond his authority but we accept, as he firmly believes, that he made clear that anything he offered was subject to Delegates' approval and a final written contract.

Having taken legal advice OUP believed that there was no binding contract, and this was borne out by the judgement of the court of first instance. It is hoped that this will be confirmed in this court.

OUP accept that Mr. Malcolm's book was not handled as it should have been, and apologise for the pain and inconvenience this may have caused. But, because of their obligation to maintain the academic standing of the Press, the Delegates were bound to oppose an action for specific performance. It is also true that some aspects of Mr. Malcolm's conduct of the litigation have only served to harden the Press's attitude."

Who runs may read.**

I have felt drawn, for the reasons stated, to propose that the appeal should be dismissed. My Lords (page 45) are of a different opinion. For once, it is satisfying to be in a minority.

* I take this to be a reference to David Hume's Treatise of Human Nature - A. M.

** I take this to be a Biblical reference, either to the Old Testament Book of Habakkuk:

or possibly to the hymn (itself perhaps drawn from the above) by Oxford priest John Keble (1792 - 1866):

Lord Justice Nourse:

I have had the advantage of reading in draft the judgment of Lord Justice Mustill, in which everything necessary for the resolution of this regrettable dispute is set out.

The only question of substance for the decision of this court is whether, during their telephone conversation on 20th May 1985, Mr Hardy and the appellant entered into a contract for the publication by the respondents of the appellant's book. Like many questions of its kind, it is both short and difficult.

The three material extracts from the conversation are fully reproduced in the judgment of Lard Justice Mustill. The first of them comes right at the beginning. Mr Hardy, having acknowledged that the appellant wanted a commitment sufficient to take him through the last stage of revision, offered him such a commitment conditional on the revision's (page 2) not, in the opinion of the Press, making the script worse. As to that condition, the judge said:

"But whilst this condition gave the university wide scope for rejection of the revised draft, the power on the part of the university of rejection had to be exercised bona fide, and indeed there is no dispute that this condition has in fact been satisfied. I am therefore quite satisfied that a clear commitment was made by the university."

The second extract comes about half way through the conversation, after a long discussion about cutting, subtitling and style. At that point Mr Hardy said that he would like to have the script accurately cast off, which would not take more than a week or so. Then he could do costings and could talk to the appellant again about length. The Press would have some costing done on the basis of the actual length and he and the appellant would talk more precisely then about what kind of saving might yield what kind of price-reduction; that again would depend on whether the Press did it in hardback only or in hardback and paperback. Mr Hardy was still wavering on that one.

The third and crucial extract, which comes at the very end of the conversation, must be quoted again in full:

Hardy: ....Anyway, I will not go on at any greater length. I mean if you want I'll be getting in touch again when I've done the costs and cast-off and so forth and then we can er talk about some sort of contract.
Malcolm: Great! Fantastic news! Really good!
Hardy: It seems to me that because it's such a risky venture I'm not going to be terribly generous financially, ermm... I mean what I think we should agree is that you have a fair royalty so that if the book is a success you will do well out of it.
Malcolm: Yes.
Hardy: ...but I don't want to pay you in advance (page 3) money that's been very riskily invested.
Malcolm: Sure, sure I wouldn't expect that, yup.
Hardy: Okay?
Malcolm: Great! That's very good. I'm just in the middle at the moment... I couldn't do anything immediately because we've got the Brighton Festival going on here and I'm involved in all sorts of things, but everything finishes in a week or two... and by then perhaps I can get down to it.
Hardy: Right. Good.
Malcolm: Great!
Hardy: Okay, well if you have any further thoughts or questions do come back to me with them, in the meantime ...
Malcolm: In the meantime I'm waiting for you, you'll do the cast-off and...
Hardy: I'll write to you. Okay?
Malcolm: Splendid! Well thanks very much, that's er, that's made my day (HH laughs) not to say my life.
Hardy: Well let's hope it does well... Okay?
Malcolm: Okay. Thanks very much."

What then was the effect of this conversation in law? Although the judge was referred to Abrahams v Herbert Relach Ltd. (1922) 1 KB 477, I cannot think that the real significance of that decision was brought to his attention. Its significance resides in an assumption, first made in argument by Mr William Jowitt and evidently shared by a division of this court consisting of Bankes, Scrutton and Atkin L.JJ., that an agreement between a publisher and an author for the publication of a book for a stated consideration and no more is a complete and enforceable contract. A common assumption made by judges as eminent as these is as valuable as any decision of this court. Having sought to give the matter an independent consideration, I am confident that we ought to apply the assumption by way of decision. (page 4)

The functions of an author and his publisher are quite distinct, a state of affairs which has been humorously expressed by the saying that each regards the other as a necessary evil. The function of the author is to produce the raw material of a script. The function of the publisher is to present and promote that material in such a way that it will be as widely acquired by the reading public as is practicable. And so a contract in the form which has been postulated, however unusual or imprudent it may be, is not one which the law regards as incomplete. It simply requires the publisher to perform his distinct function, leaving to him the decision of all questions of presentation and promotion, subject only to a requirement that he must act in good faith towards the author and not so as to detract from the purpose of the contract.

Accordingly, there was not, as the judge thought, any need for agreement on questions of print run, hardback versus paperback, sale price and so forth. On the other hand, there could not be a contract without agreement as to the consideration which the appellant was to receive from the respondents. Can it be said, on an objective view of the words in which the parties expressed themselves, that there was that agreement here? If the last part of the conversation had stood alone, I would have said that it could not. It would have appeared that everything was to remain fluid until the cast off and the costing had been done, when there would be talk "about some sort of contract", it being highly probable that at that stage there (page 5) would be an agreement for the payment of a royalty at a specified but fair rate without any advance.

How then is this view of the last part of the conversation affected by the judge's finding, based primarily on the beginning of it, that "a clear commitment was made by the university"? Mr Hardy offered the appellant the commitment he wanted, a commitment to publish the book on the faith of which the appellant could have the confidence to undertake the last stage of revision. The solemnity of such a commitment is obvious enough in itself. But that was not all. There was attached to it a condition which can only have been intended to protect the respondents. This is consistent only with the commitment's having been intended to have contractual effect.

It is within the aura of this contractual commitment to publish the book that the last part of the conversation must be reconsidered. The two expressions on the part of Mr Hardy which are most against the appellant are:

"...and then we can er talk about some sort of contract."

"...I mean what I think we should agree is that you have a fair royalty..."

The first is suggestive of there being no agreement at all; the second of there being no agreement as to the consideration. The first, if taken literally, is contradictory of the contractual commitment to publish the book. But immediately afterwards Mr Hardy said:

"It seems to me that because it's such a risky venture I'm not going to be terribly generous (page 6) financially, ermm ... I mean etc..."

That shows that when Mr Hardy referred to "some sort of contract" he actually meant the consideration which the appellant would receive.

The second of Mr Hardy's expressions is more problematical and has caused my mind to fluctuate from time to time. The consideration which the parties clearly intended that the appellant should receive could have taken one of three forms: an advance, a royalty or a combination of the two. Any thought of an advance was rejected by Mr Hardy with the assent of the appellant. That left only a royalty. On the whole I think that what the parties intended was that the appellant should receive a fair royalty, at a rate which would be agreed when the cast off and costing had been done. Having got to that stage, mindful as ever of the contractual commitment to publish the book, I see no real alternative to positing an agreement that the appellant should receive a royalty at a rate to be agreed and in default of agreement at a fair rate. That is an agreement to which the law will give effect.

I am therefore of the opinion that, during their telephone conversation on 20th May 1985, Mr Hardy and the appellant entered into a conditional contract for the publication by the respondents of the appellant's book; the appellant to receive a royalty at a rate to be agreed, in default of agreement at a fair rate. The condition having since been satisfied, the contract is enforceable at the suit of the appellant. I would emphasise my belief that (page 7) this opinion has been formed on an objective view of the words in which the parties expressed themselves and without the implication of any term or terms.

What is the appellant's remedy for the respondents' breach of contract? The primary relief sought at the trial was an order for specific performance and the same plea was made in this court. The judge, while recognising that specific performance of a publishing contract may be granted in a proper case, said that if the question had arisen, he would have refused to make such an order on the grounds of impracticability. He continued:

"Mr Malcolm has fairly and honestly told me, and this is apparent in any event, that relations have broken down irretrievably between him and the university, that he has no desire to continue relations with the university and that enforcement of a continuing relationship is likely to be impossible. I think co-operation is required for any publication of Mr Malcolm's work. There are so many stages where the publisher and writer must work together if the venture is to be completed, let alone successfully. I cannot think that any order for specific performance in this case would be practicable. I would, however, have been minded to indicate that a substantial award of damages was called for to recompense Mr Malcolm for loss of the opportunity for him to enhance his reputation by securing the imprimatur of the Oxford University Press on his work."

Even if it was open to this court to take a different view from the judge on this question, I certainly would not do so. I think that that part of his decision was plainly right. The appellant's only remedy is an award of damages.

For my part, I would allow the appeal and order an enquiry as to damages.

Leggatt L.J.

The judge decided the case on two associated points:

1. that essential terms were not agreed, and
2. that the parties contemplated that particular terms were yet to be determined by agreement

In relation to the first point different considerations apply to the terms as to royalty than to the other terms. Mr Warby denies that if the amount of royalty or the means of ascertaining it was not agreed there was any such legally binding contract as would afford a framework into which any implied term as to the payment of reasonable royalty could be fitted: see Aoterroa v Scancarriers [1985] NZLR 513 per Lord Roskill at page 556. But he concedes that, if there was express agreement for the payment of royalty, then terms as to print-run, format and price can be implied. He is constrained to make that concession by the decision of this court in Abrahams v Reiach [1922] 1 K.B. 477. It is common ground that Mr Hardy gave Mr Malcolm an assurance that he would be paid 'a fair royalty.' The question is whether this was said with contractual intent. The respondents' alternative argument that the parties intended the amount of royalty to be determined by subsequent agreement depends on the same considerations: did they intend that there should be no legally binding agreement until the amount of the royalty had been agreed between them ? (page 2)

The respondents say that Mr Hardy's reference at the beginning of his telephone conversation with Mr Malcolm to the fact that he was "not offering a totally unconditional commitment" made plain that he was not entering into an enforceable agreement. Mr Malcolm retorts that the sense in which the commitment was not totally unconditional was explained immediately thereafter when Mr Hardy said of his unwillingness to offer such a commitment that it was "because obviously if what you do seems to us to make it worse then we would write and say so." This was the basis of the Deputy Judge's finding that what Mr Malcolm was given was an absolute commitment subject only to the condition upon which Mr Warby himself relied at trial that the revised draft should not be worse than the first. About that the Deputy Judge held that "there was no dispute that this condition has in fact been satisfied": see transcript page 10D. Indeed he had earlier held (at p.4F) that "[i] It is common ground between the parties... that the revised script was, in the opinion of the University, better than the original." Against that finding there is no appeal.

It is difficult to know what the Deputy Judge meant by a "firm commitment" other than an intention to create legal relations. Nothing short of that would have had any value whatever for Mr Malcolm. He had made it clear that without a commitment he was not prepared to undertake the work of revision expected of him. To suggest that Mr Hardy intended to induce Mr Malcolm to revise the book by giving him a valueless assurance would be tantamount to an (page 3) imputation of fraud. So Mr Warby has preferred to explain the notion of "commitment" as being no more than a valueless expression of a revocable intention. I do not believe that that is what Mr Hardy thought he was giving. It must be borne in mind that not only did he say at the beginning of the telephone conversation that he knew Mr Malcolm wanted a commitment, and that the Press felt confident enough to tell Mr Malcolm to go ahead and revise the book (subject only to the condition which was in fact fulfilled), but on the following day he wrote to Mr Malcolm to say, "I am pleased that we are going to do your book." I find it hard to construe that expression as anything less than an acknowledgement that the Press was contractually bound to do so. To this Mr Malcolm replied that he too was pleased that the Press was going to do his book, and that he had waited for over ten years for this moment to arrive.

When Mr Hardy was reproached by Mr Charkin for failing to observe the internal requirements of the Press he replied, "The reason why I spoke in terms of a contract, rather than willingness to consider a revised transcript, was that the author estimated that the revision we sought would take six months' solid work." He also remarked that "this is not a case of offering a contract out of the blue for a book that happened to take my unconsidered fancy." The question therefore is whether, despite Mr Hardy's belief that in these circumstances he had committed the Press contractually, he had not in fact succeeded in doing so. (page 4)

It is in that context that the latter part of the relevant telephone conversation must be viewed. Mr Hardy first mentioned that when he had done the costs and the cast-off he could talk about "some form of contract". That to me is equivocal: although it might refer to the making of a contract in the first place, Mr Hardy then went on to speak in terms of consideration alone, saying, "I mean what I think we should agree is that you have a fair royalty so that if the book is a success you will do well out of it", adding, "but I don't want to pay you in advance money that's been very riskily invested." The conversation concluded with Mr Hardy saying, "Well let's hope it does well..." In my judgment the proper inference in the circumstances from the use of these expressions is that Mr Hardy was inviting Mr Malcolm to agree, which he did, that he should be remunerated by a fair royalty without an advance. I would therefore hold, contrary to the Deputy Judge's finding, that the respondents did expressly contract to pay Mr Malcolm "a fair royalty". It follows that in my judgment when Mr Hardy used the expressions 'commitment' and 'a fair royalty' he did in fact mean what he said; and I venture to think that it would take a lawyer to arrive at any other conclusion. There was therefore an enforceable contract for the publication of Mr Malcolm's book.

The respondents' final statement, which Mustill L.J. has reproduced in full, may be thought unworthy of them. (page 5)

There is in my judgment no call to interfere with the exercise by the Deputy Judge of his discretion to refuse specific performance. I agree with Nourse L.J. that the appeal should be allowed and an enquiry ordered as to damages. But a becoming magnanimity on the respondents' part, matched on the part of Mr Malcolm by a realistic moderation, will avoid the need for any enquiry.

ORDER

MALCOLM vs. THE CHANCELLOR MASTERS AND SCHOLARS OF THE UNIVERSITY OF OXFORD

TUESDAY THE 18TH DAY OF DECEMBER 1990 2644/90

IN THE COURT OF APPEAL CASE No. CH 1986 M 7710

ON APPEAL FROM THE HIGH COURT OF JUSTICE CHANCERY DIVISION

BEFORE LORD JUSTICE MUSTILL, LORD JUSTICE NOURSE AND LORD JUSTICE LEGGATT

BETWEEN ANDREW MALCOLM PLAINTIFF

AND THE CHANCELLOR, MASTERS AND SCHOLARS OF THE UNIVERSITY OF OXFORD DEFENDANTS

UPON READING the Notice of Motion dated the 18th day of April 1990 filed by the Plaintiff by way of appeal from the order of Mr Gavin Lightman QC (sitting as a Deputy High Court Judge of the Chancery Division) dated the 16th day of March 1990 whereby it was ordered

(1) that the Action do stand dismissed

(2) that the Plaintiff do pay to the Defendants 75% of their costs of the Action such costs to be taxed and paid forthwith if not agreed

AND UPON READING the Respondents Notice dated the 17th day of May 1990 filed on behalf of the Defendants by way of seeking to affirm the said Order on additional grounds

AND UPON HEARING the Plaintiff in person and Mr M Warby of Counsel on behalf of the Defendants

AND UPON the Application of the Plaintiff for leave to adduce the further evidence of the affidavits of Mr Giles Gordon and Mr Mark Le Fanu being granted

IT IS ORDERED

(1) that this appeal be allowed and that the order of Mr G Lightman QC (sitting as a Deputy High Court Judge of the Chancery Division) dated the 16th day of March 1990 be set aside and in lieu thereof it is ordered that there be an enquiry as to damages, such damages to be assessed by a Master of the Chancery Division

(2) that the Plaintiff's costs of this Appeal and in the Court below be taxed if not agreed and paid by the Defendants to the Plaintiff

(This matter occupied the time of the Court from 11.50 am to 1.05 pm and from 2.05 pm to 4.15 pm on the 17th October 1990 and from 10.38 am to 1.00 pm and 2.08 pm to 4.10 pm on the 18th October 1990 and from 10.45 am to 11.45 am on the 19th October 1990 and from 10.02 am to 10.12 am on the 18th December 1990)

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