Holman v Johnson (1775) 1 Cowp 341Agreement for the sale of tea at Dunkirk valid and value of tea recoverable
The plaintiff sold and delivered a quantity of tea to the defendant knowing that the defendant intended to smuggle it into England (without paying the relevant duty). The plaintiff brought an action against the respondent for recovery of the value of the tea.
The respondent argued that in a contract for sale where the illicit intention of the buyer was within the knowledge of the seller, the seller was not entitled to the assistance of the law to recover the value of the goods. The plaintiff contended that the contract could not be said to be in violation of the laws of England because it was completed by the delivery of the goods at Dunkirk (France) where the transaction was lawful. The plaintiff submitted that it was of no concern to it what the respondent intended to do with the tea.
The Court held for the plaintiff. The key question was whether the plaintiff’s demand was founded upon the ground of any immoral act or contract. Lord Mansfield observed that the plaintiff’s interest in the contract was completed by the delivery of goods at Dunkirk after which there is nothing left for the plaintiff to do. He concluded that the plaintiff was not guilty of any offence and noted that it would set a dangerous precedent to designate such an act as a crime. In contrast, if the plaintiff had agreed to send the tea to England he would have been an offender against English law and he would not have been able to raise an action for recovery of the value of the tea.