Les Affréteurs Réunis Société Anonyme v Leopold Walford (London) [1919] AC 801
Contract – Ship – Charterparty – Chartering Broker’s Commission
Facts:
Leopold Walford (Walford) acted as brokers for a charterparty. Les Affreteurs were owners of a ship. A time charterparty was effected between the shipowners and the Lubricating and Fuel Oils Company as charters. Walford charged a 3% commission which was specified in the charterparty contract which was agreed to in 1916 and was a continuation of an early agreement on similar terms. In 1917, after Les Affreteurs’ ship was recommissioned, the charterparty expired. Les Affreteurs refused to pay Walford’s commission, holding that commission was only payable in respect of hire duly earned under the charterparty.
Issues:
Whether Walford could claim commission from the contract which had expired and after the ship was recommissioned.
Held:
The appeal by Les Affreteurs was dismissed. Les Affreteurs were found have been relying on custom, in that the brokerage was payable only out of the hire as earned. The French agreement was held to be incorporated in the charterparty and thus, the agreements were not separate and to be read and interpreted as one. The charterparty contract between the owners and the charters was relevant to the brokers (which had also long been custom). The case of Harley & Co v Nagata (1917) 23 Com Cas 121, was applied. Charters were entitled to bring action as trustees of the brokers where they were directly party to the contract. Therefore, allowing a third party to sue for an entitled commission.
Updated 19 March 2026
This case summary relates to the House of Lords decision in Les Affréteurs Réunis SA v Leopold Walford (London) Ltd [1919] AC 801, which remains a leading authority on two points of contract law: (1) the incorporation of separate agreements into a charterparty, and (2) the use of the trust device to allow a third party (here, the broker) to enforce a contractual promise made for their benefit, where the contracting party acts as trustee.
The underlying legal principles described in the article remain good law. The trust device identified in this case — whereby a contracting party could hold the benefit of a contractual promise on trust for a third party — continues to be recognised as a valid common law mechanism. It is worth noting, however, that the wider landscape of third-party rights has changed significantly. The Contracts (Rights of Third Parties) Act 1999 now provides a statutory route by which third parties may enforce contractual terms made for their benefit, without needing to rely on the trust device or other exceptions to privity. In many situations arising today, a broker in Walford’s position might instead rely on the 1999 Act. The common law trust mechanism from this case remains available as an alternative, but students should be aware that the 1999 Act is now the primary statutory framework in this area. The article does not mention the 1999 Act, which is a material omission for a complete understanding of the current law on third-party rights in English contract law.
