The emphasis here seems to shift from an unconscionable contract (and one in which Mars-Jones J detected not just inequality of bargaining power but ‘plain, unvarnished deceit’) to one that was acceptably framed but defectively discharged. Even so, the effect was not to let Mills and MAM off the hook. The Lord Justices accepted that there was a fiduciary relationship, and that the defendants were in breach of it. They were therefore not entitled to profit by their wrongdoing. There was discussion about how amends might be made.
It turns out that you can’t have rescission without the possibility of restitutio in integrum. Translating roughly: there’s no point in saying a contract never happened unless you can restore the status quo as it was at the moment of signing. It’s meaningless to turn the clock back if everything has been changed by the contract itself.
The use of Latin in legal argument and judgment has been drastically reduced since 1982. The effect is to make the proceedings less opaque, but they will always be opaque to some extent by virtue of being governed by past decisions, and hinging on distinctions foreign to daily life.
A legal system based on precedent is a monument to creative rot, a sort of cultural compost heap dating back, notionally, I suppose, to the Conquest. Not everything rots down into principle at the same rate, so that the decisions of a Denning, say, can resist the process in the same way that eggshells and avocado stones do, retaining their integrity and withholding their nutrients from the rich millennial mulch of insight and vested interest.
Just as the terminology of the early 1980s now seems very stiff, so the language of earlier cases referred to during the appeal proceedings has an additional fustiness that can sometimes be beguiling. Dixon, CJ, in Alati v. Kruger (1955) refers to the disaffirmance rather than rescission of a contract.
Purely as a word, I prefer ‘disaffirmance’ to ‘rescission’ (which sounds like bad news you might hear at the dentist’s), and I’ve been disaffirming things like mad since I learned it, though made uneasy by not knowing if there’s a shade of meaning involved. Does it make a difference that Dixon was Chief Justice of Australia? I know Australian law derives in some way from English, but how does Australian precedent impinge on English case law? My ignorance seems to increase with every moment of enlightenment. I’ve written with more confidence about Japanese cinema than I do about English law.
I do feel qualified to assess rhetoric, and the award for the most stirring utterance of the appeal must go to Michael Miller, QC, for the plaintiffs, who said:
He who seeks equity must do equity. In the present case it is inequitable that the first plaintiff should seek to recover the whole profit made by the defendant companies as a result of the agreements, without being prepared to permit them reasonable remuneration for the very valuable services they have rendered in turning him from a relatively unknown song-writer to an internationally famous star.
(O’Sullivan had been working for the Post Office when he signed the contract.) Strongly put. What’s sauce for the plaintiff must be sauce for the defendant.
Or as Lord Wright put it in Spence v. Crawford (1939), ‘Though the defendant has been fraudulent, he must not be robbed, nor must the plaintiff be unjustly enriched, as he would be if he both got back what he had parted with and kept what he had received in return.’ Yet this is more or less what the court of first instance had ruled, and even on appeal the defendants were held to be entitled only to ‘a reasonable remuneration including a small profit element’. The underlying idea seems to be that someone who has been defrauded should sue for damages rather than relying on equity to make everything good. There’s a grey area here, though, since in equity the term ‘fraud’ embraces not only actual fraud but certain other forms of conduct falling below the standards demanded by equity. Conduct of this sort is known as ‘constructive’ fraud. One of the examples of such a fraud would be a transaction procured by undue influence, or where one party is in breach of a fiduciary duty to another. Exactly what was held to have been the case here.
The judgment in the lower court was neither upheld in toto, nor comprehensively overturned. Instead it was upheld in part and the judge’s order ‘varied’, with significant adjustments made to it. Mars-Jones J ‘fell into error’ when he accepted counsel’s argument about the appropriateness of compound interest. (Excepted from this were the secret deductions made by MAM (Music Publishing) Ltd from monies taken in Germany and New Zealand. It was right that these sums be repaid with compound interest.)
One of the cases referred to in the appeal was Erlanger v. New Sombrero Phosphate Co. (1878). There isn’t enough poetry in the law for me to risk leaving it out. Might that be a guano enterprise? The market value of birdshit has lessons for us all.
Dad would rather have had his order ‘varied’ than thrown out, I’m sure, but he can’t have enjoyed the experience. If I’ve battled through the case and the appeal in as much detail as I can manage, and with as much clarity, it’s partly to confront for my own benefit how different his world was from mine. In fantasy he would annex the world of books in his retirement. He also encouraged me to think of myself as a potential lawyer, but it isn’t so. My wheels grind differently, and my ego is hungry for a different food.
The case of O’Sullivan & Another v. Management Agency & Music Ltd & Others was a significant one, though it hardly dominated the headlines. Dad would have listened respectfully to submissions made on behalf of a writer or an artist, but un-justice done to a musician, a performer moreover who wrote his own material, somehow struck him more forcibly and may have been part of what caused him to ‘fall into error’.
Possibly there was an element of spurious underdog identification at work. Gilbert O’Sullivan had arrived in London by way of Waterford and Swindon, Dad by way of Llansannan and Aberystwyth. They had both come from nothing. After the death of our neighbour Os(wald) Terry, Dad would reminisce about his own early life using the phrase ‘When I were a little lad …’ which had been Os’s trademark. Dad seemed not to realize that he was advertising the inauthenticity of his remembered struggles with the use of a borrowed tag, though I’m sure that Os picked it up somewhere too, just as the monologue of his we enjoyed so much as children, about Albert and the Lion, turned out to be Stanley Holloway’s really.
Counsel for the defendants were working hard during the appeal to argue down the large sums whose disgorgement had been ordered by the court of first instance. They stated their objection to the master tapes being returned to O’Sullivan, but concentrated their efforts, understandably, on arguments that could save money right away.
It may be that the real importance of O’Sullivan & Another v. Management Agency & Music Ltd & Others was the precedent it set in the matter of master tapes. An anomaly of the case seems to be that Gilbert O’Sullivan ended up in possession of these valuable items, though if he had taken independent legal advice and signed a much more advantageous contract he would have enjoyed no such benefit. This is more or less a technicality in the case itself, because O’Sullivan had since signed other contracts that meant he then yielded up the master tapes to other record companies, but perhaps it expanded the possibilities for others. A singer/songwriter in an oppressive contract who only stood to win back his copyrights might think twice, but the prospect of getting ownership of master tapes would exponentially increase the attractiveness of a lawsuit.