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Repudiation


Approbation and Reprobation
Last updated: 06-Oct-2014

Heyman v Darwins Ltd. [1942] AC 356, per Lord Wright at p.388:

The authorities, I think, sufficiently dispose of an argument based on the maxim that a party cannot both approbate and reprobate a contract, at least in reference to an ordinary submission as contrasted with a clause making an award a condition precedent, so that it is not merely collateral or procedural, but essential to the obligations of the contract. Like all maxims of the law, that maxim, though it has a proper but very limited application, is too vague and general to be applied without careful limitation, otherwise it is apt to be misleading, as many cases have shown. Recently, in Lissenden V. C. A. v Bosch, Ld. [1940] A. C. 412, this House indicated what are the true metes and bounds of the maxim. Its most correct application is in relation to the equitable doctrine of election, but it is also used as meaning that a party cannot take the benefits of a contract without conforming to its onerous conditions. This, however, cannot truly be said of a man who, being sued for repudiation or breach of a contract, disputes the liability and claims the benefit of an arbitration clause to decide whether or not he is liable. He is in truth not reprobating the contract but approbating it. He is using it as a shield against the claim. This, I think, is abundantly clear from what I have already said and need not repeat, and from the authorities which I have cited. The maxim is also sometimes invoked to indicate conduct which disentitles a party to rely on conditions precedent, but the ordinary arbitration clause is not a condition of the contract.

But where it is used in reference to arbitration, the maxim has been relied on as a matter, not of law, but of discretion. This I think is the only correct use in this context. Section 4 of the Arbitration Act, 1889, makes the power of the court to stay an action under the arbitration clause a matter of discretion and not ex debito justitiae. Though the dispute is clearly within the arbitration clause, the court "may" still refuse to stay if, on the whole, that appears to be the better course. But the court must be satisfied on good grounds that it ought not to stay. The onus of thus satisfying the court is on the person opposing the stay, because in a sense he is seeking to get out of his contract to refer, though in truth an arbitration clause is not of strict obligation, because it is, under s. 4, always subject to the discretion of the court.


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