Facts
- Leigh provided a guarantee to pay for goods supplied to his brother, William Morgan, up to a specified limit.
- After Leigh died, the plaintiffs continued to supply goods to William Morgan, unaware of Leigh’s death.
- When the total sum exceeded the guaranteed amount, the plaintiffs sought payment from Leigh’s executors.
- The executors contended that the guarantee terminated upon Leigh’s death.
- The Court of Exchequer found for the plaintiffs, holding the guarantee valid until the plaintiffs had notice of Leigh’s death.
Issues
- Does the death of an offeror immediately terminate a continuing guarantee, even if the offeree has no notice of the death?
- At what point does an offer, such as a guarantee, cease to be valid in the event of the offeror’s death?
Decision
- The court held that a continuing guarantee remains valid until the offeree is informed of the offeror’s death.
- The guarantee provided by Leigh did not terminate automatically upon his death.
- The executors remained liable on the guarantee for goods supplied prior to the plaintiffs gaining knowledge of Leigh’s death.
Legal Principles
- A continuing guarantee does not end merely due to the offeror’s death; it continues until notice of death is communicated to the offeree.
- Communication of essential changes, such as revocation or death, is necessary for terminating continuing offers or guarantees.
- Distinction exists between continuing guarantees (which can end with notice of death) and guarantees limited to single transactions.
- Later cases, such as Dickinson v Dodds (1876) 2 Ch D 463, recognize that acquiring knowledge of circumstances ending an offer (such as the offeror’s death) may be sufficient for termination.
Conclusion
Bradbury v Morgan established that a continuing guarantee remains effective until the offeree has notice of the offeror’s death, emphasizing the necessity of communication to terminate ongoing contractual offers or guarantees.
