Mandate (or doing something for nothing…)

"Agent" is a slippery word.  Sometimes it means that a representative has been appointed to perform a legal act, and that legal consequences are intended.  At other times a less formal, more limited relationship may have been intended by the parties.  Whether an agency relationship exists is an issue of interpretation.  One must look to the intentions of the parties. Recent cases have highlighted the doubt that surrounds the rules of constitution of agency (see Lord Drummond Young's judgments in Whitbread Group plc v Goldapple Ltd 2005 SLT 281; Laurence McIntosh Ltd v Balfour Beatty Group Ltd and the Trustees of the National Library of Scotland, [2006] CSOH 1907; John Stirling t/a M & S Contracts v Westminster Properties Scotland Limited [2007] CSOH 117; [2007] BLR 537)).

It is, of course, beneficial that a commercial concept be flexible and not overly constrained by formalities.  It seems that it has always been so.  Stair emphasised the informality required in the creation of the gratuitous contract of mandate (later developed into the non-gratuitous idea of agency.) Referring to the need for the mandatar (i.e. the gratuitous agent) to consent to the creation of the contract of mandate, Stair explained (Institutions, I,12,3): "…acceptance of the mandatar may be inferred, or [be] by any other sign, as by pointing with the hand, or beckoning with the head…"

Bearing in mind the ease with which mandate can be created, is there a risk that we are entering into mandate contracts without realising it?  The court will, of course, assess consent objectively, looking at what our actions indicate our intentions to be.  Inferences can be made about intention to be legally bound.  Mandate, as a gratuitous contract, did not, in principle require to be constituted in writing, and was not limited to proof by writ or oath (Gloag, Contract, 184).  In a modern context it is not one of the contracts detailed in s1(2) of the Requirements of Writing (Scotland) Act 1995 which require to be in writing.

A case which helps us to understand the contract of mandate is Copland v Brogan 1913 S.C. 277.  Brogan was the driver of a "conveyance" (the nature of which is not specified).  Primrose Caldwell Copland was described as a school master (and does indeed appear to be male despite having the first name "Primrose").  Brogan had formed the habit of fetching and carrying sums of money, cheques, etc for Copland to and from Copland's home (Dalton) and the bank in nearby Lockerbie.  Brogan was not paid for his services.  On the day in question, between 2 and 3pm, Brogan collected a package from the bank to be delivered to Copland containing bank pass books, and around £34 14s in cash.  Brogan returned home from Lockerbie at 4.30pm.  On his return home, Brogan was no longer in possession of the package, nor could he explain what had happened to it in the intervening period of, at most, 2 and a half hours.  In the words of Lord Justice Clerk Scott Dickson (at 281-2) "He saw several friends, and was in a public house once or twice, where he had some liquid refreshment; but the pursuer does not allege that he was the worse for drink."

How does this case help us to understand the law of mandate?  Firstly, it identifies the standard of care that a gratuitous agent or mandatar must reach.  The Lord Justice Clerk approved Bell's Principles, where Bell identified the duty of a depositary as to "keep the thing with reasonable care."  The meaning to be given to "reasonable care" was expanded upon in the 10th edn of Principles, and this was relied on in the case: "…such care as a man of common prudence generally exercises about his own property of like description."   

Brogan's lawyers (unsuccessfully) argued that Brogan as a mandatar could be liable only for gross negligence.  Sheriff Anderson, at first instance, noted that Scots law departed from Roman law (an issue well documented in the works of Stair and Erskine (Institute III,3,36)).  Sheriff Anderson explained (at 279) "The Roman law imposed upon a gratuitous mandatary summa diligentia, the highest form of diligence.  But it is doubtful if Scots law followed this rule."

The second important point to note about this case is the identification of the onus of proof.  The onus lay on Brogan "…to explain how this thing happened or at least to show that he exercised the necessary reasonable care.  Here the explanation given did not, in my opinion, sufficiently discharge the defender of responsibility for the loss of the packet." (Lord Justice Clerk Scott Dickson at 282).

Finally, the Lord Justice Clerk highlighted (at 282) the danger of the use of English precedents here.  The doctrine of consideration in English law causes problems for the recognition of gratuitous contracts.  Because the agent does not receive any payment for his services, there is no consideration, and the arrangement cannot therefore be a contract.  This may be why English law tends to define agency not as a contract but rather as a consensual relationship.  Scots law, by contrast, recognises gratuitous contracts such as mandate, and indeed has well-developed rules to govern them.  So whilst, in general, English agency precedents are cited in Scottish cases, there are areas of agency law where the differences are such that English precedents are not useful.

The next time someone asks you to do something for nothing, perhaps you should pause to think of where it might lead, especially if you are on your way to the nearest public house…