Bertram, Armstrong & Co v Godfray (1830) 12 ER 364
Agency; duties of the agent; duty to follow instructions.
Facts: Godfray purchased Buenos Ayres stock through Bertram, Armstrong & Co, who were mercantile agents. Sometime later, Godfray instructed Bertram, Armstrong & Co to sell that stock when its market price reached '85 per cent or above that price'. Bertram, Armstrong & Co accepted this instruction. However, when the price of the stock reached 85 per cent , Bertram, Armstrong & Co did not sell immediately, because they expected the price to rise further. Unfortunately, after two days, the price dropped again and stayed low. When Godfray discovered that the price had risen to 85 per cent , and that Bertram, Armstrong & Co had not carried out his instructions, he sued to recover the consequent loss.
Issue: In the circumstances, were Bertram, Armstrong & Co bound to sell the stock at 85 per cent , or did they have a discretion to wait in expectation that a higher price would be obtained?
Decision: The court held that the instruction given by Godfray was specific, and that accordingly the agent had no discretion to wait for a higher price.
Reason: As agents, Bertram, Armstrong & Co were required to carry out the instruction as given to them by their principal. They were liable for the loss caused by their failure to do so.