Date: Sun, 18 Mar 2007 11:01

From: John Murphy

Subject: The Wayne Rooney case

Dear David and Jason,

I've been sitting on the fence seeing both sides of both sides. But I'm still not convinced that the case was rightly decided.

I just don't know enough about minors contracts and voidable contracts, hence my casting around for views.

Now, if Jason's claim is right --- that avoidance doesn't require formal avoidance, but merely an act inconsistent with the terms of the agreement --- then that would seem to supply the answer. [But what is the authority for this, please, Jason?] The tort requires (a) procurement of breach; (b) knowledge of the contract on the part of the tortfeasor and (c) breach. On Jason's approach, there would be no breach; and hence no tort. [This is well established in relation to void contracts --- see, eg, Joe Lee v Lord Dalmery [1927] 1 Ch 300 (a gaming contract); but not, to my knowledge voidable contracts.

So what we have here is a question about the practical difference between void and voidable contracts. If a contract is void but both parties don't know that it is void and they both act in accordance with its terms, they are both happy: no courts, no lawyers no grumbles. Similarly, if a contract is voidable but both parties don't know that is voidable yet and they act in accordance with its terms to their joint satisfaction, then, once again, no problem. So the only time that the distinction can be significant is if one party acts in "breach". Then the validity of the contract becomes crucial. But if as Jason says, any inconsistent act = legitimate avoidance, why distinguish between void and voidable contracts at all? The only answer must lie in what Jason also said: namely, that voidable contracts cannot be avoided once they have been affirmed. At this point, let’s go back to Rooney et al. Rooney & Agent No. 1 had stuck to their agreement for 1 year 10 months before any jiggery pokery on the part of the alleged tortfeasor. So why shouldn't their contract be seen as having been affirmed? And if it was, why wasn't Agent 2 a tortfeasor?

Maybe it is because Rooney never signed with Agent 2 until after the 2 year agreement with Agent 1 expired, so that there was no breach at all. But the judge seemed to think (a) that there was a breach (as opposed to avoidance) and, in any event (b) he also accepted the existence of the wider tort of "inconsistent dealings" as suggested in Thomson v Deakin.

What also troubles me is why there was no mention I saw of the Minor's Contracts Act 1987, section 2 of which says:

2. Where -

(a) a guarantee is given in respect of an obligation of a party to a contract made after 9th April 1987; and

(b) the obligation is unenforceable against him (or he repudiates the contract) because he was a minor when the contract was made,

the guarantee shall not for that reason alone be unenforceable against the guarantor.

But what the hell is meant by guarantee for these purposes?

As I just said, I don't recall any mention of this section in the case (but then again I did skim read most of it).

Might it implicitly be seen as requiring a certain amount of good faith on the minor's part as per David's analysis?

And as far damage to the first agent, I agree with David that ON THE FACTS he didn't lose anything. (Remember that, in the end, Rooney didn't get onto the new agent's books until after the initial two-year period had expired ... So agent 2 wasn't getting a cut of any earnings that would otherwise have gone to agent 1. (Things might have been different had Rooney moved over to Agent 2 while the initial two-year period of the contract with Agent 1 was still running. But he didn't. Isn't this somewhat reminiscent of Jones Bros v Stevens [1955] 1 QB 275, where it was held that the claimant suffered no damage because the employee in question would not have returned to his employ in any event?).

Finally, why does A's right to terminate a contract with B amount to a defence on the part of C. Normally, defences exist in the shape of rights held by the alleged tortfeasor him- or her-self. (eg, self-help, or the doctor's right to provide emergency treatment to unconscious patients without consent). But to say "X had the right to end the contract with Y therefore Z has a defence" seems strange to me.

Anyway, it is mother's day and since my 4 year old has insisted that we should go out and buy some ice cream for mummy, I think I'll leave this with the rest of you with one final thought ... Agent 2 sure knew a good thing when he saw it: Rooney bagged a couple of goals yesterday to bring the title that little bit closer to Old Trafford.

J

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