Felthouse v Bindley [1862] EWHC CP J35

DETAILS OF THE CASE: 

1. Citation: [1862] EWHC CP J35 
2. Name of the court: Court of Common Pleas 
3. Name of the judges: Willes J, Byles J and Keating J
4. Date of Judgment: 8 July 1862
5. Plaintiff /Appellant: Paul Felthouse. He is a builder from London and the plaintiff in the initial action. He was suing for the conversion of an horse and was seeking to establish that a valid contract for the sale of the horse existed between himself and his nephew, John Felthouse, before the horse was sold at auction 
6. Respondent/Defendant: William Bindley. He is an auctioneer from Tamworth and the defendant. He was the one who inadvertently sold the horse at auction, which led Paul Felthouse to bring the action against him. 

FACTS OF THE CASE 

In December 1860, Paul Felthouse and his nephew, John Felthouse, discussed the sale of a horse. John offered to sell the horse for 30 guineas, but Paul misunderstood and thought the price was 30 pounds, to which he agreed. John later clarified in writing that the price was 30 guineas, not pounds. Paul then offered to split the difference at 30 pounds and 15 shillings and stated that if he heard nothing further, he would consider the horse his at that price. 

On February 25th, the horse was mistakenly sold at an auction by William Bindley, the auctioneer, along with other stock for 33 pounds. William informed Paul of the mistake, and John wrote to his uncle explaining the error, noting efforts to recover the horse, including offering the buyer 5 pounds to return it. 

These events led Paul Felthouse to sue William Bindley for conversion of the horse, questioning whether a valid contract for sale existed before the auction, and thus whether Paul owned the horse when it was sold. The case was initially decided for Paul, awarding him damages, but was subsequently taken to the Court of Queen’s Bench for further consideration. 

ISSUES RAISED 

• Whether a valid contract for the sale of the horse had been formed between Paul Felthouse and his nephew prior to the auction;
• Whether the letter from John Felthouse dated February 27, 1861, was admissible as evidence or not?1

ARGUMENTS OF THE PARTIES 

PLAINTIFF/ APPELLANT 

The plaintiff, Paul Felthouse, argued that a valid contract for the sale of the horse existed between him and his nephew, John Felthouse, before the auction. He claimed that there was sufficient written evidence to satisfy the Statute of Frauds and that acceptance could be inferred from his nephew’s conduct in instructing the auctioneer that the horse was sold. Relying on Smith v. Neale (1857), the plaintiff’s counsel contended that the nephew’s assent need not be in writing, provided there was a written proposal and verbal acceptance. They further cited Bill v. Bament (1841) to argue that a memorandum satisfying the Statute of Frauds could be made at any time before legal action was initiated. Additionally, the plaintiff maintained that John Felthouse’s letter of February 27, 1861, together with earlier correspondence, constituted a valid written record of the contract. 

DEFENDANT/ RESPONDENT 

The defendant argued that no valid contract existed between the plaintiff and his nephew at the time of the auction, and therefore, the plaintiff had no legal or insurable interest in the horse. He opposed the admission of the nephew’s letter dated February 27, 1861, asserting that it was written after the sale and could not retroactively create a contract. Citing Carter v. Toussaint (1822), the defendant maintained that there was no written memorandum or valid acceptance to satisfy the Statute of Frauds, as mere verbal agreement and the nephew’s arrangements for keeping the horse did not constitute acceptance. The defendant further contended that the plaintiff had no legal claim to the horse on the date of the auction, and that any later admissions or uncommunicated intentions by the nephew could not alter the legal position. Thus, the defendant argued that the plaintiff’s claim was invalid, as no binding contract had ever been formed. 

JUDGEMENT / FINAL DECISION 

On the first issue, the Court held that no such contract existed. Although there had been correspondence between the parties, the court found that there was no clear or communicated acceptance from John Felthouse before the auction. Without this, ownership of the horse had not legally transferred to the plaintiff. 

On the second issue, the court ruled that it was inadmissible, as it was written after the sale and could not retroactively establish a contract that did not exist at the time of the auction. 

The court therefore decided in favour of the defendant, emphasizing three principles: (1) acceptance must be communicated to the offeror, (2) it must be made to the offeror or an authorised agent, and (3) an offeror cannot impose acceptance by silence or failure to reject. 

LEGAL REASONING/ RATIO DECENDI 

The Court held that no contract existed because the nephew never communicated acceptance, and silence could not amount to it. The February 27 letter was inadmissible either too late or lacking retroactive effect (Stockdale v. Dunlop, 1840). Thus, ownership never passed, and the plaintiff had no claim. 

CONCLUSION 

The case established an important principle in contract law that silence does not amount to consent. It reinforced the requirement that acceptance of an offer must be clear, unequivocal, and communicated to the offeror.

REFERENCE(S):

1 Thejalakshmi Anil, ‘Felthouse v Bindley 1862’ (ipleaders, August 20 2024)  <https://blog.ipleaders.in/felthouse-vs-bindley-1862/> accessed 20 October 2025.