78. Fred. Drughorn Ltd v Rederiaktiebolaget Transatlantic [1918 – 1919] ALL ER Rep 1122

Undisclosed principal – parol evidence admitted to prove identity

The facts

The owners were dissatisfied with the way their ship was being handled by the charterers and withdrew it from service. The charterer named in the contract, L, instituted action to recover damages after which a third party was substituted as plaintiff claiming to be the undisclosed principal on whose behalf L had acted in entering into the charterparty.

Findings

The court of first instance (Lush J), the Court of Appeal and the House of Lords unanimously held that extrinsic evidence was admissible to prove the identity of the charterer.

The delectus personae viewpoint in Rederiaktiebolaget Argonaut was not examined. One Lord of Appeal (of the three panel bench) distinguished Argonaut on its facts while another expressly disapproved of its ratio decidendi.

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