Ronaasen & Son v Arcos Ltd

Factual and Procedural Background

The Appellant, an English company acting as an agent for a foreign government, entered into two contracts dated 13 November 1929 to sell bundled redwood and whitewood staves to the Respondent on C.I.F. terms for delivery in “The River Thames.” The contracts required shipment “during the summer of 1930” and prescribed exact dimensions for the staves, including a uniform thickness of ½ inch.

The goods were shipped from “The City” of Archangel on or about 9 October 1930. The Respondent initially rejected the documents, alleging late (non-summer) shipment. An arbitrator ruled on 18 February 1931 that the shipment complied with the seasonal requirement. After landing, the lumber remained outdoors and was exposed to weather.

On 10 April 1931 the Respondent invoked a further arbitration challenging the staves’ compliance with the contractual description. Two arbitrators failed to agree and appointed an umpire who, on 24 August 1931, found the goods “commercially within and merchantable under the contract specification” and ruled that the Respondent could not reject them.

The Award came before Judge [Wright] as a special case. He remitted it for clarification and ultimately held for the Respondent, concluding that the goods did not correspond with the contractual description. The Court of Appeal unanimously affirmed. The present appeal to the House of Lords followed.

Legal Issues Presented

1. Whether, under section 13 of the Sale of Goods Act 1893, goods described as “½-inch” staves must match that description exactly or whether a seller may satisfy the condition by supplying goods “commercially within” the specification.
2. Whether the umpire exceeded his authority by importing commercial tolerance not expressed in the contracts, thereby invalidating his award.

Arguments of the Parties

Appellant's Arguments

• The umpire correctly concluded that the staves were “commercially within” the contractual description, a standard allegedly accepted in commercial practice.
• Any excess thickness resulted from post-shipment swelling for which the Respondent, who left the goods exposed, was responsible.
• Minor deviations should be disregarded as de minimis, leaving the Respondent only to a claim in damages, not rejection.

Respondent's Arguments

• The contracts stipulated an uncompromising thickness of ½ inch with no words such as “about,” “substantially,” or “commercially.” Exact compliance was therefore a condition.
• The umpire’s own findings showed that, even at shipment, substantial quantities exceeded ½ inch; therefore the goods did not match the contractual description.
• The Sale of Goods Act 1893 entitles a buyer to reject goods that fail to correspond with their description, irrespective of commercial utility.

Table of Precedents Cited

Court's Reasoning and Analysis

The House of Lords noted that the contracts expressly required ½-inch thickness without any qualifying terminology. Under section 13 of the Sale of Goods Act 1893 the critical question is whether the goods “correspond with the description.”

The umpire’s measurements showed that only a small fraction of the staves were exactly ½ inch; the vast majority exceeded that measure. Although weather exposure had caused swelling, the umpire expressly found that the staves were already thicker than ½ inch when shipped. His statement that the goods were “commercially within” specification was treated as an impermissible substitution of a new standard not agreed by the parties.

The Law Lords rejected the suggestion that commercial practice allowed a tolerance margin absent contractual language. They characterised “commercially within” as an extra-contractual qualifier and held that the strict statutory and contractual requirement had not been met. Consequently, the Respondent’s right to reject remained intact.

Holding and Implications

Appeal dismissed; the Respondent is entitled to reject the goods.

Immediate effect: the sellers cannot enforce the contracts and must bear the consequences of non-conforming delivery. Broader implication: in sales governed by English law, precise descriptive terms—especially exact measurements—must be met unless the contract itself provides a margin for deviation. The decision reinforces a strict approach to section 13 of the Sale of Goods Act 1893 and limits arbitrators’ or courts’ ability to read commercial tolerances into unqualified contractual language.