View source for Re Brown’s Estate - Case Note

{{a|contract|}}A fine articulation of the ancient legal principle, “[[Anus matronae parvae malas leges faciunt]]”<ref>“[[Little old ladies make bad law]].”</ref>, {{casenote1|Re Brown’s Estate}} sprang  in 1896 from the brow of no lesser a light than Lord Justice Chitty, nephew of the Chitty brothers who, literally, wrote the [[Chitty on Contracts|book]] on {{t|contract}}s. 

Anyway, enough of the historical context. This case is authority for the ancient principle that ''a [[loan]] of money on demand creates an immediate debt''.

Why is this so earth shattering? Because, under the Limitations Act, the limitation period runs from the point where your cause of action accrues. That is, for an on-demand loan, when you advance the money, not when you ask for it back. This means you would be time-barred after 6 years if you didn’t ask for your money back. Which is kind of cray-cray — the sort of decision you might arrive at if plaintiff is a big bad bank, and defendant a [[Little old lady|little old lady - or in this case man]] — all the more so one who had recently popped clogs — so the modern [[statute of limitations]] — the [[Limitation Act 1980]] has cured it, in Section 6(2).

In this case Mr. Justice Chitty applied the principle that “a loan payable on demand is at [[maturity]] as soon as it is made,” where a father and son covenanted in a mortgage to repay "on demand," paying interest "in the meantime from the date hereof" . The father was the son’s [[guarantor]]. Quoth Chitty LJ:

:“I am not satisfied that the distinction attempted to be made between the law merchant and the general law with regard to the meaning of the words “pay on demand” can be supported. [....] it is plain that a distinction has been taken and maintained in law, the result of which is, that where there is a present debt and a promise to pay [[on demand]], the demand is not considered to be a [[condition precedent]] to the bringing of the action. But it is otherwise on a promise to pay a collateral sum on request, for then the request ought to be made before action brought.”

The learned Judge then held, on the construction of the particular deed before him, that the father was only liable as a surety and that a demand should be made before bringing any action on the father's covenant.

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*[[Limitation Act 1980]], Section 6(2)
*[[Anus matronae parvae malas leges faciunt]]
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