Skip to content


R.S. Deboo, (since deceased by L.R's) Vs. Dr. M.V. Hindlekar and Another (10.06.1994 - BOMHC) - Court Judgment

LegalCrystal Citation
SubjectContract
CourtMumbai High Court
Decided On
Case NumberFirst Appeal No. 671 of 1978
Judge
Reported inAIR1995Bom68; 1995(1)BomCR17; (1994)96BOMLR60
ActsIndian Contract Act, 1872 - Sections 23, 151 and 152; Evidence Act, 1872 - Sections 101-104
AppellantR.S. Deboo, (since deceased by L.R's)
RespondentDr. M.V. Hindlekar and Another
Appellant Advocate Mr. Balsara, Adv. i/by ;M/s. Mulla and ;Mulla and ;Cragie Blunt and ;Caroe
Respondent AdvocateGirish Vora and ;Mrs. L.G. Vora and ;T.G. Vora, Advs.
Excerpt:
[a] indian contract act, 1872 - sections 8, 149, 161 - the contract of bailment - completed on delivery of clothes at the counter - receipts are not document of contract but more acknowledgements.;in any event, the said receipts (exhibit 'a' colly.) are merely receipts or acknowledgment and are not in the nature of a contractual document. the contract of bailment between the parties was concluded orally and the suit receipts were issued by the establishment of the laundary little later. in this view of the matter also, the condition relied on by the defendnt as a ground for exemption cannot constitute a valid defence in respect of claim for compensation for non-return of the articles entrusted by the plaintiff to the defendant.;[b] indian contract act, 1872 - sections 73, 151, 161, etc. -.....1. this appeal is preferred by original defendant against decree dated28th sept. 1977 passed by the bombay city civil court at bombay in suit no. 9048 of 1975. by the said decree, the trial court directed the defendant to pay a sum of rs. 3,560/- together with interest thereon at the rate of 6% per annum from the date of the decree till payment and cost of the suit. 1a. the court is informed by the learned counsel on both sides that in view of the death of the appellant and original respondent no. 2, the heirs and legal representatives of the appellant as well as original respondent no. 2 have been brought on record of this appeal. 2. this appeal involves consideration of interesting questions of law as indicated in the later part of this judgment. the questions of law arising in this.....
Judgment:

1. This appeal is preferred by original defendant against decree dated28th Sept. 1977 passed by the Bombay City Civil Court at Bombay in Suit No. 9048 of 1975. By the said decree, the trial Court directed the defendant to pay a sum of Rs. 3,560/- together with interest thereon at the rate of 6% per annum from the date of the decree till payment and cost of the suit.

1A. The Court is informed by the learned counsel on both sides that in view of the death of the appellant and original respondent No. 2, the heirs and legal representatives of the appellant as well as original respondent No. 2 have been brought on record of this appeal.

2. This appeal involves consideration of interesting questions of law as indicated in the later part of this judgment. The questions of law arising in this appeal arc also of public importance to some extent. For the sake of brevity, the parties to the appeal are hereinafter referred to as the defendants and the plaintiffs. The basic question arising in this appeal concerns interpretation, applicability and legality of a printed condition on the reverse of 'laundry receipts' issued by the proprietor of the laundry purporting to restrict to his liability for quantum of loss to twenty times the laundering charges or half of the value of unreturned articles whichever was less whatever be the cause for non-return of the article entrusted by the customer to the laundry for purpose of laundering. Prima facie, the said printed condition appears to be manifestly unreasonable, arbitrary and opposed to public policy.

3. The plaintiff No. 1 is a leading medical practitioner residing at 'Summichha' S.V. Road, Bombay 92. The plaintiff No. 2 is the wife of plaintiff No. 1 and is also a medical practitioner. The plaintiff No. 2 has unfortunately expired. The heirs and legal representatives of plaintiff No. 2 are already on record of this appeal in place of plaintiff No. 2 (i.e. the respondent No. 1 in the appeal). At all material times, the defendant Shri R. S. Deboo, was carrying on business of cleaner dryers and launderers in the name and style of M/s. Leach and Waborny having his office at 34, Hamam Street, Fort, Bombay and factory at 66, Off Heines Road, Worli, Bombay. On or about 27th December 1974 the plaintiffsentrusted various sarees and other clothes to the defendant for drying, cleaning and ironing at Worli shop of the defendant i.e. as a bailee vide receipt No. 36244 dated 27-12-1974. The defendant agreed to charge a sum of Rs. 22.50 to the plaintiffs for dry cleaning etc. On or about 1st January, 1975, the plaintiffs entrusted to the defendant a brand new stripes woolen suit of their son Dr. Milan for purpose of ironing only vide receipt No. 36283 dated 1-1-1975. The said receipt states that the defendant had received the sum of Rs. 1.75 from the plaintiffs towards ironing charges in respect of the said woollen suit. On 1st January 1975, the plaintiffs also entrusted to the defendant 8 sarees and 6 blouses of pure silk for purpose of Ironing' only vide receipt No. 36284 dated 1-1-1985. The above referred receipt issued by the defendants discloses that the defendants did receive a sum of Rs. 10.40 from the plaintiffs on account of 'ironing charges' in respect of all the above referred clothes.

4. The defendant failed to return one silk saree out of the clothes referred to in receipt dated 27-12-1974 which was entrusted by the plaintiffs to the defendant for dry cleaning as stated in the above referred receipt. The defendant failed to deliver the woollen suit' to the plaintiffs which was entrusted by the plaintiffs to the defendant only for purpose of 'ironing' vide receipt No. 36283 dated 1-1-1975. The defendant also failed to return 8 sarees and 6 blouses which were delivered by the plaintiffs to the defendant for purpose of 'ironing' under receipt No. 36284 dated 1-1-1975 as stated hereinabove.

5. The plaintiffs called upon the defendants to return the above referred clothes entrusted to the defendant for purpose of dry cleaning and ironing, as aforesaid. Since the said articles were not returned back by the defendant to the plaintiffs, the plaintiffs served their Advocate's notice dated 26th June, 1975 claiming a sum of Rs. 8,060.00/ -as and by way of damages from the defendants. By their letter dated 11th July, 1975, the defendant alleged that a devastating fire had taken place at the factory premises of the defendants at Worli on 4th January, 1975 andthe entire factory and clothes of various customers including those of the plaintiffs lying therein were destroyed. It was also stated in the said letter that the defendant had taken all necessary precaution and care in this behalf. By the said letter, the defendant contended that all the above referred 'receipts' clearly contained a clause printed on the reverse thereof to the effect that in no case the total liability of the defendant for non-return of the articles shall exceed half of the price of the unreturned article or 20 times the amount of the charge for laundering the same whichever was less. The defendant expressed their willingness to pay the amount equivalent to 20 times of the amount of dry cleaning charges or ironing charges collected by the defendant from the plaintiffs. It is not disputed that the amount of compensation payable by the defendant to the plaintiffs for non-return of all the above referred articles works out to Rs. 263,/- only. By their Advocate's letter dated 17th July 1975, the plaintiffs inter alia contended that the above referred alleged 'special condition' was never conveyed and/or intimated by the defendants to the plaintiff and the said alleged condition was arbitrary and of no binding effect. By para 4 of the said letter, the plaintiffs requested the defendants to inform the plaintiffs as to whether the defendants had duly insured the articles in question and as to whether the defendants had recovered the necessary amounts from the insurance company. By the said letter, the Advocate for the plaintiffs called upon the defendants to disclose as to what amount, if any, was received by the defendants from the insurance company in this behalf. The defendants did not respond to the requisition made by the Advocate for the plaintiffs by the said letter dated 17th July, 1975. The printed condition appearing on the reverse of the receipts issued by the defendants to the plaintiffs on 27th December, 1974 and 1st January, 1975 referred to in the foregoing paras of this judgment reads as under:--

'Compensation for loss of damage: The laundry undertakes to compensate the customer for loss of or damage to any article while in its possession or control by reason ofits negligence or that of its servants or agents or by fire (except where compensation for such loss or damage by fire is recoverable by the customer under policy of insurance), but accepts no liability in respect of or consequent upon loss or damage from any other cause whatsoever provided that in no case shall total liability in respect of any articles exceed half the price of the article or twenty times the amount of the charge for laundering the same whichever is less.'

Prima facie, the above referred printed condition is too wide, one sided and opposed to public policy. The use of the expression 'any cause whatsoever purports to restrict the liability of owner of the laundry arbitrarily and unreasonably. On the front side it is printed on the said receipts as under:

'For the terms see over-leaf.'

6. In the above referred suit, the plaintiff claimed a sum of Rs. 5,360/- only from the defendant as and by way of damages. In para. 6 of the plaint, the plaintiffs stated that the articles entrusted by the plaintiffs to the defendants were costly and new articles and the plaintiff No. 2 had purchased the sarees in question in Nov. 1974 from Messrs 'Roopkala' situated opposite Marine Lines, Bombay. The plaintiffs contended that brand new woollen suit of their son Dr. Milan was also very costly. In para. 8 of the plaint, the plaintiffs contended that the defendants were heavily insured against the risk of fire and/or any loss in respect of 'customers goods' entrusted to them from time to time and according to the understanding of the plaintiffs the defendants were fully compensated by the insurance company for the value of the goods belonging to the customers concerned including the plaintiffs. The plaintiffs did not admit in the plaint that the above referred goods were destroyed by fire. The plaintiffs stated in para 8 of the plaint that:

'Even assuming without admitting that on account of the fire that took place in the said premises of the defendant, the textiles, fabrics and costly articles entrusted by the plaintiffs were lost or damaged. Further, no evidence is forthcoming to the satisfaction ofthe plaintiffs that various articles handed over to the defendant vide the said receipts were at relevant time in the said premises and further that on account of the said fire the said clothes were in any way affected, damaged and/or lost.'

The said plea of the plaintiff was in addition to averment made in respect of insurance amounts pertaining to the insurance of 'customers articles' including the articles entrusted by the plaintiffs to the defendants. The defendants filed their written statement in the suit. In para. 4 of the written statement the defendants contended that the defendant had in fact taken reasonable care of all the articles entrusted by the plaintiffs to the defendants. In para. 5 of his written statement, the defendant contended that his factory at Worli was destroyed by fire which occurred on 4th January, 1975 because of circumstances beyond his control and not because of any negligence on the part of the defendants. The defendant also disputed the quantum of claim in respect whereof the said suit was filed by the plaintiffs. The defendant relied on printed condition purporting to limit the liability of the defendant purporting to restrict the liability of the defendant in the event of the entrusted articles being not returned by the defendants to the plaintiffs or other customers for any reason whatsoever. In para. 8 of the written statement, the defendant contended as under:

'The defendant submits that he is not liable to give inspection or make any such disclosure to the plaintiffs.'

The defendant refused to disclose any information whatsoever regarding the insurance obtained by the defendant against the risk of fire in respect of 'customers' 'goods' or in respect of the receipt of insurance amount by the defendant from the insurance company. The plea of the defendant in para. 8 of the written statement was specifically to the effect that the defendant would not disclose the facts relating to obtaining of the insurance in respect of customers goods or receipt of 'insurance money' by the defendants from the concerned insurance company as a result of Joss of customer's articles/goods due tofire in the factory of the defendants.

7. At the trial of the suit, the learned trial Judge framed three issues. The main issue raised by the learned trial Judge was issue No. 2. The said issue reads as under:--

'Whether the defendants is right in his contention that his liability is restricted to the extent of half the price of the articles or twenty times the amount of the charge for laundering the same, whichever is less, as contended in para. 9 of the written-statement?

8. At the trial of the suit, the plaintiff No. 1 examined himself as a witness in support of the plaintiff's case. The plaintiff No. 1 stated during the course of his testimony that the plaintiffs had deputed their servant for delivery of various clothes at the laundry of the defendant for purpose of ironing etc. as shown in the receipts Exhibit 'A' collectively. There is no dispute that the articles in question were not returned by the defendants to the plaintiffs. There is no dispute that the defendant was a bailee in respect of the said articles. In para. 6 of his testimony, the plaintiff No. 1 states that he has never gone through the reveres side of the 'receipts' in question. The plaintiff No. 1 admitted during the course of his testimony that in past also the plaintiff No. 1 had entrusted his clothes to the defendant laundry for purpose of laundering. It is not on record as to what kind of receipts were issued by the defendant to the plaintiffs in the past.

9. The learned trial Judge has recorded in the proceedings of the Court below that the learned counsel for the defendant informed the Court that the defendant did not want to examine himself or lead any other evidence at the trial.

10. For the reasons set out in his judgment, learned trial Judge held that the said alleged stipulation printed on the back of suit receipts' (Exhibit 'A' collectively) did not bind the plaintiffs. The learned trial Judge held that the said alleged stipulation would be in the nature of a special condition if held to be a contractual term and the same was rather vague. The learned trial Judge held that thesaid stipulation was in any event not applicable to a case 'where the customer had entrusted cloth articles to the defendant merely for 'ironing'. The learned trial Judge did not accept the case of the defendant to the effect that the alleged stipulation constituted a valid defence in respect of the suit claim and the liability of the defendant to pay compensation to the plaintiffs was restricted to pay 20 times of ironing and dry cleaning charges collected by the defendant from the plaintiffs. The learned trial Judge however assessed the quantum of loss recoverable by the plaintiffs from the defendant at Rs.3,560/- only.

11. At the outset, it must be stated that it was the bounden duty of defendant to enter the witness box and prove his assertions in the written statement to the satisfaction of the trial Court. It was for the defendant to prove that the defendant had taken due and proper care of the goods entrusted by the plaintiffs to the defendants. It was for the defendants to prove that the said goods were in fact destroyed by fire and the said fire did not take place as a result of any negligence on part of the defendant. It was for the defendant to prove that the said alleged stipulation was assented to by the plaintiff expressly or by necessary implication and the said alleged stipulation was liable to be considered as a contractual term. It was the bounded duty of the defendant to disclose to the Court as to what amount, if any, the defendant had received from the concerned insurance company as regards insurance moneys in respect of suit articles instead of withholding the relevant information from the Court and the plaintiffs altogether. In view of withholding of relevant evidence is indicated above and in view of the defendant having not entered the witness box, strongest possible adverse inference shall have to be drawn against the defendant on various aspects of the case.

12. It is necessary to set out one of the propositions of the law having bearing on decision of this appeal here and now. The said proposition of law is formulated as under:--

'If a bailee receives an insurance amount in respect of value of the goods bailed to him, thebailee is bound to account for the said insurance amount to the bailor as all such cases, the bailee is merely a trustee for the insurance amount obtained in respect of goods belonging to bailors.'

At page 786 of Standard Work of Pollock and Mulla on Indian Contract and Specific Relief Acts, Tenth Edition, the proposition of law is formulated in the following term:

'A bailee can insurance up to the full value of the goods bailed to him and can recover the full value but in that case he will have to account to the owner of the goods and will be a trustee for the owner, retaining so much as covers his own interest and trustee for the balance.'

At footnote 40 of the said work at page 786, large number of cases are cited by the learned authors in support of the above proposition. I am in respectful agreement with the above referred statement of law formulated by the learned authors. The owner of the laundry can never be allowed to enrich himself unjustly to the prejudice of his customers by recovering and retaining the insurance amount for the loss of the articles belonging to the customer and refusing to account for such amount to the customer concerned. In my opinion, it was very wrong on the part of the defendants to plead in para. 8 of the written statement that the defendant was not bound to disclose any fact relating to insurance moneys or give inspection of any documents to the plaintiffs. It is unfortunate that the defendant adopted an evasive attitude on this aspect of the case. The Court has reason to believe that the defendant did not enter the witness box to avoid cross-examination on the material aspects of the case.

13. On the above basis, I shall now deal with the further contentions urged by learned counsel on either side at the hearing of this appeal.

14. The learned counsel for the appellant cited various authorities in support of his various propositions. The said authorities are listed below:--

(1) (1875) 32 L T 709;

(2) (1930) 1 K B 41;

(3) 1918 A C 837;

(4) AIR 1928 Bom 5;

(5) AIR 1939 Bom 101;

(6) .

The learned counsel for the appellant endeavoured to distinguish the judgment of Lord Denning in the case of Thoraton v. Shoe Lane Parking Ltd. reported in (1971) 1 All ER 686.

15. The learned counsel for the respondent relied on various authorities during the course of his arguments in support of the case of the original plaintiffs. The said authorities are listed below:

(1) (1940) 1 All ER 356;

(2) (1971) 1 All ER 686;

(3) : AIR1981Bom299 ;

(4) : AIR1983Ker154 ;

(5) AIR 1970 Mys 154;

(6) : AIR1966Mad13 .

In Chapelton v. Barry Urban District Council (1940) 1 All ER 356, the Court of Appeal held that the condition printed on the back of 'tickets' relating to hire of deck chair were not binding on the plaintiff. In this case, it was held by the Court that the ticket in question was merely a voucher or receipt. The questions of the kind raised in this appeal are often raised on behalf of the party who seeks exemption from legal liability total or partial on the basis of printed conditions on reverse of the receipt. It is common experience that by and large no one goes through these printed conditions. It is to be decided in each case as to whether the printed condition was sufficiently brought to the notice of the plaintiff, whether the plaintiff assented thereto and as to whether the said conditions are liable to be interpreted as a term of contract. Unless the parties to the contract have consented to abide by the said printed conditions expressly or by necessary implication, such printed conditions do not and cannot form part of the contract.

16. I have carefully gone through all the authorities cited on both the sides at the Bar. In my opinion, it is not necessary to refer toall the authorities in this judgment or discuss the same in detail The factual questions arising in the appeal shall have to be decided in light of evidence before the Court, common knowledge of human affairs, balance of probabilities and the adverse inference to be drawn against the defendant for withholding evidence.

17. I have also gone through the relevant passages from the standard books on law of contract authored by well known authors like Pollock and Mulla, 10th Edn; Anson's Law of Contract 26th Edn. and the latest work on law of contract by Cheshire Fifoot and Furm-ston's, Twelfth Edition. Both the learned counsel invited attention of the Court to dictionary meaning of the word 'Laundry' therefrom. The learned counsel for the respondent invited attention of the Court to the definition of the word 'launderer' from Oxford Concise dictionary. The learned counsel for the appellant invited the attention of the Court to definition of the word 'laundry' from Longman's Concise English Dictionary.

18. The following proposition of law appears to me to be well settled by this time.

(1) Terms and conditions printed on the reverse of a receipt issued by the owner of the laundry or any other bailee do not necessarily form part of the contract of bailment in absence of the signature of the bailor on the document relied upon. In absence of signature of the bailor on the document relied upon, the onus is on the bailee to prove that the attention of the bailor was drawn by the bailee to the alleged special conditions before the contract was concluded and the bailor had consented thereto expressly or by necessary implication as a contractual term. It cannot be just assumed that the printed conditions appearing on the reverse of the receipt automatically become a contractual term or part of the contract of bailment. It is to be found on evidence in each case as to whether the alleged printed condition on the reverse of the receipt formed a part of the contract of bailment or not depending upon the conduct of the parties.

(2) In certain situations, it may have to be held by the Court that a receipt acknowledging the entrustment of articles issued by the bailee like a laundry owner or any other bailee is merely a receipt or an acknowledgment in respect of entrustment of goods and it cannot be considered as a 'contractual document as such. If a receipt acknowledging entrustment of articles is issued by the bailee after the contract is already concluded, such a receipt may have to be considered as a mere acknowledgment or receipt and not as a contractual document.

(3) It is necessary for the Court to consider in each case as to whether 'the alleged special term was reasonably and properly communicated by the bailee to the bailor and as to whether the bailor in fact assented thereto expressly or by necessary implication.

(4) The burden of proof is always on the bailee to prove that the bailee took reasonable care of the goods entrusted to him as a man of ordinary prudence would have exercised. Even in case of an assertion on the part of the bailee that the articles were lost as a result of alleged fire, it is for the bailee to prove that the suit articles were in fact lost as a result of fine and there was no negligence on the part of the defendants which resulted in the goods being destroyed by fire. The question of negligence is always a question of fact or at the most a mixed question of fact and law.

(5) In a case governed by Sections 151 and 152 of the Contract Act, the non-return of article entrusted by the plaintiffs to the defendant by itself is prima facie proof of negligence of the bailee. It is not for the bailor to lead positive evidence proving the negligence of the bailee in respect of unreturned articles entrusted by the bailor to the bailee. It is for the bailed to prove that the bailee is duly exempted from his liability to pay the reasonable amount of compensation for the value of the articles not returned or that his liability is restricted or reduced one and that the alleged stipulation is binding on the bailor under the law of the land.

(6) No exemption clause, total or partial, can be invoked where the bailee has recovered'insurance amount' from the insurance company in respect of articles entrusted to him by his customer, the bailor. No bailee is entitled to unjustly enrich himself by retaining the insurance amount recovered by the bailee in respect of his customer's articles. The defendant is not entitled to withhold the relevant information from the Court or from the plaintiff on this aspect and refuse to give inspection of relevant documents.

(7) A stipulation to the effect that the concerned customer would be entitled to claim only 50% of the market price of the article or 20 times the laundry charges whichever is less is ex facie opposed to public policy and fundamental principles of law of contract. Such an alleged stipulation cannot constitute a valid defence in an action by the bailor against the bailee.

19. The learned counsel for the appellant submits that the plaintiffs arc deemed to have assented to the alleged special condition printed on the reverse of the receipt Exhibit 'A' collectively. The learned counsel contends that the plaintiffs are deemed to have noticed of the above referred condition in view of the printing of the words 'for terms see overleaf' at the bottom of the receipts on front side. The learned counsel for the appellant relies on the fact that in the past also the plaintiffs had entrusted their clothes to the defendant in the past. Having regard to the ratio of the Division Bench judgment of our High Court in the case of Road Transport Corporation v. Kirloskar Brothers Ltd. reported in : AIR1981Bom299 and the ratio of the Judgment of Court of Appeal in the case of Chapelton v. Barry Urban District Council reported in (1940) 1 All ER 356 and the judgment of the Court of Appeal in Thornton v. Shoe Lane Parking Ltd. reported in (1971) 1 All ER 686. I am not prepared to hold that the impugned conditions formed part of the contract in this case and the plaintiffs had assented thereto expressly or by necessary implication. I am considerably impressed by oral testimony of plaintiff No. 1 in this behalf. The learned Counsel for the appellant wants the Court to imply the alleged assent of the plaintiffs-in respect of the so called special condition inview of the fact that the plaintiffs had entrusted the cloth articles to the defendant in the past also for laundering or ironing etc. It was for the defendant to enter the witness box and lead evidence and prove as to what kind of receipts were handed over by the defendants to the plaintiffs in the past and what terms were printed on the reverse of such receipts in the past. In a Court of law matters in dispute cannot be decided on the basis of assumptions or presumptions. No such implication is possible. The Court has to decide the matters in controversy on the basis of evidence led by the parties. The plaintiff No. 1 has clearly stated in his evidence that he had not read the condition printed on the reverse of the said receipts. It is believable that the plaintiffs had merely deputed their servant to entrust the articles in question to the defendant and the alleged special condition was never conveyed by the defendant to the plaintiffs at any time directly or indirectly. I am also of the opinion that the receipts Exhibit 'A' collectively are liable to be treated as 'mere receipt' and not as a contractual document. The contract of bailment was complete between the parties as soon as the clothes were entrusted by the servant of the plaintiff to the defendant at the counter. Only subsequently, the defendant or his authorised representative issued a receipt acknowledging the fact that the plaintiffs had entrusted certain cloth articles to the defendant for purpose of ironing etc. and the defend ant had collected certain charges from the plaintiff in respect thereof. If the plaintiffs would have known that in the event of there being a loss of the articles, the plaintiffs would be entitled to receive compensation to the extent of 20 times of ironing charges, the plaintiffs would never have entrusted the suit articles to the defendants. It is merely a matter of common sense. No one would assent to such a stipulation. It is not the case of the defendant that the plaintiff factually assented to the said printed condition to be as a contractual term. However the defendant wants the court to impute the presumed assent to the plaintiffs in view of the fact that the said alleged special condition appears on the reverse of Laundry Receipts' as one of the conditions printed on the reverse thereof. The text books on the law of contractare full of cases where the Courts have shown reluctance to infer such presumed or implied assent in absence of reliable and positive evidence on record. In my opinion, it would be too dangerous to treat automatically the printed conditions on the reverse of such receipts as part of consensual or contractual documents. The learned counsel for the appellant endeavoured to distinguish the judgment of the Court of Appeal delivered by Lord Denning and to other Law Lords reported in (1971) 1 All ER 686. In that case a parking ticket was issued from an automatic machine and the said parking ticket contained the alleged special conditions. The Court held that the alleged special conditions were not binding on the plaintiffs. It is true that the decision in the said case was taken by the Court in light of the fact that the said ticket was issued out of an automatic machine and not by a human hand. If the above referred decision is considered in (its) entirety, it would be found that the ratio of the said decision assists the respondents and not the appellant,

20. Having regard to my finding that the plaintiffs had no real and effective notice in respect of the alleged special condition printed on the reverse of suit receipts issued by the establishment of laundry owned by the defendant, it is not possible for the Court to accept the defence of immunity based on the 'printed condition' relied on by the defendant. In any event, the said receipts (Exhibit 'A' colly.) are merely receipts or acknowledgments and arc not in the nature of a contractual documents. The contract of bailment between the parties was concluded orally and the suit receipts were issued by the establishment of the laundry little later. In this view of the matter also, the condition relied on by the defendant as a ground for exemption cannot constitute a valid defence in respect of claim for compensation for non-return of the articles entrusted by the plaintiffs to the defendant.

21. I shall now deal with other contentions urged at the hearing of the appeal. It appears that in any event the said alleged special condition is vague as found by the learned trial Judge in so far as it purports torestrict the liability of the bailee in respect of payment of compensation to half of the price of article or 20 times the amount of laundering' whichever is less, whatever be the reason for non-return of article entrusted. In this case, the question of payment of half the price of the article does not arise as the calculation of twenty times the charge collected by the defendant from the plaintiffs works out to be very much less as compared to half of the alue of the suit, articles. Half the amount of the price of the articles entrusted will be much more than a sum of Rs.263/- which is being offered by the defendant to the plaintiff. The learned trial Judge was right in referring to the meaning of the word 'launderer' or 'laundry' as appearing in the Concise Oxford Dictionary and holding that the expression 'laundering' would mean washing and ironing and not mere ironing or pressing. It is common knowledge that whenever a customer entrusts the clothes to a launderer for laundering the cloth, he does not expect the owner of the laundry would return back the cloth article merely after washing without ironing the same. It is not possible to accept the contention urged on behalf of the appellant that mere ironing or pressing of the article by itself without anything more would mean 'laundering' of the cloth and the customer concerned is entitled to recover amount equivalent to twenty times of ironing charges whatever be the cause for non-return of the articles and whatever be the value of such articles. Prima facie it is absurd that the customer should be entitled to recover only 20 times of ironing charges as compensation for loss of the articles 'for whatever reason' including theft or misappropriation whatever be the value of the article. The amount of compensation offered by the owner must have reasonable correlation with the value of the unreturned articles. In light of the above discussion, I hold that the said alleged special condition is not enforceable as the same is in any event vague. The said condition is not applicable to the facts of this case.

22. In the opening part of ray judgment, I have clearly stated that the owner of the laundry or the bailee shall have to be considered as trustee for the amount receivedfrom the insurance company in respect of the goods belonging to the customers. In such cases, the alleged special stipulation is not at all applicable. As a matter of fact, the alleged stipulation contains an exception which reads as under:

'except where compensation for such loss or damage by fire is recovered by the customer under policy of insurance.'

The customer can never directly recover the insurance amount from the insurance company. The bailee is expected to take out insurance policy covering risk for loss of 'customers' goods. The concerned customers are owners of the goods. The customer has insurable interest in the goods entrusted in the bailee. The believe has also same interest in the goods/articles which are sought to be insured by reason of the transaction of bailment. In this case, it can be reasonably inferred that the goods of the customers were in fact insured by the defendants and the defendants in fact received the insurance amount. Such an inference shall have to be drawn in view of the defendant having refused to furnish relevant information to the Court and to the plaintiffs. In such cases, the Court is bound to draw adverse inference against the defendant. I record the above finding on the basis of adverse inference drawn against the defendant.

23. It is time to refer to a case similar to our's decided by the High Court of Madras. AIR Lily White v. R. Munuswami, : AIR1966Mad13 , Anantanarayanan, J. Officiating Chief Justice of the High Court dealt with a situation where on the reverse of a bill which was handed over by the firm of launderers to the customers there was a printed condition that the customer would be entitled to claim only 50 per cent of the market price or value of the article in case of loss. The High Court of Madras held that such a term was prima facie opposed both to the public policy and to the fundamental principles of the law of contract which cannot be enforced by a Court. The High Court of Madras observed in the said judgment that if such a clause was held to be enforceable, it would put a premium upon the obstruction of clothes, which was committed by the employee of a firm with an intention tomake private gain. 1 am in respectful agreement with the view taken by the High Court of Madras in the above case. I hold that the alleged stipulation in this case is opposed to public policy and fundamental principles of law of contract and the same is thus void and of no legal effect.

24. The learned counsel for the appellant relied on judgment of the Court of learned Additional Judicial Commissioner of Oudh in the case of Bansi Dhar v. Ajudhia Prasad . In the said case, the learned Additional Judicial Commissioner followed the observations of Sir C. Jessel, M.R. in a case reported in 32 Law Times 354 wherein it was observed that when the contract was entered into freely and voluntarily between the parties, the question of public policy did not arise. I have no hesitation in disagreeing with the extreme view expressed by the Court in the above referred case. No stipulation opposed to public policy can be given effect to or enforced by a Court even where the stipulation is found to have been assented to by the parties voluntarily and parties were sui juris.

25. The learned counsel for the respondent relied upon the judgment of the High Court of Mysore in M. Siddalingappa v. T. Natraj reported in AIR 1970 Mys 154. In the said case A. Narayana Pai J. held that the liability under Section 151 of the Contract Act could not be 'contracted out' as the said section was not expressly made subject to the contract to the contrary. As against this, the learned counsel for the appellant relied upon the judgment delivered by the Division Bench of the Bombay High Court in Lakhaji Dolaji & Co. v. Boorugu Mahadeo Rajenna reported in AIR 1939 Bom 101. In this case, the Division Bench of this Court made obiter observation to the effect that Section 151 of the Contract Act did not expressly prohibit contracting out of Section 151. It is, however, obvious to me that a stipulation alleged to be amounting to a contract to the contrary must not infringe other provisions of Indian Contract Act or any other law. If such an alleged stipulation is found by the Court to be opposed to public policy, such an allegedstipulation would be void under Section 23 of Indian Contract Act.

26. Before 1 conclude the discussion, I would like to refer to a similar case noticed by the learned authors Cheshire Fifoot and Furmston's in their work on Law of Contract, 12th Edition at page 175 as indicated hereinafter.

27. In Levison v. Patent Steam Carpet Cleaning Co. Ltd. reported in (1978) QB 69, the plaintiff had entrusted a carpet worth $900 to the defendants, for cleaning under a contract which purported to limit the defendant's liability to 40. The carpet disappeared. The Court of Appeal held that the defendants could only limit their liability if they could show that the loss arose from some cause which did not constitute fundamental breach. I am in respectful agreement with the view taken by the Court of Appeal in this case.

28. In my opinion, there is no merit in the appeal. The appeal deserves to fail.

29. In the result, the appeal fails. The appeal is dismissed with costs.

30. Having regard to gross facts of the case and the blameworthy conduct of defendant in refusing to furnish information regarding insurance amounts, etc. the appellants are directed to pay a sum of Rs. 1000/- to the respondents towards the cost of the appeal.

31. I am conscious of the fact that the respondents and their Advocates have taken too much trouble in proving a small claim. The respondents appear to have embarked on this litigation as they were shocked with the tender of a ridiculous amount to the appellants for loss of valuable articles. Nothing more need be stated in this judgment.

32. The appeal is finally disposed of in terms aforesaid.

Appeal dismissed.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //