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Breul and Co. Vs. Haji Sidick Haji Ibrahim - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case Number O.C.J. Suit No. 257 of 1909
Judge
Reported in(1910)12BOMLR474
AppellantBreul and Co.
RespondentHaji Sidick Haji Ibrahim
Excerpt:
transfer of property act (iv of 1882), section 108, clause (e)-lease, expiry of, on the premises leased being destroyed by fire.;a tenant has no right to retain possession of the premises till such time as it suits him and then make the destruction of premises by fire or other causes the ground for putting an end to the lease so far as the remainder of the term is concerned. both under the provisions of the transfer of property act and under the common law governing the relations between landlord and tenant, on the determination of a lease it is the duty of the tenant to put his landlord in vacant possession of the premises let to him. so far as this obligation imposed by law on the tenant is concerned it does not mutter whether the lease came to a termination by efflux of time or by.....davar, j.1. almost all the material facts in this case are either admitted or undisputed. the plaintiffs in this suit, messrs. breul & co., a well-known firm of merchants carrying on business in bombay, seek to recover from the defendant, who is a dealer in sugar in a very large way of business, the sum of rs. 3,300, alleging that that sum is due to them either as rent or as compensation for use and occupation of a certain godown in clive road for the months of december 1908, and january and february 1909 at the rate of rs. 1100 per mensem.2. the godown in question is built on land leased out originally by the trustees of the port of bombay to one mulji jivraj in the year 1883. this lease with the godown on the land, was about five years ago acquired by mr. luckumsey napoo. mr. luckumsey.....
Judgment:

Davar, J.

1. Almost all the material facts in this case are either admitted or undisputed. The plaintiffs in this suit, Messrs. Breul & Co., a well-known firm of merchants carrying on business in Bombay, seek to recover from the defendant, who is a dealer in sugar in a very large way of business, the sum of Rs. 3,300, alleging that that sum is due to them either as rent or as compensation for use and occupation of a certain godown in Clive Road for the months of December 1908, and January and February 1909 at the rate of Rs. 1100 per mensem.

2. The godown in question is built on land leased out originally by the Trustees of the Port of Bombay to one Mulji Jivraj in the year 1883. This lease with the godown on the land, was about five years ago acquired by Mr. Luckumsey Napoo. Mr. Luckumsey let this godown to the plaintiffs for twelve months certain from the I st of April 1908 up to the 31st of March 1909 at a monthly rent of Rs. 1100. Messrs. Breul and Co. in their turn let the godown for the same rent from the Ist of May 1908 for the remaining period of their lease to the defendant. The defendant used the said godown for storing sugar bags in it and has paid to the plaintiff the rent of the godown up to the 30th of November 1908.

3. On the 5th of December following, there was a fire in the godown. The fire destroyed the roof and several doors and windows and the sugar stored in the godown was partly burnt and partly damaged by fire and water. At the same time the fire took place, there were in the godown 44,186 bags of sugar. The sugar seems to have been in bags that had three coverings, first, a gunney, over it, matting, and then over the matting, another gunney. It appears that immediately after the fire the salvage corps of the Insurance Company or Companys with whom the sugar had been insured, took possession of the godown and the goods in it. The insurers at first seem to have intended to deal with the sugar themselves but four days after the fire they changed their minds and sold the sugar in the godown to one Haji Gulam Mahomed Azam, who is also a large dealer in sugar. On the 9th of December 1908 all the sugar belonging to the defendant that was damaged by the fire of the 5th, was sold by the Insurance Companys to Mr. Gulam Mahomed Azam for Rs. 1,35,000. Gulam Mahomed paid Rs. 50,000 on the 10th of December and the balance of Rs. 85,000 on the 11 th of December and possession of the godown with the sugar in it was given to him. On getting possession Gulam Mahomed commenced to sort the sugar according to the extent of damage d one and to put the same in new bags. There was no room in the beginning to do this work in the godown itself and therefore a neighbouring godown was engaged and the work of refilling bags was carried out there for about fifteen days. Afterwards there being room in this godown, the operation of sorting the sugar and putting it in new bags was carried on in this godown. Gulam Mahomed intended to export this sugar and claim refund of Town Duty from the Municipality, and, in order to avoid any possible question about the identity of the sugar, he asked the Municipality to send one of their men to supervise the refilling of the bags and to put proper Municipal marks on the new bags. Accordingly, one Narain Rukhmaji was deputed by the Municipality to attend to this work. He attended from the 15th of December up to the 15th of February. From the 16th of February till the 28th he did not attend because he says he was not called. On the first and second of March he attended again but that was in the other godown and not in the godown that was burnt. According to his book, Ex. No. 11 and his evidence, it appears that Gulam Mahomed refilled the damaged sugar in 26,040 bags and took them away to his own godown. After the fire, Messrs. Breul & Co. on the 10th of December 1908 wrote a letter to Mr. Luckumsey Nupoo asking him to note that the agreement between them had ceased owing to the fire. Luckumsey Napoo immediately replied stating that the godown was occupied by sugar bags and other kachra and gave notice to Messrs. Breul & Co. that he would hold them responsible for the rent of the godown till such time as the godown was cleared and possession of it given to him. See Exs. A and B. The defendant, however, appears to have done nothing till the 9th of January 1909 when he wrote a letter to the plaintiffs stating that as the godown was destroyed by fire he had exercised his option to terminate the tenancy and the same was at an end. This was written by him in reply to a demand for the payment of rent for the month of December. The defendant in his written statement set up a case in the first instance that he had given verbal intimation of the exercise of his option on the day following the fire. That was the case of the defendant at the first hearing on the 1 0 th of December. On the following day, however, Mr. Jinnah, on behalf of the defendant, abandoned his contention that his client gave notice on the day following the fire and said that he would proceed on the basis that the notice was first given on the 9th of January 1909. The plaint as originally filed confined the claim to one of rent under the sub-lease to the defendant. When the defendant's counsel on the second day raised another issue specifically, putting forward his contention that in any event the defendant was not liable on the agreement after his notice of the 9th of January 1909, the learned counsel for the plaintiff thought it safer to put his case in the alternative and based his claim on the use and occupation of the godown after fire. I gave permission to the plaintiff to amend his plaint and allowed the defendant to put in a supplemental written statement. Rule 17, Order VI of the Civil Procedure Code empowers the Court to allow either party to amend his pleadings, as may be necessary for the purpose of determining the real question in controversy between the parties. And the rea questions between the parties in this case seemed to me to be whether the defendant was liable to pay to the plaintiff any, and if so, what sum either by way of rent or as compensation for use and occupation of his godown, after the fire. After the plaint had been amended and supplemental written statement put in more issues were raised, but it seems to me the question that is before the Court is not one of much difficulty. Once the questions of fact are ascertained, the only question is one of law and of construction of certain clauses in Section 108 of the Transfer of Property Act. As to the facts, as I have said above, most of them have either been admitted or are undisputed. The only question on which the parties were at difference at the hearing was as to when Luckumsey Napoo took possession of his godown. According to Mr. Luckumsey's evidence, clear possession of his godown was not given to him till about the beginning of March and he claims to recover from the plaintiffs rent of his godown up to the 10th of March. Now there is no doubt on the evidence that is before me that Mr. Luckumsey got admission into his godown somewhere about the middle of February. This Mr, Luckumsey himself admits but he says it took him twenty days to clean the godown and remove the kachra from it and he claims to be entitled to payment up to the period inclusive of the days which he says were occupied in cleaning the godown. On the 19th of February 1909 he himself wrote a letter, Ex. No. 2, wherein he informs the plaintiffs that their subtenants had removed the bags of sugar lying there but he complains that they had left kachra both in and outside the godown. In the course of his evidence he explained that that letter was written by him on information received from Gulam Mahomed Azam's man but that when he went to the godown he found that there were about a thousand bags of sugar still in the godown and that Gulam Mahomed's men were collecting the semi-liquid stuff on the floor. He admits however, that from the 30th of February he began removing the roof debris and the kachra from the godown. In the course of the hearing Mr. Inverarity for the defendant, laid great stress on the fact that some of the roof debris must necessarily have fallen into the godown itself and remained there. And he emphasized the fact that it was Luckumsey's duty to remove the debris and his argument, if I understood aright, was that while the debris was there Luckumsey must be taken to be in possession of the godown. From what has been proved, it seems to me that although there may have been some burnt debris in the godown itself, that did not in any way prevent the use of the godown to which it was put by the insurers and their purchaser Gulam Mahomed. Luckumsey seems to have been most anxious to get back early possession of his godown, as he wished to rebuild the same and let it out again. He said his godown had before the lease to Braul & Co. fetched Rs. 1250 a month as rent and as a matter of fact after he rebuilt it, he has succeeded in letting it at a rent higher than what was paid to him by the plaintiffs. At one time he threatened that he would claim Rs. 2000 a month as rent, if possession was not given to him immediately. He seems to have made many attempts to get into the godown and take possession but Gulam Mahomed's men would not let him come in while their operations were going on. It is established that the bulk of the sugar had been removed from this godown by the 16th of February and very little remained in the godown. I have no doubt that the godown was left in very unclean condition when Gulam Mahomed's men gave up possession. But that must be partly due to the burnt debris of the roof and partly due to the kachra consisting of old burnt matting and gunney of the original bags. It must also be remembered that Luckumsey required possession for the purposes of repairing his damaged walls, replacing the burnt windows and doors and rebuilding the roof on the premises. For these purposes it was not absolutely necessary that the godown should be in a perfectly clean condition, for the building operations would necessarily be accompanied by certain amount of dirt and uncleaniness.

4. Having regard to all the circumstances of the case, the correspondence and the proved and admitted facts, I think for the purposes of this case it would be just to all parties to hold that Luckumsey got back possession of his godown on the 16th of February, the day when the Municipal man finally ceased to attend the burnt godown.

5. There does not appear in this case to be any other material question of fact on which the parties are not agreed. Mr. Inverarity for the defendant has maintained that his client is not liable to pay more than the sum of Rs. 177-6-9 being rent for the first five days of December and this sum his client has brought into Court. The learned counsel has contended in the first place that under the provisions of clause (e) of Section 108 of the Transfer of Property Act, his client was entitled to exercise his option to put an end to the lease and he has further contended that once a tenant exercises the option given to him under that clause, the lease becomes void and must be treated as a lease void ab initio. He maintained that his client having given the notice, the lease became void, and no claim whatever based on the lease itself could be entertained by the Court and therefore his client was not liable to pay any rent. As to the plaintiffs' alternative claim for compensation for use and occupation the learned counsel had a double defence. In the first place he said, his client was never in use and occupation of the godown after the fire. Between the 6th and the nth he said the Insurance Companys were in occupation; after the nth Gulam Mahomed Azam was in occupation till such time as Luckumsey Napoo got back possession of his godown. In the second place, he contended that Breul & Co. having given notice on the 10 th of December terminating their lease, they had no right to maintain any suit for use and occupation of the godown after that date. I feel considerable difficulty in accepting Mr. Inverarity's argument that in the events contemplated by clause (e) of Section 108 on the tenant giving notice, the lease becomes ab initio void and no claim could be made thereunder. It seems to me that such a construction would lead to some very startling and objectionable results. Rights may have arisen and obligations incurred by parties to a lease before the premises, the subject matter of the lease, are destroyed by fire or other causes contemplated in the clause in question. It would manifestly be unjust to hold that those claims or obligations which may have no connection whatever with the destruction of the premises and may have arisen quite independently of the fire, should all be obliterated because the tenant chooses to exercise the option given to him under the clause. Mr. Inverarity pointed to Section 65 of the Indian Contract Act, the provisions of which, he said, were sufficient to entitle the party who has a claim to enforce it, as an advantage under the lease which the other party is bound to restore. I do not think the provisions of Section 65 would meet the requirements of the many questions that may arise between the landlord and his tenant under a lease before the demised premises are destroyed and the lease is put an end to. In my opinion the true construction to be placed on clause (e) of Section 108 of the Transfer of Property Act is that on the demised premises being destroyed or rendered substantially and permanently unfit for the purposes for which they were let by any of the causes mentioned therein, the lessee would have an option by notice to terminate the lease and that on such notice being given the lease should be deemed to have come to an end. On the occurrence of the fire and the destruction of premises let to a tenant, the contract of letting becomes voidable at the option of the tenant and on that option being exercised, it becomes void. I do not think there is any warrant whatever for holding that the lease becomes void ab initio. This clause seems to be inserted in the Act for the purpose of safeguarding a tenant against the manifest injustice of having to pay rent under a lease where on the destruction of the premises the whole consideration fails and there is no reason why a lease perfectly proper and legal should be deemed to be void during a period when no contingency as is contemplated in the clause had arisen. In the present case the lease as between the plaintiff and the defendant would in the ordinary course come to a termination and be deemed to be void as soon as the defendant gave notice contemplated in the provision of the Act under discussion. Did he give such a notice He has abandoned the position originally taken up by him that he gave verbal notice on the day following the fire. The only notice therefore that he gave was his letter of the 9th of January which he did not write till after the rent for the month of December was r 61 demanded from him. Mr. Setalvad has argued that that was not a proper notice and that the notice to be a valid notice should have been given immediately after the fire. I agree with this contention but so far only that in my opinion the notice should be given within a reasonable time from the occurrence 1 of the fire and the question as to what is a reasonable time, must always be judged by the facts of each particular case. In this case the lease in the ordinary course would have terminated on the 31st of March less than four months after the fire and the notice-is not given till more than a month of the remaining period had already expired. I do not think that that was done within a reasonable time. A tenant has no right to retain possession of the premises till such time as it suits him and then make the destruction of premises by fire or other causes the ground for putting an end to the lease so far as the remainder of the term is concerned. In the view however which I take of this matter it seems to me to be immaterial to decide whether in the present case the notice of the 9th of January was such a notice as is contemplated in clause (e) of Section 108 and whether it validly put an end to the lease between the parties. I will assume that it was and that on the 9th of January the lease between the plaintiffs and the defendants became void and came to a termination.

6. The important question however that remains to be considered is whether on the lease becoming void or, as I put it, coming to a termination, was the defendant under any obligation to perform any duty cast upon him by law before he can claim to be discharged from the obligations imposed upon him under the lease One of such obligations is defined in clause (q) of the same section which provides that on the determination of the lease the lessee is bound to put the lessor into possession of the property, and clause (m) of the same section provides that the lessor on the termination of the lease is bound to restore the property in as a good a condition as it was at the time when he was put in possession and subject only to the changes caused by reasonable wear and tear or irresistible force. Mr. Inverarity has argued that these clauses do not apply, as in this case the lease was not either determined or came to a termination but that the lease had become void. That again is a contention such I am constrained to say I cannot accept. When a tenant gives notice contemplated by clause (e) it is true that according to the language of that clause the lease shall be void. But, as I have observed above, it can only mean that it becomes void from the date of the notice, in other words, the lease is determined or comes to a termination before its full period, on the happening of the contingency contemplated by clause (e) and the notice following on the happening of that contingency. I think therefore that the defendant when he gave sotice and announced his intention to treat the lease as determined, he was bound to give, if not quite clean possession of the godown, at all events vacant possession. Quite independently of the provisions contained in clauses (m) and (q) of Section 108 of the Transfer of Property Act, there is abundant authority from very old times for holding that a tenant is bound to restore possession of the premises to his landlord, when his lease comes to a termination.

7. In Harding y. Crethorn (1793) 1 Esp. 56, Lord Kenyon laid down the law as follows:-

When a lease is expired, the tenant's responsibility is not at an end.... The lessor is entitled to receive the absolute possession at the end of the term.

8. The law laid down in this case as far back as 1803 is still good law and the case I have referred is approved and followed in Henderson v. Squire (1869) 4 Q. B. 170, where Cockburn C. J. quotes the words of Lord Kenyon in his judgment and Blackburn J. says :-

Independently of authority, on principle, seeing that the landlord gives the tenant absolute possession, it is the duty of the tenant to restore absolute possession.

9. This case is followed by Sir Charles Farran in Baliaram v. Vasudev ILR(1896) Bom. 348. The Chief Justice, in delivering the judgment of the Court, says:-

There can, we think, be no doubt that a tenant giving up demised lands to his landlord is bound to give him vacant possession. That is the law in England even in the case of a demise by parol. Where there is no express stipulation to that effect made at the time of the letting of the land it will be implied as one of the terms of such letting. The same must, we think, be the law in India.

10. It will thus be seen that both under the provisions of the Transfer of Property Act and under common law governing the relations between landlord and tenant long before the Transfer of Property Act came into force, on the determination of a lease it is the duty of the tenant to put his landlord in vacant possession of the premises let to him. So far as this obligation imposed bylaw on the tenant is concerned, I do not think it matters in the least whether the lease came to a termination by efflux of time or. by operation of law on the happening of events contemplated in clause (c) of Section 108 of the Transfer of Property Act. Was this obligation performed by the defendant? The answer must clearly be in the negative. When the fire took place, the godown was filled with enormous quantity of sugar bags and the contents of the godown were not wholly destroyed. More than half the quantity of sugar seems to have escaped with such little damage that it was worth the while of the purchaser to put it in 26040 new bags and export it. The sugar so saved was of considerable value, for Gulam Mahomed Azam paid Rs. 1,35,000 for it to the Insurance Companys and he must have purchased the stock with a view to re-sell or export the same and make a profit thereby. At the time of the fire the godown was in possession of the defendant. The defendant has not chosen to come into the witness box and tell the Court under what circumstances the men of the salvage corps took possession of the godown and the goods therein. I must assume that what took place must have, been what would under the circumstances ordinarily take place. As soon as the defendant found that the godown was on fire, he must have given intimation to the Insurance Companys and either then or soon afterwards elected to abandon the salvage to the Insurers. The insurers, their agents or servants, as the' salvage corps must be taken to be, could not have entered into possession of the godown without the knowledge and consent of the defendant. The Insurance Companys in their turn on selling the goods to Gulam Mahomed gave him delivery of the goods so sold by them, by allowing him to enter into possession of the godown and to work there for his benefit. The Court have no materials of judging on what terms and conditions as to the use and occupation of the godown itself the goods were sold. The defendant has not called any evidence and therefore the Court is not in a position to say whether a continued occupation of the godown by Gulam Mahomed was or was not contemplated between the insurers as the vendors of the sugar and the purchaser Gulam Mahomed. Whether Gulam Mahomed stipulated with the Insurance Companys or the defendant that he should have possession of the godown till such time as he sorted the sugar and filled it in new bags, or whether he was to remove the sugar immediately, the Court is unable to say for want of any evidence on the point. I must, therefore, assume that what Gulam Mahomed did was with the consent of his vendors. Those vendors were there in the first instance with the consent of the defendant and it seems to me that regarded from whatever point of view, the defendant so far as his immediate lessors were concerned, was in occupation of the godown through those whom he had allowed to enter upon the demised premises. It may be that in the end either the Insurance Companys or Gulam Mahomed may be held to be liable to pay for the use and occupation of the godown from the dates of their respective possession to the date when Luckumsey Napoo succeeded in regaining possession of his godown. The plaintiffs, however, are not concerned with the question as to who would be ultimately liable. They can make no claim whatever against the Insurance Companys or against Gulam Mahomed. They can only look to their immediate tenant to pay them for the use and occupation of the godown, possession of which he failed to give to them.

11. It was further argued that the plaintiffs having given notice to their landlord Luckumsey Napoo terminating their lease, they had after the date of the notice no interest in the premises and that, they were not entitled to maintain the suit either for rent or for compensation for use and occupation in respect 01 this godown. It seems to me that, assuming that the notice given by Breul & Co. was a good notice and that it terminated the lease between themselves and Luckumsey Napoo, they were under obligation immediately to restore possession of the godown to their landlord. This they were unable to do, entirely owing to the failure of the defendant to give possession to them and therefore even assuming that they were not entitled to maintain a suit for any further rent, they would be still entitled to maintain a suit to recover by way of compensation an adequate sum for the use and occupation of the godown by the defendant and those whom he put m possession. By the action of the defendant in not giving over vacant possession to them, they were unable to give vacant possession to Luckumsey Napoo and they rendered themselves liable to make good tic Luckumsey either by way of rent or by way of compensation for use and occupation such sum of money as may be held to be adequate compensation. It is not necessary that they should in the first instance pay Luckumsey Napoo and then seek to recover from the defendant. It is sufficient if they have rendered themselves liable to their landlord to entitle them to maintain a suit against their tenant to recover what would be adequate and proper compensation for withholding possession of the godown after die fire. As to what is the measure of such compensation, there is clear authority for holding that in all ordinary cases the measure of damages or compensation for se and occupation is usually the rent reserved between the parties.

12. In Henderson v. Squire, Blackburn J. lays down this rule. He says :-

Then comes the next question what measure of damages the plaintiff is entitled to recover. He is entitled to what the rent would have amounted to for the time he was kept out of possession.

13. And in the case of Baliaram v. Vasudeo Sir Charles Farran observes:-

The question however still remains, what is the result of not giving a vacant possession. Does it continue the tenancy indefinitely or does it give rise to a claim for damages on the part of the landlord. The latter appears to us to be its legal result.

14. Following these authorities I hold that the defendant in this case is bound to make compensation to his immediate landlord the plaintiffs for use and occupation of the godown from and after the date of the fire till the 16th of February when as I have found above the owner of the godown was able to re-enter on the premises and take possession of the godown. It was argued that in any event such compensation should be for the use of the bare land. I am unable to accept this view. The godown was not wholly destroyed. The walls stood and Gulam Mahomed seems to have closed up the spaces of the burnt doors and windows and made use of the godown in much the same way as if the godown was still intact. Gulam Mahomed must be taken to be a needy tenant. If he had to remove all the damaged sugar to another godown and there sort and refill it in new bags it would I think have not only cost him more than the rent of the godown in question but would in addition have involved him in much additional inconvenience and trouble. If he had been put on terms I have no doubt whatever that he would have agreed to pay the full rent for the godown for the period of his occupation. It was said that Luckumsey Napoo got full insurance money on which he must have earned interest and' therefore he was not entitled to claim both rent and interest. This argument was based on an inaccurate knowledge of facts. Luckumsey did not get full insurance money. He put in a claim for total destruction but he had to accept a smaller sum as the walls were not destroyed but only slightly damaged. The foundation and the plinth and flooring were excluded from the Insurance. The moneys were intended by him and were eventually utilized in rebuilding the destroyed portion of the godown.(Sic) Luckumsey the godown was worth more than Rs. 1,100 per month. As soon as he rebuilt his godown he was able to let it for higher rent. Having regard to all these circumstances I think the rent reserved between the parties is a fair measure of damages or compensation which the plaintiffs are entitled to recover from the defendant.

15. [After finding on the various issues his lordship continued:-]

There will be a decree for the plaintiffs for Rs. 2,750. This sum is made up of rent for the first five days of December 1908 and compensation for use and occupation thereafter till the 15th of February 1909.

16. The defendant must pay the plaintiffs costs of the suit. The defendant has no doubt succeeded in reducing the claim of the plaintiff by Rs. 550 but. that I think does not materially affect his liability to pay the costs of this suit. The costs so awarded not to include costs reserved. Plaintiffs must bear their own costs of and incident to the amendment of their plaint and pay the defendant his costs of putting in his supplemental written statement.


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