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Phillip A. Watkins Vs. Laxminarayen Basdeodas - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai
Decided On
Case NumberO.C.J. Appeal No. 25 of 1926
Judge
Reported in(1927)29BOMLR131
AppellantPhillip A. Watkins
RespondentLaxminarayen Basdeodas
DispositionAppeal allowed
Excerpt:
.....not covering ten per cent. above actual value-suit to recover the excess-suit in bombay-leave to sue.;under an order received in london from the plaintiff in bombay, the defendants in london purchased gold bullion of the value of £ 25,000 and shipped it to bombay under an insurance for an amount exceeding the actual cost by six per cent. the ship was lost with all its cargo. the plaintiff duly received in london the amount of the insurance money from the defendants. the plaintiff then sued the defendants in bombay alleging that they should have insured the gold for ten per cent, above its value in accordance with the custom of the bullion market in london. the plaintiff having obtained leave to sue under clause 12 of the amended letters patent, the defendants took..........exceptional. it depends, in our opinion, solely upon the question as to what is the custom of the london bullion market. all the evidence must necessarily be in london. it will be for those skilled in the practice of london bullion market to give evidence, with if necessary their books to prove instances of the practice which they say exists. the learned judge says that there are two indian merchants who can testify to the practice of the london market. surely in a case such as the present, the people they deal with in london can give far better evidence of the practice of the london market than those two alleged indian merchants in bombay.5. moreover, if this case was brought in london, the court hearing the case would have the advantage of seeing the witnesses. i disagree with the,.....
Judgment:

Amberson Marten, C.J.

1. This is an exceptional ease. The plaintiff an Indian merchant bought gold bullion through the defendants in London in May 1922. The bullion was shipped on SS. Egypt and was lost on the sinking of that ship. But the defendants had insured the gold for its value and upwards, with the result that the plaintiff was repaid his entire cost of the purchase of the gold plus a certain additional sum. But he is not content with that. He says that the defendants ought to have insured not for say live or six per cent. above the value of the gold, as they in fact did, but for ton per cent. above that value. Accordingly, he claims the difference between this five per cent. and ten per cent.

2. This claim is based solely on an alleged custom of the bullion market in London : and it is thus pleaded in the plaint which, I am glad to notice, is concisely and clearly drawn, differing in that respect from most of the plaints I see in this Court. Para, 3 runs as follows :-

In accord with the custom prevailing in such business, which custom is and was at all material times well-known to the defendants, the defendants ought to have insured the said bullion for 27,600, that is to say, for an amount ten per cent. over the value of the said order and charges.

4. The defendants in fact, contrary to the said custom and in breach of their duty to the plaintiff, insured the said bullion for 25,600 only.

Accordingly, the plaintiff prays for a decree for Rs. 26,247-8-9 with interest from July 4, 1922, which sum represents from the particulars Exh D the equivalent of 2,000 at the current rate of exchange on July 4, 1922.

3. The plaintiff waited nearly three years to bring his suit. He has now brought it and has obtained the leave of the Chamber Judge under Clause 12 of the Letters Patent The defendants took out a summons to have that leave discharged. Mr. Justice Mirza has refused that leave and discharged the summons. The defendants appeal.

4. It will readily be seen why this case is exceptional. It depends, in our opinion, solely upon the question as to what is the custom of the London Bullion market. All the evidence must necessarily be in London. It will be for those skilled in the practice of London Bullion market to give evidence, with if necessary their books to prove instances of the practice which they say exists. The learned Judge says that there are two Indian merchants who can testify to the practice of the London market. Surely in a case such as the present, the people they deal with in London can give far better evidence of the practice of the London market than those two alleged Indian merchants in Bombay.

5. Moreover, if this case was brought in London, the Court hearing the case would have the advantage of seeing the witnesses. I disagree with the, opinion of the learned Judge to the effect that in a case of this sort it is immaterial to judge of the personal character of individual witnesses. If there is to be any real contest of fact in this case, I think the demeanour and standing of the witnesses has its importance. I also attach importance to this that there is a special Commercial Court in London, and that either the Commercial Judge or a London special jury will be in a far bettor position to judge of the position and standing of the witnesses from the different firms that may be called before them at the trial in London than would be the case if the suit was heard in Bombay merely on commission evidence.

6. I also, with great respect to the learned Judge, dissent from his view that justice can equally well bo done if first of all there is to be a trial in Bombay on commission evidence, and that then if the plaintiff is successful there can be another law suit in London to enforce the judgment obtained in Bombay. This seems to me to be a roundabout way of obtaining a fair and proper decision as to what is the custom of the bullion market in London. There is also a smaller point that if these London witnesses have to produce their books, that can be easily done in London without the necessity of making and checking copy entries from the business books as would be necessary if the case had to be decided here on commission evidence taken in London. But it is not solely a question of mere convenience. It is only right and proper to look at the whole of the facts of the case. And what do we find here The contract made in London by reason of a cable sent to London and accepted there: the bullion bought in London : the bullion paid for by the plaintiff in London through his agents the Mercantile Bank of India: the bullion shipped in London: and the assurance monies also paid in London to the plaintiff's agents the Mercantile Bank. Accordingly, all the essential facts of the case have taken place in London. As far as plaintiff's own personal evidence is concerned, I fail to see how he could help the Court as to what the custom of the bullion market in London is. In any event his evidence can be of comparatively little weight compared with those who have spent their lives in that market.

7. These, then, being the general considerations, what are our powers under Clause 12 of the Letters Patent As I read that clause, I find that in cases where the cause of action has arisen only in part within the local limits of the Ordinary Original Civil Jurisdiction, then the leave of the Court is to be obtained. What does this mean It means surely that the Court in the exercise of its discretion may either grant the leave or refuse it. Otherwise, it would be useless to insert in Clause 12 the words 'with the leave of the Court' for it would be sufficient to say 'if the cause of action arises wholly or in part within the local limits of the jurisdiction.'

8. If, then, a discretion is vested in the Court as to whether leave should be granted or not, why should the exercise of that discretion be cut down by any alleged hard and fast rule as to practice. It will be remembered that we are dealing here with an exceptional case. It may well be that in an ordinary cause it is a useful general guide in the exercise of one's discretion to see whether a material part of the cause of action has arisen within the jurisdiction. But I entirely repudiate the notion that where the words of a statute or a charter are clear, then one's interpretation or application of them in any individual case is to be cut down by any arbitrary so-called rules of construction or practice which may have been adopted in essentially different cases. With great respect I adopt and concur in the view which Sir Norman Macleod and Mr, Justice Shah expressed in Govindlal v. Bansilal : AIR1921Bom328 . There in dealing with a case of land Sir Norman says (p. 1056 ):-

The question of granting leave is purely a question for the discretion of the Court and it will be considered according to the facts of each case whether it is advisable tha leave should be granted. In ordinary cases leave is granted practically as a matter of course, unless either the portion of the land or the part of the cause of action inside the local limits is so trifling that it is not desirable that the suit should be tried in the High Court...But if it is merely a question of discretion, whether or not leave should be granted, it is open to the defendant to ask the Court to exercise its discretion against the plaintiff according to the circumstances of the case ; and undoubtedly where part of the property in a partition suit is outside British India, the Courts would certainly be very slow to grant leave, so that the Court could exercise jurisdiction over such property, as undoubtedly difficulties would arise in the execution of any decree that might be passed in the suit.

9. What Sir Norman Macleod said there app lies, I think, equally to a case not dealing with land, but with a cause of action such as we have here. After all, we are dealing with defendants who live over 6000 miles away from this Court, and whom it is sought to bring into this Court on facts which mainly arise in their own country and to decide the question of the custom of their own market, and not that of Bombay. Looking at the case as a whole, I have no doubt that this is one of those exceptional cases where leave under Clause 12 of the Letters Patent ought not to be given. On that ground alone the decision of the learned Judge ought, in my judgment, to be reversed, and the leave revoked.

10. In saying this I recognise that the learned Judge has given certain grounds for the exercise of his discretion. But, again, I regard this as an exceptional case where we are justified in reversing the decision of the Judge notwithstanding that he has purported to exercise his discretion. 1 have already indicated that I disagree with several of the grounds on which he has based the exercise of his discretion.

11. Apart from that there is another branch of the case, viz., whether any part of the cause of action has arisen in Bombay. Speaking for myself, I see great difficulty in holding that any part of the cause of action has arisen here. But I recognise that there are so many authorities on this particular branch of the law in this Court that I do not wish to say anything which would necessarily conflict with the decisions either on one side of the line or on the other that have been given. I would only say that as at present advised my present view is that at any rate no material part of the cause of action arose in Bombay, and that all the material parts arose in England. Accordingly, if it was necessary so to do, I should be prepared to base my judgment on that alternative ground alone.

12. Accordingly, in our opinion, the leave given should be revoked, and the plaint must be returned to the plaintiff. The plaintiff will pay defendants' costs of this summons.

13. I should add that the plaintiff has indicated to us that he proposes at some unspecified date to present an application for amendment of the plaint. It is sufficient to say that no such application is before this Court or was before the lower Court notwithstanding that his plaint was tiled over a year ago, and that the cause of action arose nearly three years before that date. We propose, therefore, to say nothing further about this proposed amendment except that it is not now before the Court, and that we do not in the least wish to encourage it. On the contrary, after this lapse of lime it might be quite improper for any Court to allow any such amendment.

Kemp, J.

14. The plaintiff its a bullion dealer in Bombay. The defendants are described in the plaint as a partnership carrying on business in England. On May 11, 1922, the plaintiff sent a cable to the defendants requesting them to purchase 25,000 worth of gold bullion. The order was accepted by the defendants' cable of the same date. On May 1(16, 1922, the defendants cabled to the plaintiff 'Bought 15,000 gold shipment this mail. Please cable remittance and advise through which bank'...On May 17, 1922, the defendants cabled a further purchase of 10,000 gold and asked for a similar cable remittance and advice as to the bank. The invoice value of the goods purchased by the defendants for the plaintiff was 24,490-12-10 and the defendants insured it for a sum of 25,600 and intimated that fact to the plaintiff on May 23, 1922.

15. It appears that the amount for which the defendants insured this bullion was approximately six per cent, above the value. On May 20, 1922, the steamship Egypt on board which the bullion had been shipped by the defendants was lost at sea. The plaintiff says that the defendants should have insured the bullion for an amount ten per cent. over its value which, as calculated in para. 8 of his plaint, would have amounted to Rs. 27,600. On July 4, 1922, the defendants received the insurance moneys and remitted to the plaintiff through the bank a sum of 980. The plaintiff filed this suit, on June 15, 1925, claiming the difference between the percentage for which the defendants had insured this bullion and the percentage at which, according to him, they should have insured it.

16. The defendants took out a summons before the learned Chamber Judge to revoke the leave granted under Clause 12 of the Letters Patent. The learned Judge discharged that summons, and against that order the present appeal is preferred.

17. Now the plaintiff's claim against the defendants is in respect of a breach of duty as agent. The plaintiff says that according to the custom of the bullion market in London the proper percentage for which the bullion should have been insured was ten per cent, above its value. The first point for consideration in this case is what was the contract between the parties I think it is clear that it was a contract of agency. The plaintiff employed the defendants to purchase this bullion for him in London, to ship it and generally to perform all the duties ordinarily incumbent on an agent entrusted with such business. The cause of action is obviously the alleged breach of duty by the defendants as agents in the performance of their agency.

18. Did any part of the cause of action accrue in Bombay In the first place, the contract was clearly made in London because it was there that the offer of agency was accepted by the defendants. Then the performance of the contract was to be in London because it was there that the gold was to be purchased and the shipment was to bo made and the duties of the agent to be performed. Incidentally, the defendants reside in London. The alleged broach of the defendants' duty arose in London, because it is there that the defendants are alleged to have insured for a percentage below the customary percentage in the London market. The damage accrued to the plaintiff in London because it was there that the insurance monies were to be paid to his agents.

19. As a matter of fact the defendants paid the insurance monies to the plaintiff's bank in London (see their cables of May 16 and 17, and the plaintiff's letter of May 19, 1922) ; so that the payment was to be made by the defendants to the plaintiff's agent in London. This was one of the ways in which the principal in Bombay would according to the usual course of business bo paid. It could not bo expected that the defendants should send their representative with the money all the way to Bombay to pay to plaintiff.

20. It seems to me, therefore, that the whole cause of action accrued in London.. That being so, there is no part of the cause of action accruing in Bombay under which leave under Clause 12 of the Letters Patent could be granted.

21. In coming to this conclusion 1 wish also to point out that the cases which have been cited with reference to suits between a commission agent and his principal in which the principal asks for the balance due at the foot of a commission agency account have no application in this case. Here the present suit is not a suit for an account Nor is it a suit for the balance due at the foot of an account. Further, I am of opinion that even if any part of the cause of action in this case did accrue in Bombay, it is desirable that the suit should be heard in London. All the evidence relating to the custom of the bullion market in London is in London and there does not appear to me to be any necessity for the plaintiff himself to give any evidence on the point. I, therefore, think that even under Clause 12 of the Letters Patent if leave to sue were necessary this is a case in which it should not be granted.

22. I agree with the order proposed by the Chief Justice.

Amberson Marten, C.J.

23. Our order will, accordingly, bo to the following effect:-Appeal allowed. Order discharged. Leave revoked. Plaintiff to pay defendants' costs of the appeal and in the Court below.

24. Plaint to be returned.


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