1. This appeal is preferred by original defendants challenging the judgment and decree passed by the learned Civil Judge. Senior Division, Sangli, decreeing the plaintiff's suit for recovery of the amount of Rs. 16,252.06/- together with, interest at 6% per annum from the date of the suit till the date of realisation and also awarding the costs of the suit from the defendants.
2. The facts leading to the filing of the suit by the plaintiffs in the trial court are as under:
Plaintiff No. 1 is a well known manufacturer of farm machinery and pumps in India and plaintiff No. 2 is an Insurance Company registered under the Indian Companies Act. The defendants inter alia carry on business of transporting for hire, goods in their vehicles from one place to another all over the country and are common carriers within the meaning of Carriers Act III of 1865.
One National Pipes and Tubes Co. Ltd., at Calcutta was instructed by Plaintiff No. 1 to supply high tensile brass rods of various descriptions, sizes, quantities and values mentioned in the various orders placed by the Plaintiffs in the said company. Plaintiff No. 1 also instructed the said National Pipes and Tubes Co. Ltd., to send the said goods by road from Calcutta through the defendants who were the common carriers. Accordingly the said National Pipes and Tubes Co. Ltd., entrusted the contracted rods of the total value of Rs. 1,05,030.22 to the defendants in May and June, 1967. Along with the said goods three challans of various dates were handed over to the defendants. There is no dispute regarding the defendants having received these challans from the said National Tubes and Pipes Co. Ltd. The plaintiffs' further case is that the defendants did carry the rods entrusted by the said Company in order to deliver them to the plaintiffs at Kirloskarwadi. However, defendants ultimately short delivered to the plaintiffs the said rods and therefore, plaintiff No. 1 addressed a notice in writing dated July, 5, 1967 setting out the price of the short delivered goods to the defendants. The plaintiffs further stated in their plaint that defendants were requested either to deliver the balance of the goods short delivered or to pay the sum of Rs. 29,033.46 plus proportionate freight and other incidental charges to the first plaintiff. It seems that defendants thereafter delivered part of the goods which were short delivered to plaintiff No. 1. However, even defendants had admitted that in all 53 rods were short delivered to plaintiff No. 1. All these goods were already insured by plaintiff No. 1 with plaintiff No. 2. Plaintiff No. 2 are the insurers of the aforesaid consignment. The amount of Rs. 16,252.06 was the value of the short delivered consignment of goods and therefore, plaintiff No. 1 asked plaintiff No. 2 to pay the amount which plaintiff No. 2 did pay and thereafter plaintiff No. 1 had passed in favour of plaintiff No. 2 a letter of subrogation dated February 17, 1968. Plaintiff No. 2 has thus stepped into the shoes of plaintiff No. 1 as a result of the document i.e, the letter of subrogation and therefore, plaintiff No. 2 will be entitled to be reimbursed to the extent of the damage causeddue to the short delivery of the 53 rods on account of the negligence of the defendants. Both the plaintiffs, therefore, are jointly and severally entitled to recover a sum of Rs. 16,252.06 from the defendants. It was further stated in the plaint that under the aforesaid contract the defendants contracted to deliver the goods at Kirloskarwadi. and therefore, the cause of action had arisen within the jurisdiction of Sangli Court. The plaintiffs. therefore, prayed that defendants be directed to pay the plaintiffs Rs. 16,252.06 with 6 per cent interest per annum till the realisation of the amount.
3. The defendants not only contested the plaintiffs' suit on merits but also challenged the letter of subrogation dated February 17, 1968. The defendants also maintained that National Pipes and Tubes Co. Ltd., was a necessary party to the suit. The further defence of the defendants was that they had agreed to carry the goods as a public carrier subject to the terms and conditions printed overleaf of their consignment notes and the said terms and conditions are binding on all the parties concerned. According to the defendants the goods were carried from Calcutta to Indore and from Indore to Pune for onward transmission to Kirloskarwadi, the destination of the delivery of the goods. However, at Pune there was a theft and some rods were stolen. Therefore, the Branch Manger of the defendants at Pune filed a complaint at Pimpri Police Station on June 13, 1967 and as a result of the search by the police 75 rods were recovered from the river where they were submerged. The defendant's manager got the rods released from the Court by the Court's order and ultimately delivered all the rods to the plaintiff No. 1. Even then 53 rods were short delivered of the total consignment. The defendant further denied that the goods were short delivered as a result of negligence on their part and that they had taken all reasonable and proper precaution to protect the goods from the theft and therefore, the say of the defendants was that they were not liable for the alleged loss or claim by the plaintiffs. They therefore, denied their liability for payment of Rupees 16.252.06 as price of the short delivered rods either to plaintiff No. 1 or toplaintiff No. 2. Defendants also did not admit the payment of the said amount by plaintiff No. 2 to plaintiff No. 1 and stated that such a transaction of payment was not binding on the defendants. It was denied that the letter of subrogation dated 17th February, 1968 created or vested any title or interest in plaintiff No. 2. In view of the provisions of Section 8 of the Carriers Act it was further contended that the plaintiffs had no locus standi whatsoever to claim the alleged loss and it was further the say of the defendants that the suit was based on a contract which took place at Calcutta and the Court of the Joint Civil Judge, Senior Division, Sangli had no jurisdiction to entertain and try such a suit. The defendants further denied that any cause of action had arisen on February 17 1968. The further say of the defendants was that the suit was time barred. In short the defendants denied their liability to pay the amount of Rupees 16,252.06 as price for short delivery of the brass rods to plaintiff No. 1
4. On these pleadings the learned trial Judge framed as many as 10 issues. The learned trial Judge held that the said suit was not barred by non-joinder of National Pipes and Tube Company as a party. He further held that the plaintiffs had proved that the short delivery of rods was caused due to the negligence on the part of the defendants or their servants or agents, and that they had not taken reasonable care and precaution to keep the goods in order to protect them from loss or damage. The learned trial Judge negatived the contention of the defendants that they were not liable for the loss in view of Clause 5 and other clauses in the terms and conditions noted on the reverse of the consignment note Ex. 49. According to the learned trial Judge the subrogation of plaintiff Number 2 in place of plaintiff No. 1 was legal and valid. The learned trial Judge held that the plaintiffs have successfully proved the loss of goods and the price of the short delivered rods. On Issue No. 7 which has some significance in this appeal, the learned trial Judge held that the Court at Sangli had jurisdiction to try the suit and therefore. In view of the findings recorded by him earlier he was pleased to decree the entire claim of the plaintiffs against the defendants and directed the defendants to pay the amount of Rupees 16,252.06/- paise by a judgment and decree dated August, 13th 1971 to the plaintiffs. It is against this judgment and decree that the above mentioned first appeal has been filed by the original defendants.
5. The learned counsel Shri Vashi, appearing for the defendants has raised two important contentions before us. First and the more important of the two contentions is that in view of the terms and conditions mentioned on the reverse of the consignment note Ex. 49, the Court of the Joint Civil Judge, Senior Division, Sangli had no (territorial) jurisdiction to try the suit and therefore, according to him, as a result the decree passed by the said Court became a nullity against the defendants. The second submission is that the insurance policy which was taken out by plaintiff No. 1 on February 25, 1966 and which was valid for a period of one year that is to say, up to February 24, 1967 having expired prior to the date of the contract consignment, neither plaintiff No. 2 could have been subrogated in place of plaintiff No. 1 by letter of subrogation dated February 17, 1968 nor did plaintiff No. 2 have any locus standi to recover the amount by way of price of short delivered rods which plaintiff No. 1 had alleged not to have received.
6. The second submission that plaintiff No. 2 had no locus standi as the policy taken out by plaintiff No. 1 with plaintiff No. 2 had expired on February 24, 1967 is only to be stated to be rejected. Mr. Vashi further contended that admittedly the original insurance policy was not produced and only a certified copy thereof was produced in the record. The defendants did not give their consent to exhibit the certified copy of the open General Insurance Policy taken by plaintiff No. 1 from plaintiff No. 2. In the body of the insurance policy it was mentioned that it was to remain in force for a period of one year from February 25th 1966. The policy has expired and therefore was not in force from February 24th 1967 onwards. The letter of subrogation dated February 17, 1968 by plaintiff No. I in favour of plaintiff No. 2 in consideration of plaintiff No 2 having paid the suit claim infull and final settlement in the name of plaintiff Na 1 few short delivery was not binding on the defendants and this letter of subrogation did not create any legal right in favour of defendant No. 2 to claim the suit amount.
7. As against these contentions, Mr. Kotwal appearing for both the plaintiffs has made the following submissions :
As far as plaintiff No. 2's locus stand! is concerned Shri Kotwal had relied on defendants' consent to exhibit the said document i.e. the certified copy of the open General Insurance Policy. As it was once exhibited ii would have to be accepted that plaintiff No. 1 had taken the policy. Nextly. Shri Kotwal further contended that defendants had not-raised in the lower Court the point that Calcutta Court alone had jurisdiction to try the suit as per the last condition mentioned in the consignment note Ex. 49 and that the Sangli Court has no jurisdiction and at this late stage the defendants should not be allowed to raise this point for the first time. He further submitted that since it was the clause of ouster of the Jurisdiction of the Court which tried the suit this clause was also not made known to the consignor or for that matter to consignee before altering into the contract and therefore ouster of jurisdiction cannot be treated as a matter of assumption or presumption. He further contended that the exemption clause limiting the liability to the defendants which is to be found at the end of the consignment note Exh. 49 is unreasonable and oppressive. After taking into consideration all the circumstances relevant in this case, such an exemption clause excluding the jurisdiction of the Sangli Court should not be given effect to. In his submission the Court in considering the Question of ouster of jurisdiction ought to look into the balance of convenience as well, and the ouster of the jurisdiction is not to be lightly assumed. His main submission was that as the suit has been decided on merits the trial Court's finding as to jurisdiction is unassailable unless it is satisfactorily shown that it has caused a failure of justice.
8. Before we deal with these rival contentions of the learned Counsel, it is necessary to make brief reference to the admitted and undisputed facts in this appeal. It is not disputed before us that plaintiff No. 1 placed various orders with the National Pipes and Tubes Co. Ltd., and had contracted to purchase from the said company the brass rods of the description and other particulars mentioned in those orders. It is also not disputed before us that plaintiff No. 1 having paid the entire amount of the goods consigned to them by the said National Tubes and Pipes Co. Ltd., and the said Company having entrusted these goods to defendants for being transported to Kirloskarwadi. plaintiff No. 1 became the owner of these floods. It is also not disputed that out of the three consignments, in all 53 rods were not delivered by the defendants to plaintiff No. 1 and in fact defendants had admitted that they had failed to deliver these 53 rods to plaintiff no. 1, It is the contention of the plaintiffs that the short delivery of 53 rods was the result of gross negligence on the part of the defendants, their servants and agents and therefore, they are liable to make the loss good to the plaintiff No. 1. Plaintiff No. 1 therefore, made claims against the defendants for a sum of Rs. 16,252.06/- being the value of the short delivered goods. Plaintiff No. 1 demanded the said amount from plaintiff No. 2 in view of the insurance policy taken out by them from plaintiff No. 2 The entire amount having been paid by plaintiff No. 2 to plaintiff No. 1 the latter passed in favour of the former, a letter of subrogation dated February 17th 1968.
9. Once these facts are admitted, certain consequences follow and they may briefly be stated here. One of the terms in the consignment note (Ex. 49) was that the goods were transported subject to the terms and conditions mentioned on the overleaf and therefore a vain attempt was made both in the trial Court and in this Court that the defendants were not liable as carriers for the payment of compensation for the short delivery of goods. The trial Court has rightly come to the conclusion that under the mandatory provisions of Section 8 of the Carriers (Act III) of 1865. every common carrier shall be liable to the owner for loss at damage to any property caused by the negligence or fraud of defendants or their agents not with standing anything contained in the terms and conditions in Ex. 49. The lower Court was also right in holding that such condition would not exonerated defendants from liability for short delivery of goods and further finding of the trial Court that admission given by Shri Gole, the plaintiff's witness that the suit consignment to defendants for being transported from Calcutta to Kirloskarwadi was subject to the terms and conditions printed overleaf of the consignment note would also not assist the defendants to escape from their liability, is also unassailable. In fact the provisions of Section 9 of the said Act are too unambiguous to be emphasised here and under these provisions the plaintiff No. 1 is absolutely free from the burden of proving that shore delivery or non-delivery or damages caused in consequence thereof were owing to any negligence or criminal act an the part of the defendants. All that the plaintiff has to prove in such a case of short delivery or non-delivery is the factum of loss by way of short delivery or non delivery. The presumption of negligence on the part of the defendants being rebuttable presumption, it is for the common carriers-defendants in this case, to rebut such a presumption and if that is not done satisfactorily the suit has to be decreed. The liability of carriers is not that of a mere bailee. It has been held that such a liability is on the part of the defendants and the liability of an insurer is that of risk. Therefore, the best of the efforts on the part of the defendants will not assist them in their defence in the case if there is a short delivery or non delivery of the consignment in question.
10. Once it is held that there was short delivery on the part of the defendants, then if follows that the defendants are liable to make good for such a short delivery. This is also not disputed before us by Shri Vashi. the learned Counsel.
11. Dealing with the second submission on behalf of the defendants that plaintiff No. 2 has no locus standi to claim recovery of the amount in this case inasmuch as the Insurance Policy taken out by plaintiff No. 1 from plaintiff No. 2 had already stood expired on February 24, 1967. this submission is only to be stated to be rejected. It appears from the record that originally defendant No. 1 had not given consent to exhibit the certified copy of the open Insurance Policy dated 25-2-1966. taken by the plaintiff No. 1 from plaintiff No. 2. Subsequently the defendants Rave a consent in writing on the list Exh. 48 to exhibit the said certified copy of the Insurance Policy and it was marked as Exh. 57
12. This Insurance Policy (Exh. 57). as stated above, is issued at Kolhapur and it is dated February 25, 1966. In the first column in the schedule it is mentioned that the party assured is M/s. Kirloskar Brothers Ltd., Kirloskarwadi and in the last column the amount insured was shown for rupees three lakhs only. By this Insurance Policy the plaintiff No. 2 were bound to pay the damages on hardware materials and other goods of a heavy nature and it covered rail as well as road risk including non delivery. It was stated in sub-column in terms that the policy was to be in force for a period of one year from 23rd February, 1966. Shri Vashi relied upon the said paragraph of the Exh. 57 to argue that as the Insurance policy has come to an end on Feb. 22. 1967, plaintiff No. 2 had no locus standi to claim recovery of the amount for short delivery of the consignment goods. However, Shri Patel, who was serving as a law officer with plaintiff No. 2 at Head Office in Bombay has stated in evidence that plaintiff No. 1 had taken an open General Insurance Policy for Rupees three lakhs from the plaintiff No. for the year 1966 - 1967. It was in force for the whole year 1967. Plaintiff No. 1 had preferred a claim in respect of the said loss and plaintiff No. 2 paid the sum to plaintiff No. 1. There is no challenge in the cross-reexamination by the defendants to this statement that the Insurance Policy was to remain in force for full one year that is the whole of the year 1967. In view of this it must be held that the Insurance Policy taken out by plaintiff No. I was for the whole of the year 1967.
13. The letter of subrogation Exh. 58 passed by purchase officer of plaintiff No. 1 in favour of plaintiff No. 2 reads as follows:--
LETTER OF SUBROGATION.
The New India Assurance Co.
In consideration of your paving to us the sum of Rs. 16,252.36/- only sayRupees Sixteen Thousand Two Hundred Fifty Two and Paise Thirty Six only in full settlement of out claim for nondelivery shortages and damages under policy No. 211510679 issued by you on the undermentioned goods, we hereby assign, transfer and abandon to you all our rights against the Railway Company/Administration or other persons whatsoever, caused or arising by reason of the said damage or loss and grant you full power to take and use all lawful ways and means in your own name and otherwise at your risk and expense to recover the said damage or loss and we hereby subrogate to you the same right as we have in consequence of or arising from the said loss or damage.
And we hereby undertake and agree to make, and execute at your expense all such, further deeds, assignments and documents and to render you such assistance as vou may reasonably require for the purpose of carrying out this agreement.
As, witness we set our hands this i7th February, 1968.
For Kirloskar Brothers Ltd.,
Signature of Consignees.
Bale/Case No.InterestInvoice No.C' ment Note No. & Date From
__Brass Rods__4606 of 18.6.67
4818 of 25-5 1967
4775 of 5-8-1967.CALCUTTA
14. In view of this letter of subrogation Shri Gole who has been examined on behalf of plaintiff No. 1 has identified this document to have been signed by Shri A.B. Tembe. whose signature Shri Gole knows. It therefore, must be held that this letter of subrogation has been properly proved. Once it is held that the letter of subrogation is validly proved then the contention of Shri Vashi is clearly without any foundation that plaintiff No. 2 cannot enter into the shoes of plaintiff No. 1 for recovery of the suit amount.
15. In view of the provisions of Section 69 of the Indian Contract Act. it must be held that plaintiff No. 2. who bona fide paid, this amount to plaintiff no. 1, is entitled to be reimbursed by the defendants. There is therefore no substance in the argument that plaintiff No. 2 is not entitled to claim recovery of the suit amount from the defendants. As the ownership of goods had also passed in the plaintiff No. 1 and plaintiff No. 1 had made, full payment including the freight charges to the defendants, plaintiff No. 1 alone was the owner of the suit goods which were short delivered and plaintiff No. 2 had paid the entire amount for this short delivery. Plaintiff No. 2, therefore, in view of the said letter of subrogation Exh. 58 is unquestionably entitled to recover the suit amount from the defendants. The defendants were therefore, rightly liable to pay the suit claim. We therefore, reject the first submission of Shri Vashi that plaintiff No. 2 had no locus stand to recover the suit money from the defendants.
16. Coming to the more important point raised in this case by Shri Vashi that in View of the Exh. 49, the consignment note executed by defendants, it must be held that the carrying of goods by common carrier (defendants) was subject to the terms and conditions which were written on the overleaf of the said consignment note.
17. Before we decide whether Exhibit 49. consignment Note, on which heavy reliance is placed by Shri Vashi constitutes to be a contractual document or an integral part of the contractual document, it will be necessary to examine the contents of the consignment note itself. At the top of the said note, in bold letters, it is written;
''CONSIGNMENT NOTE' ROAD TRANSPORT CORPORATION.'
After these words in small letters we find the following sentence,
'Goods booked ate carried subject to terms and conditions given overleaf.'
18. In the next column of Consignee-address, it is written :
''Self Kirloskar Brothers Ltd., Kirloskarwadi. Dt. Sangli.'
In the nest column number of Packages is written as 104 bundles and the nature of goods is written as brass rods, and the weight as 5429 to 5430. The total value is written as Rs. 66,500/-. In column appearing thereafter, name of the consignor is shown as:
'National Pipes and Tubes Co. Ltd., 1 and 2 Hare Street, Calcutta.'
In, the last column the freight charges payable by consignee was shown in total, as Rs. 1632.85/-. It is also shown that these charges are to be paid. On the reverse of this consignment note in very small letters terms and conditions of the consignment are written, and it is stated that goods booked, are carried subject to the following terms and conditions. Since the question of liability, for short delivered woods is not in issue, the only relevant term in the condition is. No. 18, which is. pot only in a very small print but the print is not even legible. After some effort we could read it as follows:
'The Court in Calcutta City alone shall have jurisdiction in respect of all claims and matters arising under the consignment or of the goods entrusted for transport.'
19. Relying on this term and condition, it is the contention of Shri Vashi that the Calcutta Court' alone had jurisdiction to try any claim or matter arising ' under the consignment or of the goods, so entrusted for transport In other words Shri Vashi submitted that the decree passed by Joint Civil Judge, Senior Division, Sangli will be a nullity and since the parties have chosen by this last clause of the consignment note, the forum in case of dispute, only the Court in Calcutta should have passed the valid decree for the suit amount and therefore, the decree passed by the Joint Civil Judge, Senior, Division Sangli was not binding on the defendants. This consignment note is signed only by representative of the defendants i.e. the Road Transport Corporation, but nowhere has it been signed either by the consignor National Pipes and' Tubes Co. Ltd., or on behalf of the plaintiffs, the consignees. It is thus an unsigned consignment; note which according to the defendants, operates as a special contractbetween the carrier and the consignorof the goods.
2o. The question that arises for determination in this case is whether aconsignment note which is not signedeither by the consignee or by the consignor operates as a special contractgiven though the carrier has not broughtsuch terms and conditions specificallyto the notice of the consignor or consignee?
21. As far as this question is concerned, in the trial Court all that wife pleaded by the plaintiff was that:
'Under the aforesaid contract of carriage, the defendants contracted to deliver the goods at Kirloskarwadi. Accordingly, the cause of action has arisenwithin the jurisdiction of this Hon'bleCourt.'
In reply to this cautious averment the defendants had replied by stating to para 1.6 as follows:
'With reference to para 8 of the plaint the defendants submit that the suit being based on a contract to carry the goods, which took, place at, Calcutta, this Court has no jurisdiction to entertain and try this suit.'
22. In the trial Court, issue No. 7 was framed as to whether the Court of Civil Judge, Senior Division. Sangli had jurisdiction to try the suit and the finding recorded by the learned trial Judge was as follows:--
'The plaintiffs in para 8 of thier plaint exhibit 1 have alleged that under the contract of carriage with the defendants the latter contracted to deliver the goods at the place of destination, i.e. at Kirloskarwadi and that, therefore, the cause of action has arisen within the jurisdiction of this court. The defendants beyond their bare contention in para 16 of their written statement exhibit 16 that this court has no jurisdiction to try the suit, have not shown as to how the court has no jurisdiction. When it is an admitted, fart the the suit goods were to be transported from Calcutta and were to be delivered at Kirloskarwadi and, when in fact the bulk of the goods except the goods delivered short, was actually delivered at Kirloskarwadi by the defendants to the plaintiff No. 1, it cannot be said that this Court has no jurisdiction to try the suit. I, therefore, answer issue No. 1 also in the affirmative.'
23. The question of jurisdiction was therefore, raised in this perfunctory fashion in the trial Court. Shri Kotwal seems to. be right in con tending that in the trial court the defendants had not wised this point either in the written statement or argued seriously and therefore, the defendants should not be allowed to raise the point for the first time in this court. According to the provisions of Section 21 of the Civil P. C. if defendants wanted to take objection as to the venue of the trial it ought to have been taken at the earliest possible opportunity. Section 21 of the Civil P.C. reads as follows:-.
'21. No objection as to the place of suing shall be allowed by an appellate or revisional court unless such objection was taken in the Court of first instance at the earliest possible opportunity and in all cases where issues are settled at or before such settlement, and unless there has been a consequent failure of justice.'
24. It is now well settled that when the case has been tried by the court on merits and judgment is rendered, it should not be reversed only on technical grounds unless it has resulted in failure of justice. The objection to the territorial jurisdiction must be taken at the earliest opportunity and cannot be allowed to be raised at the appeal stage specially when defendants are not able to show that there has been failure of justice. This is not a case where the suit was tried in court which had no jurisdiction at all. The important question to ask is that if one of the two courts which has concurrent jurisdiction to try the suit, has rendered a judgment on merits and where there is no consequent failure of justice, is it open to the appellate court to set aside the decree on such technical grounds It is well settled that if two courts have Jurisdiction and the suit is tried at one of the places and no objection is taken at the inception and there is no substantial failure of justice, the defendants cannot successfully challenge such a decree passed by the trial court .
25. It is also, now equally well settled by a series of decisions both of this court and that of the Supreme Court that where more than one court have jurisdiction to try the suit, the parties can by an agreement restrict a forum to try the suit, In other words by anagreement between the parties, the contractual document can confine such jurisdiction to try the suit and such an agreement does not contravene Section 28 of the Indian Contract Act. (See Hakam Singh v. Gammon (India) Ltd. : 3SCR314 ).
26. The facts of this case make itclear that the order was placed in Calcutta and the manufacturer M/s. National Pipes and Tubes Co. Ltd., was inCalcutta. However, the goods were tobe delivered in Kirloskarwadi. Substantial part of delivery except the shortdelivery was in fact made in Kirloskarwadi. The price of the consignment aswell as the freight charges were alsopaid in Kirloskarwadi and 'the plaintiffsKirloskar Brothers' Ltd., have officeat Kirloskarwadi. Both the courts i.e.the Civil Judge, Senior Division, Sanglias well as Calcutta Court had thereforeconcurrent jurisdiction in this case. Itis not as if by Clause 18 the defendantswere trying to confer jurisdictionon a court which was whollyfactually unconnected with the dispute nor was there any intentionon the part of the defendants to confer jurisdiction on a court which hadno factual connection with the dispute.involved in the case. It has been heldby a Division Bench of this Court , inGhatge and Patil (Transport) Ltd. v.Madhusudan AIR 1977 Bom 2991 thatthe parties are free to choose one ofthe two forums to try the suit if morethan one court have concurrent jurisdiction. It is also held in Hindustan Tiles Corporation v. Kisanlal MataprasadAgarwal : AIR1979Bom69 by Dharmadhikari, J. that by an agreement between the parties they can restrict forumto one of the courts having such jurisdiction, The learned Judge refers tothe decision in Ghatge and Patil (Transport) Ltd. v. Madhusudan as well asHakam Singh v. Gammon (India) Ltd.,(supra).
27. Shri Vashi in fact relied upon the above two cases to show that Exh. 49, consignment note constituted a contractual document between the parties and last term and condition No. 18 clearly stated that plaintiffs were bound by the same whether they have read it or not or whether they are ignorant of the precise legal, effect of the same.
28. In order, to test this contention of Shri Vashi it will have to be firstascertained as to whether a document i.e. Exh. 49 can be identified as a contractual document. Admittedly it is an unsigned document either by the consignor or consignee. It is merely a consignment note which was not signed but merely delivered or handed over, after the oral agreement according to which the defendants undertook to transport the consignment from Calcutta to Kirloskarwadi. Shri Vashi has relied upon the admission by Shri Gole, plaintiffs witness No. 1 who is the accountant of the plaintiff No. 1 at Kirloskarwadi, that there was correspondence between the plaintiff No. 1 and the defendants in respect of the suit consignment and that they have documentary evidence to show that they had engaged the defendants as their carriers. Further he Roes on to say as follows:--
'We are aware of the terms and conditions printed overleaf of the consignment notes. We as per and subject to the terms and conditions printed overleaf of the consignment notes entrusted the suit consignment to the defendants.'
29. Taking advantage of this admission in the cross-examination, the learned counsel Shri Vashi tried to build a formidable argument that Exh. 49 must be treated as a contractual document or alternatively, and it is the case of Shri Vashi. that as there was an oral contract between the consignor and the defendant to carry the consignment from Calcutta to Kirloskarwadi and as Exh. 49 the consignment note, was handed over by the defendants to the consignor, it must be regarded as an integral part of the contractual document, and if that is so the plaintiffs would be bound by the clause 18 of the said Exh. 49 under which any dispute arising between the parties could be tried in Calcutta Court alone.
30. In our judgment, these contentions of Shri Vashi are wholly misconceived. As held by the Division Bench of this Court in Ghatge and Patil case : AIR1977Bom299 (supra), a person who signs a document which contained contractual terms is unquestionably bound by them even though he has not read them and even though he is ignorant of their precise legal effect. It is only when an unsigned document is merely delivered to consignor or consignee the question would arise whetherthe terms of the said document are adequately brought to his notice. Admittedly in this case the consignment note is not signed either by consignee or consignor. On this ground alone, it is therefore, difficult to hold that Exh. 49 is a contractual document.
31. The next question that has to be considered is whether Ex. 49 can at least be held to be an integral Dart of the contract, if not the contractual document itself. If it could not be identified as contractual document or could not be held as an integral part of the contract but only a consignment note indicating the willingness on the part of the defendants to carry the goods to Kirloskarwadi for payment of the freight charges mentioned therein, it will be reasonable to hold that it is nothing more than what it says; 'consignment note.'
32. As observed earlier, the consignment note is not signed. The clause restricting the jurisdiction to only one court is sought to be enforced. In such a case of an unsigned document, the question would be whether reasonable, notice of the terms contained therein has been given to the plaintiffs. The English cases laying down the principle that when a document is not signed but is merely delivered to the plaintiff, attention of the other side should be adequately and specifically drawn to such terms and conditions are legion. This was the crucial test pronounced by Mellish L.J., in 1877 in the case of Parkar v. South Eastern Rail Co. (1877) 36 LT 540 'where the defendants claimed that a passenger was bound by terms stated on a cloakroom ticket of which he was ignorant. The question that was raised was had the defendants done what was sufficient to give notice of the term to the person or class of persons to which the plaintiff belonged?' It was observed in that case 'the question was one of fact, and the court must examine the circumstances of each case.'
33. There is a vast number of cases decided by the English Courts, popularly known as -- 'ticket cases' where it has been held that when a defendant relies on an unsigned document which is not an integral part of the contract, sufficient or adequate notice of such condition' ought to have been given before the contract to the other party.
34. From a number of decided cases on the question of adequate and sufficient notice being given to the other side, following principles have been deduced and followed in subsequent cases:
'At the outset of its inquiry the court must be satisfied that the particular document relied on as containing notice of the excluding or limiting term is in truth an integral part of the contract. It must have been intended as a contractual document and not as a mere acknowledgment of payment. To hold a party bound by the terms of a document which reasonable persons would assume to be no more than a receipt is an affront to common sense.
35. In Chapelton v. Barry U.D..C. (1940) 1 KB 532 the facts were as follows :--
'The plaintiff wished to hire two deck-chairs from a pile kept by the defendant Council on their beach. The chairs were stacked near a notice which read..... 'Hire of Chairs 2s, per session of 3 hours'.....and which requested thepublic to obtain tickets from the chair attendant and retain them for inspection. The plaintiff took the chairs and obtained two tickets from the attendant, which he put , in his pocket without reading. When he sat on one of the chairs it collapsed and he was injured. He sued the Council, who relied on a provision printed on the tickets excluding liability for any damage arising from, the hire of a chair.' On the facts of that case it was held that the defendant Municipal Council, had failed to satisfy the preliminary requirement of identifying the ticket as the contractual document inasmuch as the ticket was nothing more than a receipt for payment of money. The contract was already concluded and it was held that the ticket should not be held as integral part of the document.
36. In another interesting and much later case, viz. McCutcheon v. David Macbrayne Ltd., (1964) 1 All ER 430, the facts of which case are strikingly similar to the facts in the present case the plaintiff had asked the defendants, the owners of steamers operating between Scottish mainland and the islands, to arrange for the plaintiff's car to be shipped to the main land. One Mr. McSporran called at the defendants'office and made an oral contract on the plaintiff's behalf for the carriage of the car. On the voyage, through the defendant's negligence, both the ship and the car were sunk. The plaintiff therefore, sued the defendants for the value of the car. The defendants in terms contested the claim of the plaintiff and pleaded that the terms excluding the liability for negligence were contained in twenty seven paragraphs of small print displayed both outside and inside their office. These terms were also printed on a 'risk note' which customers were usually asked to sign. On this occasion the defendants omitted to ask Mr. McSporran to sign the risk note. He was only given receipt stating that 'all goods were carried subject to the conditions set out in the notices.' The House of Lords ultimately gave judgment for the plaintiff even though neither the plaintiff nor Mr. McSporran on his behalf had read the words on the notices or on the receipt and it was held that there was in fact no contract at all. The receipt was given only after oral contract had been concluded.
37. In this case also after the oral contract was concluded between the consignor and the defendant, defendants in acknowledgment of payment of freight charges passed on a receipt referred to above as the consignment note which contained the terms and conditions and specifically the last one that is to say. the disputed clause No. 18 on the reverse of Exh. 49. In the case quoted above plaintiff's agent also by oversight did not ask the owner to sign the risk note which contained terms and conditions. We do not see any difference in the facts of both the cases. We therefore, are fortified, in our view that a mere consignment not delivered after the oral contract could not bind the consignor or consignee and the Clause 18 therefore was not binding on the plaintiff.
38. The facts of one more English case may be looked into for holding that the time when the notice of terms and conditions of document is given to the plaintiff is also of considerable importance. A term in the document either excluding or limiting the liability or excluding the jurisdiction of a court will be of no use to the parties seeking protection unless it has been brought to the attention of the party of theother side before the contract is entered into. The facts in an English case reported in Olley v. Malborough Court Ltd. (1949) 1 All ER 127 throw considerable light on the question raised in this case.
'A husband and wife arrived at a hotel as guests and paid lor a week's board and residence in advance. They went up to the bedroom allotted to them, and on one of its walls was a notice that 'the proprietors will not hold themselves responsible for articles lost or stolen unless handed over to the manageress for safe custody.' The wife then closed the self-locking door of the bedroom, went downstairs and hung the key on the board in the reception office. In her absence the key was wrongfully taken by a third party, who opened the bedroom door and stole her furs.'
In that case also the defendants sought to incorporate the notice in the contract. But the Court of Appeal held that the contract was complete before the guests went up to their room and that no subsequent notice could affect their rights. The time, when the notice is alleged to have been given is also of considerable importance. A term in the said document excluding the jurisdiction of the court will be of no use to the party seeking the protection unless it has been brought adequately to the attention of the other party before the contract is entered into.
39. In the present case on submission of Shri Vashi', it is clear that consignor National Pipes and Tubes Co. Ltd., had already arranged with the defendants to carry the consignment from Calcutta to Kirloskarwadi. After these arrangements were made or arrived at or the contract was entered into the defendants delivered the consignment note Ex. 49. In view of the facts stated above in our judgment the contract was already concluded and the endeavour on the part of the defendants to identify Ex. 49 as a contractual document or at least to treat it as an integral part of the contract cannot succeed as the contract was already completed before the consignment note was handed over by the defendants.
40. In order to show that the plaintiffs had previous dealings with the defendants and they were aware of theterms and conditions written overleaf of Ex. 49 as stated earlier Shri Vashi has relied heavily on the admission given by Shri Gole in his cross-examination. He has further relied on a passage in Halsbury's Laws of England, 4th Edition. page 394 to the following, effect;
'The issue of a ticket to a passenger in return for the payment of his fare is evidence of a contract to carry him with reasonable care to the named destination within a reasonable time..... These terms and conditions are not binding upon the passenger unless he impliedly or expressly assents to them. If he accepts a ticket without objection, he will be taken as a general rule to have assented to the conditions contained or referred to on it.....If the passenger has had notice or if it be shown that he had knowledge that there was writing on the ticket containing or referring to the conditions, the ticket, together with the documents referred to on it. forms the contract between the passenger and the carrier. Thus a passenger or a consignor of goods who accepts a contractual document in these circumstances is estopped from denying his assent.'
There can be no quarrel with the propositions referred to above. However, whether consignor had the knowledge of the terms and conditions and whether all reasonable steps were taken to give him notice are questions of fact. As according to Shri Vashi this is a case of oral contract followed by Ex. 49, the consignment note, in our opinion in a case where an oral contract has been concluded, further terms cannot be added by the defendants by handing over of a receipt acknowledging payment or other documents containing such terms.
41. In this case the facts indicate that there was an oral contract between the consignor and the defendants and thereafter in token of having received the number of rods and also having received freight charges for onward transmission to Kirloskarwadi they have handed over the consignment note, on the reverse of which the conditions including one restricting jurisdiction to Calcutta Court alone were mentioned. The facts in the case of M/s. Ghatge and Patil : AIR1977Bom299 were altogether different. In that case the document was signed by both the parties and onthe top of the forwarding note Ex. 72 it was clearly mentioned in bold italics:
'Subject to Kolhapur Jurisdiction.'
On the fads of that case therefore, it was held that in view of the specific bold italic wording in the floods forwarding note that the contract of consignment was subject to Kolhapur jurisdiction, it was incumbent on the plaintiff to bring the suit in the competent court at Kolhapur and therefore, the Small Cause Court at Poona had no jurisdiction. The plaintiff had signed the document. He also admitted that he knew English. His attention was specifically drawn to italic words.
'Subject to Kolhapur Jurisdiction,'
42. Similarly in the case of Hindustan Tiles Corporation v. Kisanlal : AIR1979Bom69 (supra) it was held by this Court that plaintiff had signed the agreement in English and there was also evidence to the effect that he had knowledge of English. The plaintiff was therefore, aware of the term which was printed on the reverse of the agreement that the court at Trichur would have jurisdiction in the matter, and that only Trichur Court and not the Nagpur Court had jurisdiction in case of a dispute between the parties. In the court the plaintiff tried to deviate from this agreement and contended that it was not binding on him as he had no knowledge of English. . This was not acceptable. This court further did not accent the contention on behalf of the plaintiff in that case that he was given an assurance that such a condition in the printed form would not be binding on him. The court, therefore, held that in case of a signed agreement between the parties where the plaintiff was aware of the terms and conditions that a particular court alone had jurisdiction in the matter and that plaintiff had knowledge of English he could not escape from such a condition on the printed form and therefore, it was the court at Trichur and not at Nagpur which had the jurisdiction.
43. In this case Shri Vashi has to face a number of difficulties. Firstly as held earlier Exh. 49 is not a contractual document. The defendants have further failed to prove, that Ex. 49 was either a contractual document or an integral part of the contractual document. Then it is an unsigned document, Therefore, it will now be examined whether the attention of the other party i.e. that of the plaintiff was adequately and specifically drawn to the term, excluding the jurisdiction of any other court and confining all the disputes to the jurisdiction of Calcutta Court alone. As Shri Vashi has conceded that there is no contract in writing, he could not possibly refer to the other terms and conditions of Ex. 49 limiting the liability of his clients except the last one. which excluded jurisdiction of any other court except that of Calcutta Court, As observed earlier where a document is signed by the parties and which expressly incorporates contractual terms both limiting the liability as well as confining the jurisdiction of the court to particular forum to try the suit, it is no defence in the eyes of law that the parties which had signed the document had not read the terms of such a contractual document. However, when the document is not signed and is merely delivered to the other party, after the contract is concluded the question that falls for determination is whether the terms of such document are adequately and specifically brought to the notice of the other party. Shri Vashi further relied on the judgment of Court of Appeal in England in J. Spurling Ltd. v. Bradshaw (1956) 2 All ER 121 in which on facts of that case it was held that the defendant had sufficient notice of the conditions and they formed part of the contract of bailment. It was further held that although an exempting clause availed a party to a contract only when he was carrying out the contract and would not avail him if he were deviating from it or were in breach of a term which went to the root of the contract, yet since the defendant's counter-claim against the plaintiffs was based on negligence but nothing more, as exempting clause protected them and the counter-claim failed. In that case question for decision was whether the clause exempted liability for any loss or damage and protected bailee by the said exemption clause. In order to appreciate the decision in that case, a brief reference may here be made to the, facts of that case :--
The defendant brought eight barrels of orange juice and sent them to the plaintiffs, who carried on business as warehousemen, to be stored. After awhile the plaintiffs, sent the defendants & landing account acknowledges receipt of the goods and stating 'the company's conditions printed on the back hereof cover the goods held in accordance with this notice. Goods will be insured if you instruct us accordingly: otherwise they are not insured'. On the back of the landing account there were 'Contract conditions' and many lines of small print including the following: 'We will not in any circumstances when acting either as warehousemen or in any other capacity, be liable for any loss, damage or detention howsoever, whensoever, or wheresoever occasioned in respect of any goods.'
It further stated 'all goods are handled by us in accordance with the conditions as over and warehoused at owner's risk and not insured unless specifically instructed.' Denning L.J. as he then was observed that these exemption clauses are held to be subject to the overriding proviso that they avail to exempt a party only when he is carrying out his contract not when he is deviating from it or is guilty of a breach which goes to the root of it. Just as a party who is guilty of a radical breach is disentitled from insisting on the further performance by the other, so also he in disentitled from relying on an exempting clause. The learned Judge further held that:
'I agree that the more unreasonable a clause, is, the greater the notice which must be given of it. Some clauses which I have seen would need to be printed in red ink on the face of the document with a red hand pointing to it before the notice could be held to be sufficient.'
44. It is difficult to understand how these remarks of Denning L.J. are in any manner helpful to the appellant-defendants. In this case the defendants had short delivered the goods and therefore were deviating from the contract. Therefore, the clause of limiting jurisdiction only to Calcutta Court in case of dispute cannot be relied upon by the defendants. On the contrary in unhesitating terms Denning L.J. has said that more the unreasonable a clause is. the greater the notice which must be given. As Exh. 49 was neither a contractual document nor an integral part of the contractual document but was delivered as a consignment noteafter the oral contract was entered into and that too unsigned by consignor or consignee, in the facts and circumstances of the case it must be held that limiting the jurisdiction to Calcutta Courts alone was unreasonable and no sufficient notice was given to the other side i. e. to the plaintiffs.
45. In this case as stated earlier thetrend of the English authorities wouldclearly indicate that whenever a clauseof ouster of jurisdiction was contemplated it should be made known to theconsignor before entering into the contract. Apart from the ruling referred toearlier in Olley v. Malborough Court Ltd.(1949) 1 Alt ER 127 recent pronouncement of Lord Denning M.R. speaking forthe Court of Appeal. in Thornton v.Shee Lane Parking Ltd. (1971) 1 All ER 686 is of great assistance in decidingthis case. In that case the plaintiff hadparked his car in defendant's automaticcar park. Outside the park there was anotice stating the charges and includingthe words 'All cars parked at owner'srisk.' As plaintiff drove in thelight turned from red to green and aticket was pushed out from a machine.Nobody was in attendance. The plaintiff took the ticket and saw the sameon it. He also saw that it containedother words but without reading putthe ticket in his pocket. The wordswhich the plaintiff did not read wereto the effect that the ticket was issuedsubject to the conditions displayed onthe premises. One of these conditionspurported to exempt the defendants notonly from liability for damage to carsbut also from liability for any injuryto a customer howsoever caused. Whenthe plaintiff returned to collect his carthere was an accident in which he wasinjured. In a suit for damages by theplaintiffs the defendants heavily reliedon the clause exempting the term oftheir liability. The Court of Appealgave judgment for the plaintiff. Thefirst question that was raised was themoment at which the contract wasmade It was held that the contractwas complete as soon as the ticket waspurchased by the plaintiff. The customer would be bound by the conditionsdisplayed on the notice board in thepremises if they were sufficientlybrought to his notice before hand, butnot otherwise.
46. The most important question that, has to be answered is: Did the defendant do what was sufficient to draw the plaintiff's attention to the relevant condition before the contract was concluded In the facts of the present case the last condition was to restrict the jurisdiction to a particular court out of the two courts having concurrent jurisdiction. In order that terms or conditions on the overleaf of a consignment note passed by common carrier be binding on the consignor or consignee and in order that it should operate as special contract between the consignor or consignee on the one hand and the carrier on tha other hand, the consignment note must be signed by the consignor and consignee and constitute a contractual document or at least must be identified as an integral part of the contractual document. In cases of unsigned consignment notes containing clauses limiting the liability of the carriers as well as excluding the jurisdiction of certain courts and restricting it to specific court only, such clauses or terms or conditions must be brought to the notice of the consignor of the goods. If such terms and conditions are not brought to the notice specifically and adequately then the consignor or consignee would not be bound by these terms and it would be open for them to file a suit in any competent court having jurisdiction other than one mentioned in the clauses excluding jurisdiction of other courts. When more than one court have concurrent jurisdiction to try a suit in order to exclude jurisdiction of one court such condition required explicit warning. It must be brought to the notice before hand and preferably printed in red ink or pointed by a hand in the red ink on the face of the document as observed by Lord Denning M.R. In the present case no sufficient and adequate notice was given to the consignor or consignee by the carrier of the term excluding the jurisdiction of the Sangli Court and restricting it to the Calcutta Court alone and therefore it was not binding on. the plaintiffs i. e. the consignees in this case. It was therefore, open to the plaintiffs to have its claim instituted and settled in any one out of the two or more competent courts having territorial jurisdiction in respect of the subject matter in dispute.
47. Our attention was also drawn to the latest pronouncement of Lord Denning M.R. reported in Levision v. Patent Steam Carpet Cleaning Co. Ltd. (1977) 3 All ER 498. The contention of Shri Kotwal is that if the limiting clause excluding exemption clause was unreasonable then it should not be given effect to. In that case Lord Denning M.R. held that an exemption clause or limitation clause should not be given effect in contracts where there is inequality of bargaining power or if it is unreasonable to apply the clause in the circumstances of the case. In that case a bailee, a cleaning company had contracted with Mr. Levision the plaintiff, the owner of a Chinese carpet worth 900 for cleaning. While taking the carpet for cleaning a signature of Mr. Levision was obtained on order form in the space provided for owner's signature. He did not read the terms and conditions which were put in small print above the space of the signature. These terms and conditions by Clause 5 provided:
'All merchandise is expressly accepted at the owner's risk, and recommended that the owners should insure their goods.'
The defendants never returned the carpet to the plaintiff. The defendants heavily relied on the exempting clause. After reviewing of the 'ticket' cases as well as other cases. Lord Denning M.R. was of the opinion that where a fundamental breach of contract was alleged by the bailor of goods, the burden of proof was on the bailee to show that the loss had not occurred in consequence of a fundamental breach of contract since he was in a better position than the bailor to know what had happened to the goods while they were in his possession. Since the defendants had not explained how the carpet had been lost, they had not disproved that the loss had been due to a fundamental breach, and therefore, the defendants were not entitled to rely on the exemption Clause 5.
48. Lord Denning M. R. goes on to hold that Clause 5 limiting the liability of the defendant was not reasonable unless defendants had drawn the clause specifically to the customer's attention and therefore, the defendant company was not entitled to rely on this exemption clause.
49. It is not necessary to go into the other authorities on which, reliance is placed by Shri Kotwal in support of hispoint. It may be briefly mentioned that he has relied on ; C. Satyanarayan v. L. Narasimham, : AIR1968AP330 and M/s. Patel Bros. v. Vadilal Kashidas Ltd. : AIR1959Mad227 .
50. Reliance was placed on Surajmal Shiwbhagwan v. Kalinga Iron Works. : AIR1979Ori126 to the effect that the ouster Of jurisdiction should not be assumed or presumed very easily or lightly. It is further observed as follows :--
'Ouster of Court's jurisdiction should not be easily construed and could not be assumed or presumed very easily. Ouster of jurisdiction must be proved by express words or by necessary or inevitable implications,'
51. As the suit baa been decided on merits the trial Courts finding as to the jurisdiction cannot be challenged by the appellants/defendants in this appeal. We enquired with Shri Vashi that when plaintiff admitted the liability for short delivery of goods what difference would have been made and what prejudice would have been caused to his client if the suit was to be filed in Calcutta Court than in Sangli Court. We also asked, him to indicate to us as to what failure of justice was caused as the suit was tried in Sangli Court. Shri Vashi was not able to give any satisfactory answer to himself, still less to us. The position that emerge therefore can be summarised as follows;
(1) Exh. 49.: consignment note cannot be held to be a contractual document or an integral part of such a contractual document.
(2) The said document was not singedby either' consignee or consignor andtherefore, it cannot be said that the carrier and the consignor had armed ata consensus ad idem or that either ofthem had applied their mind and haddecided to create contractual obligationsin terms of conditions written overleafthe consignment note Ex. 49.
(3) As the consignment note was unsigned, no sufficient attention of the consignor of consignee was drawn to the last clause restricting jurisdiction to Calcutta Courts alone.
(4) While it is too well settled to be emphasised that where there are two competent' courts' of concurrent jurisdiction which can deal with the subject matter of the dispute parties have freedomto choose the forum of any one to adjudicate their dispute that such an agreement is legally valid and not contrary either to the public policy and not violative of Section 28 of the Contract Act in case of an unsigned document i. e. the consignment note in this case it cannot be said that parties were bound by the last clause limiting the jurisdiction to Calcutta Courts alone in case of dispute when no attention was adequately or specifically drawn of the other side by the carrier 1o such a term.
(5) Therefore, the defendant carrieFis not entitled to rely upon such clausein the consignment note excluding thejurisdiction of other competent courts.The facts in both the cases i.e. Ghataeand Patil case : AIR1977Bom299 aswell as Hindustan Tiles Corporation : AIR1979Bom69 (supra) were ofsigned written contracts. Both theplaintiffs in both the cases, had admittedthat they were aware of the terms ofthe contract and therefore, they werebound by the terms of the contract, restricting jurisdiction to the forums mentioned in the agreement.
52. In view, of this finding in our judgment the appellant-defendants have failed to prove that the consignor of consignee were bound by the last clause of the consignment note. The appellants have failed in both the submissions canvassed; by them before us.
In the result the appeal fails and the judgment and decree dated Aug. 13, 1971 by the learned Joint Civil Judge, Senior Division, Sangli in Civil Suit No. 38 of 1970 is hereby confirmed and the appeal is dismissed with costs.
53. Appeal dismissed.