1. The plaintiff-respondent in Original Suit No. 494 of 1951-52 in the Court of the First Munsiff at Bangalore, sued the appellant-defendant, in a sum of Rs. 1000/- as damages for (1) slandering his title to the property offered as security for the loan to be granted by the State Government as per their order No. A.F. 6850/2A.H. 66-30-2 dated 13-11-1950; (2) for defaming him; and (3) for inducing the Government to cancel the loan which had been sanctioned and thereby interfering with the implementation of the contract.
The trial Court decreed the suit claim as prayed for holding that the defendant had slandered the title of the plaintiff to the property offered as security for the loan proposed to be advanced by the Government and that he (defendant) induced the Government to cancel the loan which had been sanctioned. The first appellate Court while it agreed with the finding of the trial Court in all respects thought that the ends of justice will be met if a consolidated sum of Rs. 500/- is decreed as damages. Accordingly it modified the decree of the trial Court. The defendant in this appeal has challenged the correctness of the findings of the Courts below. His learned Counsel Sri H.V. Narayana Rao, has pressed a three-fold attack against the decrees and judgments of the Courts below.
They are: (1) the proved facts are not sufficient to hold that the defendant either slandered the plaintiff's title to the property offered as security or that he induced the Government to break its contract with the plaintiff; (2) when the act induced is within the right of the immediate actor (Government) and is therefore not wrongful in so far as the Government is concerned though it may be to the detriment of the plaintiff, the defendant cannot be liable unless it is shown that he had procured his object by the use of illegal means for that purpose; and (3) the act complained of cannot give rise to a decree for general damages and the evidence on record does not prove that the plaintiff has incurred any special damages.
2. In order to make the points formulated above intelligible, it is necessary to tell the story of the circumstances antecedent to the incident concerned. At one time there were controversies as regards the preliminary circumstances. But these controversies have been quietened by the decisions of the Courts below and the facts found by the Courts below are as follows: The plaintiff and the defendant are cousins, their paternal grandfathers being direct brothers; there were considerable litigations between the branch of the plaintiff and the defendant; the plaintiff who is a qualified cattle breeder applied to the Government for a loan of Rs. 10,000/- for starting a Dairy Farm in Jodi Aralasandra Village, in Nelamangala Taluk; the Government sanctioned a loan of Rs. 5,000/- on 13-11-1950 on the security of his 1/5th share in the Jodi Aralasandra Village; when the security bond was about to be executed and the loan dispersed, the defendant wrote Ex. G dated 5-1-1951; in that letter he stated:
'My father Puttiah and Puttashamiah father of B.P. Gangadhara (Plaintiff) are cousins. Our grandfathers Gangiah and Gundappa lived as joint family members and died leaving considerable landed properties situated at Begur, Marohalli, Hosur, Thippaganahalli, Araladebba, Kenchanahalli and Araiasandra in the Nelmangala Taluk. With regard to the partition and possession of these joint family properly a civil suit has been instituted on the file of the Hon'ble Sub-Court at Bangalore under No. O.S. 181 of 48-49 and the case is in the evidence stage. While the facts are as above, my cousin, D.P. Gangadhara alias Chitranna, seem to have applied to the Govt. for a loan of Rs. 10,000/- on the securities of these properties with the object of creating complications on the family properties. I also learn that he had secured the support of the local officers for the grant of this loan, and that the grant of this loan is at an issue stage in a day or two. If this is a fact without our consent to the loan there can be no charge on any of the family properties while our claim is on them and specially during the pendency of the above suit.
Under these circumstances, I request that the issue of any loan to him may be withheld or postponed till the civil suit in question is decided. I trust by taking immediate action an order of stay of issue of loan may kindly be passed and endorsement to that effect may also be kindly sent to me.'
On receipt of this letter, the Amildar of Nelamangala Taluk, submitted the same to the Deputy Commissioner at Bangalore along with his report. His report, Exhibit R reads as follows :
Sub : Grant of Dairy Loan to Sri Gangadharan.
With reference to your kind memo No. A5.P.B. 221/ 50-51 dated 8-2-51 re: the above, I beg to state that the properties offered by the applicant as security towards the loan are ancestral properties and it is ascertained that there is a dispute about the partition and a case is pending on the file of the Sub Judge, Bangalore. Any property standing in the applicant's name is considered to be a property made from the income derived from the ancestral properties and as such, until the litigation among the cousins is decided by the Court and ownership is established in accordance with the decision of the Court, it is not desirable to accept these properties as security towards the loan.
The above facts viz. that there was a dispute pending decision in respect of the properties were not disclosed by the applicant when I was asked to recommend his case for a loan of Rs. 5000/-. Later on it was learnt that Sri Gangadharan attempted to obtain the loan as means of substantiating his ownership on the properties offered as security.
For the above reasons, I pray that the loan prayed for may not be sanctioned during the pendency of the litigation.'
At that stage, the plaintiff brought to the notice of the Government that there was absolutely no substance in the allegations made in Exhibit G and that they were wholly false. But in spite of that the Deputy Commissioner wrote to the plaintiff as per Exhibit S dated 27-3-1951.
Sub : Regarding the grant of Dairy loan to Sri Gangadharan.
With reference to your letter No. A7-180/49-50 dated the 10th January 1950, regarding the above subject, I have the honour to state that the lands offered as security for the said Dairy loan by the applicant are under dispute, and as such, I am not in favour of recommending any loan to the applicant.
The records received with your letter No. A7-180/48-49 dated 10-3-51 are herewith returned.'
The plaintiff unsuccessfully appealed to the Government. The order of the Government is found in the communication sent by the Deputy Commissioner as per Exhibit T dated 25-5-1951. It rends:
'With reference to his petition dated 28-1-1951 stating that the objection petition filed by Sri Gangiah be rejected to a loan of Rs. 5,000/-granted to him in G.O. No. A.F. 6850.2/A.H. 66-50-2 dated 13-11-50 for the purpose of starting a dairy at Jodi Aralasandra Village he paid to him, Sri B.P. Gangadharan son of B. Puttaswamiah ishereby informed, through his counsel Sri M. P. Somasekhar Rao, B.A., B.L., Bangalore that as he is involved in a civil dispute and as he has offered the ancestral property as security for the loan his request for the payment of the loan will be considered after the disposal of the said civil dispute. His documents are also returned herewith.'
The Courts below have found that the allegations contained in Exhibit G, i.e. (1) that Aralasandra property is joint family property; and (2) that O.S. No. 1 of 1948-49 on the file of the Subordinate Judge at Bangalore, is a suit for partition, of the joint family properties including Aralasandra Property, are false and they were false to the knowledge of the defendant. They have also come to the conclusion that the defendant was actuated by malice in writing Exhibit G. These are findings of fact, the correctness of which cannot be challenged in this Court.
3. The points urged on behalf of the appellant are: (1) that the Government which had the right to revoke the sanction of the loan, having revoked the same, the defendant cannot be held liable for inducing the Government to break the contract; (2) the mere fact that the defendant induced the Government to break the contract does not by itself entitle the plaintiff to general damages; (3) lastly the plaintiff has not proved that he has suffered any special damages.
4. There is no doubt that the chain of events culminating in the cancellation of the proposed loan was set in motion by the defendant. There is reason to believe that it was because of Exhibit G, the authorities were induced to cancel the proposed loan. But as seen from Exhibit R, after the receipt of Ex. G, the Amildar had purported to have ascertained the relevant facts. It is not known from what source or sources he got the information that Aralasandra properties were joint family properties of the plaintiff and the defendant; that there was dispute about the partition of the same and that case is pending on the file of the Sub Judge at Bangalore in respect of those properties.
It is probable and likely that the Amildar merely relied on the allegations contained in Ex. G. The Deputy Commissioner appears to have revoked the sanction for the loan on the recommendation of the Amildar. That being so can the defendant be held responsible for the consequences? In support of his contention that the appellant cannot be held responsible for the Government revoking the sanction of the loan, the learned Counsel for the appellant relied on the decision in Chakrapani Naidu v. Venkalaraju, AIR 1938 Mad 958. In that case it was held:
'No action will lie against any one for damages resulting from an erroneous decision of the Court, merely because that person has set the Court in motion, provided that malice is not established. The defendant in such an action is only liable for the direct consequences of his wrongful act and the intervening act of an independent third person bound by law to make a judicial decision breaks the chain of causation.'
This decision has no direct bearing on the issues that arise for determination in this case. In the instant case, the decision of the Government not togrant the loan cannot be said to be a judicial decision. Further the Courts below have held that the appellant maliciously wrote Exhibit G. Next case to which reference was made is the decision of a Bench of the Rangoon High Court in Nan Kee v. Au Fong, AIR 1985 Rang 73(2).
In that case due to certain allegations made by the appellant therein in his affidavit, the Minister of Education granted a stay o the Pawnbrokers license that was proposed to be given to the respondent; ultimately the appeal was dismissed; the respondent sued the appellant for damages on the ground that he had induced the Government to issue the order of stay by making false allegations; the Courts below decreed the claim of the respondent but the High Court reversed the decrees of the Courts below and held that the appellant cannot be held responsible for procuring the order of the Government by illegal means. Page, C.J. speaking for the Bench, quoted the observations of Lord Watson in Alien v. Flood, (1898) AC 1, which says;
'There are two grounds only upon which a person who procures the act of another can be made legally responsible for its consequences. In the first place, he will incur liability if he knowingly and for his own ends induces that other person to commit an actionable wrong. In the second place, when the act induced is within the right of the immediate actor and is therefore not wrongful in so far as he is concerned, it may yet be to the detriment of a third party and in that case the induced be held liable if he can be shown to have procured his object by the use of illegal means directed against the third party. In such cases the motive of the person doing the act is immaterial. If it is a lawful act, however ill the motive might be he has right to do it. If it is an unlawful act however good his motive might be he would have no right to do it. Motive and intention in such a question is absolutely irrelevant.'
No doubt this decision is somewhat helpful to the appellant. But then we will have to consider whether the appellant had used illegal means in inducing the Government not to disperse the loan agreed to he given? Further we have to hear in mind the fact that in this case, the Courts below have held that there was malice on the part of the defendant in writing Ex. G. In considering the cases of interference with contractual or business relations, decided authorities appear to take the view that if the defendant had procured the breach of contract or breach of contractual or business relations by 'illegal means' or if he did so with malicious intent he is liable in law for the consequences of his act.
This brings us to the question whether the appellant can be said to have used 'illegal means' in procuring the breach of contract. According to Section 43 of the Indian Penal Code, the word 'illegal' is applicable to everything which is an offence or which is prohibited by law or which furnishes ground for a civil action. Hence if it is held that directly or indirectly the defendant had defamed the plaintiff, then his action must be held to be illegal. The appellant in his letter Exhibit G has clearly indicated that the plaintiff had attempted to cheat the Government.
This amounts to defaming the plaintiff. Further the Courts below have held that the defendant was actuated by malice when he wrote Ex. G. Hence he must be held responsible for the consequences of his act. Where a party's act is wholly illegal or mischievous, Courts of law will not too nicely scan his liability. He will not be permitted to indulge in injurious falsehoods and then try to escape liability by seeking shelter behind persons whom he has used as pawns in the game. The other decisions cited by the learned Counsel for the appellant have no direct bearing on the points at issue.
5. From the proved facts it is reasonable to hold that the defendant was responsible for inducing the Government to refuse to implement the agreement entered into by it with the plaintiff.
6. The next question that falls for consideration is whether on the facts found, the plaintiff is entitled to general damages. There can be no doubt that the plaintiff is entitled to general damages on the ground of defamation. But as regards the interference with his contractual relationship, he (plaintiff) must prove either that damage has resulted or that it is likely to result from the defendant's procuring the breach. It is not an easy task to assess general damages.
It is truly said that assessment of general damages is really arbitrary and not amenable to any legal standard of measurement. It depends on various factors, the nature of the accusation, the language used, social position of the parties etc. The trial Judge has fixed Rs. 400/- as general damages. The first appellate Court fixed a consolidated sum of Rs. 500/- as damages, general as well as special. This is clearly wrong. I have no material to differ from the conclusion of the trial Court that the general damages may be fixed at Rs. 400/-. Hence I accept the same.
7. The evidence as regards special damages is very unsatisfactory. But it is unnecessary to scan the same as there can be no doubt from the material on record that under no circumstance it could be less than Rs. 100/-. The first appellate Court has decreed the plaintiff's claim only to the extent of Rs. 500/-. The sum of Rs. 500/- cannot be said to be excessive as damages both general and special. In the result the appeal fails and the same is dismissed with costs.
8. As regards the cross-objections, the evidenceas regards special damages is highly unsatisfactoryand hence there is no justification to allow the cross-objections. The same is dismissed. No costs.
9. Appeal and cross-objections dismissed.