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Soundararajan and Co. Ltd. Vs. K.P.A.T. Annamalai Nadar - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtChennai High Court
Decided On
Case NumberC.C.C. Appeal No. 39 of 1956
Judge
Reported inAIR1960Mad480
AppellantSoundararajan and Co. Ltd.
RespondentK.P.A.T. Annamalai Nadar
Cases ReferredFilley v. Pope
Excerpt:
.....the facts of a case like the present, where the sellers merely undertake that they would have the goods shipped from australia by a particular steamer expected to sail in august-september, and further qualify themselves by adding a clause protecting them against delays in shipping, with the necessary implication that time was not the essence of the contract, and that the goods may be delivered later, and may or may not be delivered by the particular ship specified. it may very well, be as we may conceive, that goods shipped from that very port, which could be described as so obtained, might have a particular enhanced value in the market. but that is not at all the case here, taking the contracts as a whole, and we have no doubt that the suit for refund of the advances must fail, as the..........as expected. the defendant--company then sent a letter dated 4-12-1951 offering to deliver the goods contracted for which had arrived as per 's. s. dengola', a ship which sailed upon a later date, and by which alone the defendant--company were apparently able to arrange for the shipment. the plaintiff rejected the goods, and refused to take delivery on the broad ground that it was an integral term of the contract that the goods should be shipped per 's. s. devenha', and that, since this term was frustrated, the plaintiff was not bound to take delivery of goods which had arrived by some other ship.in other words, it was contended by the plaintiff that the description of the goods, and admittedly this is a case of contract relating to goods to be supplied by description, included, as.....
Judgment:

Anantanarayanan, J.

(1) This appeal by the defendant is directed against the judgment and decree of the learned Assistant Judge of the City Civil Court, Madras in a suit for refund of advances in respect of the two mercantile contracts.

(2) Practically, the facts are not in dispute. The plaintiff entered into two contracts with the defendant-company on dated 3-8-1951 and 10-8-1951 (Exs. A-1 and A-2) for the purchase of a certain quantity of Australian Self Raising Flour at specified rates and weight, to be shipped by 'S. S. Devanha' expected to sail from Australia during August--September. This contract between the parties was subject to certain conditions, to which we shall make reference a little later, which protected the defendant--company in the event of unforeseen circumstances necessitating delays in shipping, or supplies at a later date.

The subsequent facts are that the 'S. S. Devanha' was damaged by fire, and could not sail as expected. The defendant--company then sent a letter dated 4-12-1951 offering to deliver the goods contracted for which had arrived as per 'S. S. Dengola', a ship which sailed upon a later date, and by which alone the defendant--company were apparently able to arrange for the shipment. The plaintiff rejected the goods, and refused to take delivery on the broad ground that it was an integral term of the contract that the goods should be shipped per 'S. S. Devenha', and that, since this term was frustrated, the plaintiff was not bound to take delivery of goods which had arrived by some other ship.

In other words, it was contended by the plaintiff that the description of the goods, and admittedly this is a case of contract relating to goods to be supplied by description, included, as an essential part thereof, a term or condition that the goods should be shipped by 'S. S. Devenha'. Since this warranty was infringed, the plaintiff contended that he was entitled to a refund of the advances and the learned Judge decreed the suit accordingly.

(3) We have no doubt whatever that the learned Judge was in error, and that the contract in this case, taken as a whole and properly interpreted, could only imply that the defendant--firm were bound to supply the goods from Australia either by 'S. S. Devanha' expected to sail in August--September in the normal course, or by some other ship or the same ship subsequently, if there were inevitable delays in shipping.

We have no doubt carefully scrutinising these contracts, that it was no essential term of the description that the goods should arrive by 'S. S. Devanha' alone. The learned Judge came to the conclusion which we have referred to, mainly upon the authority of Kumaraswami v. Karuppuswami, : AIR1953Mad380 and certain English cases referred to therein, in the judgment of Venkatarama Ayyar, J. But this judgment itself expounds the relevant legal principles which are in favour of the defendant company, and not in favour of the plaintiff. Further, it is clear that the learned Judge did not properly appreciate the ratio of the English cases or the fact that the dicta in them applied to totally different and distinguishable circumstances.

(4) We might immediately give our reasons why we consider that the contract in the present case could not possibly be interpreted as implying an integral term or condition of the description that the goods should be supplied by 'S. S. Devanha' alone. We might here further add that this was not the understanding of the contract by the plaintiff himself. On the contrary, the plaintiff did understand the contract as implying that unforeseen circumstances might delay the shipping, and that the goods might arrive by some other ship. The correspondence shows that his ground of complaint was that even assuming that 'S. S. Devanha' was not sea-worthy due to the fire accident, the defendant-firm could have arrange to supply the goods (via) Colombo earlier than they were actually received. There can therefore be no doubt that the plaintiff actually repudiated the contract, not because an integral term of the description had not been fulfilled, but because he did not find it convenient to take delivery, under the market conditions which prevailed when delivery was offered by the defendant-firm.

(5) In the contract Ex. A-1, we find that the 'description' is limited to this 'Self Raising Flour, Australia'. The other headings relate to quantity and price, about which there is no dispute, and there is equally no dispute with regard to the subsequent heading 'marks'. But under the heading 'shipment' we find the following entry. 'Per 'S. S. Devanha expected to sail during August-September from Australia'. But this clause must not be construed as standing alone by itself.

It must be read along with clauses 3 and 4 of the sale conditions overleaf, under which the defendant-firm stipulate fall protection for themselves in case of various unforeseen contingencies, which include 'want of railway trucks, accidents to machinery, fire, blocking of shipping or railway lines'. We think that this is sufficient to show that in the contract in this case, the defendant-firm were entitled to deliver at a later date, if there was blocking of shipping, by another ship, if that was the only means whereby delivery could be effected. Learned counsel for the plaintiff-respondent is totally unable to show that the delivery by some other ship affected any interest of the plaintiff, or affected the goods in any conceivable manner, such as different conditions of storage etc.

(6) In this context, it is also instructive to refer to the actual reply of the plaintiff-firm when delivery was offered, by which they repudiated the contract. In this reply, the plaintiff-firm state that they were not aware of the fire accident which disabled 'S. S. Devanha'. But that, of course, has been established in the evidence. They add 'even if 'S. S. Devanha' was damaged by fire accident, the goods could have easily been shipped to India via Ceylon and delivered to them in time'.

This clearly shows that the term that the goods were to be shipped by 'S. S. Devanha' expected to sail about August-September, was not an integral part of the description of the goods, but was an incidental recital concerning shipment.

(7) We shall now briefly refer to the authorities which have been cited both in the lower court and here.

(8) : AIR1953Mad380 , does not directly relate to a question of this kind. But there are incidental observations therein to show that (1) the contract must be looked into as a whole, in construing the expression relating to description and (2) were certain words which are contended to be part of the description, do not occur under that heading, but elsewhere, it would not be reasonable to assume that they were intended to be part of the description. This case is thus directly in favour of the defendant-firm, for the words relied on in the present case occur under the heading 'shipment', and not under the heading 'description'.

(9) Of the two other cases cited, the nearest upon the facts which might help the plaintiff-respondent is J. Aron and Co. (Incorporated) v. Comptior Wegimont, 1921 3 KB 435. But in that case, the facts were that the contract of sale itself related to goods already on board a particular ship namely, S. S. Idaho. In other words, the sale related to goods actually in physical existence in a specified ship, and the learned Judge (Mccardie, J.) observed then the buyers were entitled to succeed, as it was a part of the contract that the goods should be shipped as required by the contract. He added that there was another ground on which the buyers could succeed, namely, that upon the facts of that particular case, 'the subject matter sold and brought was twenty tons of cocoa powder actually on board the steam ship Idaho at the date of the contract'.

This decision can possibly have no bearing upon the facts of a case like the present, where the sellers merely undertake that they would have the goods shipped from Australia by a particular steamer expected to sail in August-September, and further qualify themselves by adding a clause protecting them against delays in shipping, with the necessary implication that time was not the essence of the contract, and that the goods may be delivered later, and may or may not be delivered by the particular ship specified.

(10) The other case referred to by the learned counsel for the plaintiff-respondent is Filley v. Pope, (1884) 115 US 213 : 29 Law Ed 372. That was a case in which the sellers undertook delivery of certain goods with this condition inter alia 'shipment from Glasgow as soon as possible'. The learned Judges observed that buyer took the risk of delay in getting the shipment from Glasgow, but insisted that the shipment was to be from Glasgow as a condition precedent to liability. Under these circumstances, the Court refused to go into the question why the buyer wanted shipment from Glasgow, and rejected shipment from some other port.

It may very well, be as we may conceive, that goods shipped from that very port, which could be described as so obtained, might have a particular enhanced value in the market. In any event, there can no doubt were such a term is an integral part of the description itself, the court would certainly enforce that term. But that is not at all the case here, taking the contracts as a whole, and we have no doubt that the suit for refund of the advances must fail, as the plaintiff was really not entitled to reject the goods under the circumstances of this case.

(11) We consequently allow the appeal, and dismiss the suit.

(12) The defendant-firm has advanced a claim of further appeal upon which separate court-fee has been paid, and which is really in the nature of a cross-suit. This relates to a some of Rs. 6390/-, representing the loss sustained by the defendant-firm after re-sale of the goods, adjusting the advances already paid by the plaintiff. There is no doubt a condition in the contract by which the defendant-firm could effect this re-sale at the buyer's risk, in case the buyer rejected delivery. But we find, upon a scrutiny of the relevant dates, that this claim is definitely out of time. It ought to have been instituted within three years of the date of the breach of the contract, and it is no defence to this objection to urge that it was only the occasion of re-sale which enabled the defendant-firm to ascertain exactly the decree of damages, or the precise amount which would represent the injury suffered by them. The occasion for ascertainment will have to be distinguished from the date upon which the cause of action arose, and from which limitation began to run. Since this cross claim is out of time, the appeal is dismissed upon this point. Under the circumstances, we direct that the parties shall bear their own costs throughout.

(13) Order accordingly.


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