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M.V.K.T.S.R. Seethalakshmi Ammal by Her Authorised Agent T.A. Narayana Sastrial Vs. Co-operative Distrubutive Society Ltd. and ors. - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported inAIR1921Mad594; 70Ind.Cas.636
AppellantM.V.K.T.S.R. Seethalakshmi Ammal by Her Authorised Agent T.A. Narayana Sastrial
RespondentCo-operative Distrubutive Society Ltd. and ors.
Cases ReferredIn Ireland v. Living
Excerpt:
principal and agent - agent acting under general instructions--bona fide act--principal, whether bound. - - the, evidence of the plaintiff's agent and the secretary shows clearly that it was in consideration of the lease being for 3 years that the rent was fixed at the low rate of rs......or that the secretary, when he negotiated for the lease and executed the agreement, was not acting bona fide. the, evidence of the plaintiff's agent and the secretary shows clearly that it was in consideration of the lease being for 3 years that the rent was fixed at the low rate of rs. 12-8-0 a month. i find it difficult to believe that the president and the directors did not inquire what the terms of the lease were or were not told by the secretary the terms on which he engaged the premises. where the authority of the secretary to lease premises for a branch is general and where he acts bona fide and in the interests of the society, it is difficult to see how the lease can be held not to be binding on the society, in ireland v. living stone (1872) 5 h.l. 395 lord chelmsford.....
Judgment:

Kumaraswami Sastri, J.

1. It is not disputed that the Secretary of the Co-operative 'Stores was asked to rent premises for the opening of a branch. The President of the Stores states in his evidence that no directions were given to the Secretary as to the terms on which the premises were to be engaged. Evidently the terms were left to the discretion of the Secretary. The resolution, Exhibit E, authorises the Secretary to arrange for not exceeding Rs. 32 for the establishment expenses, etc., for the branch store in the Mahadanam Street. The premises in question are situate in the Street and it is not disputed that the society occupied the premises and has been paying rent. The Secretary leased the premises for three years and executed a registered rental agreement acting on behalf of the Society. The expenses of Registration are entered in the Society's accounts and the accounts, which included the sum spent on registration, were passed by the Directors at a meeting held on the 17th February 1918 as appears from Exhibit E. There was nothing to show that there was any fraud or collusion or that the Secretary, when he negotiated for the lease and executed the agreement, was not acting bona fide. The, evidence of the plaintiff's agent and the Secretary shows clearly that it was in consideration of the lease being for 3 years that the rent was fixed at the low rate of Rs. 12-8-0 a month. I find it difficult to believe that the President and the Directors did not inquire what the terms of the lease were or were not told by the Secretary the terms on which he engaged the premises. Where the authority of the Secretary to lease premises for a branch is general and where he acts bona fide and in the interests of the Society, it is difficult to see how the lease can be held not to be binding on the Society, In Ireland v. Living stone (1872) 5 H.L. 395 Lord Chelmsford observed:

Now it appears to be that if a principal gives an order to an agent in such uncertain terms as to be susceptible of two different meanings and the agent bona fide adopts one of them and acts upon it, it is not competent to the principal to repudiate the act as un authorised, because he meant the order to be read in the other sense of which it is equally capable.

3. I am of opinion that the Secretary's act in leasing the premises for 3 years is, on the facts of the present case, binding on the Society, I set aside the decree of the lower Court and pass a decree for Rs. 12-8-0 in favour of the plaintiff against the 1st defendant with the costs in this and in the lower Court.

4. The petitioner's Vakil states that he gives up his claim against the 2nd defendant and will not execute the decree against him.


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