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Edmund Bendit and anr. Vs. Edgar Raphael Prudhomme - Court Judgment

LegalCrystal Citation
Decided On
Reported inAIR1925Mad626
AppellantEdmund Bendit and anr.
RespondentEdgar Raphael Prudhomme
Cases ReferredLtd. v. S.F. Jones and Co.
- .....ha therefore wrote on 22nd december, 1916, and 11th january, 1917, to the appellants pleading force majeure and asking them to consider the contracts as cancelled. the appellants refused to do so, rejecting the plea that this was a case of force majeure and suggested trying other lines and other ports. the respondent tried all the shipping agents in vain. he then made a proposal that he should endeavour to work off old contracts by shipping a portion of the goods contracted for under old contracts along with the portions of the goods to be supplied under new contracts, but the appellants only treated this as a virtual admission of his liability and an attempt to diminish his debt. they were unwilling to accept the proposal exactly as it was offered and it fell through. there was no.....

Spencer, J.

1. The respondent, a merchant of Madras, contracted on 10th November, 1916, with the appellants, who are a firm in Marseilles, to ship 400 tons of groundnut kernels of Marseilles in the December January 1916-1917 season on a C.I.F. contract, the goods to be of H. P. Brand. Ha booked the necessary tonnaga on the S.S. Seapool, a vessel chartered by Messrs. Gordon Woodroffe & Co., but it was commandeered by the Government on 14th November for purposes connected with the War. In spite of his best endeavours, the respondent was unable to obtain accommodation for this cargo on any other steamer leaving the 'kernel' ports, that is, ports on the Coromandel Coast from which kernels are usually shipped, viz., Madras, Pondicherry, Cuddalore, Negapatam and Porto Novo. Ha therefore wrote on 22nd December, 1916, and 11th January, 1917, to the appellants pleading force majeure and asking them to consider the contracts as cancelled. The appellants refused to do so, rejecting the plea that this was a case of force majeure and suggested trying other lines and other ports. The respondent tried all the shipping agents in vain. He then made a proposal that he should endeavour to work off old contracts by shipping a portion of the goods contracted for under old contracts along with the portions of the goods to be supplied under new contracts, but the appellants only treated this as a virtual admission of his liability and an attempt to diminish his debt. They were unwilling to accept the proposal exactly as it was offered and it fell through. There was no extension of the time for performance for an indefinite period by mutual agreement. In the end they put the respondent into Court in March, 1921, and lost their case in the Trial Court, on the findings of the Judge, (1) that force majeure would discharge the defendant from the performance of his original contract, and (2) that inability to obtain tonnage is force majeure within the meaning of that expression as construed in English Courts.

2. It may be noted in this connection that both the standard contract forms in use by the parties (Exhibits A and I) contain force majeure clauses. Exhibit I which is respondent's version is the less definite of the two. It mentions two kinds of force majeure which would render the contract null and void except so far as it had already been partly performed. One is prohibition of export of the article from the country, a second is blockade, and there are others not mentioned. Such are cases of force majeure preventing the execution of the contract. Exhibit A is more explicit, as it enumerates war, revolution, strikes, epidemics as well as other unforeseen circumstances which might prevent the goods from reaching the port of embarkation or from being shipped or despatched and so would render the contract void. Section 56 of the Indian Contract Act simply says that a contract to do an act which, after the contract is made, becomes impossible, or by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful; and Section 65 provides that in such event any person who has received any advantage under the contract is bound to compensate the person from whom he received it.

3. The term force majeure which is borrowed from the Code Napoleon has received interpretation in several decisions of the English Courts in recent years. In Matsoukis v. Priestman and Co. (1915) 1 K.B. 681 Mr. Justice Bailhache after considering the definition given by an eminent Belgian lawyer of force majeure as meaning 'causes you cannot prevent and for which you are not responsible' a definition which would certainly include inability to obtain tonnage owing to war conditions prevailing in the port or ports from which the goods were to be despatched-himself gave it a more restricted meaning. In his opinion force majeure would include strikes and break-down of machinery but not bad weather, or football matches, or a funeral. In Lebeeaupin v. Crispin (1920) 2 K.B. 714 Mr. Justice McCardie observed : 'A force majeure clause should be construed in each case with a close attention to the words which precede or follow it, and with due regard to the nature and general terms of the contract. The effect of the clause may vary with each instrument.' In Peter Dixon and Sons, Ltd. v. Henderson Craig and Co. Ltd. (1919) 2 K.B. 778 the fact that British ships were no longer available by reason of the war for carriage of wood pulp from Canada to Grimsby in England was held to be a hindrance to the performance of a contract for delivery of pulp and came within the meaning of the force majeure clause in the contract under consideration in that case. If the hindrance was insurmountable, it would amount to prevention, which was another term used in the contract which would relieve the sellers from liability, and the Court of Appeal held that the arbitrators were accordingly justified in finding the Boilers not liable.

4. In the present case the matter is simplified by the fact that the expression 'force majeure' does not stand alone, but the clause in which it occurs in Exhibits A and I contains examples of what was intended to be conveyed by the term. War is one of the examples and the word et cetera at the end of the enumeration denotes that there are others.

5. In their letter (Exhibit K) of January 18, 1917, the appellants admitted that, if shipment by the Seapool has been one of the declared terms of the contract between them and the respondent, the latter would be exonerated by the fact of that steamer being subsequently requisitioned by the Government. What, however, they failed to appreciate was that the respondent was not asking to have the contract considered as cancelled merely on account of the Seapool being requisitioned, but that the combination of two circumstances, (1) the commandeering of the Seapool on which he had already booked accommodation for this consignment of groundnuts, (2) the total lack of any other ships with available accommodation not already booked up by earlier applicants, made it impossible for the respondent to fulfil his engagements under Exhibits VII and VII (a) in the season December-January, 1916 1917.

6. It has been contended both in the trial Court and here that the respondent might have shipped this consignment of groundnuts on the Jossiphoglu or the Khiva, or the Griqua, or the Voyazides, or the Locksley Hall, or the City of Florence; but the evidence on the point to which we have referred makes it clear that all the space on the steamers calling at Marseilles in December or January was already booked before the commandeering of the Seapool became known on November 14, and that the respondent could not have foreseen the fact that he would be prevented from sending the consignment by the ship in which he had booked space, and could not have made other arrangements; also that if he could have booked space in a steamer leaving Madras after January, 1917, the consignment would not have reached the consignees within the contract time. On the facts I agree with the conclusion of the learned Judge who heard the evidence 'that it was a physical impossibility for Mr. Prudhomme to get tonnage to take this cargo at any rate of freight however high during the contract period.'

7. But on the Voyazides, the Jossiphoglu the respondent sent consignments of groundnuts to Chabriere Morel and compoi of Marseilles on earlier contracts with those consignees. It is suggested by the appellants' Counsel that the respondent might have kept his contract with the appellants by buying in these consignments made by other merchants trading in groundnuts and diverting them to his consignees.

8. But it is not stated that any such consignments of groundnuts were sent except under previous contracts, and in Tenants (Lancashire), Ltd. v. C.S. Wilson and Co. Ltd. (1917) A.C. 495 it was observed by Lord Loreburn that it would not be reasonable to ask a parson, who had entered into a particular contract to supply goods, to break his other contracts or to make others break their contracts in order to perform this contract. If a party to a contract could not perform his part without breaking other contracts, then the existence of those other contracts in the opinion of their Lordships might be deemed to hinder or prevent him from performing the contract in question. At considerable expense and loss the respondent might, it is suggested, have bought groundnuts in Marseilles itself and tendered them to appellants in performance of his contract, or he might have sent this consignment to some port from which it might have been transhipped to Marseilles. But if he had adopted either of these courses he would still have been unable to make a good tender which the appellants would have been bound to accept, for the contract between the parties was a C.I.F. contract under which ho had to render bills of lading for 400 tons of groundnut kernels of H.P. Brand shipped by steamer from a kernel port to Marseilles. A tender of groundnuts of some other brand or of bills of lading from some other port such as Bombay or London would not have bean a strict compliance with the terms of the contract such as appellants would have been bound to take up vide : Hansson v. Hamel and Horley Ltd. (1922) 2 A.C. 36.

9. The fact which appears from the judgment in O.S.A. No. 73 of 1921 that in respect of the commandeering of this very steamer Seapool a French Court of Arbitration in regard to another contract held that the sellers could not successfully plead force majeure as a defence on the ground that goods of the proper month's shipment might have beau bought up either on the high seas or locally in Marseilles, no doubt at a great advance in price, is immaterial for the decision of this appeal, because the details of that contract are not before us so as to enable us to judge of the correctness of the view taken by those arbitrators, and their decision is by no means binding upon us.

10. For these reasons I can coma to no other conclusion than that the judgment appealed against is right and the appeal is therefore dismissed with costs.

Srinivasa Aiyangar, J.

11. I agree that the appeal should be dismissed with costs. I wish only to add a few sentences with regard to the main contentions raised in the argument on behalf of the appellants. It seems to me really unnecessary to canvass for the purpose of this case the meaning or definition of force majeure. The only thing that was contended to amount to force majeure was the commandeering of the Seapool by the Government. I did not understand Mr. Hockett, the learned Counsel for the appellants, in his argument to contend that such commandeering would not amount to force majeure. But in all such cases, it is not sufficient for the contracting party to point to something in the nature of a force majeure and seek to escape liability. It is absolutely necessary to go further and establish by satisfactory evidence that the circumstance or occurrence which is called force majeure was the real cause, which, to use the language of the contract in question, prevented the performance of the contract. Now, if the commandeering of the Seapool had taken place, say on the 30th or 31st of January, almost at the last moment, so as to upset all the calculations and arrangements of the defendant there could possibly be no doubt that the force majeure would have been the immediate cause of the failure of the defendant to ship the goods and perform the contract. But the real difficulty in the case arose by reason of the Seapool having bean commandeered as early as the 14th of November, whereas the shipments had to be in December-January. The defendant's plea, which was found by the learned Judge in the Court below to have been made good, was, that till the end of January the defendant made every effort to book the cargo and failed, not because the high rate of freight obtaining made his contract commercially impracticable but because he could not get tonnage for the cargo at any price whatever, It may almost seem from this finding that the real or immediate cause for Mr. Prudhomme not performing the contract was not the commandeering of the Seapool but his inability to procure tonnage in any vessel. No doubt this inability has been found as a fact by the learned Judge and has not been seriously assailed before us. But the inability to procure the necessary tonnage could not possibly be force majeure because the contract itself was during the war and the difficulty of securing space for cargo to be exported must have been in the contemplation of the contracting parties, and the difficulty or even the impossibility as it may be of procuring tonnage was the result of the extraordinary competition prevailing at the time and could not aptly be described by the expression force majeure however elastic and varying its connotation may be accepted to be. In these circumstances, unless the commandeering of the Seapool could be found to be the real or immediate cause of Mr. Prudhomme not performing the contract, the force majeure clause in the contract will not help him. After giving the matter my very careful consideration, I have come to the conclusion that in this case in spite of the interval of time between the 14th of November and the close of the period fixed for the performance of the contract, the commandeering of the Seapool was the real or immediate cause-cause, not in any scientific sense nor even in the language of ordinary parlance, but in a commercial sense. The fact was that Mr. Prudhomme, as a commercial man, made certain arrangements for shipping, entered into engagements for the purpose of procuring necessary tonnage and then entered into the suit contracts. Then suddenly on the 14th November ho finds his plans are upset by the vessel being commandeered by which he had arranged to ship the goods. If thereafter he was able to obtain tonnage in any of the ships in such a manner as to enable him to fulfil the contract or indeed if he made no efforts at all to procure any such tonnage, the cause of his non-performance of the contract would not have been the commandeering of the Seapool. But it is a matter of common experience that what in ordinary circumstances would not have been the cause of any particular effect might become such cause when conjoined with certain other circumstances and then

12. Two other arguments were addressed to us by Mr. Mockett, the learned Counsel for the appellants. It was said that if Mr. Prudhomme was not able to obtain any tonnage in Madras or Pondicherry there was no evidence that he could not have obtained such tonnage from any of the kernel, ports on the Coromandel Coast. This aspect of the contention would require him to establish conclusively a negative. It is significant that no evidence whatever has been adduced on behalf of the plaintiffs regarding the possibility of obtaining any such tonnage at any such port. The kind and quantity of evidence that would be required to establish a negative of that nature would obviously vary according to circumstances. I have no doubt whatever that the learned Judge who arrived at the finding did so after a consideration of all those circumstances and the argument before us has failed to satisfy us that that finding of fact has not been arrived at on proper or sufficient material. Further, having regard to the fact that the inability to procure any tonnage after the commandeering of the Seapool must be held to have been relied upon not as in itself constituing force majeure but merely as a contributing cause to make the force majeure of the commandeering the effective cause of non performance. I cannot help considering that the nature and quantity of evidence required to establish the negative need not be so exhaustive or conclusive as may be required if what was relied upon was solely the impossibility of obtaining tonnage. In such circumstances I am prepared to hold that when a commercial man finds himself face to face with an upsetting of his plans and calculations brought about by force majeure he is not bound to prove more than that be made his best endeavours as a man of ordinary prudence would and should, who was anxious to procure some tonnage for himself in such circumstances.

13. This tests at any rate on the evidence on the record on behalf of the defendant, as accepted by the learned Judge, is amply satisfied in the present case.

14. The third and last contention on behalf of the appellants was that the defendant finding that the Seapool was commandeered and finding himself unable to procure any other tonnage should still have performed the contract by purchasing at Marseilles goods of the description contracted for and supplying to the plaintiffs such goods on the documents relating to shipments thereof so as to carry out the contract.

15. To begin with, I must observe that this contention does not appear to have been submitted to the learned Judge in the Court below. In the second place, it is perfectly clear that any purchase of similar goods in the market locally at Marseilles and tendering them in performance of the contract would not have been performed according to the terms and the tenor of the contract and the buyers would have been entitled to refuse to accept the same. I am not also sure whether even the purchase of documents relating to December-January shipments of goods from the ports referred to would have been proper performance; there is a stipulation in the contract as regards the brand 'H.P.' (Hope Prudhomme), and there is no evidence and no facts which would justify me in holding that this stipulation with regard to the brand did not include besides the mark ' H.P.' (Hope Prudhomme) an implied condition regarding selection of goods by Mr. Hope Prudhomma. There is no evidence whatever that such documents were available in Marseilles which, even if the defendant could have procured them at any price, were such as the plaintiffs would be bound to accept as in performance of the contract.

16. Mr. Mookett relied upon the case of Greenway Brothers, Ltd. v. S.F. Jones and Co. 32 T.L.R. 184 But that was a case of an ordinary contract for sale and delivery of goods and what was held was that the omission to deliver was not due to war or any other cause referred to in the contract. I in a contract for sale and delivery of goods the manner of the performance of the contract is not indicated or included as necessarily being in the contemplation of parties, then it necessarily follows that difficulties or even impossibility in the performance of the contract in the manner contemplated by one of the contracting parties would be no excuse for non-performance. But if the manner of performance is really indicated in the contract, or otherwise comes to be included as a term in the contract then the force majeure clause would apply to any case of force majeure preventing the performance of the contract in that manner.

17. On a consideration of the whole contract in this case I have no hesitation in coming to the conclusion that the manner of performance of the contract included a shipment of goods to be selected by the defendant.

18. I am further of the opinion that whenever the possibility of performance is referred to in commercial contract, what must be considered and contemplated is the possibility in a commercially reasonable sense and not merely supposititious possibility.

19. It follows from these considerations that the contract between the parties was that the defendant should purchase and ship goods of the descriptions contracted for and that if the plaintiffs were minded to do so, they would have been entitled to refuse any goods or documents not so proceeding; and it also follows that having regard to the manner in which, commercially speaking, the defendant was expected and required to perform the contract there was no obligation on his part to proceed to Marseilles and look out for goods or documents of the description which might possibly have satisfied the requirements of the contract.

20. The decision of the learned Judge therefore to the effect that the defendant had made good his defence is right, and the plaintiff's action was rightly dismissed.

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