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Dr. S. Munisami Naidu and ors. Vs. G. Thandvaraya Mudaliar - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported in159Ind.Cas.1005
AppellantDr. S. Munisami Naidu and ors.
RespondentG. Thandvaraya Mudaliar
Cases ReferredKuttikrishnan Nair v. Kallil Appa Nair
Excerpt:
evidence act (i of 1872), section 91 - contract in writing between a and b--oral evidence to prove that c was also really a party--admissibility--partnership--building contract--agreement by contractor to pay third person a share of profits 'as soon as final bill is ready'--suit for accounts and share--cause of action--suit before disputes between contractor and owner are settled--maintainability. - .....defendant's son-in-law and was at the time the contract was taken, employed in the service of the railway company itself. it was the plaintiff's case that on account of this circumstance the contract was taken in the first defendant's name but it was intended for the second defendant's benefit. the second defendant denied this, but the lower court has upheld the plaintiff's contention on this point. this finding has not been assailed before us.3. having taken this contract for the construction of the railway line, it is the plaintiff's case that defendants nos. 1 and 2 availed themselves of his services in connection with that work and the terms of the arrangement as finally settled are stated in ex. a. as follows:you should be my substitute at the place of work, look after the work and.....
Judgment:

1. This is an appeal by the defendants against a decree directing certain accounts to be taken and awarding to the plaintiff one-third share of the profits which on such taking of accounts may be ascertained to have been earned in connection with a certain venture.

2. About the end of 1924, a contract was taken in the name of the first defendant for the construction of a portion of the Shoranur-Nilambur Railway. The second defendant is the first defendant's son-in-law and was at the time the contract was taken, employed in the service of the Railway Company itself. It was the plaintiff's case that on account of this circumstance the contract was taken in the first defendant's name but it was intended for the second defendant's benefit. The second defendant denied this, but the lower Court has upheld the plaintiff's contention on this point. This finding has not been assailed before us.

3. Having taken this contract for the construction of the railway line, it is the plaintiff's case that defendants Nos. 1 and 2 availed themselves of his services in connection with that work and the terms of the arrangement as finally settled are stated in Ex. A. as follows:

You should be my substitute at the place of work, look after the work and finish it. As soon as the final bill is made after deducting all the expenses, I agree to pay you one-third of the profits.

4. This document dated January 14, 1925, was signed only by the first defendant. But it was the plaintiff's case that the arrangement with him was entered into by both the first and second defendants, that the second defendant could not sign it because he still continued in the Railway Company's service and, therefore, wanted to make it appear that it was the first defendant's concern. The second defendant admits that the terms were settled by him and also that Ex. A, in his hand-writing, but he would make it appear that he wrote it at Trichinopoly and sent, it to Angadipuram where the plaintiff was. In the circumstances of the case and the probabilities appearing from the evidence, the lower Court rightly came to the conclusion that the arrangement must have been come to in the presence of all the persons at Angadipuram. It would, therefore, follow that it is a contract between the plaintiff on the one side and the first and second defendants on the other.

5. The learned Advocate-General contended that as Ex. A is signed only by the first defendant, no oral evidence could be adduced to show that the second defendant was also a party to the arrangement or was bound by it. This argument is opposed to the rule laid down by a Division Bench of this Court in Venkatasubbiah Chetti v. Govindarajulu Naidu 31 M. 45 : 3 M.L.T. 259 : 18 M.L.J. 1. Our attention was drawn to an observation of Beaman, J. in Lakshmi Bai v. Keshav Annaji 18 Bom. L.R. 131 33 Ind. Cas. 396, that the wide generalisation adopted in this Madras case 'ignores the logic of the principle' as attempted to be shown by the learned Judge in an earlier portion of the judgment. But even that learned Judge has not put the matter higher than that and we do not feel satisfied that the principle of the decision in Venkatasubbiah Chetti v. Govindarajulu Naidu 31 M. 45 : 3 M.L.T. 259 : 18 M.L.J. 1, ought not to be followed. By way of analogy, the learned Advocate-General relied upon the case in Sarnahnga Mudah v. Pachi Naicker 38 M. 680 : 22 Ind. Cas. 1 : 14 M.L.T. 559 : (1926) M.W.N. 27 : 26 M.L.J. 113. That decision is not analogous. All that was there laid down was that a person who has himself executed a document cannot be allowed to set up a contemporaneous oral agreement that he should not be held liable on that document.

6. The main argument in the appeal before us related to the question raised by the first issue, namely, whether the action was premature. The facts relevant to this question are set out in para. 54 of the lower Court's judgment. The position taken up by the first defendant in his written statement which was substantially adopted by the second defendant was that it was only after the final bills are passed and paid that the plaintiff could make any claim at all. There are no words in Ex. A, corresponding to the italicised words. The words are 'final bill anavudan' which may more accurately be translated as 'as soon as the final bills are ready.' In this case, the final bill was prepared by the Railway Company in October 1927, but as the contractor took exception to the various, items therein, it was not passed as such and the disputes between the contractor and the Railway Company had to be settled by the Court. Original Suit No. 13 of 1929 was accordingly instituted by the contractor against the Railway Company in 1929 and the appeal, therefore, was decided by this Court in September, 1934.

7. The learned Advocate-General argues that as the amount out of which the plaintiff could get a one-third share could be definitely ascertained only after the disputes between the contractor and the Railway Company as regards the bill had been. fully settled, this suit which was instituted in January 1928 must be held to be premature. We are unable to accede to this contention. Take for instance the familiar case of a partnership. As soon as a dissolution takes place, any partner can sue for the taking of the partnership accounts and the award of his profits in the partnership concern. It may take a long time for the ascertainment of the assets of the partnership. There may, for instance, be proceedings by the partnership against persons indebted to the partnership or proceedings against the partnership by persons having claims thereon. Such proceedings may considerably postpone the date when the exact state of the partner-ship assets may be ascertained. But it has not been suggested that a partner's right to ask for the taking of the accounts of the partnership and for payment of his share of the profits is postponed till after such ascertainment. The cause of action or right to sue for accounts is one thing and the ascertainment of the amount of profits to which he will be entitled is another thing. Once it is found that under the contract between the parties the plaintiff was entitled to a share of the profits that is the cause of action for him, if only he had fulfilled his part under the contract. The settlement of accounts between the contractor and the Railway Company is no part of his cause of action, though till those accounts are settled, the exact amount payable to him may not be ascertained. In the interests of all parties, especially when the plaintiff's right itself has been denied, as in the present case, it will be best that an action of this kind is brought as soon as the work is completed rather than that it should be indefinitely delayed, pending settlement of disputes with the Railway. Company. If the plaintiff's right had not, been denied by the defendants and they had made common cause against the Railway Company, the position may be different at least on the question of costs.

8. The learned Advocate-General referred in this connection to the decision in Kitchamma v. Chetarvedalu (1932) M.W.N. 318. But that related to different set of circumstances, because the purpose for which the plaintiff's services had been availed of had not been completed in that case. A similar plea was raised in the present case but overruled by the lower Court. We are accordingly of opinion that the finding of the lower Court on the first issue is correct.

9. The only other point argued before us relates to the form of the decree. On the assumption that the first defendant entered into a contract with the plaintiff as agent of the second defendant, the learned Advocate-General argued that according to the decision in Kiittikrishnan Nair v. Kallil Appa Nair 51 M.L.J. 311 : 97 Ind. Cas. 475 : (1926) M.W.N. 729 : 24 L.W. 451 : 49 M. 900 : A.I.R. 1926 Mad. 1213, the plaintiff could have a decree either against the agent or against the principal but not against both. But the assumption, that the first defendant entered into a contract with the plaintiff only as agent of the second defendant, does not correctly represent the position here. The, contract was, as already explained, one between the plaintiff on the one side and the first and second defendants on the other. In this view, it is unnecessary for us to say whether or not Section 233 of the Indian Contract Act has been rightly interpreted in Kuttikrishnan Nair v. Kallil Appa Nair 51 M.L.J. 311 : 97 Ind. Cas. 475 : (1926) M.W.N. 729 : 24 L.W. 451 : 49 M. 900 : A.I.R. 1926 Mad. 1213. The appeal fails and is dismissed with costs.


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