1. On 22nd January 1936, the defendants, who are the executrix and executors of the will of one Arun Bhusan Basak, deceased, entered into an agreement in writing with the plaintiff for the sale to him of certain premises known as No. 19/1 Ultadinghi Road, Calcutta. Clause 1 of the agreement states that the defendants have got an absolute estate in the premises free from encumbrances. The consideration is to be the sum of rupees 1500 (per cottah), subject to the approval of title by the purchaser's solicitor. Clause 2 states that the plaintiff has paid to the defendants the sum of Rs. 251 as and by way of earnest money, the balance of the price to be paid on completion. Clause 4 provides that there will be four several conveyances in regard, to the land intended to be sold, and that the purchasers will not be bound to pay any extra expenses for approval of the same. Clause 5 provides that, if the title be not good, the purchaser shall be at liberty to rescind the agreement, and the vendors shall refund the earnest money, and shall pay all out-of-pocket costs of investigation of title and of the agreement not exceeding Rs. 51 in all. Clause 6 provides that the vendors shall be at liberty to rescind the contract in case objections are taken to the title which they are unable to remove, and in such case they shall refund the earnest money and pay the out-of-pocket costs not exceeding Rs. 51 in all. Clause 10 provides that, if it turns out that, prior to the date of the agreement, the premises or any part thereof has been notified to be acquired by the Calcutta Improvement Trust, the Corporation of Calcutta, or any other public body, for public purposes, the purchaser will have the option to rescind the agreement.
2. In March 1936 it came to the knowledge of the plaintiff that the premises were affected by a proposed bustee road sanctioned under Section 345, Calcutta Municipal Act. The Act defines 'bustee' as an area containing land occupied by, or for the purpose of, any collection of huts. Chap. 22 of the Act deals with 'bustees.' Under Section 338 the Corporation may require a bustee owner to prepare a plan of the bnstee which shall be considered by the Corporation, and shall when approved by them be deemed to be the standard plan of the bustee. Under Section 343 the Corporation may at any time, by written notice, require the owner of any bustee for which a standard plan has been prepared to carry out the improvements shown on such plan. Section 359 is important. It provides that the owner of any land included in a bustee, and bearing a separate number in the assessment book, may, at any time, whether a standard plan for the bustee has been prepared or not, send a written notice to the Corporation that he intends to remove all the huts standing on such land. There is a proviso to the effect that the receipt of such notice shall not be a bar to the approval by the Corporation of a standard plan of such bustee. Under Section 359 (b) where all the huts standing on any land within a bustee have been removed, the Corporation may either (a) cancel the standard plan (if any), already approved for such bustee, or (b) modify such plan after hearing the objections (if any) of any owner of land included in the bustee. The plaintiff obtained the standard plan and he says that he subsequently discussed the situation with the defendant Kishori Mohan Basak. He says he was advised to see the bustee surveyor and to enlist the support of Municipal Councillors with a view to have the bustee plan cancelled. The Corporation officials informed the plaintiff that it would be necessary to put in a formal application for cancelling the bustee road alignment and that this application should be supported by a building plan signed by the vendors. Accordingly on 7th September 1936, the plaintiff's attorney wrote to the defendant's attorney enclosing the formal application and copies of the building plan for the defendant's signature. On the following day, the defendant's attorney returned the application form and copies of the plan unsigned. Correspondence followed and the plaintiff's contentions are set out in a letter written by his attorney and dated 14th September 1936, in which the writer says:
Your clients were approached and I myself saw the Bustee Surveyor at your client's request and my client has seen the members of the Bustee Committee and on their suggestion a building plan was prepared at the cost of my client to be submitted to the Corporation for transference of the land from Bustee to Pucca Assessment Register so that the road alignment will be cancelled. My client is ready and willing to complete the purchase and if your client co-operates with my client the matter may be smoothly completed and the bustee alignment may be cancelled. In the circumstances I have been instructed to request you to persuade your client to help me in the matter and in the meantime please return me the plan duly signed by your client with the application form and oblige. My client further definitely has instructed me that the sale and purchase is to be completed within a fortnight from the cancellation of the road alignment with this condition that if the registration office remain closed, then a little more time will have to be given to my client to complete the investigation and necessary searches. I hope your client will have no objection to the course suggested.
3. The plaintiff's attorney wrote again on 21st September, saying that his client had agreed to re-sell the five plots of land, and threatening that if the sales fall through owing to the defendant's failure to cooperate in securing the cancellation of the road alignment, he would look to the defendants to compensate him for any loss that might result. The defendant's attorney replied by calling on the plaintiff to complete the sale by Monday, 5th October, and saying that in default of completion the agreement would stand cancelled and the earnest money would be forfeited. On 2nd October, the plaintiff's attorney wrote offering to complete on the production by the defendants of written evidence to show that the Corporation had cancelled the road alignment. The present suit was filed on 26th August 1937. The plaintiff claims refund of the earnest money, the costs of investigating the title, and damages based on the difference between the price stipulated in the agreement for sale, and the prices for which the plaintiff had agreed to sell the several plots to sub. Purchasers. The written statement was filed on 17th November 1937. At the trial the main issues raised were: first, whether by failure to remove or have cancelled the road alignment in the standard plan the defendants have been guilty of a breach of the warranty that they had got an absolute estate free from encumbrances, and secondly on the assumption that there has been a breach, the measure and quantum of the damages. While the suit was pending, the defendants made an application to this Court under Section 45, Specific Belief Act, which was dealt with by Ameer Ali J. on 14th March 1938. From the proceedings it appears that in December 1936, the defendants actually submitted the building plan to the Corporation, and asked that the standard plan be formally abandoned. There appears to have been inexplicable delay on the part of the Corporation, and on 25th November 1937, the defendants wrote to the Chief Executive Officer asking for sanction of the building plan, and for exclusion of the land from the category of bustee land, and for cancellation or variation of the standard plan. No reply was received to this letter, and the application under Section 45 was taken out. The learned Judge accepted the undertaking of counsel appearing for the Corporation to deal promptly with the matter, and adjourned further consideration of the application for two months while declining to issue a mandamus. It appears that the application was finally disposed of on 8th July 1938. The order then made as form-ally drawn up is as follows:
Upon the advocate for the Corporation of Calcutta stating to the Court that the building plan of the said applicants has been sanctioned by the said Corporation of Calcutta as per resolution of the Building Committee No. 1 dated 80th May 1938, it is ordered that the application of the said applicants pursuant to the said notice be treated as placed on the Motion list of this day, and this Court does not think fit to make any order on the said application or as to the costs thereof.
4. These proceedings, to which the present plaintiff was not a party, are irrelevant for the purposes of this suit. Now, on the main question, I feel no doubt that the defendants were not entitled to call on the plaintiff to complete as long as there was a possibility of the road being constructed in accordance with the alignment shown on the standard plan. I do not think it is a matter of much importance whether the existence of the standard plan be called an encumbrance or a removable defect of title. That being so, it was the duty of the defendants as vendors to take every step to have the defect removed. In this connexion Day v. Singleton (1899) 2 Ch. 320 is instructive. There the representative of a deceased vendor of leasehold property made no attempt to obtain the lessor's consent to the proposed assignment or terms which the purchaser was willing to accept. The purchaser claimed damages. There being no reason to suppose that the lessors would not, if requested by the vendor, have consented to the assignment on those terms, the Court of Appeal held that the plaintiff was entitled to succeed and to recover not only his deposit with interest and expenses but damages for the loss of his bargain, since Bain v. Fothergill (1874) 7 H.L. 158 did not apply to the case of a vendor who can make a good title but will not, or will not do what he can do and ought to in order to obtain one.
5. Day v. Singleton (1899) 2 Ch. 320 was followed in In re Daniel (1917) 2 Ch. 405 where the property agreed to be sold was together with other property the subject of a mortgage. The mortgagees refused to release the particular property, unless the entire mortgage were redeemed. The vendor's representatives were not in a position to redeem, and in the circumstances the purchaser was held to be entitled to damages. I hold that the defendants in refusing to apply for sanction of the building plan and cancellation or variation of the standard plan committed default. I further hold that this default entitles the plaintiff to ask for damages in addition to the return of his deposit and the expenses of investigating title. Were it necessary to decide whether the rule in Bain v. Fothergill (1874) 7 H.L. 158 applies to India my inclination would be to hold that it does not. I can see no particular reason to limit the scope of Section 73, Contract Act, by adding to it an exception based on the rules. This is in accordance with the view taken in this Court by Stephen J. in Nabin Chandra Saha v. Krishna Baroni Dassee (1911) 38 Cal. 458 and by a Full Bench of the Madras High Court in Adikesavan naidu v. Gurunatha Chetti (1918) 5 A.I.R. Mad. 1315. These authorities are, in my opinion, to be preferred to Dhanrajgiri narsinggirji v. Tata Sons Ltd., (1924) 11 A.I.R. Bom. 473. However this may be, the rule in Bain v. Fothergill (1874) 7 H.L. 158 can have no application to the present case in which there has been positive default, as is shown by Day v. Singleton (1899) 2 Ch. 320, and the authorities on which that decision is based.
6. With regard to damages the plaintiff has proved three agreements for the resale of various plots. One of these agreements is with a person named Pasupati Chatterjee at the rate of Rs. 2700 a cottah and is dated 4th May 1936, The purchasers under the other agreements are named Manick Lai Mukherjee and Banku Behari Chatterjee, and the agreements are both of September 1936, the rate being Rs. 2200 a cottah. The purchasers have given evidence and cross examination has altogether failed to substantiate the suggestion that the re-sales are fictitious, in the sense of being manufactured transactions, whose sole object is to support a claim for damages. As the agreements were entered into subsequently to the date of the agreement in suit, the rates cannot of themselves afford a measure of damages, though they are certainly evidence of the rate at which purchasers could be found for the land at or about the time that the defendants should have completed. I see no reason to suppose that they do not furnish a reasonably accurate guide to the value of the property, when sold in lots and improved. The plaintiff has calculated his damages on the basis of the plots actually sold and omitted the unsold portion, which it is intended to leave unsold and available for improvement, the value of the sold plots being thereby enhanced. I think it would be fair to assess the value of the whole plot at the time when the defendants ought to have completed at about Rs. 1800 per cottah and I award a sum of Rs. 6500 as damages. The plaintiff is also entitled to Rs. 251 with interest thereon at 6 per cent, from 22nd January 1936 until today, and also to a sum of Rs. 51 as the costs of investigating title in terms of the contract. There will be a decree for these sums with costs and interest on decree at 6 per cent.