Skip to content

Dina Nath Law Vs. Metharam Navalrai and Co. - Court Judgment

LegalCrystal Citation
Decided On
Reported in64Ind.Cas.785
AppellantDina Nath Law
RespondentMetharam Navalrai and Co.
Cases ReferredLaljee Mahomed v. Dadabhai Jivanji
evidence act (1 of 1872), section 92, proviso 3 - burden of proof--examination de bene esse--irregularity--objection waived--court of appeal,, duties and functions of. - .....position of the plaintiff is, if possible, still more hopeless. the allegation that on the 31st august time was extended till the 3rd september was not made in the plaint. the true reason for this omission is not far to seek. the story of the second extension would have materially weakened, if not completely destroyed, the story of the first extension. besides this, we have the remarkable omission on the part of the plaintiff, or of his legal adviser, to rely upon this extension of time in answer to the letter of the solicitors of the defendants canceling the contract on the 30th august 1917. the plaintiff seeks to throw the blame for this omission on the solicitor, but the latter explains that he did not mention the matter because from what he heard from the plaintiff as to the.....

Asutosh Mookerjee, J.

1. This is an appeal by the plaintiff in a suit for damages for breath of contract. On the 30th July 1917 the plaintiff agreed to purchase and the defendant firm agreed to sell 15 tons aluminium ingots at Rs. 200 per owt. On the 6th August 1919 Anderson and Macrae, who purported to act as brokers, passed a Bought Note in the following terms :

We have this day bought by your order and for your account from Metharam Naval rai, 117 Corporation Street, the following:

15 tons (fifteen) Aluminium ingots, 93 per cent purity, at rupees two hundred only exgodown. The Aluminium may be tested by the buyer prior to delivery within a week from date. Delivery to be taken within 45 days from date of contract from seller's godown. After the expiry of the above period, the goods will remain at buyer's risk and account, and a rental of rupees ten only per day will be charged. Twenty-four hours' notice to be given before delivery is taken.

2. Tarms and conditions of this contract, Cash on delivery which is to be given and taken as follows:

Delivery--From seller's godown within 45 days from date of contract (viz. 30th July 1917).

3. Payment in full within 30 days from date of contract (viz. 30th July 1917).

4. Interest at 1 per cent, per annum above Bank rate on total amount for 30 days credit from 30th July 1917, being the date on which the previous contract was passed.'

5. On the face of this contract, payment in full was to be made by the buyer to the sellers within 30 days from the 30th July 1917, that is, on or before the 29th August 1917, It is not disputed that payment was not so made, and on the 31st August 1917, the Solicitors for the sellers gave notice to the buyer that the contract was cancelled, as the time for payment had expired on the 29th August and a bill sent by them on the 30th August had not been paid. The plaintiff thereupon instituted the present suit on the 5th February 1918 for recovery of Rs. 24,000 as damages for wrongful breach of contract by the defendants.

6. The case for the plaintiff, as set out in the plaint, was that it had been arranged between him and the defendants, through the brokers, that the contract was to be considered as binding, only when confirmed by both the contracting parties; that although the plaintiff confirmed the contract on the 7th August 1917, the defendants delayed confirmation on their part; that on the insistence of the plaintiff, the parties ultimately agreed that the time for delivery and payment would be extended so as to run from date of confirmation; and that it was only on the 17th August that the defendants confirmed the contract. The contention of the plaintiff, consequently, is. that under the contract, as modified, he was entitled to make the payment within 30 days from the 17th August 1917, that is, on or before the 16th September 1917, and, that, consequently, the defendants without justification cancelled the contract before there had been default on this part. At the trial, the plaintiff gave evidence in support of the case set out in the plaint; but he also set up an alternative case, namely, that on the evening of the 30th August, there was a verbal agreement between him and Ladharam, the manager of the defendant firm, by which the time for payment and for delivery was. extended till the 3rd September. It will be observed that the two alternative cases are not easy to reconcile, because if on or about the 14th, 15th or 17th August 1917, the time for payment was extended until 30 days after confirmation, that is, until the 16th September 1917, it is difficult to appreciate why on the 30th August another verbal agreement should be made for extension of time till only the 3rd September 1917. Both these allegations obviously cannot be true; and we are not surprised to find that when the first and third issues were framed, the former in respect of alleged extension of time till 30 days after confirmation and the latter in respect of alleged extension till 3rd September, Counsel for defendants objected. The objection was apparently disallowed and the trial proceeded with regard to both the issues. This was plainly risky for the plaintiff, though permissible, Philipps v. Philipps (1878) 4 Q.B.D. 127 at p. 137 : 48 L.J.Q.B. 125 : 39 L.T. 556 : 27 W.R. 436; if the first issue was found in his favour, the second was bound to bs decided against him; on the other hand, if the first was decided against him, he might succeed on the second; or, he might fail on both, a result by no means uncommon, when a plaintiff launches his suit with contradictory allegations. This is precisely what has happened here. Mr. Justice Rankin has found against the plaintiff with regard to both the stories narated by him and has dismissed the suit. On the present appeal, we have been pressed by the Advocate-General to accept as proved both the allegations of the plaintiff as regards extension of time for performance of the contract. After full consideration of the arguments addressed to us, we feel no doubt that the evidence does not sustain either branch of the case for the plaintiff.

7. In the Court below, a question I was raised, whether either of the alleged oral agreements for extension of time was valid and could be proved by oral evidence. It is plain that Section 92 of the Indian Evidence Act did not stand in the way of the plaintiff. Under proviso 3, he was entitled to prove the existence of a separate oral agreement constituting a condition precedent to the attaching of any obligation under the contract, and, consequently, to show that the contract was to be considered as binding only when confirmed by the principals themselves. Under proviso 4, again, he was competent to prove the existence of any distinct subsequent oral agreement which modified the written contract, as the contract here was neither required by law to be in writing nor had been registered according to the law in force for the time being as to the registration of documents. Indeed, the view has been maintained that the mere acceptance of a substituted mode of performance, as in Leather Cloth Co. v. Hieronimus (1875) 10 Q.B. 140 : 44 L.J.Q.B. 54 : 32 L.T. 307 : 23 W.R. 593, or the postponement of performance at the request of one party, as in Ogle v. Vane (Earl) (1868) 3 Q.B. 272 : 9 B. & S. 182 : 37 L.J.Q.B. 77 : 16 W.R. 463 and Hickman v. Haynes (1875) 10 C.P. 598 : 44 L.J.C.P. 358 : 32 L.T. 873 : 23 W.R. 872, does not amount to a new contract varying the original agreement. When, however, a written agreement is alleged to have been so varied by a subsequent oral agreement, we may usefully recall the weighty observations of Lord Chelmsford in Darnley (Earl) v. London, Chatham and Dover Railway (1867) 2 H.L 43 at p. 60 : 36 L.J. Ch. 404 : 16 L.T. 217 : 15 W.R.817:

When parties, who have bound themselves by a written agreement, depart from what has been so agreed on in writing and adopt some other line of conduct, it is incumbent on the party insisting on, and endeavouring to enforce, a substituted verbal agreement, to show, not merely what be understood to be the new terms on which the parties were proceeding, but also that the other party had the same understanding--that both parties were proceeding on a new agreement the terms of which they both understood.

8. There is one further point which demands notice before we proceed to discuss the evidence. The examination of Anderson, the broker, who was cited as a witness on behalf of the defendants, was taken de bene esse pursuant to an order of Court dated the 30th May 1918. The examination took place before Mr. George Ryper, Deputy Registrar, though no commission was issued to him, under Order XXVI, Rule 3 of the Code of Civil Procedure. This was clearly irregular. It was ruled by Macpherson, J , in this Court, as early as 1864, in Hoffman v. Framjee (1864) Coryton 7, that an examination de bene esse stands on precisely the same footing as the examination of a witness in a cause, Consequently, the examination must take place either in Court or before a Commissioner; the latter course was adopted in Prankrishna v. Biswanath 8 B.L.R. App. 101, No objection, however, was apparently raised in this case when the examination took place or when the deposition was read in Court; we have consequently decided not to strike out the evidence from the record. It is pointed out in Daniel on Chancery Practice, 1914, Volume I, page 567, that when a witness has been examined de bane esse, if any irregularity be discovered or the adverse party be advised of any ground of objection to the reading of the depositions, he should give notice in writing to the adverse Solicitor and move to discharge the order immediately upon the service of it, or on the earliest opportunity; for it seems that although depositions taken de bane esse are irregular, yet it is too late to object to them on the ground of irregularity at the hearing of the action. Reference is made in support of this practice to Ely (Dean) v. Warren (741) 2 Atk 189 : 26 E.R. 518 and Gordon v. Gordon (1818) 1 Swans. 166 at p. 171 : 1 Wils. 155 : 36 E.R. 341. In the present case, though the objection is in form one of jurisdiction, it cannot be overlooked that if exception had been taken before the examination commenced (which took place in presence of Counsel on both sides), the proceeding could have been regularised by the issue of a commission by the Court to Mr. Ryper. The objection was in such circumstances capable of being waived, on the principle explained in Gurdeo Singh v. Chandrika Singh 1 Ind. Cas. 913 : 36 C. 913 : 5 C.L.J. 611, and in the events which have happened must be deemed to have been waived.

9. We have now to consider two questions, first, was the time for performance extended on or about the 17th August so as to make the time run from the date of confirmation; and secondly, was the time for performance extended on the 30th August till the 3rd September. As we have already pointed out, if the first of these questions is answered in the affirmative, there could not obviously have been another agreement on the 30th August, which would in reality have the effect of reducing and not extending the time.

10. As regards the first alleged extension, we are of opinion that the plaintiff has failed to establish it by satisfactory evidence. It is not enough for him to prove that the parties understood that the contract would become binding, only upon confirmation by the respective principals. Let this condition be taken to have been made out, as the fact of confirmation does lend some support to the theory that the parties intended that the contract made by the broker should become operative only upon confirmation. This is by no means inconsistent with the view that the agreement, when confirmed, became operative with effect from the date when originally made or that the buyer was to perform his obligation within the time specified with precision in the Bought Note. The plaintiff must consequently prove that, as asserted in his plaint, on or about the 17th August, the parties same to an agreement that time for performance by the buyer would run from the date of confirmation by the sellers. The most important evidence on this point is that of Anderson, who has hopelessly contradicted himself: when faced with the statement which he had previously signed, he could not satisfactorily explain why his views had undergone a radical change. We have, then, the evidence of Harris, whose testimony has not been accepted by the Trial Judge. We have read his deposition and see no reason to form a different opinion as to the value of his evidence. We have next the striking fact that although, according to the plaintiff, negotiations for extension of time were already in progress, he contented himself with the letter of the 17th August 1907 written by the defendants, confirming the contract but making no mention of extension of time. In this connection, we cannot overlook the pencil note to the plaintiff from Harris, dated the 15th August, where the latter had stated that he had gathered from his interview with the defendants that the dates for payment and delivery would run from the date of receipt of the confirmatory letter, The case for the plaintiff is not improved by the story of his conversation with the manager of the defendants (whom he had never met previously) over the telephone on the 17th August, when he got the letter of confirmation and missed therein the expected term for extension of time. The plaintiff must have been inordinately credulous, if he did really accept an assurance that all would be right, conveyed over the telephone wire by a person whom he did not know. On the other hand, we find that when on the 31st August 1917, he set up the story of the alleged extension of time, the defendants forthwith contradicted him. In our opinion, the evidence does not justify the conclusion that time was extended by mutual agreement on the 17th August.

11. As regards the second question, the position of the plaintiff is, if possible, still more hopeless. The allegation that on the 31st August time was extended till the 3rd September was not made in the plaint. The true reason for this omission is not far to seek. The story of the second extension would have materially weakened, if not completely destroyed, the story of the first extension. Besides this, we have the remarkable omission on the part of the plaintiff, or of his legal adviser, to rely upon this extension of time in answer to the letter of the Solicitors of the defendants canceling the contract on the 30th August 1917. The plaintiff seeks to throw the blame for this omission on the Solicitor, but the latter explains that he did not mention the matter because from what he heard from the plaintiff as to the alleged interview with the manager of the defendants on the 30th August, he came to the conclusion that nothing had been concluded between the parties. The position then is, first, that what is said to have taken place on the 30th August is inconsistent with what is asserted' to have happened on or about the 17th August; secondly, that the result of the alleged interview of the 30th August was not even hinted at in reply to the letter of the defendants dated 31st August, when one would expect, in the normal course of human conduct, that it would be set up; and thirdly that the case of second extension was Dot made in the plaint when the suit was instituted. Along with all this, we have the evidence of Ladharam, who denies the telephone communication and the interview which is said to have taken place on the 31st August. The testimony of Harris is clearly not trustworthy, and the only other person alleged to be present, Motilal Chunder, has not been called on the bare suggestion that he has been won over by the defendants. These circumstances place the plaintiff in a situation of inextricable embarrassment. The Advocate-General invited us to review the whole evidence, and not to base our conclusion as to the credibility of the various witnesses upon the opinion expressed by the Trial Judge. We have scrutinised the entire evidence and examined all the surrounding circumstances; and in our opinion, the story told on behalf of the plaintiff is so improbable and full of contradictions that Mr. Justice Rankin very properly refused to act upon it. As pointed out in Laljee Mahomed v. Dadabhai Jivanji 34 Ind. Cas. 807 : 43 C. 833 : 23 C.L. J. 190 : 20 C.W.N. 335, there is really no conflict of judicial opinion upon the question of the duties and functions of a Court of Appeal, though there may be room for diversity of conclusion, when, in an individual case, the evidence comes to be reviewed and weighed, in the case before us, however, there is no shadow of a doubt that the plaintiff has completely failed to establish his allegations by reliable evidence.

12. The appeal must consequently be dismissed with costs.

Ernest Fletcher, J.

13. I agree.

Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //