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Ram Dutt Ramkissen Dass Vs. E.D. Sassoon and Co. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported in33Ind.Cas.938
AppellantRam Dutt Ramkissen Dass
RespondentE.D. Sassoon and Co.
Excerpt:
contract - sale of goods--jute sold for shipment with guarantee of quality at port of destination--buyer's right to recover price on account of inferiority in quality--home guarantee clause relating to arbitration, construction of. - .....counsel for the defendant firm contends that the award referred to in that bye-law means the london award and not an award to be made in calcutta; that it means the london award made upon a submission by the calcutta purchaser, who is the seller in london, and the eventual purchaser of the goods in london, and that such an award between those parties is binding upon the calcutta seller who is no party to the arbitration in london. let us see if the contract sustains this contention. the clause in writing contained in the contract in suit 'is subject to the terms and conditions, of london association contract, 1913.' it does not say that a london award in a submission by the calcutta purchaser and the london purchaser, in accordance with the rules and conditions of the london.....
Judgment:

Chaudhuri, J.

1. By a contract dated the 2nd March 1914 the plaintiffs sold to the defendant firm 500 bales of what is known as (B D)/G 2 jute. The jute was to be placed alongside exporting vessel at once. The contract form used is that of the Baled Jute Association. It purports to be the form approved by the Association dated the 30th June 1909, as appears on the form itself. In addition to the printed terms in the contract form there is a clause in writing to this effect 'weight, condition and quality guaranteed by sellers at port of destination as substitute for (S C)/(C) B grade under the terms and conditions of London Association Contract, 1913. Any short weight to be paid by sellers and any overweight to be refunded by buyers.' One of the terms of the contract in suit is (clause 14), 'cash on delivery of Mate's or Dock receipts.' It appears that according to the shipping instructions of the defendant firm dated the 3rd March, the plaintiffs placed the goods alongside exporting vessel on the 6th March 1914. The defendant firm obtained possession of the Mate's receipt and shipping documents relating to these goods without the knowledge and consent of the plaintiffs. They had meanwhile opened two bales for purposes of inspection and marked the whole consignment with their own mark. The Mate's receipt and the shipping documents show that their mark was used. The defendant firm did not pay the value to the plaintiffs when they received the documents as above stated. The following facts are not disputed, namely, that on or about the 17th March the plaintiffs wrote to the defendant firm complaining that they had not been paid and that the defendant firm had wrongfully obtained possession of the Mate's receipt and shipping documents. They threatened proceedings, civil or criminal as advised. The ship had in the meantime left the Port of Calcutta with the goods. It left on or about the 12th March 1914. The plaintiffs instituted this suit for the price, or in the alternative for the return, of the goods on the 28th April 1914. On the 30th April 1914 the defendant firm wrote to the plaintiffs that the London Chamber had made an award in respect of this jute, in a dispute between them and their buyers, and on the 1st May 1914 they informed the plaintiffs that it had been decided that the goods would be invoiced back. The goods, however, were never in fact invoiced back. In the written statement which was filed on the 30th June 1914 the defendant firm stated that the goods were lying in London. It, however, transpires from the defendant firm's letters, Exhibits E and F, dated the 6th March 1915, that the goods have been sold and are no longer available to the plaintiffs. The matter, therefore, stands thus. The defendant firm obtained Mate's receipt and shipping documents without paying for the goods, which they had no right to take. They purported to go to arbitration in London in a dispute between themselves and their buyers. The goods were to be invoiced back, but have not been, and having been sold cannot be invoiced back, yet the defendant firm says that the plaintiff is entitled to no relief. They put their case in this way: That at the port of arrival these goods were objected to, on the ground of quality, by their buyers, that an arbitration took place according to the terms of the English Jute Association Contract, that upon such arbitration, the objection as to quality was upheld and an allowance was awarded with option to the sellers (the defendant firm) to invoice back the goods, and that such option was exercised by them. The plaintiffs, therefore, it is contended, are not entitled to recover the value of the goods, but are bound to take them back. But what are they to take back? The goods no longer exist. The defendant firm also insist that inasmuch as they suffered loss over their sale, they are entitled to recover damages from the plaintiffs, but they have reserved their right to institute a separate suit for that purpose and do not seek any such relief in this suit. They submit in their written statement that under the terms of the award the goods being invoiced back are at the disposal of the plaintiffs, and, therefore, this suit is not maintainable. It seems to me a very curious position to take up. They wrongfully obtained possession of the goods and have again wrongfully sold them after intimating to the plaintiffs that they were being invoiced back and were at the disposal of the plaintiffs. Their contention is, I understand, based upon the clause in writing I have above referred to, namely, what is known as the Home Guarantee Clause. The contract form used purports to be the approved form of the Baled Jute Association dated the 30th June 1909. I find, however, from Exhibits G and H that the form used in this case is not the approved form of the 30th June 1909, although so printed, but it is the form which was adopted by the Association on the 9th September 1910. In the approved form of 1909 there is a printed clause relating to what is known as the Home Guarantee.' In the approved form of 1910 that clause is deleted. But it is not material to this enquiry as to what the approved form was in 1909 or 1910. The question is, what is the effect of the Home Guarantee Clause in writing appearing in the contract. It is contended that the Bye-laws of the Baled Jute Association printed on the back of the contract form govern this contract, which has a Home Guarantee Clause. It seems to me, however, that these Bye-lawn do not come into operation until there is an arbitration by the Calcutta Chamber. Let us look at the contract itself. Clause 15 of the contract provides, in the event of any dispute whatsoever arising out of or in any way relating to this contract, or to its construction or fulfillment between the parties hereto, and whether arising before or after the date of expiration of this contract, the dispute shall be referred to arbitration in accordance with the Rules and Bye-laws (of the Baled Jute Association) endorsed on this contract. Each party to the dispute shall appoint one arbitrator and such arbitrators shall have the power to appoint an umpire. Both arbitrators and umpire must be persons engaged in the Baled Jute Trade, and their award shall be final, subject only to right of appeal to the Committee.' The Association Rules and Bye-laws, as printed on the reverse, are part of this contract. Bye-law No. 6 runs thus: 'Where jute is guaranteed at port of discharge, the parties to the contract for the Jute concerned agree to accept and be bound by the award which is tendered in conformity with the terms of guarantee entered into between the parties. They also agree that the signatures of the arbitrators on such award shall be sufficiently proved by the production of the award purporting to be signed by them.' Learned Counsel for the defendant firm contends that the award referred to in that Bye-law means the London award and not an award to be made in Calcutta; that it means the London award made upon a submission by the Calcutta purchaser, who is the seller in London, and the eventual purchaser of the goods in London, and that such an award between those parties is binding upon the Calcutta seller who is no party to the arbitration in London. Let us see if the contract sustains this contention. The clause in writing contained in the contract in suit 'is subject to the terms and conditions, of London Association Contract, 1913.' It does not say that a London award in a submission by the Calcutta purchaser and the London purchaser, in accordance with the rules and conditions of the London Association Contract of 1913, would be binding in a dispute between the Calcutta seller and the Calcutta buyer. To make such an award binding upon a total stranger to the London submission there should be a clear and unambiguous agreement to that effect. I find it difficult to imply such a term.

2. It is correctly contended that a contention about quality, between the Calcutta seller and Calcutta buyer, may be validly referred to arbitration in London, in accordance with that clause; but it is sought to extend the meaning of the clause by making an award between the Calcutta purchaser and the London purchaser binding upon the Calcutta seller. I do not think it can be so extended. It may be that the effect of the clause is that the award in an arbitration in London between the Calcutta purchaser and the London purchaser may be tendered as evidence in a submission to the Calcutta Chamber by the Calcutta seller and Calcutta buyer of their disputes in Calcutta, and the Calcutta Chamber may make their award referring to the London award. But whether that is so or not, I do not think affects the claim in this suit. It is quite clear that possession of the goods was wrongfully obtained. Before the date of the London award, these goods ware the subject of litigation in this Court. The defendant firm evidently dealt with these goods against the plaintiffs' protest. They had inspected the goods at the time of the shipment and marked them with their own mark, and treated these goods as if they were theirs. When the defendant firm had notice of this suit, it was open to them to come to this Court and ask for a stay of proceedings, if, they rightly contended that the plaintiffs were bound to abide by the decision of the London Chamber. They, however, filed a written statement stating that the goods were at the disposal of the plaintiffs, yet sold them without notice to the plaintiffs, and now assert that the plaintiffs are not entitled to any relief. 1 am unable to take that view, and hold that the plaintiffs are entitled to the value of the goods. I decree the suit for the price of the goods with costs on scale II. Interest on decree at 6 per cent. I may add that it was contended on behalf of the plaintiffs that under the rules of the Baled Jute Association, if there was any addition to the printed terms on their contract form, it was open to the Association to refuse to arbitrate, and that, therefore, the Arbitration Rules on the printed form were not applicable to this case. There is ground for that argument, but I do not think it matters much in this case.


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