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Albert Bonnan Vs. Imperial Tobacco Co. (India) Ltd. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported inAIR1926Cal757,94Ind.Cas.444
AppellantAlbert Bonnan
Respondentimperial Tobacco Co. (India) Ltd.
Cases ReferredIn Smith v. Day
Excerpt:
limitation act (ix of 1908), schedule i, articles 25, 36, 42, 48 - civil action brought maliciously and without reasonable and probable cause--suit for damages, whether lies--limitation--temporary injunction obtained in suit--damages, cause of action for--sea customs act (viii. of 1878), sections 18, 19-a--detention of goods in customs. house maliciously--damages, cause of action for--civil procedure code (act v of 1908), section 95, interpretation of. - pearson, j.1. this is a suit for damages arising out of certain acts of the defendant company alleged to be wrongful and malicious. the defendant company had been formed in 1910 to take over the business for importing and selling within the limits of india various cigarettes under the manufacturers' brand of w. d. and h.o. wills including this gold flake brand. on the 1st september 1910 an agreement was executed with that object, the parties being the british-american tobacco co., ltd., the british american tobacco co, (india), ltd., and the defendant company. no actual document of assignment or transfer was executed until the 11th april 1922. the shares in the defendant company were owned to the extent of some 80 per cent. or 00 per cent. by the vendor company, and from 1910 onwards the.....
Judgment:

Pearson, J.

1. This is a suit for damages arising out of certain acts of the defendant Company alleged to be wrongful and malicious. The defendant Company had been formed in 1910 to take over the business for importing and selling within the limits of India various cigarettes under the manufacturers' brand of W. D. and H.O. Wills including this Gold Flake brand. On the 1st September 1910 an agreement was executed with that object, the parties being the British-American Tobacco Co., Ltd., the British American Tobacco Co, (India), Ltd., and the defendant Company. No actual document of assignment or transfer was executed until the 11th April 1922. The shares in the defendant Company were owned to the extent of some 80 per cent. or 00 per cent. by the vendor Company, and from 1910 onwards the sale of these brands in India was entirely in the hands of the defendant Company acting under the agreement. At the termination of the war the Army Canteen Authorities found themselves in possession of a very large stock of cigarettes purchased from the British-American Tobacca Co., and from elsewhere: accordingly they took steps to sell them off, but imposed on purchasers the restrictive condition that the goods should not be disposed of in Great Britain. The plaintiff was one of those who came forward and made considerable purchases of these cigarettes of the Gold Flake Brand from the Canteen Authorities through Venis & Co., Ltd. and M. Drapkin. Some he disposed of in Europe, Egypt or Palestine. Others he imported into India for sale through Calcutta or Bombay. The first arrivals in India were at the end of February and beginning of March 1922. By the middle of March 1922 the defendant Company too was alive to the plaintiff's intrusion and the effect it might have on its trade. On the 12th April 1922 the defendant Company moved the Collector of Customs in Calcutta for confiscation of some of these goods which had arrived and were lying in bond. The goods were accordingly detained by the Collector of Customs under his statutory powers, and the usual period of 30 days was later extended by 10 days at the request of the defendant Company. On the 10th May 1922 the indenture of assignment (dated 11th April 1922) was executed in Calcutta by Mr. Abbott as agent of the British-American Tobacco Co., Ltd., and by Mr. Abbott and another as Directors of the defendant Company: the 10th May 1922 was also the date of registration of that document in Calcutta.

2. On the next day, the 11th May 1922, the Company filed a suit in the High Court here against the plaintiff and A. Bonnan & Co., claiming an injunction to restrain him from selling his goods. The defendant Company in that suit based its claim upon an exclusive proprietary right in the brand and also upon the allegation that the Gold Flake cigarettes had acquired amongst purchasers in India the reputation of being goods imported by the Company and that the plaintiff in selling his goods in India would be deceiving purchasers by passing off his goods as those imported by the defendant Company. The Company also gave notice of motion for an injunction and obtained an interim order for injunction covering the 100 cases then in the Customs in Calcutta, the plaintiff giving the usual undertaking in damages, This injunction was dissolved by an order of 8th June when the plaintiff undertook to place a certain sum of money out of the sale proceeds on deposit of receipt with the Bank and lodged the receipt in Court. The suit in Calcutta was dismissed on the 18th July 1922, the appeal on the 10th April 1923 and the appeal to His Majesty in Council on the 13th May 1924.

3. Similar action was taken by the defendant Company in Bombay. On the 1st May 1922, application was made to the Collector of Customs in regard to 60 cases by S.S. 'Australia.' An order for detention for one month was passed, but this was re-called and the goods were released after 48 hours' notice from the 5th May. An unusual feature was that in this instance in addition to the usual indemnity bond, a Bank guarantee was taken from the Company. On the 22nd May the defendant Company filed a suit in the High Court in Bombay against the' Cigarettes Importers Agency and Bonnan & Co., under which names the cigarettes had been imported, claiming an injunction and other relief similar to that in the suit filed in Calcutta. Notice of motion was given on the 23rd May for an injunction restraining the defendants in that suit from importing, advertising, exposing for sale or selling their goods. On the 19th June 1922 when the motion came on, it was ordered by consent that it should stand over to the hearing on the 17th July 1922 and it was further ordered by consent that pending the hearing of the suit the defendants undertook not to dispose of or in any other way deal with the cigarettes then lying in Bombay or to arrive in the interim and it was further ordered by consent that the plaintiffs' undertaking as to damages should continue pending the final disposal of the suit, On the 2nd August 1922 an order was passed staying the suit until after disposal of the appeal in the Calcutta suit, the defendants' undertaking was also vacated, they having agreed to keep an account of sales. Subsequently on the 25th September 1923 an. order was passed discharging the defendants' undertaking of 2nd August 1922 to keep account of the sales. Finally on the 9th January 1925 a consent decree was made in the suit whereby the suit was dismissed with cost, 'without prejudice to the defendants' rights, if any, to claim and recover damages from the plaintiffs in any other proceedings.'

4. On the 21st January 1925 the present suit was filed against the Company to recover damages in regard to the detention of the plaintiffs goods by the Collector of Customs in Calcutta and Bombay: damages in respect of the injunction and restraint on the goods in the High Courts of Calcutta and Bombay: and damages for injury to his trade and reputation caused by untrue and disparaging statements as to the quality, etc., of the plaintiff's goods.

5. One of the important questions which arises in the suit upon the facts is whether malice finds place in the action of the Company in procuring the Collector of Customs to exercise his powers of detention over the goods, and in instituting and carrying on the proceedings in the two suits in the High Court. From the correspondence before me I find that on the 15th March the Company in Calcutta was writing to the British-American Tobacco Co. in London with whom constant communication was maintained, that 60 cases had arrived of Gold Flake cigarettes. The letter is headed 'competition' and shows that it was realised then that the goods were those of the British-American Co.'s manufacture, made in United States of America and Mr. Abbott, the writer, adds: 'Evidently the cigarettes form part of some more stocks and they may cause us some trouble here.' On the 16th March the Company's Bombay office informed the Calcutta office of the arrival of 80 cases there, intimating that 'the goods though old are still sound.' On 23rd March 1922 Mr. Abbott again wrote to London with news of the Bombay consignment of which 10 cases had been sold to dealers at Rs. 20 per thousand (the Company's selling price for Gold Flake cigarettes being Rs. 36 per thousand). 'This,' says Mr. Abbott, 'is most annoying, but we cannot so faras we can see do more than warn our dealers that we accept no responsibility for these goods.' He also says that it is possible there may be a difficulty in disposing of the plaintiffs goods in the carton packing for which the demand is limited; 'if, however, they get below the Scissors price' (which was Rs. 19 per mille) 'they may cause no trouble.' On the 23rd March the Bombay office through Mr. Selfe wrote that these importations 'will certainly have bad effects on the sale of our Gold Flake and Capstan on account of the cheap rate at which they are being or will be marketed.' Mr. Selfe also stated in his weekly report that these importations had affected the sales of Gold Flake Magnums. On the 28th March Mr. Abbott wrote to London asking for particulars of the stocks of Gold Flake cigarettes available on the Continent or elsewhere.

6. On the 4th April 1922 the Company received a telegram from a Mr. Macnaughten of the Legal Department of the British-American Tobacco Co. in London in reply to Mr. Abbott's letter of the 15th March:

60 cases Gold Flake the sale of these cigarettes is infringement of your mark and if the bond customs should be asked to destroy them if owners will not re-export.

7. Until that moment it never seems to have occurred to Mr. Abbott or anybody else that they possessed any right in law to which recourse was possible in order to stifle the competition of the plaintiff's cigarettes. The reason for that was that so far as they knew, they had no such right: that is clear from a passage in Mr. Abbott's letter of 10th May, where he says, 'We may say that as soon as the first shipment of 'Gold Flake' came to our notice, we immediately questioned ourselves as to what was our position. A few years ago some' 'Three Castles' cigarettes were imported into Rangoon from Singapore, and the legal advice we then had was that we were not in a position to prevent them from being imported. As the Gold Flake shipment was on a par, as far as we know, with that of the 'Three Castles' from Hongkong, we felt it was no use taking the matter up from a legal point of view.' This is an important statement Of the Company's state of mind and knowledge with reference to the period to which it refers.

8. Mr. Macnaughten's telegram, based on what materials I do not know, was on the 4th April. The Bombay weekly report of 7th April brought the information that the whole consignment of 80 cases had been disposed of to dealers, and the anticipation that the goods, if not disposed of before the monsoon, would probably not hold out; on the 12th April 1922 came the application to the Collector of Customs in Calcutta to confiscate the 60 cases arrived by the 'Sardinia.' The ground expressed in the application itself was that the importation of plaintiff's goods was 'infringement of our trade mark in W.D. & H.O. Wills brand of Gold Flake cigarettes,' but Mr. Ryan had already been down himself to interview the Collector on the subject before the application was put in, Section 18 of the Sea Customs Act 1878, deals with the classes of goods whose importation is prohibited and whose detention or confiscation may be allowed under Section 19A of the Act. It is admitted that the endeavour in the present case was to bring the plaintiff's goods under Section 18(d) which relates to 'goods having applied thereto a counterfeit trade mark within the meaning of the Indian Penal Code, or a false trade description within the meaning of the Merchandise Marks Act.' Mr. Ryan, a solicitor, who is in charge of the legal department of the Company in Calcutta says that his opinion was that the plaintiff's goods could be brought under neither category. Mr. Abbott though he must have known Mr. Ryan's view says that he charged the plaintiff's goods as being counterfeit before the Collector and if he did so before the Collector, it is difficult to think that he would restrain himself otherwise. Some attempt has been made to whittle away the offensive meaning, but from any point of view it is a dangerous word for one trader to use of the goods of another. That was the view which they desired to impress on the Collector and in which they succeeded, is clear from paras. 4 and 5 of the Collector's order, dated the 19th June 1922, where reference is made to the earlier application.

9. Then there are two letters, dated the 12th April 1922 and 19th April 1922 from the British-American Tobacco Co., and received on the 8th and 10th May respectively. The last named Company played a prominent part throughout in this correspondence and apparently took upon itself to advise if not to dictate the course to be followed by the defendant Company. The intrusion of the plaintiff's goods affected the one as much as the other. These two letters refer to Mr. Abbott's previous question as to the amount of old stocks and the passages in them are as follows.--'We believe there is still a very large quantity of old : stocks of this description in various parts of the world, and if you do not take steps to stop their importation in India now, it is very probable that you will be having constant repetitions of this trouble.' Then in the letter of 19th April is this; 'We regret to say that it is impossible to estimate what quantities of goods of this description are available in different parts of the world but we may say that it is probable that they are very large indeed. This makes it all the more important that you should establish the fact as soon as possible that goods of this nature cannot be imported in India, otherwise those at present holding stocks will very soon hear that they can dispose of them in India, and there is no saying to what extent the trouble may grow.' There is no doubt that the steps initiated by the Company were all calculated to make it 'as difficult as possible for the plaintiff to market his goods' (see Ex. LL) and so further representations were made to the Collector of Customs after suit with the object of obtaining from him an assessment of the plaintiff's goods to duty at the same rate as that paid by the defendant Company. The Collector, however, ultimately allowed an assessment based on the invoice value of the plaintiff's goods.

10. Mention must be made of an interview which took place between Bonnan and Abbott on the 6th May, as to which the oral evidence is somewhat conflicting. The plaintiff's version was not put to Mr. Abbott, but Mr. Ryan was present on the occasion; his version of the story is borne out by a letter written to the British-American Tobacco Co. on the 10th May which summarises' the result of the interview, and may be assumed to be substantially true, namely, that the Company wanted an undertaking from the plaintiff not to remove the goods from bond, to which the plaintiff was agreeable if the Company would pay him Rs. 13-8-0 per thousand in bond for what arrived. I have little doubt that there may have been suggestions by the plaintiff in the course of the interview as to the Company taking over the whole of his purchases at their own selling rate of Rs. 36 per thousand but the letter of 15th May bears out the Company's story of the interview quite sufficiently. The offer was not accepted by the Company, however, as they 'felt certain that the British-American Tobacco Co. would not listen to this.' The result was the filing of this suit on the 11th May.

11. Paragraph 11 of the plaint alleges the circulation by the defendant Company of statements and rumours in the nature of slander of the plaintiff's goods, that they were inferior in quality, not in a sound and merchantable condition, and not genuine and also that the Company would boycott dealers purchasing or selling the plaintiff's cigarettes. As regards the quality of the cigarettes themselves, I do not forget the plaintiff's own representations to the Collector as to his cigarettes being entirely different in quality and everything else the plaintiff's explanation of which in his evidence I find it difficult to accept. But the evidence clearly shows that in fact there was no difference; also that the condition of the plaintiff's cigarettes was somewhat inferior due to age, the chief effect of that being that they would deteriorate quicker than fresh stock and be more easily affected by adverse climatic conditions, such as those prevailing in the monsoon. At the same time there is no doubt that the plaintiffs cigarettes on arrival in this country were sound, smokeable, and at their price freely merchantable. Mr. Abbott in his letter of 10th May says he can quite believe that Baksh Ellahi would be a willing purchaser, of plaintiff's goods and further mentions that they are in surprisingly good condition (though to Mr. Abbott's rival palate they 'smoke rather nasty.' Khodadad, one of the dealers, says that when he was first shown them he considered them as good as the Company's both in quality and condition. Mr. Selfe when he says in para. 8 of his affidavit in the Bombay suit that the plaintiff's cigarettes are 'old, inferior in quality and in preparation and packing' is not strictly accurate. They are indeed old, and the packing was inferior, because the Company had air-tight tin containers, for the smaller quantities within the tin-lined cases, whereas the plaintiff had not: but the quality was the same, both of the cigarettes and of their preparation. The plaintiff has called a witness named Corr, a servant in 1922 of the Company who stated that it was his business in particular to look out for competition. He says that Mr. Selfe's instructions were to warn the various dealers about the plaintiff's cigarettes as being old stock and inferior in quality, and that he could do anything he liked so long as he stopped competition, and kept the market for the Company. Khodadad says that he was visited by Corr who informed, him that plaintiff's cigarettes were not genuine but imitations imported from Basra, and he would get into trouble and be involved in litigation with the Company if he continued. Corr's evidence taken by itself would hardly be safe to act upon. He is apparently now a dismissed servant of the Company, over some monetary defalcation in regard to which he seems to have put forward two different explanations, added to which his demeanour in the box could not be described as well-balanced or impartial. The details given by Khodadad are difficult to accept because they are not put to Mr. Abbott or spoken to by Corr. It is, however, difficult to brush it aside entirely having regard to the other evidence which goes to support it, and to the way in which the Company had already overstepped the mark in the matter of the applications to the Collector. Two Calcutta dealers Kalipada Roy and Narendra Nath Chakraverty, father and son, gave evidence that they had been visited by officials from the Company and had had it impressed on them that the goods were ' bad ' (kharab) which I think was used not so much applying to their quality as to their merchantability having regard to the litigations that were going on. The evidence of these witnesses; was to some extent damaged by their identification in Court of Mr. Ryan as one of the persons whom they had seen on the occasions in question, whereas I am quite clear that Mr. Ryan's denial must be accepted and those witnesses are consequently mistaken in that particular. There is some further evidence of the same nature from other dealers. Undoubtedly the Company's servants were going round warning dealers that they would not be responsible for the plaintiff's goods. There is no harm in that, and they could probably employ the whole of their organisation in broadcasting it to the dealers. There seems to be no doubt, however, that they went further and wrongly impressed on dealers a nonexistent difference in the quality of the goods; and also made full use of the litigation in Bombay and Calcutta with its attendant threat of trouble to others as an obstruction to the plaintiff and as a deterrent. That is a clear impression which I retain after hearing the evidence. Considering these matters to which I have referred I hold that the conduct of the Company in regard to the proceedings before the Collector was malicious and without reasonable and proper cause. Between the application to the Collector and the filing of the suit nothing has emerged, though privilege has been claimed for certain documents, to show that the Company can say it was now in any better position as regards the filing of the suit. I have supported the claim of privilege, but I am certainly not going to assume in the Company's favour that the documents in question would support its case on the question of malice or want 6f reasonable and probable cause. Looking to the evidence, as it stands, I hold that in filing the suit and proceeding with it as it did the Company was acting maliciously and without reasonable and probable cause. These findings also apply to the Bombay proceedings both before the Collector and in Court. I also find that the Company did make and circulate the statements in para. 11 to the extent already, mentioned. In connection with the question of malice I should mention a further fact that was relied upon as evidence of malice, namely, the filing of the suit in Bombay when the Company were already amply protected by the suit instituted in Calcutta and the injunction there. The ' contention, I think, is unsustainable, having regard to the fact that the injunction in Calcutta was limited to the Calcutta goods, the plaintiff being apparently not then within the jurisdiction, and also to the fact that the plaintiff was using different names or styles for his importations, so that the parties to the suits were nominally different, though in fact, as it turned out, the plaintiff alone was interested. That the plaintiff suffered damage by reason of malicious acts of the Company cannot I think be reasonably contested. A certain amount of delay occurred in consequence of the Collector's action and the injunction and undertakings and other proceedings in the suits, while plaintiff had to cancel a very favourable contract with one of his buyers and had also to arrange to submit a cancellation of some of the goods he had still to take up from his own sellers under his original purchase contracts. He started off very well in Bombay : it made a lot of difference to him if he could dispose of his perishable goods before the arrival of the ' monsoon and the Company knew it. But instead of finding a fair field for his goods he found himself faced with obstruction after obstruction maliciously raised by the Company, bourses of delay, disparagement of his goods, assertion of unfounded rights--all of which interfered with his right to trade his goods in the ordinary way.

12. It is argued by the Company that notwithstanding the injury he has suffered, the plaintiff cannot recover. So far as the action of the Collector goes, it is said that it was a judicial act of the Collector and the Company cannot be held responsible for it. I think that Nemi Chand v. Wallace 34 C. 495 : 11 C.W.N. 537 supports the opposite contention that such a suit will lie, at any rate where, as in the present case, there is evidence of malice, and no reasonable and probable cause exists.

13. As to the suits and the proceedings in them the same contention is made by the Company, that no action will lie for damages, even if malice was present and reasonable and probable cause was absent. In support of this the case of Mohini Mohan Misser v. Surendra Narain Singh 26 Ind. Cas. 296 : 18 C.W.N. 1189 : 21 C.L.J. 68 is cited. That is a suit where damages were claimed against the defendant for having previously instituted an action against the plaintiffs for an injunction to restrain them from erecting a building on a certain land. An interim injunction had been granted but the action had ultimately terminated in favour of the defendants in the action. The defendants were sued for damages for malicious prosecution of the suit for an injunction. The question of the maintainability of such a suit was raised and Fletcher, J., came to the conclusion that there was no authority for the proposition that a suit was maintainable for maliciously and without reasonable and probable cause obtaining a perpetual injunction which was subsequently dissolved on appeal. He relied upon Quartz Hill Gold Mining Co. v. Eyre (1883) 11 Q.B.D. 674 : 52 L.J.Q.B. 488 : 49 L.T. 240 : 31 W.R. 668, while pointing out that there are certain exceptions where the proceedings involve either scandal to reputation or the possible loss of liberty to the person. In Bishun Singh v. Wyatt 11 Ind. Cas. 729 : 16 C.W.N. 540 : 11 C.L.J. 515, a case of wrongful attachment, Mookerjee, J., in the course of his judgment remarks that the statement that the institution of an ordinary civil action, however, unfounded, vexatious and malicious it may be, is not a good cause of action must be qualified where there has been arrest of person or seizure of property. In Bhut Nath Pal Mistry v. Chandra Benode Pal Chowdhury 16 Ind. Cas. 443 : 16 C.L.J. 34, the plaintiff sued for damages for an injunction, wrongfully issued against him at the instance of the defendants, restraining him from erecting a building. It was there held that such a suit was maintainable on the ground that the defendants had unlawfully interfered with the exercise of his property rights by the plaintiff. The defendants, therefore, committed an act in the nature- of trespass to the property, 'and are consequently liable in an action for trespass; it is not necessary for the plaintiff to prove any malice or want of reasonable or probable cause.' In Narendra Nath Koer v. Bhusan Chanara Pal 57 Ind. Cas. 375 : 31 C.L.J. 495 at p. 500., the plaintiff sued for damages for wrongful attachment and wrongful detention of certain chattels belonging to him. The question was raised of whether Bhut Nath Pal Mistry v. Chandra Benode Pal Chowdhury 16 Ind. Cas. 443 : 16 C.L.J. 34 was correctly decided having regard to other decisions of this Court including Madras Steam Navigation Co. v. Shalimar Works Ltd., 28 Ind. Cas. 463; 42 C.85., and the case, already cited, of Mohini Misser v. Surendra Narain Singh 26 Ind. Cas. 296 : 18 C.W.N. 1189 : 21 C.L.J. 68. The point was accordingly referred to a Full Bench, which, however, disposed of the case by re-affirming the general principle that a suit does not lie for damages against a defendant for maliciously and without reasonable and probable cause instituting a civil action; as also the other principle that a person who unlawfully interferes with the exercise of the property rights of another, commits an act in the nature of trespass to property, and is liable for damages in an action for trespass. I may draw attention here to that portion of the judgment of the learned Chief Justice in the referring judgment of Narendra Nath Koer v. Bhusan Chandra Pal 57 Ind. Cas. 375; 31 C.L.J. 495 at p. 500., where he indicates that the defendant- in his view should not be held liable because the injunction under which the chattels are detained was an act of the Court ' and inasmuch as it has been held that there was no mala fides on the part of the defendant and as there is no finding that there was an absence of reasonable and probable cause.' So in the case of Madras Steam Navigation Co. v. Shalimar Works Ltd. 28 Ind. Cas. 463 : 42 C. 85, already mentioned, an action in rem against a vessel had been instituted in this Court in its admiralty jurisdiction. The vessel was arrested but the suit was subsequently dismissed for want of' jurisdiction. In a suit by the owners for damages for the arrest on the footing of trespass, Sir Lawrence Jenkins, C.J., held that the action based on trespass would not lie, and he also refers to the fact that the 'arrestment of the ship is a judicial act of the Court and an ordinary step in an action in rem. So, where it constitutes a legal grievance, it is not an independent wrong, but an integral part of an action in rem in which there was malice, or its equivalent, entitling the aggrieved person to seek compensation either in the admiralty proceedings or by separate action' and (at page 109) he adds that ''in the absence of proof of malice or its equivalent the suit if treated as one for trespass, will not lie in the circumstances of this case.'

14. So Clissold v. Cratchlay (1910) 2 K.B. 214 : 79 L.J.K.B. 635 : 102 L.T. 520 : 54 S.J. 442 : 26 T.L.R. 409, referred to in some of the cases in this Court cited above shows that a wrongful seizure of goods under a writ of fi. fa., where the judgment is already satisfied, may make a party liable in trespass, whether malice is present or not? but that where it is an action on the case the plaintiff must fail unless he can also prove malice. In Kissorimohun Roy v. Harsukh Das 17 I.A. 17 : 17 C. 436 : 13 Ind. Jur. 452 : 5 Sar. P.C.J. 472 : 8 Ind. Dec. (N.S.) 830 (P.C.), a case of wrongful attachment of the goods of a third party for which damages were claimed, it was argued that the plaintiff could not recover unless he proved malice and want of probable cause. ' That,' says Lord Watson (at page. 27), 'is a rule which obtains between the parties to' a suit when the defendant suffers loss through its institution and dependence.' It is unnecessary for me to consider further' the cases in this Court above referred to in so far as any of them may seem to afford ground for the contention that a suit may lie for damages for wrongful interference with the property rights of another by obtaining an order from a Court, even though no malice is proved. It is enough that in the circumstances of this case malice has been proved and want of reasonable and probable cause, both in regard to the proceedings before the Collector in Bombay and Calcutta, as also in regard to the proceedings in the two suits instituted and carried on in those places. That damage resulted to the defendant in consequence is clear, and in my view he has a good cause of action, on which a suit is maintainable.

15. As regards the injunction, it may be a question whether it is to be regarded as separate and independent or as a part of and a step in the suit itself which as I have held bears the taint of malice. It is argued that no action will lie in respect of damages arising out of the injunction. If there was reasonable and probable cause or absence of malice, it may be that is so; if otherwise, what is the position? The defendant relies upon Mohini Mohan Misser v. Surendra Narain Singh 26 Ind. Cas. 296 : 18 C.W.N. 1189 : 21 C.L.J. 68, to show that even then no suit is maintainable. I am not satisfied that that principle is applicable to the facts of this case, and if necessary I should say that the circumstances place the matter on a different footing, otherwise it might be that in the case of perishable goods they might be utterly destroyed, yet the defendant for all his malice could shelter behind the injunction as the act of the Court and get off scot-free. True it is obtained on evidence on which the Court will say that a prima facie case is established, but that evidence is afterwards shown to be unacceptable. As already stated, the injunction of this Court only affected 100 cases then in Calcutta and continued from the 11th May till the 8th June. An undertaking was given by the Company in damages. That undertaking might have been acted upon by the Court on application of the plaintiff in that suit. In Smith v. Day (1888)21 Ch.D. 421 at p. 428 : 31 W.R. 187 : 48 L.T. 54, Brett, L.J., says that if the injunction had been obtained fraudulently or maliciously the Court would give exemplary damages. No case, however, has been shown to me whereupon such an enquiry as to damages the Court has consented to assess damages upon the footing that the suit had been maliciously carried on, where such malice had not arisen as an issue for decision in that suit. It is argued that the. fact that the undertaking is embodied in the order is itself an indication that apart from it the defendant could not recover. Similarly that when Section 95 of the C.P.C. allows limited damages in the case of an injunction being obtained on insufficient grounds, it is because apart from such provision of law, no such damages would be recoverable. On the other hand, it may be argued that the undertaking is inserted because it gives a quicker remedy, and so with the application under Section 95. As to the latter and the inference to be drawn, it seems illogical to allow a defendant who has incurred Rs. 1,000 damages to recover Rs. l,000 and only allow the same to a defendant who has incurred Rs. 10,000. I agree that the existence of Article 42 of the First Schedule to the Limitation Act is in itself no argument that a suit is maintainable for damages for an injury caused by an injunction wrongfully obtained, because such an Act cannot create a cause of action if it does not already exist independently. Nevertheless in the circumstances' of the present case I think that a cause of action may exist in respect of the injunction and the resulting damages to the plaintiff's trade: but whether that be so or not the plaintiff can obtain his relief in respect of it as a proceeding forming part of the' suit which is itself affected by malice in its entirety.

16. As regards the Bombay suit the order of 19th June 1922, made upon the notice of motion, dated 23rd May, for interim injunction, was a consent order, the defendant in the suit undertaking not to deal with the goods in Bombay or to arrive, and the plaintiff Company giving an undertaking in damages. The defendant's undertaking was vacated by the order of 2nd August, without prejudice to his rights in damages. As to this part of the case I think that the plaintiff's remedy, if at all, would be limited to the enforcement of the undertaking in the suit in which it was given, and that as he submitted to the making of the order by giving his consent, he has no separate cause of action in this respect although he may say his consent was accorded only under pressure of the circumstances maliciously brought about by the Company.

17. Next, it is contended that even if the present suit is maintainable it is barred by limitation, whatever the cause of action may be. That appears to be so partly. I think that limitation intervenes in so far as the proceedings before the Collector are concerned. The detention terminated not later than June 1922. Article 36 is the general Article which provides a period of two years' limitation for a suit to recover damages in tort, unless any specific Article provides otherwise. Article 48 has been referred to but in my view does not apply, if for no other reason because the defendant Company never had possession of or control over the goods and the Collector cannot be looked upon as the Company's agent. In so far as the cause of action may be slander of title or slander of goods the limitation would be either one year under Article 25 or two years under Article 36, the latter is, in my opinion, applicable L.T. 51. in the circumstances, for I think the action would foe on the case. Nevertheless I think it is a fair inference to draw from the evidence that the statements alleged and complained of, continued, to the extent already mentioned, to be repeated within two years before suit, particularly having regard to the continuance of the previous suits which throughout were designed as a disparagement of the plaintiffs goods and in obstruction to the unfettered exercise of his rights as a trader, of which I have no doubt the Company made the fullest use the whole time the litigation lasted, end whenever occasion so required. I am not-prepared to say that in any view of the matter the Company is excused by the principle that a trader is entitled to protect his own property and his own interests, because I think in this case there was mala fides and ulterior motive from the beginning until the end.

18. There remains the question of damages. One head of damages is that for loss of trade and business based upon the suggestion that the plaintiff might have established himself in the tobacco trade in India at any rate to the extent of the remaining canteen war stocks of cigarettes which were very large indeed. He says that it was his intention to do so, but the evidence does not appear to me to be sufficient to enable me to hold that he has established his case in this particular, or that his failure in this respect could be said to be the proximate effect of the defendant's action. Similarly he has claimed damages under certain other treads which I think are inadmissible. These, are the items at the end of his schedule of claim, namely, (1) living expenses - in India for 642 days, (2) travelling expenses to and from India and also in India, and (3) difference between party and party costs allowed to him in the previous suit, and his attorney and client costs.

19. As regards the remainder of the claim I think that the plaintiff must recover damages substantially according to the headings of his schedules. Exhibit O is a convenient resume furnished to me by plaintiffs Counsel of the goods that came to India, and their disposal as well as the other goods - contracted for of which the plaintiff lost the benefit owing to concellation of the contract. The sales effected by the, plaintiff after he had undertaken to keep an. account show that in many instances he was able, to dispose of his goods at so high a rate as Rs. 30 per thousand, At the end of March he started his sales to Sheriar & Co, and other Bombay dealers at rates of Rs. 18 and Rs. 20 per thousand : while he contracted to sell 220 cases to Sheriar at the rate of Rs. 238. The Company argues that the sales paper in packets of these Gold Flake cigarettes are shown from their own experience to be very small in India, and, therefore, the plaintiff would have had the greatest difficulty in disposing even of what he had actually brought out; but that argument could only have weight if the plaintiff were selling at the same rates as the Company, whereas he was in a position to undersell them heavily. It leaves out of account the attraction of a bargain price. Besides, if there was any substance in the argument the best course for the Company would have been (subject to warning their dealers) total passivity. The best answer is the conduct of the Company itself, the passages from the letters already referred to and the considerable sales to the Bombay dealers. There would; be no doubt a certain amount of deterioration, particularly in the rains once the cases are opened, and indeed, I find the plaintiff writing to the Collector about the end of the rains claiming, further reduction of duty on the ground of substantial deterioration; but 1, believe upon the evidence before me that but for the defendants' action plaintiff would have been able to dispose of his goods that had already come out here before the monsoon season, and as regards those at home they would still have been saleable by the time they were brought out. Still, there would necessarily have been some amount of deterioration among them in the matter of condition.

20. On the question of damages I am not inclined to attach much weight to the evidence of the interview of 8th May, even accepting the Company's version of it, because that took place when the interference through the Collector was actually in existence, and the impending litigation was held over the plaintiff's head. The plaintiff's claim under the headings with which I am now dealing is based upon the assumption that he would have been able to dispose of his goods at the uniform rate of Rs. 30 per thousand. Taking the various matters into consideration I have endeavoured to put myself in the place of a Jury and arrive at a fair and reasonable figure which may be taken as an average rate to form a basis for the calculation of damages, and in the circumstances I think an all round figure of Rs. 23 8 would not be excessive. The defendant Company does not admit the items of the account as set out in the schedule to the plaint, so that subject to the rate of Rs. 23-8 which I have fixed, there must be a reference to ascertain what is the amount of damage under the claims numbered 1 to 5 in the schedule. The decree will be made accordingly and the plaintiff will have his costs of the suit on Scale No. 2.


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