Court : Supreme Court of India
Reported in : AIR1967SC1315; 1967(0)BLJR483; 2SCR312
..... the covenant on the part of the purchaser to pay off the previous encumbrance on the property sold. under section 124 of the indian contract act 'a contract of indemnity' is a contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the ..... and venkatanarayaniah v. subramania iyer. 74 i c 209. 6. it was then contended by mr. b. c. misra that even if there was a contract of indemnity the cause of action for the plaintiff arose on february 4, 1937, when the final mortgage decree was passed and not on february 25, 1943 when the plaintiff ..... purchase the vendor's property but also one to relieve the vendor from the liability of the mortgage, and in that sense there was an implied contract of indemnity in favour of the vendor. it follows therefore that article 83 of the limitation act applies to this case and as the sale deed is a ..... the purchaser ought to have paid off the mortgage. in the second place, it is also open to the vendor to bring a suit on the contract of indemnity if as a result of the failure of the purchaser to discharge the encumbrance the vendor incurs a loss. it was contended on behalf of the ..... c. misra put forward the argument that a provision in a conveyance whereby the purchaser agrees to pay off an encumbrancer does not give rise to any contract of indemnity and that the appropriate article of limitation act was article 116 and not article 83 and time began to run from the date from which the covenant .....Tag this Judgment!
Court : Mumbai
Reported in : AIR1940Bom315; (1940)42BOMLR550
..... the debts of those constituents.4. the first question argued and decided by the learned judge is whether the first document, exhibit a, is a contract of guarantee or a contract of indemnity. if it is a contract of guarantee, no doubt making a settlement with the principal debtor behind the back of the surety would discharge the surety. the learned judge held that ..... test there laid down is where the sub-broker is interested in the transaction to be effected, apart from the fact that he had agreed to be liable, the contract is one of indemnity. there is nothing to show that section s 124 and 126 give a go-by to this distinction which has been so well recognized in england.3. periamanma ..... is interested in the subject-matter of the contract, because his is getting substantial payments under the contract, and therefore the contract is one of indemnity and not of guarantee.5. apart from that, i think that the contract is a contract of indemnity within the meaning of the indian contract act. section 124 defines a contract of indemnity as being a contract by which one party promises to save the ..... the whole amount of rs. 16,176 therein referred to. exhibit b is, i should say, neither a contract of guarantee nor a contract of indemnity. it is a contract to pay an agreed sum ascertained, i will assume, as the amount due on a contract of guarantee. i can see no answer on the part of the plaintiff to a suit against him for .....Tag this Judgment!
Court : Andhra Pradesh
Reported in : 55CompCas677(AP)
..... to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person, is called a 'contract of indemnity'. 126. a 'contract of guarantee' is a contract to perform the promise, or discharge the liability, of a third person in case of his default. the person who gives the guarantee is called the ..... the appellant. in the view we have taken, we have no hesitation to reject the contention of the learned counsel for the appellant. to sum up : (1) a contract of guarantee, unlike a contract of indemnity which is bilateral, is tripartite where three persons, viz., the principal debtor, the creditor and the surety, are involved. but, it is not necessary or sine qua ..... primarily and essentially it is substance that has to be looked into and not the form in order to determine in such cases as to whether it is a contract of guarantee or indemnity. in suresh narain sinha v. akhauri balbhadra prasad, : air1957pat256 , a division bench held that it is not necessary that the principal debtor should as a matter of law ..... called the 'creditor'. the last sentence in this section, viz., 'a guarantee may be either oral or written' has special significance. this contract is, therefore, trilateral unlike the contract of indemnity which, as stated earlier, is bilateral. where, the contract is one of indemnity, the non-liability of the principal debtor does not affect the obligation undertaken by the indemnifier which is primary, whereas every .....Tag this Judgment!
Court : Andhra Pradesh
Reported in : AIR1981AP153
..... to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person, is called a 'contract of indemnity.' 126. a 'contract of guarantee' is a contract to perform the promise, or discharge the liability, of a third person in case of his default. the person who gives the guarantee is called the ..... appellant. in the view we have taken, we have no hesitation to reject the contention of the learned counsel for the appellant.26. to sum up :--(1) a contracts of guarantee, unlike a contract of indemnity which is bilateral, is tripartite where three persons, viz., the principal debtor, the creditor and the surety, are involved but, it is not necessary or sine qua ..... and essentially it is the substance that has to be looked into and not the form in order to determine in such cases as to whether it is a contract of guarantee or indemnity.in suresh narain v. akhauri, : air1957pat256 , a division bench held that it is not necessary that the principal debtor should as a matter of law, be an express ..... , the promisor and the promisee. the promisor promises to make good the loss though caused by a third party. this gives rise to the contract of indemnity, whereas section 126 of the contract act gives rise to a contract of guarantee wherein three persons are involved. under this section, a party who promises to discharge the liability of a third person in case of .....Tag this Judgment!
Court : Supreme Court of India
Reported in : 37CompCas434(SC)
..... brothers for the sum of rs. 35,000 which had been secured by the second mortgage still remains. as such the appellant is liable under the contract of indemnity contained in clause 13 to make good the loss yet in spite of the compromise in the second execution application. learned counsel for the appellant has ..... not in our opinion enough to absolve the appellant of the liability which lay on him under clause 13 of the agreement. the liability under the contract of indemnity contained in that clause was to make good the loss to be caused to the bank in circumstances like the present to which clause 13 is ..... that the tins of ghee contained rotten ghee or water, the appellant became liable under the contract of indemnity contained in clause 13 of the agreement. under that clause it was his duty ,to see that goods pledged to the bank as security were not ..... has come before us.6. we are of opinion that there is no force in this appeal. clause 13 of the agreement is clearly a contract of indemnity by which the bank is indemnified in connection with certain matters mentioned therein. it has not been and cannot be disputed that when it was found ..... the bank then went in appeal to the high court. the high court allowed the appeal and held that clause 13 of the agreement was a contract of indemnity and mere execution of the two mortgages would not absolve the appellant of the responsibility that lay on him under clause 13. it further held that the .....Tag this Judgment!
Court : Chennai
Reported in : AIR1944Mad457
..... who was not a party thereto. it is settled law that a judgment obtained after bona fide contest against the party indemnified in respect of the matter to which a contract of indemnity applies is conclusive against the indemnifier although the latter was no party to it, not because such judgment binds him as res judicata, but because the claim against which ..... refer to many of them as we think that the position as regards the rights of a promisee in a contract of indemnity is fairly well settled. it is, of course, material in such cases to consider the terms of the particular contract but, subject to such variations as might arise from any special terms the position generally speaking seems to be this ..... : the promisee is entitled not only to recover from the indemnifier what he has been required to pay to the creditor to whose demand or claim the indemnity relates, but he is also entitled ..... section 125(1), contract act, is based. it was, however, urged that a compromise stood on a different footing, and that, unless notice had been given to the indemnifier calling upon him to satisfy or contest the claim and he failed or refused to do so, he was not precluded from showing, in a suit to enforce the indemnity, that the claim .....Tag this Judgment!
Court : Mumbai
Reported in : AIR1940Bom161; (1940)42BOMLR175
..... the appellants. hence the most favourable construction in favour of the plaintiffs which can be placed on the promissory notes is that they created a contract of indemnity whereby defendant no. 2 undertook to make good any loss that they might sustain. it was open to the plaintiffs to repudiate the mortgage transaction ..... all the three promissory notes (exhibits 98, 99 and 100) are similarly worded and if they are taken literally they do not purport to create a contract either of indemnity or of guarantee, but contain an unqualified promise by defendant no. 2 to pay on demand rs. 5,000 with future interest at nine per ..... and . the collateral security offered by the surety for its performance are to be deemed to constitute but one cause of action. whereas in a contract of indemnity the promisor engages to save the promisee from loss caused by the conduct of the promisor himself or by the conduct of any other person (s ..... have undertaken the liability under the mortgage deed. it is not clear from the judgment whether the undertaking was regarded as a guarantee or a contract of indemnity, but the decretal order shows that it was treated as an agreement to make good any loss that might be caused to the plaintiffs if ..... in consequence of that transaction, and in fact they have not claimed anything more from them in this suit.10. thus the contract being one of indemnity the plaintiffs' claim against defendant no. 2 must be held to be premature. it is clear from section s 124 and 125 of the .....Tag this Judgment!
Court : Chennai
Reported in : AIR1970Mad48
..... can be no liability under the contract of indemnity. on the other hand, if he has not previously recovered from such third party, but has the right to do so, there is no reason ..... in his classic on marine insurance (british shipping laws vol. 10, page 1193) states the position thus:"...,........ it is entirely foreign to the spirit of contracts of indemnity that a person damnified should recover his loss more than once; it is, therefore, clear that if he has already recovered from a third party, there ..... subrogated. it may not be that in every case of loss a third party is liable to the assured, the assured might have acquired by contract absolute indemnity against loss and the insurer might not be able to recover anything from the third party for subrogation. the assured may have really no cause of ..... all the parties are presumed to know the law, the intention is that insurers, who are parties to a policy of marine insurance, which is a contract of indemnity, should be careful to see that, if they desire to sue the board, as standing in the shoes of the assured, they are able to ..... following form. is there a suit known to law by an insurer, as in this case, who has, partially or wholly, reimbursed the assured on a contract of indemnity, or marine insurance, in respect of loss or injury to the goods, and who seeks to recover from the wrongdoer, to a proportionate extent, as one .....Tag this Judgment!
Court : Chennai
Reported in : (1918)35MLJ692
..... apply it towards the discharge of the debts. in such cases, the suit will be upon the covenant and not upon an implied or express contract of indemnity. in the ptesent case, i feel no doubt that the suit is brought upon the covenant. the two clauses in ex. a to which mr ..... under consideration in that case, there was an implied contract of indemnity, and if the purchaser expressly covenanted with the vendor to pay the encumbrances, such a covenant as that without more, having regard to the nature ..... . ananthakrishna aiyar and it is this : ' if the purchaser covenants with the vendor to pay the encumbrances, it is still nothing more than a contract of indemnity'. but reading that sentence in the light of the rest of the judgment, it means nothing more than this, that in a transaction of the nature ..... , he should be liable to pay the plaintiff for any damage the latter might sustain. it was held that the agreement was not a mere contract of indemnity. there the learned judges point out in support of their view, that this provision could not detract from the absolute promise to pay contained in ..... any amount, yourself and your properties would be liable for all such losses and amounts etc.' it is contended that these clauses amount merely to a contract of indemnity, and therefore the respondents, the vendors of the property were not entitled to bring this suit, until any loss has been caused to them by .....Tag this Judgment!
Court : Supreme Court of India
Reported in : AIR2007SC2361; 2006(5)ALD35(SC); 2006(3)AWC3124(SC); 2006(6)BomCR143; 132CompCas565(SC); 2006(2)CTLJ1(SC); JT2006(6)SC152; 2006(6)MhLj257; 2006(6)SCALE600; (2006)6SCC
..... was erroneously described as a preamble stating:.the preamble of the document in question creates an impression that the said document is a contract of indemnity and not a contract of guarantee.9.4. the high court, furthermore, inserted some words in the said document which in fact were not there, as for example, in paragraph 31 of ..... . (now reliance energy ltd. v. fenner india ltd. and anr. : air2006sc1148 ). however, in this case, we have no doubt in our mind that the document in question constitutes a contract of indemnity and not an absolute or unconditional bank guarantee. the high court, therefore, erred in construing the same to be an unconditional and absolute bank guarantee.10. rate of interestcontention of ..... or placed on the record by the appellants. the officer of the bank stated before the court that the document in question was intended to be a contract of guarantee and not a contract of indemnity. the written document (exhibit-46) as quoted above lays emphasis on the preamble as under....yet again, in the said paragraph, the operative portion of the document ..... appearing on behalf of the appellants submitted that:(i) on a true construction of the document dated 4th september, 1985, it would be seen that the same is a contract of indemnity and not a bank guarantee.(ii) the high court committed a manifest error in considering the oral evidence adduced by the parties in construing the said document dated 4th september .....Tag this Judgment!