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1903 DIGILAW 110 (CAL)

Haridas Khandelwal v. Kalumull

1903-05-01

body1903
JUDGMENT Sale, J. - This was a suit which was instituted in the Small Cause Court and subsequently transferred to this Court for recovery of damages by reason of the Defendant failing to take delivery of 50 chests of shellac. 2. The defence set up in the affidavit of the Defendant, which, under the order of this Court, must be regarded as the written statement in the suit, was that the Defendant rightly rejected the goods on the ground that in quality and condition they were not of the character which the Plaintiff had contracted to deliver to the Defendant. 3. The goods, which were the subject-matter of the suit, were described in the contract as 50 chests of shellac, T.N. mark (in a diamond), of the average standard quality. The price was Rs. 75 per bazar maund and delivery was to be given from the godowns of the Plaintiff's broker in January and February 1902, the terms being cash on delivery. The date of the contract is the 14th November 1901. 4. The goods were tendered by the Plaintiff through his broker to the Defendant on the 18th February. It appears that the Defendant, who was carrying on business in Calcutta through his gomasta, Giridhari Lall Chobay, took no steps for the purpose of inspecting the goods, or testing the quality of them, but on or about the 25th February, by an endorsement on a delivery order, directed the Plaintiff's broker to deliver the goods in question to the firm of K.G. Banerjee and Co. It appears that the Defendant was under a contract to deliver shellac to the firm of K.G. Banerjee and Co. and accordingly the Defendant, under the terms of his contract with K.G. Banerjee and Co., tendered the goods in suit to that firm in performance of his contract with them. On the 10th or 11th March 1902, Messrs. K.G. Banerjee and Co. caused a sample of the goods to be drawn and requested the Plaintiff's broker to make an allowance of Re. 1-8 per bazar maund; the goods were at the time in the godowns of the broker. The broker offered only an allowance of 8 annas and in the result K.G. Banerjee and Co. by a similar endorsement, directed the broker to make over delivery of the goods to the firm of Becker Ross and Co. K.G. Banerjee and Co. 1-8 per bazar maund; the goods were at the time in the godowns of the broker. The broker offered only an allowance of 8 annas and in the result K.G. Banerjee and Co. by a similar endorsement, directed the broker to make over delivery of the goods to the firm of Becker Ross and Co. K.G. Banerjee and Co. were under a contract at the time to deliver shellac, T.N. mark, to Messrs. Becker, Ross and Co. Similarly, Becker, Ross and Co. caused a sample to be drawn of the shellac and alleging that the goods were not up to contract quality, rejected them. The Defendant thereupon, for the first time, on the 21st March rejected the goods and-called upon the Plaintiff to make a fresh tender within 24 hours. The Plaintiff, however, claimed the right of reselling the goods in question as against the Defendant and after due notice by letter the goods were resold on the 1st April at the price of Rs. 57 per bazar maund and the Plaintiff now claims to recover from the Defendant as damages the difference between the contract price of the goods and the price of the goods obtained on the resale. 5. Now it may be conceded that if the goods tendered under the contract in suit to the Defendant were net of the contract quality the Defendant had the option to reject the goods subject of course to the special provisions of the contract and unless there was something in the contract to the contrary I take it the buyer could not be compelled to take the goods with an allowance for inferiority in quality. In the present contract, however, there is a provision that the buyer in case of inferiority is to take the goods subject to an allowance to be fixed by the broker. There is a further provision that all disputes in respect of the contract are to be finally determined by the brokers. Having regard to these provisions in the contract, the question might undoubtedly have arisen whether the Defendant was not bound to take the goods if they were not of the contract quality with an allowance to be fixed by the broker. The question in the present case, however, is not dependent, I think, upon any suggestion as to inferiority in quality of the goods tendered under the contract. The question in the present case, however, is not dependent, I think, upon any suggestion as to inferiority in quality of the goods tendered under the contract. It appears to me upon the facts admitted in the affidavit of Giridhari Lall Chobay, which is the Defendant's written statement in the suit, that the right, if any, to reject the goods as being of an inferior quality was not exercised by the Defendant when the goods were tendered. On the contrary, the Defendant by directing delivery of the goods to be given to K.G. Banerjee and Co. exercised a right of a proprietary character in respect of the goods. Moreover, the action of K.G. Banerjee and Co. in directing delivery of the same goods to Becker, Ross and Co. under their contract with that firm exercised a proprietary right of a still more unequivocal character, because in this case delivery was directed after a sample of the goods had been drawn and the quality thus tested. It appears to me then that these acts are evidence of an acceptance of the goods and inasmuch as the goods remained in the possession of the Plaintiff through his brokers, the Plaintiff had a lien on the goods for the purchase-money which entitled them to resell the goods u/s 107 of the Contract Act. It has been proved that the right to resell was exercised by the Plaintiff after due notice given to the Defendant and I think that the Plaintiff was justified in exercising that right. 6. Under these circumstances it is not necessary that I should make a final and formal adjudication as to the quality of the goods, though, I think, under all the circumstances that the truth as regards the quality of the goods is to be found in the evidence of Mr. A.C. John, who was called on the part of the Plaintiff, who says that the inferiorty was such as might be compensated by an allowance of 8 annas per bazar maund. I think the evidence on the other side as regards the excessive inferiority of the goods, especially the evidence of Hera Chander Bose, is very much exaggerated. However, the question in the case does not depend on the question of inferiority. I think the evidence on the other side as regards the excessive inferiority of the goods, especially the evidence of Hera Chander Bose, is very much exaggerated. However, the question in the case does not depend on the question of inferiority. The Plaintiff being entitled to exercise the right of resale, he is entitled to recover from the Defendant as damages the difference between the contract price of the goods and the price obtained upon the resale. 7. There will therefore be a decree for the amount so calculated as damages. Costs on scale No. 2 and interest on decree at six per cent.