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1958 DIGILAW 29 (GAU)

River Steam Navigation Co. Ltd v. Milapchand Hiralal Firm

1958-03-03

G.MEHROTRA, SARJOO PROSAD

body1958
G. MEHROTRA, J. : This is defendants' appeal arising out of a suit for recovery of Rs. 117207- as damages. The plaintiff is a duly registered firm under the In­dian Partnership Act, carrying on business in cloth, yarn and bidis, both in Calcutta & at Now-gong, Assam. It is the sole agent for the sale and distribution of Monkeyboy brand bidis, manufactured and supplied by Messrs. C. J. Patel and Co. of 3 Rupchand Street of Calcutta. (2) 200 baskets of Monkeyboy brand bidis were purchased from the aforesaid firm by the plaintiff and booked from Jagannathghat to Sil-ghat Steamerghat under invoices Nos. 371 and 372 dated 3-2-1948; each of the two consignments contained 100 baskets of bidis. They were made over to the defendants-appellants R. S. N. Co. Ltd. and I. G. N. Co. Ltd. for carriage against the freight. When the consignments arrived at Sil-ghat, it was found that there was a shortage of 40 baskets of bidis under the invoice No. 371 and 27 baskets under the invoice No. 372. On 24-3-1948, the plaintiff took open deli­very of the said bidi baskets, having duly en­dorsed the fact of the shortage. In spite of the repeated demands, the delivery of the short baskets was not given to the plaintiff nor the value was paid. On these facts, it was alleged that the baskets appeared to have been lost or tampered with in transit or pilfered with due to the wilful misconduct of the servants of the defendants' Steamer Co. The demand notice was given to the defen­dants claiming Rs. 10,720/-, the price of the lost goods with Rs. 100/- as compensation and the suit was thereupon filed for the aforesaid amount. A joint written statement was filed by both the defendants and it was denied that the plaintiff's firm was a registered one. The book­ing of 200 baskets of bidis in two consignments, each containing 100 baskets for carriage to Sil-ghat as per S, S. Mingin owned by defendant No. 2 was admitted. The fact of short delivery is also admitted, but the main defence taken up was that S. S. Mingin carrying the consignments met with an accident on the way in the river with the result that 67 baskets out of the said consignments were found damaged and. the contents were des­troyed as per medical advice. The fact of short delivery is also admitted, but the main defence taken up was that S. S. Mingin carrying the consignments met with an accident on the way in the river with the result that 67 baskets out of the said consignments were found damaged and. the contents were des­troyed as per medical advice. The detail of the accident was noted in the protest and a copy of which was duly sent to the plaintiff. That the loss was due to the negligence of the defendants' servants was deni­ed and it was asserted that the damage was caused due to accident and the goods were des­troyed on medical advice and that they took all reasonable care to protect the goods; as such they were exonerated from the liability. The amount of damage claimed was also denied. (3) The trial court decreed the suit on the finding that the defendants failed to prove satis­factorily the cause of the accident and as the onus was on the defendants to establish that there was no negligence on the part of their servants in the accident, the defendants were not protected and were liable to pay the da­mages. It was also held by the court below that it was not established by the defendant that the goods were destroyed under proper medical ad­vice. As regards the amount of damages, the finding is that the plaintiffs were entitled to the entire price claimed. The amount of com­pensation claimed was however reduced to Rs. 280/- and thus the suit was decreed for a round sum of Rs. 11,000/-. (4) In appeal, the points urged by the ap­pellants before the court below have been re­iterated. It is asserted that the defendants have fully discharged the burden and have estab­lished that there was no negligence on their part and the damage was caused to the bidis due to accident. It is also to be mentioned that the trial court has held that the document al­leged to be a protest was not admissible in evi­dence. It is not disputed that the burden is not, on the plaintiff to establish that the loss, da­mage or non-delivery was due to the negligence or criminal act on the part of the defendants' servants. The burden lies on the carrier to es­tablish the absence of negligence. It is not disputed that the burden is not, on the plaintiff to establish that the loss, da­mage or non-delivery was due to the negligence or criminal act on the part of the defendants' servants. The burden lies on the carrier to es­tablish the absence of negligence. In the ab­sence of any proof by the carrier, it will be liable to make good the loss. (5) In the case of River Steam Navigation Co. Ltd. v. Syarn Sunder Tea Co. Ltd., AIR 1955 Assam 65 (A), it has been held by this Court that section 6 of Carriers Act, 1865 en­ables the common carrier to limit his liability by a special contract, otherwise the liability which the common law imposes is there. Even the special contract contemplated by S. 6 would be of no avail where the loss or damage has been caused by negligence or any criminal act on the part of the carrier or his agents or ser­vants. In such a case the common carrier shall be liable to the owner for the loss or damage, and S. 9 of the Act relieves the plaintiff from the burden of showing that the loss or damage or non-delivery was owing to any such negligence or criminal act. Sections 6 and 9 thus recognize the common law doctrine, save in so far as the liability is limited by some special contract, as provided by S. 6. Even if the carrier took as much care of the goods as a man of ordinary prudence would, under similar circumstances, 'they would be liable if the loss was not occasioned by any act of God or the King's enemies, which, in case of republic State, would mean the enemies of the State. The liability of the carrier is not that of a mere bailee as defined by Ss. 151 and 152 of the Contract Act. Its liability is very often described as the liability of an insurer against all risks. In this case, it was further held that though the stea­mers may even sink on account of their having struck upon some snag and the cargo was lost that may be mere peril of navigation, but not an act of God and the company will be liable. In this case, it was further held that though the stea­mers may even sink on account of their having struck upon some snag and the cargo was lost that may be mere peril of navigation, but not an act of God and the company will be liable. (6) Reliance was placed in this case on an earlier decision of the Calcutta High Court in the case of Moothora Kant Shaw v. India General Steam Navigation Company. ILR 16 Cal 166 (B) and in the case of The Irrawaddy Flotilla Co. v Bugwandas, ILR 18 Cal 620 (PC) (C). In a suit! for damage caused to the plaintiff's goods entrusted for carriage by the defendants' ship, it is for the defendant to plead and prove perils' of sea. If he makes out a prima facie case, it can be rebutted by proving negligence. Each case will, however, depend upon its own facts and circumstances & the facts of each case will have to be examined in order to determine if the burden has or had not been discharged by the carrier. The defendants, in order to establish the accident have examined seven witnesses in court and one was examined on commission. (After discussing the evidence for the de­fence their Lordships proceeded :) (7 to 13) This is the whole of the evidence produced on behalf of the defendants as regards the actual accident. The District Judge has come to the finding on consideration of this evi­dence that it cannot be said that the defendants had satisfactorily established the cause of the accident, and that they failed to discharge their onus in proving that there was no negligence on the part of their servants. (14) As we have already pointed out, the onus is on the. defendant carrier to prove the absence of negligence on their part. But hav­ing considered the evidence, we are of opinion that prima facie the burden has been discharged by the defendant-company that there was ab­sence of negligence on the part of the company's employees at the time of the accident. The steamer was following the usual route. The pilot was there constantly fathoming the water. The Nilgiri struck aground and under these circumstances it had to be left and the other flat had to be anchored at a safe place. The steamer was following the usual route. The pilot was there constantly fathoming the water. The Nilgiri struck aground and under these circumstances it had to be left and the other flat had to be anchored at a safe place. There was no reason for them to have suspect­ed strong current when they attempted to re­connect Palta. The snag striking against the bottom of the vessel was purely an accident. It cannot be said that such snag could only come under the water if there was some unusual natural phenomenon. In our opinion, there­fore, there was an accident due to some hard substance submerged under the water which struck against the bottom, of the vessel which resulted in the damage to the hold No. 1 and the goods which were stocked in that hold were damaged by water. Attempt was made by the company to take back Mingin to Goalanda where the goods were unloaded. The question still remains whether the defendants were justi­fied in destroying the goods of the plaintiff. (15) Two arguments have been advanced by the counsel for the respondents in this connec­tion. Firstly it has been urged by him that there is no sufficient and reliable evidence produced by the defendants which establishes that the goods were unfit for human consumption and there was thus no justification for the opposite party to have destroyed these goods. Secondly it was contended that even if it be accepted that the master of the vessel can be regarded as an agent of necessity due to emergency, still he had sufficient time to take instructions from the plaintiff about the dispo­sal of the goods and the failure on his part to take an instruction makes the defendants liable from non-delivery of goods. (16) The law on this point has been sum­marised in Halsbury's Laws of England, Third Edition, Vol. IV, p. 139 para 379 thus: "If in order to preserve the goods the car­rier will be put to expense not contemplated by the parties when he undertook the carriage, he must incur such expense which he can refer from the owner. (16) The law on this point has been sum­marised in Halsbury's Laws of England, Third Edition, Vol. IV, p. 139 para 379 thus: "If in order to preserve the goods the car­rier will be put to expense not contemplated by the parties when he undertook the carriage, he must incur such expense which he can refer from the owner. Where the goods carried into such a condition that it is impossible for them to be safely carried to their destina­tion, if it is not reasonably impossible to ob­tain instructions from the owner of the goods, it is the duty of the carrier to sell them forth­with, and he will not be liable for damages for breach of contract for failure to deliver the goods. If, on the other hand, the carrier fails to show the impossibility of obtaining instruc­tions from the owner, he will be liable for damages for such sale." The binding force of the contract entered into, between the Master of the ship arid a third party at the time of the accident and emer­gency on the owner of the cargo has been dealt with and summarised in the Law of Contracts by Cheshire at page 300 thus: "It is well settled, however, that the mas­ter of a ship is entitled, in case of accident and emergency, to enter into a contract which will bind the owners of the cargo, notwithstanding that it transcends his express authority, if it is bona fide made in the best interest of the owners concerned. Probably the same power is possessed by a land carrier. A person who seeks to bind a principal on these grounds bears the onus of proving that the course adopted by the carrier was reasonably necessary in the circumstances, and also that it was practically impossible to communicate with the cargo' owners." The law summarised above was laid down in the case of Springer v. Great Western Railway Co., 1921-1 KB 257 (D) and in the case of Sims and Co. v. Midland Railway Co., 1913-1 KB 103 (E). (17) On the finding that the accident did! v. Midland Railway Co., 1913-1 KB 103 (E). (17) On the finding that the accident did! take place which resulted in the damage to the goods, the plaintiffs can legitimately argue that the carrier became, in the eye of law, an agent for the plaintiff-respondent in view of the emergency of the situation; but it will have to be considered on evidence how far the appellant has established that there was no sufficient time to take instructions from the plaintiff and that he acted in a manner which was the only reasonable course to be adopted by an agent under the circumstances. Plaintiff's witness No. 1 has stated that the accident occurred due to the negligence on the part of the servants of the Steamer Company and that the plaintiff got no information about the damage of his goods before he served the claim notice. The appellant relied upon a letter sent to the plaintiff-respondent from the Superin­tendent dated 26-2-1948 - Ext. D on the record. That was a letter which only mentioned that a copy of the protest lodged by the master of the Steamer from Goalanda on 17-2-1948 in con­nection with the accident was being sent to the plaintiff's firm and there is also in that letter an expression of regret and the denial of liabi­lity for the damages. Nothing has been shown by the defendants-appellants that any letter was sent to the plaintiff's firm seeking its direction as regards the disposal of the damage of goods. It is also not asserted by the appellants that any such letter was sent. It is contended that there was no time for the appellants to take instructions from the respondent. (18) According to the evidence of the defen­dant's witnesses, the vessel Mingin started from Jagannathghat on 2-2-1948 and arrived at Goar landa on 7-2-1948 and on the same day, it left for Assam. The accident to the Nilgiri hap­pened in the early part of the 7th February. The accident to Mingin happened at 11-40 P.M. on the 9th February. The damaged goods ar­rived at Goalanda on the 11th February at 10-15 hours. It took 5 or 7 days for the doctor to examine the goods and thereafter the goods were des­troyed. The accident to the Nilgiri hap­pened in the early part of the 7th February. The accident to Mingin happened at 11-40 P.M. on the 9th February. The damaged goods ar­rived at Goalanda on the 11th February at 10-15 hours. It took 5 or 7 days for the doctor to examine the goods and thereafter the goods were des­troyed. If the goods could be detained for 5 or 7 days for examination by the doctor, there is no reason why the master could not have in the meantime obtained instructions from the plaintiff as regards the disposal of the goods. That the goods were damaged due to accident was known to the master of the ship when the goods arrived at Goalanda. Thereafter, what should be done with the goods had to be decided by the master after obtaining the necessary instructions from the owner of the goods. The examination by the doctor of the goods would have been helpful only for two purposes. Firstly to ascertain if the goods could be sent in that damaged condition without affecting other goods and secondly if they could be detained without any further deterioration. The doctor has not stated that If the goods were sent they were likely to damage the other goods. He has stated that in his opinion they were not fit for human consumption. The defen­dants should have either taken instructions from the plaintiff before destroying them or should have at once sold them and thus minimised the damages. Defendants cannot be said to have acted as a prudent man in destroying the goods lion the report of the doctor. The agent of neces­sity in the event of not having sufficient time to obtain instructions from the owner of the cargo as regards the disposal of the goods has only a right to sell the goods instead of send­ing them back to the party. It gives him no right to destroy the goods. In some cases in order to avoid the vessel sink­ing, the carrier may have a right to throw the goods; but in the present case, even assuming that the doctor's evidence was correct that the goods were not fit for human consumption, the defendants may have been justified in not send­ing it back to the plaintiff, but they had no right to throw away the goods without taking instructions from, the plaintiff. In. In. our opinion, however, the defendants have failed to prove that they had no suffi­cient time to take instructions from the owner and that in the circumstances, their authority did not extend to throwing away the goods. The only right, under the circumstances, they posses­sed, was to sell the goods. Although, therefore, we are of opinion that the finding of the Judge that the defendants have failed to prove the absence of negligence resulting in the accident is not correct and that the defendants have prima facie discharged the burden and have established that the damage was caused by ac­cident without any negligence on the part of the employees of the company, still we are of opinion that the defendants exceeded their powers as agents of necessity in destroying the goods and that they had sufficient time to take necessary instructions from the plaintiff. The plaintiff is thus entitled to get the damages. (19) The next question is - what should be the damage awarded to the plaintiff under the circumstances. The trial court has awarded to the plaintiff the full price of the goods as dama­ges. It is contended by the counsel for the res­pondents that the defendants had acted in an unauthorised manner and having failed to deli­ver the goods to the plaintiff, are liable for damages to the extent of the entire value of the goods. It is further contended by him that no evidence has been adduced as to what was the value in the open market of the goods on the date when they arrived at Goalanda in a damag­ed condition. Ordinarily, no doubt, if an agent is guilty of wrongful conversion and that the carrier fails to deliver the goods to the consignee, he is li­able for the market price of the entire goods. But in the present case, on the finding that the defendants are entitled to protection in so far as , the damage to the goods was concerned as the damage was caused due to accident, the liability of the defendants arises only as he failed to have instructions from the plaintiff as regards' the disposal of the damaged goods. The loss thus suffered by the plaintiff is the market value of the damaged goods on 10-2-1948, when they arrived at Goalanda. What was the value of the goods on 10-2-1948 cannot be defi­nitely ascertained from the evidence on the record. The loss thus suffered by the plaintiff is the market value of the damaged goods on 10-2-1948, when they arrived at Goalanda. What was the value of the goods on 10-2-1948 cannot be defi­nitely ascertained from the evidence on the record. The only course, therefore, open to us is to send back the case to the court below for deter­mining the value of the goods in the damaged condition after giving full opportunity to the parties to adduce further evidence. But as the matter is very old and it may not be possible to get evidence to establish the value of the goods on 10-2-48, we prefer to decide to assess the amount of damages on the materials such as there are before us. The counsel for the defen­dants has urged that according to the evidence of the doctor, the goods were not fit for human consumption and therefore they had no value. The plaintiff's witness has however stated that the leaves of the bidis were wet, but not the tobacco inside. He further states as follows: "We have sold sometimes wet bidis.'' This state­ment clearly suggests that even if the leaves of bidis had become wet, it could not be said that they could not be sold in the market and if sold, would have fetched no price. Having regard to all circumstances, therefore, we are of the opi­nion that the plaintiff is entitled to damages to the extent of Rs. 5360/-, half the price of the goods. He is entitled to no further compensa­tion. (20) In the result, therefore, we modify the decree of the court below to the extent that we decree the suit for recovery of Rs. 5360/-. The suit for the rest stands dismissed. The respon­dent will be entitled to his full costs in the court below; but the cost in this appeal will be in proportion to success. (21) SARJOO PROSAD C. J.: I agree. H.G.P. Decree modified.