Motilal Dossabhai and Others vs Dungermal Perajaji

Baxi, J.—This appeal arises out of the Plaintiff''s claim against the Defendant firm who were employed by the Plaintiff as commission agents to sell jaggery. The claim is in respect of conversion of 103 bags containing Mds. 423 Srs 36 by sale.

The Plaintiff despatched from Disa 140 bags of U.P. jaggery to the Defendant firm of Dhanki with instructions to sell it in the market at the current market rate. The jaggery was of the previous year and has been described by the parties as the "old" jaggery in contradistinction to the "new" jaggery i.e. jaggery produced in the current year. According to the Plaintiff Mds. 572 Srs. 29 of jaggery was despatched to the Defendant Company by railway. The Defendant firm commenced selling it in lots and by 13-12-1949 they had sold 30 bags containing Mds. 90 Srs 321/4 and a sum of Rs. 1000/- was sent to the Plaintiff by a hundi on account of the sale of these bags. In their covering letter which is dated 6-01-1950 the Defendant firm wrote to the Plaintiff that the old jaggery was not likely to be sold at more than Rs. 7/- per maund and informed the Plaintiff that they would continue to sell it if instructed by the Plaintiff.

The Plaintiff sent a reply by his letter dated 08-01-1950 Ex. 12 instructing the Defendant firm not to sell any further jaggery until further instructions. By his telegram dated 10-01-50 Ex. 13 the Plaintiff asked the Defendant firm not to sell jaggery at any rate. Then the Defendant firm sent the Plaintiff a consolidated statement of account of the sale of jaggery which included the account of the sale of 103 bags Ex. 22A along with a hundi for Rs. 2524-4-0 in full settlement of the account. The Plaintiff repudiated the sale of these 103 bags by his letter dated 16-03-1950 Ex. 21 and subsequently filed the present suit alleging that the sale was not a genuine transaction and was made in collusion with the purchaser with the intention of defrauding the Plaintiff.

In the alternative the Plaintiff stated that the above mentioned sale was unauthorised and contrary to his instructions and claimed Rs. 6020-13-0 at the rate of Rs. 12-8-0 per maund. He had stated in the plaint that Mds. 572 Srs. 9 of jaggery were despatched to the Defendant firm. The Defendant firm denied that they had received Mds. 572 Srs. 9 as alleged by the Plaintiff. According to them they had received Mds. 540 Srs 15 with standing instructions to sell the jaggery at the market rate which instructions were repeated by the Plaintiff from time to time. With regard to the sale of 103 bags which the Plaintiff repudiates, the Defendants'' contention was that they had sold these bags to Tribhovan Mulehand of Patdi on 4-1-50 at the rate of Rs. 6/- per maund and had sent advice of the sale to the Plaintiff.

They admit having received the Plaintiff''s letter and telegram instructing them not to sell jaggery any further but contended that the bags were sold under the Plaintiff''s standing instructions before they were countermanded. The Defendant further alleged that the Plaintiff''s son Jawanmal came to Dhanki on 11-1-1950 and confirmed the sale of these 103 bags and delivery was given to the purchaser after Jawanmal had confirmed the. sale. They denied the Plaintiff''s allegation that the sale was fictitious or collusive or contrary to instructions and while they offered to pay the price actually received by them, subject to the deduction of expenses and commission, they denied their liability to pay any damages.

The learned Civil Judge held that Mds. 542 Srs. 141/2 were received by the Defendants and rejected the rest of the defences and awarded the Plaintiff a decree for Rs. 2004-10-6 calculated at the rate of Rs. 10-8-0 per maund and interest and costs. The Defendants have preferred this appeal against the decree contending that the suit should have been dismissed while the Plaintiff had filed cross objections claiming that he should have been awarded damages at the rate of Rs. 12-8-0 per maund.

(His Lordship on consideration of the evidence agreed with the findings of the lower Court that the Defendants must have received Mds. 542 Srs. 141/2 of jaggery and that they sold 103 bags contrary to the instructions of the Plaintiff. His lordship then proceeded.)

3-5. The Defendants having thus sold the jaggery without authority and contrary to the Plaintiff''s instructions, the next question for determination is what should be the measure of damages which should be awarded to the Plaintiff. The principle on which damages are assessed in such cases has been stated in -- Tadi Sarareddi (dead) and Another Vs. Chelamcherla Brahmayya, minor by mother and guardian Rattamma, . It was held there that in the case of wrongful conversion of goods of ordinary merchandise by the agent where the principal can repurchase goods after getting information of conversion the market value of the goods on some subsequent day should be the measure of damages. Reasonable time must be allowed to him for making the repurchase. We think that the principal is entitled to claim the market rate of the goods on the day on which he came to know of the conversion or the market rate on the subsequent date, the option to claim the particular rate being with him. The agent who is the wrong-doer cannot compel the principal to accept the latter rate i.e. the rate on the subsequent day if that rate is not favourable to the principal.

(His Lordship considered the evidence as to the date on which the Plaintiff came to know of the conversion and proceeded:)

Therefore the above evidence shows that the Plaintiff definitely came to know of the conversion on 16-3-50 and he is entitled to claim the market rate of the jaggery prevailing at about this time subject of course to being allowed further reasonable time to repurchase it to the market.

(His Lordship on consideration of the evidence held that the Plaintiff was entitled to claim damages at the rate of Rs. 12-8-0 per maund and concluded:)

In the result the appeal is ordered to be dismissed and the cross objections are allowed and the decree of the learned Civil Judge is varied by directing the Defendant to pay Rs. 2804-10-6. Subject to this variation the learned Civil Judge''s decree is confirmed. The Appellants shall pay the Respondents'' costs of the appeal and the cross objections.

Shah, C.J.

I agree.