Obla K. Subbier and Others vs C.M. Venkatachalapathi Ayyar

Charles Gordon Spencer, J.—The contract between the plaintiffs and the defendants was for the sale of 25 bales of yarn to be delivered at

the plaintiffs'' godown at Madura. The defendants paid an, advance of Rs. 1,250. The price at which the goods were to be sold was Rs. 13-2-0

per bundle that is, at the rate of 89 bundles to the bale, Rs. 1,050 per bale. No time was fixed for performance, but the terms of the contract were

that the plaintiffs were to intimate the arrival of the bales from the Madura Mills and that the defendants, next'' day, were to bring the pride and

take delivery of the goods. The terms are contained in a letter (Ex. A) written by the plaintiffs'' agent to the defendants. The defendants accepted 3

bales of the total consignment of 25 bales, and the present suit relates to the remaining bales. As regards 7 of the remaining bales the plaintiffs give

notices in their letters Exs. D, G, G1 and G2 but the defendants failed to take delivery. The Subordinate Judge awarded damages to the plaintiffs

as regards these 7 bales, calculating the prevailing price at Rs. 9-4-0"" at the difference between that and the contract rate of Rs. 13-2-0. In respect

OF the remaining 15 bales, the plaintiffs'' suit was dismissed,

The defendants appeal and the plaintiffs file a memorandum of objections. As regards the 7 bales, the arrival of which the plaintiffs announced to

the defendants, the defendants'' Vakil''s argument is that there was no compliance with the terms of the contract, '' because the plaintiffs failed to

prove that they had goods in their hands available for delivery. On receiving a letter of advice, the defendants were entitled to proceed to the

plaintiffs'' godown and inspect the goods before taking delivery. It has not been established in the present case that the goods never reached the

plaintiffs'' godown, or that they would not have been available if the defendants had applied for delivery. The defendants do not say that they went

and saw the plaintiffs'' godown and found it empty. The conclusion of the Subordinate Judge that the defendants failed to substantiate this

contention that the letters of advice were not in accordance with the terms of the contract appears to be correct.

As regards the rate at which damages were calculated, the evidence of P. W. No. 1 is that the price fell in October to Rs. 12, and Rs. 12-8/and

in November to Rs. 9 and Rs, 9-8. Plaintiff''s witness No. 2 says 1 hat the price on the 8th of Mast, that is on the 19th February was Rs. 9-4. As

the price in November about the time when defendants failed to take delivery had fallen and then varied between Rs. 9 and Rs. 9-8, I think that the

Subordinate Judge was right in taking Rs. 9-4 as the mean between these prices, and in calculating damages on the difference between that rate

and the contract rate and that he was not misled by referring to the price prevailing at the time when the plaintiffs treated the defendants as having

broken their contract through the letter, Ex. II of February 17, 1919. The plaintiffs are not entitled to damages in respect of the remaining 15 bales

in respect of which they gave no notice of arrival. Defendants also are not entitled to damages in respect of these 15 bales as they suffered no loss.

In the memorandum of objections, the plaintiffs have put forward the plea that the defendants, having failed to take delivery of 7 bales, showed

by their conduct that they bad repudiated their contract even as regards the remaining 15 bales. The only support ''''or this contention is the letter

(Ex. H) written by the plaintiffs to the defendants, in which they said that if the defendants ''failed to take delivery of the 7 bales within two days,

they would be deemed to have broken the contract, and added that even as regards the remaining 15 bales which were yet to arrive, they would

calculate damages at the same rate. Defendants did not answer this letter and it is now suggested that their conduct in not answering it amounted to

a repudiation of the whole contract, when it is coupled with the fact that the market was falling and that they had not kept their contract in respect

of any portion of the goods which they contracted to buy. The Subordinate Judge held in -Respect of this portion of the case that the plaintiffs''

failure to give notice with respect to 15 bales was really a breach of contract on their part, and that they could not claim damages when they failed

to perform the first step in the performance of their part of the contract, I see no reason to differ from this conclusion. 1 think that it would not be

justifiable to infer merely from the fact that the defendants sent no reply to Ex. H that they agreed to treat the whole contract as no longer existent.

It is evident from Ex. I that there was no booking and no despatch of goods from the Mills after 20th November. 1918. As time for performance

of this part of the contract had not arrived, I think that until the plaintiffs gave the defendants notice that they had available 15 bales ready for

delivery to them, or unless they informed them that'' if they failed to reply to their letter, they would treat the whole contract as having been broken

by them, they had no right to presume from their conduct that the defendants would not take delivery of the bales that remained to be delivered,

whatever market rates might be prevailing at the time of tender.

The appeal and the memorandum of objections are dismissed with costs.

Ramesam, J.

I agree, and will add a few words. The first point argued by the learned Vakil for the appellants is that the plaintiffs have not substantially

complied with the terms of the contract, when they wrote letters Exs. D, G, G1 and G2, as they had not the bales in their godown. When we

examine the contents of Ex. 1, the ledger kept by the Madura Mills, it is not clear that plaintiffs had not the goods ready when they addressed these

letters though perhaps the contention is true as to Ex. G1; but assuming they had not the goods in their godown, I do not think that possession of

the goods in the godown is a condition precedent to their intimating, to the defendants asking them to take delivery of the goods. It is enough if the

plaintiffs had practically the goods at their disposal in the custody of the Mills, Ex. A'' cannot be construed as if the words ""arrival of the bale or

bales"" amount to a description of the goods similar to the words ""July or August Shipments"" in Bowes v. Shand (1877) 2 A.C. 455 : 46 L.J.Q.B.

561 : 36 L.T. 857 : 25 W.R. 730. Mr. C.V. Ananthakrishha Iyer relied on a decision in Ramier v. Runa Cheena Mana Navanna Ona & Bros 19

L.W. 654. We observe that Phillips, J. I agreed to the conclusion reluctantly; and he Mater differed from that conclusion in Lakshmana v.

Ramalinga Mudaliar 90 Ind. Cas. 206 : 48 M.L.J. 522 : AIR (1925)(M.) 888. A similar view was taken by the Chief Justice and Srinivasa

Iyengar, J., in A. Section No. 60 of 1922. It is true that for a plaintiff to succeed, he must prove first his readiness and villingness to perform the

contract which, no doubt, includes his capacity to perform the contract: vide my observations in Rayulu Iyer v. Kuppu Iyer 49 M.L.J. 1 : A.I.R.

(1925) (M.) 974. It is clear on the facts of this case that the plaintiffs were not only ready and willing to perform the contract but able to perform

the contract as regards the 7 bales. That being so, this point fails.

I have nothing to add to my learned brother''s judgment on the second point.

As regards the memorandum of objections it is difficult to construe Ex. II as a notice of cancellation of the whole. contract by the plaintiffs. The

first part of the letter deals only with the contract so far as it related to the 7 bales and only towards the end of the letter reference was made to the

remaining 15 bales. It is difficult to construe this letter as giving notice to the defendants that they, will be deemed to have broken the whole

contract. Even assuming that the defendants may be deemed to have broken the whole contract, certainly it cannot be said that the letter amounts

to a cancellation of the contract by the plaintiffs on account of the breach by the defendants, even assuming that the plaintiffs are entitled to do so,

which is doubtful having regard to the case of Simpson v. Crippin 27 L.T. 546 : 21 W.R. 141. Seeing that the plaintiffs offered at the most 10

bales from July to February one cannot assume that the remaining 15 bales were going to be manufactured. One cannot assume that they will be

ready before May or even within another 10 months. It is possible that the market may become a rising market, J $Q not gay there may not be

cases in which with reference to the facts of the*'' particular case, an implied repudiation of the whole contract might be inferred from refusal of

part-performance of the contract. Lakshmana v. Ramalinga Mudaliar 90 Ind. Cas. 206 : 48 M.L.J. 522 is a case in which the goods were ready in

Subbier''s godown, and there was nothing more to be done for getting the goods. I do not see that Section 39 of, the Indian Contract Act helps

them, for ''it is doubtful whether this is a contract which could be said to have been broken in its entirety by the refusal to accept the 7 bales.

Secondly, it is not clear from Ex. II that the promissee has put an end to the contract. This section cannot, therefore, help. I agree with my learned

brother that the memorandum of Objections should be dismissed with costs.

I agree with the order proposed by my learned brother.