9911796707
TMI Blog1961 (10) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... n business at Calcutta. The appellant's case was that the appellant and the respondent had entered into a contract in the first instance on December 18, 1980, through brokers named T. N. Mehrotra & co., Calcutta. This contract was later confirmed by two letters written respectively on January 3 and 15, 1951, by the appellant to the respondent and replied to by the. respondent. By this contract the respondent agreed to sell 1000 bales of Banaras Hemp particulars of which were set out in the plaint. According to the appellant, by a letter written on March 14, 1951, the appellant in part performance of the said contract accepted delivery of 110 bales of Banaras Hemp No. 1 and 50 bales of Banaras Hemp No. 2; this delivery was Made by the respondent to L. N. Poddar & Co., who acted as the agent of the appellant and Paid the price of the said 160 bales. In they transaction the respondent realised ₹ 3,840 from the said I,. N. Poddar &; Co. in excess of the actual price of the goods delivered to the said company. Inspite of the repeated demands made by the appellant the respondent failed to deliver the balance of the goods contracted for and thus committed breach of the contract. Tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Court of Appeal, as in the trial court, on the bought and sold notes; and it was urged that the bought and sold notes clearly showed that the appellant had entered into the contract on account of the disclosed principal Messrs. Khaitan and Sons Ltd. Before the Appellate Court the respondent's case was that the said bought and sold notes constituted the terms. Of the contract and no other evidence was relevant and admissible in order to determine the said terms. Das Gupta, J., upheld this. plea. In his opinion the bought and sold notes issued by the brokers Constituted the sole basis for the terms. Of the contract and the two letters subsequently written on January 3 and 15, 1951, were inadmissible and irrelevant for the purpose of determining the said terms of the contract. The learned judge, however, considered the matter also on the alternative basis. that the said letters could be considered for ascertaining the terms. Of the contract and came to the conclusion that can reading the said letters and the bought and sold notes together the result was the same, namely, that the contract had been entered into by the appellant on behalf of the disclosed principal. Bachawat, J., dif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Any dispute in connection with this deal is subject to Arbitration by Bengal Chamber of Commerce. Calcutta, 18-12-1950. Radhakrishna Sivadutta Rai, A/c Khetan and Sons Ltd., Shewpur, Banaras. Dear Sirs, We confirm having purchased on your account and risk under noted goods from Messrs. Tayeballi Dawoodbhai, 20, Zakaria Street, Calcutta. Commodity: 500 (five hundred) bales of Banaras No. 1 only with Agmark Jan/March '51 at K. P. Docks @ ₹ 165 per bale of 400 lbs. each on receipt of the goods. Yours faithfully, For T. N. Mehrotra and Company, Sd. T. N. Mehrotra. Sales Tax number should be furnished by the Buyers otherwise to be charged." "T. N. Mehrotra and Co. No. 378 Hemp, oil and oil Seeds Pollock House Brokers (3rd Floor) Bank 4718 29-A Pollock street Tel: B.K. 1914 Calcutta, 18-12-50. Any dispute in connection with this deal is subject to arbitration by Bengal Chamber of Commerce. To: M/s. Tayeballi Dawoodbhai, 20, Zakaria Street, Calcutta. Dear Sirs, We confirm having sold on your account and risk, the under noted goods, to M/s. Radakrishan Shiv Dutt Rai with A. G. Mark. A/c Khetan and Sons Ltd., Shewpur, Banaras. Commodity: (500 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring January/March 1951. This confirms your letter of 3rd instant. Yours faithfully, for Tayeballi Dawoodbhai. Sd. x x Partner. Copy to Messrs. T. N. Mehrotra & Co., Calcutta, and to Gopinath Mehrotra, Banaras." Mr. Pathak contends that in construing the effect of the relevant documents we should not attach any importance to the reference to Khaitan & Sons made in the bought and sold notes for the simple reason that the said reference is the result of a mistake or misconception on the part of the brokers. In that connection he contended that the J. finding recorded by the trial court on the issue of mistake should be accepted by us and not the finding made by the/ Appellate court. We are not impressed by this argument. In regard to these notes we have the evidence of Trilokinath and Gopinath on behalf of the brokers which negatives the theory of mistake or misconception. Trilokinath has stated on oath that when he got the offer from the respondent he telephoned to his brother Gopinath who is a broker in respect of hemp of the firm of Sewnath Gopinath and he told him about the offer. Gopinath then informed Trilokinath that the offer was closed either on the 16th or on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation slip he may have noticed the reference to Khaitan & Sons but he did not read the document attentively. He was, however, forced to concede that he had gone through the note before he signed the confirmation slip. It was under stress of cross-examination that Gopal Lal incidentally mentioned that the reference to Khaitan & Sons may have been made by mistake. It is obvious that Gopal Lal's evidence which otherwiee suffers from the infirmity that it is full of contradictions cannot be accepted on the question of mistake because his explanation about his conduct in signing the confirmation slips considered by itself is wholly unsatisfactory. Therefore, in our opinion, the Appellate Court was fully justified in reversing the finding of the trial court on this point and in coming to the conclusion that the reference to Khaitan & Sons which the notes made was no the result of any mistake or misconception In this connection it may be relevant to refer to the attitude adopted by the appellant when the dispute arising between the parties in the present contract had gone before the Bengal Chamber of Commerce for adjudication. In those proceedings the respondent had raised the same plea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the brokers has been frequently considered by judicial decisions. As early as 1846 the Privy council had occasion to deal with this question in Cowie v. Remfry (1846) 3 M.I.A.448. In that case a. C & Co and H.& Co; were merchants at Calcutta. The latter sold to the former a large quantity of indigo through the medium of a broker who drew up a sold note addressed to H.& Co. and submitted. it to H. for his approval. H. Objected to a particular word appearing in the note whereupon the broker took the sold note to C. and informed him of His objection. C. then struck his pen through the word objected to by H. placed his initials over the erasure and returned the note to the broker. The broker then delivered it in that altered form to H. & Co. Next day the broker delivered to C. & Co. a bought note which differed in certain material terms from the sold note. In an action brought by H. & Co. against C. & Co. for the breach of the contract as contained in the sold note the Supreme Court at Calcutta was of the opinion that the sold note alone formed the contract and so it decreed the plaintiff's suit. On appeal by the defendant the Privy Council reversed the finding of the Supreme Court a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arol agreement", observed Lord Campbell, C. J., "so may the sold note; and which of them is to prevail It seems to me, therefore, that we get back to the same point at which we-were when the variance was first objected, and the declaration was amended. I by no means say that where there are bought and sold notes they must necessarily be the only evidence of the contract; circumstances may be imagined in which they might be used as a memorandum of a parol agreement. Where there has been an entry of the contract by the broker in his book signed by him, I should hold without hesitation, notwithstanding some dicta, and a supposed ruling of Lord Tenterden in Thornton v. Meux (M. & M. 43), to the contrary, that this entry is the binding contract between tho parties and that a mistake made by him, when sending them a copy of it in the shape of a bought or sold note, would not affect its validity. Being authorised by the one to sel], and the other to buy, in the terms of the contract, when he has reduced it into writing and signed it as their common agent, it binds them both, according to the Statute of Frauds, as if both had signed it with their own hands; the duty of the brok ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the bought and sold notes in the present case. The notes referred to the appellant and added "A/C Khaitan & Sons Ltd." There is no disparity in the notes at all; and so the two notes can be safely taken to evidence the terms of the contract. When along with the name of the appellant the notes specifically refer to a "Khaitan & Sons Ltd." with the preceding words "A/c'', there can be no doubt that the appellant is shown by the notes to be acting on account of the disclosed principal. The appellant realised that the effect of the reference to Khaitan & Sons in the notes would inevitably be to support the plea of the respondent that it was not entitled to bring the present action and so it pleaded that the said reference was the result of a mistake. Therefore, there can be no doubt that if the material question had to be considered in the light of the bought and sold notes alone the appellant was acting on behalf of the disclosed principal and, on the contract thus entered into, it had no right to sue end can claim no cause of action in its favour. In Gadd v. Houghton (1876) 1 Ex. 357. James, L. J. Observed "when a man says that he is making a contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , L. J., because as we will presently point out they would be of material assistance in deciding the point which Mr. Pathak has raised on the strength of the two subsequent letters. Thus, the bought and sold notes in this case unambiguously indicate that the appellant was acting for a disclosed principal and the contracting party was the disclosed principal and no other. It is, however, urged by Mr. Pathak that before determining the terms of the contract and the parties to it we must read the notes in question along with the two letters. We have already seen the sequence of the documents. First, the notes were delivered by the brokers to the appellant and the respondent. Then the respective parties filed confirmation slips and then followed the two letters exchanged between them. Mr. Pathak contends that in its letter addressed to the respondent the apellant has definitely stated that 'they' had bought from the respondent 1000 bales in question. Mr. Pathak places considerable emphasis on the use of the word "we" without reference to the principal; and he also relies on the fact that the letter is signed by the appellant without describing itself as acting on behalf of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere entitled to sue upon the contract. The majority decision was based on three grounds. The first ground was that the plaintiffs had signed the note without describing themselves as acting on behalf of the principal and so it was held following the language used by Mellish, L. J., in the case of Gadd (1876)1 Ex. D. 357. that prima facie when a man signs a document in his own name and states therein "I have this day bought from you" he is the person liable on the contract. The second consideration was that the reference to the foreign principal was made in the note in order to declare the destination of the goods. There wax evidence adduced in the case to show that during wartime the destination of goods intended for export had to be made known. Therefore the reference to the foreign principal was treated as having been made for the purpose of meeting the said requirement; and the third circumstance was that the plaintiff's statement at the head of the note that they were acting for and on behalf of a foreign principal could not get rid of the prima facie presumption that a person signing a contract in his own name is personally liable on it. It would thus be seen that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally," it is observed, "in the ease of contract in writing other than a bill of exchange, promissory note, or cheque, depends upon the intention of the parties, as appearing from the terms of the written agreement as a whole, the construction whereof is a matter of a law for the Court- (a) if the contract be signed by the agent in his own name without qualification, he is deemed to have contracted personally, unless a contrary intention plainly appear from other portions of the document, (b) if the agent add words to his signature, indicating that he signs as an agent, or for or on behalf of a principal, he is deemed not to have contracted personally, unless it plainly appears from other portions of the document, that, notwithstanding such qualified signature, he intended to bind himself." In conclusion it is added that "effect should be given to every word used and none should be rejected unless it is apparent that they have been introduce per incuriam" (P. 266, Art. 116). These observations do not carry the appellant's case very for because all that they show is that in determining the question as to whether the agent has entered into the contract on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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