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TMI Blog1904 (4) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... Jadhawji and Tokersey Jadhawji, trading in partnership under the style of Motiram Jadhawji. 3. The two suits arise out of transactions initiated by instructions to David Sassoon and Co. to purchase American cotton as follows: on the 15th March, 1901, instructions were given by Motiram Jadhawji to purchase 400 bales, and by Tokersey Jadhawji to purchase 100 bales for delivery in July-August; on the 26th March instructions were given by Motiram Jadhawji to purchase 500 bales for delivery in August-September; and on 23rd April instructions were given by Motiram Jadhawji to purchase 1,500 bales and by Tokersey Jadhawji to purchase 500 bales for delivery in August: 4. The course of dealing throughout has been the same in respect of each order, and it will suffice to state the history of one of these transactions, as that will describe what was done in the others. 5. On the 15th of March, 1901, the Bombay Branch of David Sassoon and Co. cabled their London Branch to buy 500 bales of American cotton July-August delivery. This was done in pursuance of instructions from Motiram Jadhawji to buy 400 bales, and from Tokersey Jadhawji to buy 100 bales for July-August delivery. 6. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssoon and Co. pressed the Bombay purchasers to deposit a sufficient amount to cover the deficiency in price. Accordingly on the 13th of May, 1901, there was deposited with the plaintiff firm by way of equitable mortgage a title deed to cover this deficiency, and on the 26th of July a sum of ₹ 7,000 was deposited as further security. 11. On the 8th of August, 1901, the plaintiff firm wrote to Tokersey Jadhawji as follows:-- Dear Sir, Owing to the continued heavy decline in American cotton please take note that unless you send us a further deposit of ₹ 5,000 by 1 o'clock to-morrow (Friday) we shall wire instructions to London to sell off your open contracts with us. Begging immediate attention. P. pro David Sassoon Co., (Sd.) Henry Solomon. 12. On the 9th of August, 1901, a telegram was sent by the plaintiffs' Bombay Branch to their London Branch to sell all the cotton purchased under the orders to which I have referred, and on that same clay the sale was effected. This sale resulted in a loss, and in respect of the transaction to which suit No. 695 of 1901 relates, the plaintiffs, after giving the defendants credit for c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with the transactions in suit. 22. It will be noticed that it incorporates the printed rules of the Liverpool Cotton Association; Limited, find it has not been suggested before us in argument that those rules as they stand point to an agreement by way of wager. 23. At the same time the evidence all points the other way. Thus it has been sworn that the contract is in the ordinary form, that under such a contract delivery is ordinarily demanded and given, that the purchases made in March and April were ordinary purchases for future delivery, and that they were made under contracts in the ordinary form for future delivery, in the form in which cotton is ordinarily bought and sold for future delivery, and in the form in which delivery is demanded and given. This evidence has not been impugned and I think we should accept it as trustworthy. 24. But then it is argued that, when the facts are investigated, it becomes obvious that, notwithstanding the terms in which the agreements are expressed, the transactions in suit were by way of wager, and what is relied on for this purpose is the fact that under them no delivery was made, and that David Sassoon and Co. practically never d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en I say he can always get delivery that is supposing he is dealing with a sound man. That rests on that (sic) if my seller is solvent he can always got delivery except in covers in American futures. As a rule there is an enormous deal. More American cotton is sold than is grown and a great deal more is sold in Liverpool than comes here. I can't give statistics. So if in any one month all the people who had purchased ahead for delivery in that month were not to resell and were to ask for delivery, they could not got it because there would not be enough cotton to go round. Of 90 per cent bona fide delivery about are covering purchases and would be purchases for delivery. All what I have said about covering purchases relates to my constituents' business as well as mine. I make the covering purchases for constituents. I make them to order, but I don't know whether they are covering purchases or not. 32. It has been argued before us that purchases for cover cannot be treated as bond fide business and a doubt has been suggested as to how far, therefore, Mr. Comber's evidence can be relied on. But it is easy to see why Mr. Comber as a business man so classes purcha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the English contracts were wagers or they were not: if they were wagers, then the plaintiffs obviously are not entitled to recover; it they were not, the result will be the same, since then they would have failed to comply with the authority under which they purported to act. 39. But in my opinion the second of these horns will not stand the strain to which it is put. The instruction's, in my opinion, were not an authority only to enter into wagering contracts: it cannot be, and in fact before us has not been, suggested that the contracts actually made were not in accordance with the instructions, and we have already held they were not agreements by way of wager. The defect of the learned Judge's argument will on analysis be found to be that he has failed to distinguish the rights created by the contracts from the mode in which those rights may subsequently have been dealt with. 40. So far I have dealt with the case on the basis of section 30 of the Contract Act, but from my conclusions it equally follows that Bombay Act III of 1865 affords no defence to this suit, for in the view I take neither the contracts of Sassoons with the defendants nor the English contra ..... X X X X Extracts X X X X X X X X Extracts X X X X
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