110-NLR-NLR-V-23-FERNANDO-v.-SUBRAMANIAM-et-al.pdf
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1022*
Present: Bertram C.J. and De Sampayo J.FERNANDO v. STJBRAMANIAM et al.
46—D. C. KcU‘UtdT(i3 8,386*
Damages—Breach of contract—Goods sold against defendant—No marketfor goods at time of breach—Sale after some time^Claim ofdifference between contract price and price realized*
Defendant contracted to bay thirty leaguers of arrack, butrefused to take delivery of a portion. The plaintiff gave formalnotice that he would sell against him. The notice expired onJuly 16. The arrack was sold in September. The -plaintiffclaimed the difference between the contract price and the pricerealized. There was no actual market for arrack in July, andit was difficult to find purchasers for the arrack in question.
Held, that plaintiff was entitled in the circumstances to thefull amount of the difference in price.
rpHE foots appear from the judgment of the District Judge. (Allan Beven, Esq.):—
The plaintiff, who is a renter and wholesale dealer in arrack, allegesthat he entered into a contract with defendants on May 23, 1918, tosupply them with 30 leaguers of arrack at Rs. 180 a leaguer, and theyagreed to receive the same. Hie defendants admit they received 13leaguers of arrack and paid plaintiff for the same, but deny that (hey
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entered into any agreement to accept 30 leaguers from him. In proofof tftfa they produce a writing dated May 23, 1918 (D 1), in whichplaintiff promises to supply them with 30 leaguers of arrack at Ba 180,per leaguer, but they contend that there was no obligation on their part, .either expressed in writing or tacit, to accept the same. Bat plaintiffhas proved by the witness Sinniah, who acted as broker for defendants,and introduced first defendant to him at (he Council Chamber at the saleof rents, that he (first defendant) agreed to take 30 leaguers. The sameday Sinniah took plaintiff to Hulftsdorp togetRs. 2,000 in advance fromfirst' defendant, who said he had no money, but asked him to come nextday. But first defendant was so anxious to bind plaintiff to his contractthat he took the writing D 1 from him. This document is verycautiously worded, and put no obligation on defendants to accept thearrack. At that time the arrack market was rising, but evidently wasin a state of fluctuation. On May 27 and June 5 plaintiff delivered975 gallons, equ ivalent to 131eaguers,for which he was paid. Accordingto Sinniab’s evidence, the price of arrack went down after the lastdelivery by plaintiff, though plaintiff states it kept between Rs. 180 andBe. 190 for 15 days after the contract was entered into. The plaintiffstates that defendants would not take the balance arrack, because theyhad no money at tho time,nor enough vessels to store it. So, even if theprice kept steady for 15 days, defendants were not in a position to takedelivery.
The first defendant has gone into the witness box to repudiate thecontract which was made with him previously (vide D 1), but seconddefendant gives as a reason for not accepting the balance arrack, that itwas not quite up to the standard of the previous instalments delivered.I have no doubt in my mind that defendants intended taking over allthe arrack (30 leaguers), but they were not in a position to do so for wantof vessels and foods. Then they found the market falling and repudiatedthe contract, on the ground that there was no obligation on them toaccept it.
Plaintiffs sent defendants a letter of demand (D 2) on July 8, and.received reply (P 1) repudiating the contract. Plaintiff, thereafter,
. sold the arrack at Rs* 105, and is now claiming Rs. 1,500 damages.
I give judgment for plaintifEfor Rs. 1,360, with costs.
At the second hearing the District Judge (J. C. W. Rock, Esq.)delivered the following judgment:—
This case is sent back for inquiry as to what was the market price inJuly, 1918, or rather after July 16. Plaintiff called evidence to showthat tiie price was Rs. 100 or Bs. 110 per leaguer. One Pieris, managerof Mr. R. E. 8. de Soysa, gave evidence to this effect, but said that thecredit price might be Rs. 170 or Rs. 180. The witness Warlianu Fer-nando, however, does not give unequivocal support to this statement.In fact, his evidence was rather evasive, and when 1 questioned him, itcame out quite involuntarily that—to use his own words—“ in Julywholesale godown keepers sold arrack for Rs. 160 and Rs. 180 readycash.*9 He tried afterwards to amend this statement, but it seems torepresent the truth. Defendant called a witness, who produced hisaccount book (D 3) to show that Rs. 180 was the price paid to godownkeepers on July 30, and, in fact, to Kens* employer arrack was sold atRs. 170. Neither plaintiff nor Pieris produced any books, and taking
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1923.1the evidence of defendant’s witness with that of Warlianu, it appears to
me that it was possible to get B& 180 a leaguer in July. Plaintiff wasprobably mate intent in pursuing damages from defendant than onumnftrm selling. There was no appreciable fall in the price of arrack, and there-fore plaintiff is not entitled to recover any damage. Plaintiff should paycosts of appeal and of this inquiry.
A.St. P. Jayawardene, K.C. (with himF. deZoysa),for appellant.
Pereira, E.G. (with him Amarasekera), for respondents.
January 12,1922. Bbrxbah O.J.—
This is a case which is far from easy to decide. It has alreadybeen before this Court, and was sent back for further inquiry inthe District Court. Our difficulties are due to the fact that thatinquiry has not been so close and searching as it ought to havebeen. The question arises on the sale of certain arrack. Thecontract was for the sale of thirty leaguers of arrack at Rs. 169 perleaguer ; and thirteen leaguers were delivered under that contract,after which the defendant repudiated it. For some time theplaintiff took no actual step to make the defendant responsible;but finally he gave him formal notice that he would sell againsthim. He did not, however, sell against him immediately. Thenotice expired on July 16; the arrack was disposed of in September,and the plaintiff claimed the difference between the contract priceand the price realized.
When the matter came before this Court, it was thought thatthe measure of damages had not been properly estimated. Thecase was sent back, so that inquiries might be made as to what wasthe market price on July 18, and the Court bdow applied itselfto that question. The evidence tendered by the plaintiff wentto show that there was no actual market for arrack at the time inquestion. Most of the arrack dealt with had already been con-tracted for, and it was said that in the latter part of July there wasno demand for additional arrack, and that it was very difficultto find a purchaser for the arrack in question, the only sales beingsales direct from distilleries. One witness, on examination by theJudge, made a series of remarks, which appear to be absolutelyunintelligible. One of these remarks was to the effect that in Julyarrack was disposed of at Rs. 160 and Rs. 180 per leaguer. On theother side the manager of Mr. P. C. H. Dias was called, and heproduced a book showing that in the course of the month of Julytransactions were entered at Rs. 180 per leaguer.
Row, the petition is really this. The case went back to theCourt below for inquiry as to the market price of arrack in thelatter half of July. The question is, Has any market price beenproved ? Certainly the plaintiff has not proved the existence
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of any market price. The question is, Does the production ofMr. P. G. H. Dias's books show the ruling market price ? It seemsto me that the book is inadequate for the purpose. It is not statedwhether the sales of arrack referred to were sales of surplus arrackas ordinary market transactions, or whether they were sales inpursuance of a contract or some understanding. One of them isa sale by Mr. Dias himself to the Eour Kor&les renters, of whom hehimself was one. On the other side of the book are numerous entriesshowing that Mr. Dias himself purchased from various distillersaxrack&ta muohlower price, and the evidence called by the plaintiff,in particular that of Mr. Pieris, the manager- of Mr. R. E. S. deSoyBa, seems to suggest that these sales were sales in theordinary course of business. It does not seem to me, therefore,that the production of this book by Mr. Dias does prove anythingin the nature of a ruling market price, and I see no reason why weshould not act upon the evidence of Mr. de Soysa's manager.
If we accept those facts, the case is exactly on all fours with thecase of the Dunkirk CoUiery Company v. Lover?- which was thecase of a coal contract, where the defendant repudiated the contract,where there was no market for the coal thus thrown on the handsof the seller, and where he tried to find another purchaser accordingto the ordinary course of his business, and after several failuressold the coal at a much lower rate than that contracted for. Itwas there held that the plaintiffs were entitled to the full amountof the difference between the contract price and that which theyobtained. On that principle X think it must be taken that theresult of the inquiry really is that there was no market price, andI think that, under the circumstances, the plaintiff is entitled tothe damages originally awarded. I would, therefore, allow theappeal, with costs.
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Bbbsbau
O.J.
Fernando v,Subnhmaniam
Db Sahpato J.—I agree.
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