131-NLR-NLR-V-31-HETTIARATCHI-v.-TERUNNANSE.pdf
( 469 )
Present; Fisher C.J. and Akbar J.
HETTIARATCHI v. TERUNNANSE.
359—D. C. Kurunegala, 13,907.
Sale of goods—Contract for transfer of car—Payment of value within one' month—Breach of agreement—Cause of action—Ordinance No. 11
of 1896, s. 18, rule 4.
An agreement for the sale of a car provided for the payment ofits value within one month, when the seller undertook to transferhis interest in. the car. On ..failure thereof, the purchaser agreedto return the car, paying a penalty.
Held, that the property in the car did not pass to the purchaser,unless the price was paid within the month and the transfer taken.
Where the seller sued for the recovery of the value of the caron the assumption that there had been a completed contractof sale,—
Held, that the. plaintiff's cause of action was a .breach ofcontract.
^^Fi’EAL from a judgmenfc.of'^iie District Judge of Kurunegala.
Dc Zoysa, K.G. (with Ameresekera). for defendant, appellant.
H. V. Pefera (with Abeysekera), for plaintiff, respondent.
March 4, 3930. Fishes C.J.—
In this case the learned District Judge gave judgment for theplaintiff for Rs. 2,000', being the price of a motor car alleged to havebeen sold to the defendant, and the question is whether there was a
1080
{1913) 2 1. R. 265 ; Halsbury's Supp. para. 439, note (a).
( 470 )
.1980 sale, having regard to the terms of the agreement dated August 15,
FtommC.J". 1927. That agreement is in the following terms
Heuiqratcki “ On August 15, 1927, at Kurunegala.
v.
Terunnanse “I the undersigned B. Dewamiffcta Terunnanse Incumbent ofBotota Vihare do hereby remove the Chevrolet car bearingNo. D1110 belonging to Mr. D. J. Hettiaratchi, Headmaster ofthe Buddhist Mixed School in Kurunegala, agreeing to pay thereforthe sum of rupees two thousand (Rs. 2,000) as its full value withinone month, and if it is found impossible to pay the said sum ofmoney within one month the said car will be returned together witha sum of rupees five hundred (Rs. 500) as a penalty. That duringthe said term if any damage was caused to the said car the full valuethereof be paid to the said Mr. D. J. Hettiaratchi. It is herebyagreed that immediately after the full value -has been paid withinone month, the said D. J.. Hettiaratchi shall transfer all his interestin the said car to me ..
The agreement therefore (a) entitled the defendant to removethe car; (b) gave him the right to purchase the car for the sum ofRs. 2,000 within .one month; (c) imposed an obligation on him toreturn .the car-if he did not pay the Rs. 2,000 within one monthtogether with a sum of Rs. 500 11 as a penalty/’ Whether this is tobe regarded as a penalty, in the sense which makes such sumsirrecoverable, or the payment, of a sum in consideration of having-been allowed to use the car for one month may be open to question,but having regard to the course we propose to ^adopt in this caseit is unnecessary at this stage to express an opinion on the point;
made the defendant liable for any damages which * may havebeen caused to the car during the period of one month; (f) providedthat if the defendant pays the full purchase money within one monththe plaintiff ‘‘ would transfei^all his interest in the said car ” to the"defendant. It seems to me clear, in view of the last mentionedprovision^ that the property in the car was not to pass unless thedefendant duly exercised his option to purchase within one month.It was urged by Counsel for the’respondent that rule 4 (h) of section18 of the Sale of Goods Ordinance, 1896, covered ^the case. Theoperation of section 18 depends on the initial words “ Unless adifferent intention appears when this is not the case the “ rulesfor ascertaining the intention of the parties as to the time at whichthe property in the goods' is to pass to the buyer ” thereafter set outare to be applied. Under the agreement in question the time atwhich the property was- to pass is clearly laid down and the con-tingency on which it was "to pass never arose. A 44 different inten-tion " is therefore apparent and rule 4 is not applicable. Thatbeing so there was no sale of the car and the plaintiff was notentitled to recover Rs. 2,000 as purchase money.
( 471 )
But there is another aspect of the case, namely, the breach bythe defendant which clearly took place of his obligation to returnThe car if he did not pay the Bs. 2,000 within one month. . On thatbreach the plaintiff ha.'; a cause of action. I do not think we havesufficient material before us to satisfactorily estimate what thedamage payable to the plaintiff should be. This must be thesubject-matter of further inquiry by the learned District Judge.We therefore set aside the decree and remit the action for trial on•the question of damages based on the failure of the defendant toreturn the car in accordance With the agreement.
1 think that each party should bear his own costs of the hearingin the Court below and of this appeal. The cos.ts of the furtherhearing will be in the discretion of the learned Judge who tries theissue as to damages.
Akbar J.—
The short point in this appeal which was argued before us iswhether there was a contract of sale on a transaction set forth inthe following document: —
“D8 Translation. On August 15, 1927, at Kurunegala, I theundersigned M. Dewamitta Terunnanse, incumbent of BototaVihara, do hereby remove the Chevrolet car bearing No. D1110belonging to Mr. D. J. Hettiaratchi, Headmaster of the BuddhistMixed School, in Kurunegala, agreeing to pay therefor the sum ofrupees two thousand (Rs. 2,000) as its full value within cne month,and if it is found impossible to pay the said sum of money withincne month, the said car will be returned together with a sum ofrupees five hundred (Rs. 500) as "a penalty. That during the saidterm if any damage was caused to the said car the full value thereofbe paid to the said Mr. D. J. Hettiaratchi. It is hereby agreedthat immediately after the full value had been paid within one. month, the said D. J. Hettiaratchi shall transfer all his interest inthe said car to me. And we have set our usual signature to two ofthe same tenor as this' agreement and retained the same with bothof us.”—(Sgd.) B. Dewamitta and D. J. Hettiaratchi.
Witnesses:—(1) (Sgd.) H. M. Appuhamy, (2) (Sgd.) Ratnayake.
The plaintiff, the owner of this car, sued in this action claiming thesum of Rs. 2,000 and also the sum of Rs. 500 being the fine or penaltymentioned in the document. . The District Judge has given judg-ment for the plaintiff for the sum of Rs. 2,000 because he was ofopinion that there was a sale of the car to the defendant and that theplaintiff was entitled to recover its value. The facts were admitted,namely, that there was a delivery of a car to the defendant and thatthe defendant did not elect to pay its value within the month andthat he has not returned the car up to date. It was contended for
1930
Fishes C.J.
Hettiaratchi
v.
Terunnanse
1980
Akbar J.
Hettiaratchi
v.
Terunnanse
( 472 )
the respondent that this sale was governed by section 18 rule4 (6) of the. Sale of Goods Ordinance, No. 11 of 1896, and that asthe defendant did not give notice of rejection within the month orreturn the car, it must be held that there was a sale and that theproperty in the car had passed to the defendant. As pointed outby the Court of Appeal in the case of Weiner v. Grill,1 the rule is notapplicable if there is a different intention manifested in the termsof the contract. In my opinion such an intention exists in Do.This is a sale of a motor car and such sales are regulated by Ordi-nance No. 20 of 1927. The car at the time of the sale was admittedlyregistered in the name of the plaintiff and there can be no sale orpassing of the property in the car to the defendant unless thenecessary alteration of the registration is made under section 22 ofthe Motor Car Ordinance. Under section 22 (6) the plaintiff, ifthere was a sale, had .to deliver his motor car licence to the Registrarand deliver his certificate of registration and inform the Registrarof the change of ownership. The Motor Car Ordinance, No. 20 of1927, came into operation on January 1, 1928, but ever, under thelaw before January, 1928, namely, under the bye-laws made undersection 22 of Ordinance No. 4 of 1916, a similar provision existed.
Now this document D3 provides for this formality in that it isstated that only on the payment of the value of the car within themonth was the plaintiff bound to transfer his interest in the car tothe defendant. It seems to me that the whole intention indicatedin the document was that the title was not to pass from the plaintiffto the defendant, unless the payment of the price of the car was madewithin the month and the plaintiff had signed the document. Onthis .construction the plaintiff should have sued the defendant fordamages for a breach of the contract disclosed in D3. The plaintiffwas I think wrong in contending that there was a sale in thiscase. The defendant, however, could not have been prejudiced be-cause the full facts of the plaintiff's cause of action were set outin the plaint. The case should therefore in my opinion go backfor the assessment of the damages consequent on the breach of thecontract, for according to the finding of the District Judge therecannot be any doubt at all that the defendant has broken theterms of the contract and that he has not returned the car. Iwould, therefore, set aside the judgment and send the case back forthe assessment of the damages due to the plaintiff owing to thebreach of the contract by the defendant. I agree with the orderproposed by My Lord the Chief Justice as regards the costs incurredup to date, and that the further costs should be in the discretion ofthe trial Judge.
Set aside.
i (1906) 2 K. B. D. 574.