A party to a contract who has rendered service to the other party not intending to do so gratuitously and the other person has obtained some benefit, the former is entitled to compensation for the value of the services rendered by him.

Headnote:
CONTRACT - Construction of building - Additional work - Compensation - Basis of assessment - Prevailing market rates - Oral agreement not proved - Compensation under S. 70 of the Contract Act.
Fact of the Case:

The appellant and the respondent entered into a written agreement for the construction of a house and shops on a plot of land owned by the appellant. The respondent carried out a substantial part of the construction work according to plan and the appellant paid him diverse sums of money and delivered building materials. Before the work could be completed, disputes arose between the appellant and the respondent about the work done by the latter. The appellant claimed that the work done was defective and that he was entitled to compensation for effecting repairs necessary to rectify the defects. The respondent claimed compensation at certain rates set up by him for work done for the appellant for which no express provision was made in the written agreement. Each party set up an oral agreement about the remuneration to be paid to the respondent for the extra work which was not included in the original agreement.
Finding of the Court:

The High Court held that the respondent was entitled to received compensation at the prevailing market rate for constructions which were not covered by the agreements dated October 1, 1942 and October 6, 1942. The High Court negatived the plea of the respondent that the appellant had agreed to pay him at "extra rates for deviations and additions not specifically contained in the original agreement.
Issues: Whether the respondent was entitled to compensation for additional work done by him at prevailing market rates, even though he failed to prove an express oral agreement in that behalf.
Ratio Decidendi: If a party to a contract has rendered service to the other not intending to do so gratuitously and the other person has obtained some benefit, the former is entitled to compensation for the value of the services rendered by him. The respondent made additional constructions to the building and they were not done gratuitously. He was therefore entitled to receive compensation for the work done which was not covered by the agreement.
Final Decision: The appeals were dismissed with costs.

Judgement

SHAH, J. : V. R. Subramanayam, the appellant herein is the owner of plot No. 29, Subedar Chattram Road in the town of Bangalore. B. Thayappa respondent is a building contractor. The appellant entrusted the respondent with the work of constructing a house and shops on the plot, on terms and conditions set out in a written agreement dated October 1, 1942, which was slightly modified on October 6, 1942. By the agreement the respondent was to construct for the appellant on the plot six shops abutting a public road, the main building at the rear of the shops, an out-house and a garage according to a site plan. The respondent was to be remunerated at rates specified in the agreement: for constructions with R. C. C. roofing, the rate stipulated was Rs. 4-2-0 per square foot and for "tiled construction it was Rs. 3-2-0 per square foot. The Municipality of Bangalore did not sanction the plan as proposed by the appellant. the plan was altered and it was sanctioned, subject to those alterations. By the alterations the shops were deleted from the plan, the area of the out-house was increased, and a puja room on the ground floor and an extra room on the first floor were added to the plan. A compound wall was also to be constructed. The respondent carried out a substantial part of the construction work according to plan and the appellant paid to him diverse sums of money and delivered building materials. The aggregate amount accordingly received by the respondent was Rs. 20,200. But before the work could be completed disputes arose between the appellant and the respondent about the work done by the latter. The appellant claimed that the work done was defective and that he was entitled to compensation for effecting repairs necessary to rectify the defects. The respondent claimed compensation at certain rates set up by him for work done for the appellant for which no express provision was made in the written agreement. Each party set up an oral agreement about the remuneration to be paid to the respondent for the extra work which was not included in the original agreement.

2. The appellant filed a suit in the court of the Subordinate Judge, Bangalore, against the respondent which was later transferred to the court of the Principal District Judge, Bangalore and numbered O. S. 54 of 1946-47, for a decree for Rs. 8,515-4-0 being the amount of compensation which the appellant claimed he was entitled to receive from the respondent for defective work and for delay in completion of the construction. The respondent filed a suit against the appellant which was later transferred to the court of the Principal District Judge. Bangalore and numbered 55 of 1946-47. By this suit, the respondent claimed a decree for Rs. 5,988-12-0 being the remuneration due to him for the work done in constructing the house less Rs. 20,200 received from the appellant. The respondent filed another suit No. 117 of 1945-46 for a decree for Rs. 15,001-10-9 with interest and notice charges being the amount due to him for the construction of the out-house, godown, first floor room and flight of steps and the value of some building materials which the respondent claimed he had left in the premises of the appellant and which the latter had wrongfully removed.

3. The trial Court granted to the appellant a decree for Rs. 3,000 in suit No 54 of 1946-47. To the respondent. he granted a decree for Rs. 2,989-6-0 in suit No. 55 of 1946-47 and in suit No. 117 of 1945-46, he granted a decree for Rs. 13,329-10-9. Both the parties felt themselves aggrieved by the decrees passed in the three suits and six appeals were preferred to the High Court of Judicature of Mysore at Bangalore against those decrees. The High Court reversed the decree passed at Suit No. 54 of 1946-47 and dismissed the appellant s claim in its entirety. The decrees passed in suits Nos. 55 and 1946-47 and 117 of 1945-46 were also set aside and proceedings were remanded to the District Court with a direction that a q

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