Judgement

Appeal (No. 126 of 1919) from a judgment and decree of the High Court (June 16, 1917) varying a decree of the Court of Small Causes, exercising the powers of a Subordinate Judge of Azra.

In March, 1913, the appellant entered into a written agreement to sell to the respondents 4000 sal railway sleepers at Rs. 1, a. 15, per cubic foot, to be delivered by May 31, 1913 ; as a term of the contract the appellant deposited Rs. 5000 with the respondents and agreed to a penalty of 8 annas per cubic foot for sleepers not delivered by May 31, 1913. The respondents had previously contracted to supply sleepers to the Bengal-Nagpur Railway. By a letter of May 14, 1913, the appellant informed the respondents that 2000 sleepers were ready for inspection, and of these 1746 were passed by the railway company on June 28, 1913, and were accepted by the respondents. No

Law. Rep. 48 Ind. App. 175 ( 1920- 1921) Muhammad Habid Ullah V. Bird and C ompany

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further sleepers were delivered; in December, 1913, the respondents having threatened to exact the penalties, the appellant refused to make any further deliveries, and commenced the present suit.

The appellant by his plaint alleged that the respondents by delay in inspecting and removing the sleepers had caused him loss, and had rendered performance impossible before May 31 ; he further alleged that time was not of the essence of the contract, and that there had been a waiver of delivery in the time agreed. He claimed the return of the Rs. 5000 and damages. The respondents by their written statement denied the alleged delay, and alleged that at the request of the appellants agent the time for delivery had been extended by them to November 30, 1913. They claimed to" deduct from the deposit the profit which they would have made under their contract with the railway upon the undelivered sleepers.

The trial judge held that the appellant was entitled to the return of his deposit of Rs. 5000 and to Rs. 5000 as damages. The High Court, upon an appeal, found that the time for performance of the contract had been extended by the parties to November 30, 1913, and that the appellant, and not the respondents, were to blame for the non-perform ance by that date. They held that the respondents had suffered Rs. 3345 damages and were entitled to deduct that sum from the deposit. Both Courts held that the suit was cognisable by the trial judge as the final acceptance of the contract was at Agra. The effect of the judgments in India appear more fully from the judgment of the Judicial Committee.

1920. Nov. 23, 25, 26. Dunne K.C. and Hyam (Dube with them) for the appellant.

De Gruyther K.C. and du Parcq for the respondents.

The arguments were substantially upon the facts, it being contended on behalf of the appellant that he was not responsible for the failure to deliver by May 30, that his agent had no authority to agree to an extension of time, and that in the absence of any request by them the respondent had not an option under the Indian Contract Act to extend the time for performance.

Feb. 14. The judgment of their Lordships was delivered by

LORD DUNEDIN. The present appeal arises out of a contract made between the appellant and the respondents by which the appellant was to supply 4000 sleepers of a special pattern at any station on the Bengal-Nagpur Railway by May 31, 1913. As a condition of the contract, the appellant had to deposit and did deposit Rs. 5000 with the respondents as security for liquidated damages at a certain rate per foot for all sleepers not delivered on the said May 31. The sleepers had to pass inspection. Only 1746 sleepers were delivered and passed inspection. The time for delivery was extended, but no more deliveries were made, and the parties in December, 1913, broke off negotiations. The appellant then raised action asking for (1.) the return of the deposit; and (2.) damages in respect of his profit on the balance of sleepers not supplied. The respondents counterclaimed for dam