The main legal point established in the judgment is that the governing law of a contract depends on the intention of the parties, the place of making and performance of the contract, and the applicable legal framework, which in this case led to the determination that the contract was governed by the law of Travancore.

JUDGEMENT

9 Law. Rep. 69 Ind. App. 1 ( 1941- 1942) State Aided Bank of Travancore, Limited V. Dhrit Ram

70

Appeal (No. 5 of 1941) from a decree of the High Court in its appellate jurisdiction (March 13, 1940) affirming a decree of that court in its ordinary original civil jurisdiction (July 20, 1939).

The following facts are taken substantially from the judgment of the Judicial Committee. The appellant (defendant) (hereafter called the bank) was a company incorporated according to the laws of the State of Travancore and, apart from a branch office in the State of Cochin, had its head and only office at Alleppey in that State. It had no branches elsewhere. In September, 1936, the respondent (plaintiff), who resided in, and was in permanent employment in, Bombay, wrote to the Bank at Alleppey asking for the rate of interest allowed on fixed deposit. On September 5, 1936, the bank wrote back stating that their present rates of interest for deposits of six months, one year, and two or more years were 4 per cent., 5 per cent, and 5^ per cent., respectively. "Remittance may be made towards credit of our account "with the National City Bank of New York, Bombay, and the "same will be accepted by us at par, and interest allowed "from the date on which credit will be afforded to our account "at that end. Enclosed please find the necessary opening "forms for fixed deposit account, which please return duly "completed and signed on remittance being made/ On October i, 1936, the respondent paid Rs.i 1,000 to the account of the bank in the National City Bank of New York, Bombay, filled up the banks opening form, and wrote to the bank at Alleppey enclosing the executed form and also the specimen signature card, and requesting the issue of a fixed deposit receipt for two years in his name. The opening form was in the following terms —

Place Bombay. Dated 1.10. 1936.

The Manager,

The State Aided Bank of Travancore Ltd.,

Alleppey.

Dear Sir,

Please receive the sum of Rs. Eleven thousand only sent herewith as per detail below—

Cash

Notes.

Cheque, Bills, etc. 11,000 credited to your account

in the National City Bank

of New York, Bombay. Total Rs.11,000

as a fixed deposit repayable 24 months after, bearing interest at the rate of 5^ per cent, per annum as per your Rules and issue a receipt in the name of Mr. Dhrit Ram, Senior Auditors Chief Auditor office, G. I. P. Railway, Bombay V. T. The specimen signatures are also attached.

Yours faithfully, Signature —Dhrit Ram. Full Address as given above.

If the deposit is in more than one name, please say if it is a joint or either survivor deposit. Specimen Signature.

9 Law. Rep. 69 Ind. App. 1 ( 1941- 1942) State Aided Bank of Travancore, Limited V. Dhrit Ram 71

1. 1. Dhrit Ram.

2. 2. Dhrit Ram.

3. 3. Dhrit Ram.

On October 6 the Bank wrote enclosing the deposit receipt "with effect from the 1st inst." The deposit receipt was in the following form —

THE STATE AIDED BANK OF TRAVANCORE LIMITED

Interest to run from 1.10. 1936 DEPOSIT RECEIPT Due on 1.10. 1938.

and payable ½ yearly on 2nd

July and 2nd January

ALLEPPEY, 6th October, 1936

Rs. 11,000/-As of 1st October, 1936.

No. 10/229.

FOR THE STATE AIDED BANK OF TRAVANCORE LTD.

Sd. MANAGER.

Ented, Sd. Accountant.

Interest will cease at the expiration of two years when this receipt must be sent in for payment or renewal endorsed by the Depositor. No notice will be issued by the Bank.

A similar transaction took place in March, 1937, when similar documents passed. The deposit in that case was for Rs.4000 for one year at 5J per cent. Interest was paid by the bank to the depositor on four occasions at the fixed terms by sending him a cheque on a bank in Bombay, only in one case on the New York Bank. In March, 1938, when the second deposit of Rs.4000 became due the Bank was in difficulties, and a correspondence followed, the respondent asking for payment, the bank putting him off. Later in 1938, creditors petitions were presented to the Travancore Court for winding up the bank,