Rectification of a contract under Section 31 of the Specific Relief Act requires clear proof of mutual mistake and that the instrument fails to express the parties' real intentions. Such a claim fails if the party's conduct in other transactions proves they understood the terms used.

Lord Thankerton. -

In this appeal it became obvious that there was one crucial point, the decision of which might supersede consideration of any further points. Their Lordships wish to recall the essentials which have to be proved under S. 31, Specific Belief Act, 1877. The plaintiffs (the present respondents) must prove that it was through a mutual mistake of the parties that the three contracts in question did not truly express the intention of the parties; and the duty of the Court, before it can rectify, is to find it clearly proved that there has been mistake in framing the instrument, and it must ascertain the real intention of the parties in executing the instrument. On being satisfied of those two elements, it is in the discretion of the Court to grant rectification. In the present case it is unnecessary to consider the appellant-defendants' conduct or view vis-a-vis the question of mistake. The vital question in the appeal is whether the plaintiffs (the present respondents) have established that there was mistake on their part within the meaning of S. 31. Mr. Rewcastle, in a very frank and able statement, has admitted, and has rightly admitted, that the only person who could prove the purpose of putting the word "shipment" into the three contracts with which the present case is concerned was the witness Nanakram.

The case made, briefly put, was that Nanakram did not know the difference between the meaning of the word, "shipment" and the word "delivery." Both Courts in India are agreed that commonly there is a very material distinction between the two words, and the real question is whether it can be accepted at Nanakram's hands that on 5th and 6th December 1941, he did not know the difference between those two words. The learned trial Judge found difficulty in accepting that suggestion from Nanakram. It seems to be quite clear on his judgment that he did not accept it, and he held that the plaintiffs had failed to prove that alleged understanding and purpose of Nanakram in inserting the word "shipment" in the three contracts. When the matter came before the High Court, the Chief Justice and Chagla J. were agreed in accepting the trial Judge's appreciation of the evidence, which included a discrediting of Nanakram as a witness; but Chagla J. said in reference to Nanakram's evidence :

"But, in the midst of contradictions and falsehoods which he has indulged in, one fact clearly emerges, and that is that he thought that the expression "shipment" combined with the words "to take delivery as soon as we get" meant the same thing as "delivery" and when he inserted this expression in the contract he meant the same thing as if he had inserted 'January-February delivery'."

Their Lordships find themselves unable to agree with that finding, because they are at the very least, of opinion, agreeing with the trial Judge, that Nanakram has failed to prove that such was his understanding; but their Lordships are prepared to go further in view of the fact that in relation to a contract concluded on 4th December with some people called Nathalal, Nanakram had given instructions to the broker that, if Nathalal objected to the word "shipment," which was in that contract as drawn by Nanakram, it would be altered to the word "delivery" and that, following an objection by Nathalal being reported by the broker, in the result the word "shipment" was altered to "delivery" by Nanakram. That was done before he knew of any of the three contracts with the defendant-appellants in this case: yet he retains the word "shipment" in their contracts. That of itself to their Lordships' minds is rather suggestive of the fact that he thought that there was some difference, or some advantage to him, in retaining those words; but when their Lordships find, a few days later, a contract of 10th December 1941, made by Nanakram with other parties which contract was also for "shipment," they have this finding by the trial Judge:

"In respect of this contract correspondenc