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1956 Supreme(Pat) 68
PATNA HIGH COURT
Raj Kishore Prasad, J.
Gopalji
Versus
Nagarmal Baijnath
Appeal From Appellate Decree No. 347 of 1951 ;
Decided On : APRIL 18, 1956
The mere fact that one of the partners of the selling and purchasing firms is common does not make the sale invalid.
Headnote:
SALE OF GOODS - Resale by Seller - Common Partner in Selling and Purchasing Firms - Validity of Sale - Partnership Act, 1932, Secs. 14, 15, 16, 18, 19, 29 - Sale of Goods Act, 1930, Sec. 54(2).
Fact of the Case:
Plaintiffs, a firm carrying on business at Muzaffarpur, sold 6 bales of long cloth to defendants, a firm carrying on business at Chanpatia, through their representative Radhakishun. The goods were to be delivered at Muzaffarpur on cash payment. When the defendants refused to take delivery, the plaintiffs sold the goods by public auction and suffered a loss. They sued the defendants for damages.
Finding of the Court:
The courts below decreed the plaintiffs' suit, holding that the defendants were bound by the transaction entered into by Radhakishun, and that the measure of damages should be the difference between the contract price and the price fetched at the sale.
Issues: Whether the sale held on 5-8-1943, was bad in law because one of the partners of the plaintiffs firm was also a partner of the purchasing firm.
Ratio Decidendi: The court held that the sale was not invalid merely because one of the partners of the selling and purchasing firms was common. The court distinguished between co-ownership and partnership, and held that the rights of a co-owner to deal with a joint property are not the same as those of a partner to deal with the partnership property. The court also held that even if the sale was invalid, the plaintiffs would still be entitled to damages based on the difference between the contract price and the market price at the date of the breach.
Final Decision: The appeal was dismissed with costs.
Raj Kishore Prasad, J.
1. This appeal by the defendants is against a judgment of affirmance of the 1st Additional District Judge of Muzaffarpur.
2. It is really unfortunate that the suit, which was instituted on 19-8-1944, although it has run a course of about twelve years, has not yet come to an end. This is the second time that the matter has come up before this court. The point which has been presented in the present appeal is a short one; but in order to appreciate it, it is necessary to state a few facts.
3. The plaintiffs are a firm carrying on business at Muzaffarpur under the name and style of Nagarmall Baijnath with their head office at Bombay. The defendants Gopalji and Baldeoji are brothers, being members of a joint Hindu Mitakshara family carrying on their business at a place called Chanpatia, in the district of Ghamparan, under the name and style of Gopaiji Baldeoji.
But according to the plaintiffs they carried on their business also in the name of Sitaram Shreekishan. Sitaram is the sisters husband of the defendants. Radhakishun and Shreekishun are the sons of Sitaram. Shreekishun is a minor aged only about 10 years. The plaintiffs case is that on 19-5-1943, the defendants through their representative Radhakishun purchased from the plaintiffs farm at Muzaffar-pur 6 bales of long cloth at the rate of Rs. 4/9/- per lb. at the total price of Rs. 10,025. The goods were to be despatched from Bombay in June-July 1943, and were to be delivered when received at Muzaffar-pur to the defendants on cash payment.
When the intimation of the despatch of the goods from Bombay reached the plaintiffs firm and the railway receipt was received, the plaintiffs sent a registered letter on 15-7-1943, to the defendants, addressed to Sitaram Shreekishun intimating that the railway receipt of the goods had been received. No reply having been received from the defendants a second letter was sent on 23-7-1943, by the plaintiffs addressed to Gopalji Baldeoji, the present defendants.
When the defendants took no action, a registered notice was sent on 29-7-1943 by the plaintiffs to the defendants intimating that in the event the defendants did not take delivery of the goods received they would be sold by public auction on 5-8-1943. On 2-8-1943 the defendants sent a reply refusing to take delivery and stating therein that Radbakishun had made no purchase from the plaintiffs on behalf of the defendants, and that they had no concern with the firm Sitaram Shreekishun, and as such the transaction entered into between the plaintiffs and Radhakishun as agent of the firm Sitaram Shreekishun was not binding on them. This reply of the defendants was received by the plaintiffs on 4-8-1943. The goods accordingly were sold on 5-8-1943, by a pleader appointed by the plaintiffs to hold the sale by public auction and the cloths were sold for Rs. 5530/1/3 and purchased by a firm Hari Prasad Chiranjilal. The plaintiffs by the sale, therefore, suffered a loss of Rs. 4494/14/9, being the difference between the contract price and the price fetched at the sale. The plaintiffs then brought the present suit for breach of contract claiming Rs. 4494/14/9 by way of damages.
4. The defendants contested the suit, and their main defence was that they had no concern with the firm Sitaram Shreekishun, which according to them, was an independent firm belonging to Sitaram and his sons. They denied Radhakishun being the representative, or having purchased any cloth from the plaintiffs on behalf of the defendants. They also denied to have received the notice dated 29-7-1943, by which intimation was sent by the plaintiffs that the goods were to be sold by public auction in default of the defendants taking them on cash payment:
5. The first Court decreed the plaintiffs suit on the finding that the defendants were the proprietors of the firm Sitaram Shreekishun, and that Radhakishun was their representative or agent, who in his capacity as such had placed orders with the pl
