HIGH COURT OF CALCUTTA
R. S. BACHAWAT, A. K. MUKHERJI
UNION OF INDIA - Appellant
Versus
ALLIANCE ASSURANCE CO. LTD. - Respondent
A. F. O. D. 48 Of 1960
Decided On : JULY 25, 1963
TRANSFER OF PROPERTY ACT, 1882 - SECTION 6(E) - ASSIGNMENT OF RIGHT TO SUE FOR DAMAGES - NOT A MERE RIGHT TO SUE - VALID ASSIGNMENT.
Fact of the Case:
The plaintiff, an insurance company, paid the assured for the loss of goods in transit. The assured assigned their rights against the railway company to the plaintiff. The railway company refused to pay the plaintiff, who then sued for damages.
Finding of the Court:
The court held that the assignment was valid and that the plaintiff had a right to sue the railway company. The court found that the assignment was not a mere right to sue for damages, but rather an assignment of the goods themselves and the actionable claims relating thereto.
Issues: Whether the assignment of the right to sue for damages was a mere right to sue and, therefore, void under Section 6(e) of the Transfer of Property Act.
Ratio Decidendi: The court held that the assignment was not a mere right to sue for damages, but rather an assignment of the goods themselves and the actionable claims relating thereto. The court found that the assignment was valid and that the plaintiff had a right to sue the railway company.
Final Decision: The court dismissed the appeal and upheld the trial court's decision in favor of the plaintiff.
( 1 ) ON the 7th June, 1954 the defendant No. 2 made over to the Eastern Railway administration represented by the defendant No. 1, 546 packages of tyres, rubber-goods and accessories for carriage from Bansbati, a station on the Eastern Railway to Lucknow, a station on the Northern Railways. The Eastern Railway administration accepted the goods for carriage and delivery to the defendant No. 2 at Lucknow. The goods were short delivered and a shortage certificate was issued to the defendant No. 2. The goods had been insured by the defendant No. 2 under an insurance policy dated the 6th August, 1951 issued by the plaintiff against risk of loss or damage whilst being conveyed by train or other conveyance including risks of theft, pilferage and non-delivery. Having regard to the shortage certificate, the plaintiff, as insurer of the goods, paid to the defendant No. 2 the value of the goods short delivered amounting to Rs. 3262/11/ -. On the and August, 1954, in consideration of the aforesaid statement of the claim for shortage under the policy the defendant No. 2 assigned, transferred and abandoned to the plaintiff all then rights against the railway company caused or arising by reason of the damage or loss and granted to the plaintiff full power to take and use all lawful ways and means in the plaintiff's own name and to recover the damage or loss, and subrogated to the plaintiff the same rights which the defendant No. 2 had in consequence of or arising from the said loss or damage. In spite of demand the defendant No. 1 did not pay the sum of Rs. 3262/11/- to the plaintiff. The plaintiff then instituted the suit claiming the aforesaid sum as damage for non-delivery of the goods short delivered and impleaded the assured as a proforma defendant. The learned Judge decreed the suit. Issue No. 2 raised at the trial was as follows : "did the defendant No. 2 transfer or assign their right, title and interest in the goods in suit to the plaintiff ? If so, what is the effect thereof. " the only point now urged on behalf of the appellant defendant No. r is that the plaintiff has no right to sue because on the 2nd August, 1954, the defendant No. 2 had a mere right to sue the defendant No. 1 for damages for loss of the goods and, as such, the transfer dated the 2nd August, 1954 was in contravention of Section 6 (e) of the Transfer of Property Act and a nullity. This contention is baseless. The plaintiff claimed damages for non-delivery of the goods. This non-delivery is proved by oral evidence. The further allegation in the plaint that the non-delivery was due to the wilful misconduct and neglect of the defendant No. 1 in not taking proper care of the goods while they were in the custody of the defendant No. 1 and/or the Railway administration concerned was denied by defendant No. 1 and is not substantiated by the oral evidence. The defendant No. 1 chose not to call any evidence to show that the goods had been lost in the sense that the goods were no longer in their custody. The goods are certainly lost to the plaintiff but there is no evidence to show that the defendant No. 1 had lost the goods. The defendant No. 1 did not give delivery of the goods and at the same time chose to withhold all evidence from the court as to how they had dealt with the goods. We must, therefore, proceed upon the assumption that the goods short delivered are lying with the defendant No. 1. On a true construction of the deed of assignment we think that the subject matter of the assignment are the goods short delivered together with the actionable claims relating thereto. Such an assignment is not a transfer of a mere right to sue for damages, and for the reasons given in Union of India v. Alliance Assurance Co. Ltd. , 66 Cal WN 419 is not hit by Section 6 (e) of the Transfer of Property Act.
( 2 ) IN Bristol and West of England Bank v. Midland Rly. , Co. (1891) 2 QB 653 the plaintiffs as pledgees sued the bailee for the recovery of the value
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