The main legal point established in the judgment is the interpretation of the nature of the claim as falling under S.70 of the Indian Contract Act, 1872, and the applicability of the limitation period under the Indian Limitation Act, 1908.

1. The plaintiff in S.C.S. No. 53 of 1955 of the Court of the District Munsiff, Chenganachery, is the petitioner before us. The suit was dismissed on the ground that it was barred by limitation under Art.115 of the Indian Limitation Act, 1908, and the contention before us is that the article applicable is not Art.115 but Art.120 and that the suit should have been held as having been filed within time.

2. Under Ext. A, an agreement between the petitioner and the Tahsildar Chenganachery, dated 27.12.1950, the petitioner under took to pump out water from certain paddy lands and was entitled to be paid therefore at the rate of Rs. 12-4-0 per acre under condition No.1 of the said agreement.

3. Condition No. 2 of the agreement reads as follows:

The respondent was no party to the contract and cannot hence be held as bound by its terms. He was, however, benefitted by the pumping operations and the question that arises for consideration is what exactly is the nature of the claim made against him by the plaintiff.

4. If the claim can be considered as one based on a contract Art.115 of the Limitation Act, 1908, will definitely apply and the suit has to be held as barred by limitation, but as the respondent was no party to Ext. A, his obligation can be treated only as the obligation of a person enjoying the benefit of a non-gratuitous act, i.e., an obligation coming within the ambit of S.70 of the Indian Contract Act, 1872;

"Where a person lawfully does anything for another person or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered."

5. S.70 occurs in Chapter V of the Contract Act which is headed: "Of Certain Relations Resembling Those Created by Contract" and prima facie the obligation created under S.70 should be considered as based not on contract but on quasi-contract, a term which covers a wide area including claims on a quantum meruit.

6. The rationale of quasi-contract according to Lord Mansfield, is the necessity of restoring benefits unjustly obtained - Moses v. Macferlan (1760) 2 Burr. 1005 - and according to Lord Sumner the existence of an implied agreement Sinclair v. Brougham (1914) A.C. 398. As stated by Cheshire and Fifoot (The Law of Contract, 4th Edition, P. 554):

"Between the views of two such lawyers as Lord Mansfield and Lord Sumner, divergent alike in temperament and in historical method, reconciliation would seem impossible."

A via media, however, has been offered by Sir C.K. Allen and the authors deal with Sir C.K. Allen's solution as follows:

"Sir C.K. Allen's solution, in fact, is to pay deference to the propriety, so strongly urged in the dicta in Sinclair v. Brougham, of expressing the English quasi-contract in contractual language, but to find its substantial criterion in the idea of unjust benefit. The Judges may feel constrained, if they wish to give judgment for the plaintiff, to 'imply' or 'construe' a contract in his favour: they will do so only if the defendant has been improperly enriched at his expense. The compromise is consistent with the national genius, and nothing in the many and varied judicial pronouncements upon the basis of quasi-contract goes so far as to forbid its adoption".

7. In United Australia, Ltd. v. Barclays Bank, Ltd. - (1941) Appeal Cases 1- Lord Atkin characterised the fiction of a contract as fanciful;

"These fantastic resemblances of contracts, invented in order to meet requirements of the law as to forms of action which have now disappeared, should not, in these days, be allowed to affect actual rights. When these ghosts of the past stand in the path of justice, clanking their mediaeval chains, the proper course for the judge is to pass through them undeterred".

In the Fibrosa case - (1943) Appeal Cases 32 - Lord Wright thought that the legal basis for an action under quasi-contract was restitution and