IMPORTANT POINT
Delay in taking out summons for judgment does not automatically entitle defendant to unconditional leave to defend the suit.

R.D. Dhanuka, J.— By this summons for judgment, the Plaintiff seeks judgment be entered for the Plaintiff in this suit against the Defendant for a sum of US $ 58,677.91. The suit is based on the written contract dated 30th December, 2002 and various invoices issued by the Plaintiff

2. On 1st November, 2002, the Plaintiff entered into a Lease Agreement (Equipment Agreement) with the Defendant and leased various containers for its business operation on the terms and conditions set out in the said Agreement. The lease period was from 1st November, 2002 to 31st October, 2003. The agreed rental payable by the Defendant was set out therein. Clause 10(a) and (b) of the Agreement reads as follows:

“(a) If a unit of Leased Equipment is lost or destroyed, Lessee shall send a written declaration of loss to Lessor as soon as the loss is known and Lessee shall pay the Replacement Value (“RV”) or Depreciated Replacement Value (“DRV”) for the unit as stated in the applicable Lease. If a unit is returned to Lessor’s designated depot and the repair costs for Lessee’s account are higher than the applicable RV or DRV. Lessee shall pay the applicable RV or DRV for the unit.

(b) A unit which is lost or destroyed and has not been returned to Lessor’s designated depot shall be off hired on the date of Lessee’s declaration of loss, provided that the applicable RV or DRV is paid within forty-five (45) calendar days of the date of Lessor’s invoice. Otherwise, the unit shall be off hired on the date the invoice is paid.”

3. According to the Plaintiff except 8 containers the Defendant returned all the containers to the Plaintiff. The Plaintiff’s Agent vide its e-mail enquired with the Defendant regarding the whereabouts of the containers not returned by the Defendant and requested to return the same to the Plaintiff. By its e-mail dated 10th September, 2004 the Defendant informed the Plaintiff’s Agent that all the 8 containers were loaded for Kuwait and were being located. It was stated that said Defendant was taking legal action against its Kuwait Agent. In the meanwhile the Defendant requested the Plaintiff’s Agent to advise the cost of each of the container. By e-mail dated 16th October, 2004, Defendant reiterated that it had taken legal action against its Kuwait Agent and requested for the value of the containers.

4. By e-mail dated 19th October, 2004 to the Defendant, the Plaintiff’s Agent attached the calculations of the depreciated value of the 8 containers. By e-mail dated 26th October, 2004, the Defendant informed the Plaintiff that they had given up 8 containers as lost by their Kuwait Agent and was in the process of taking legal action. The Defendant requested the Plaintiff to discontinue billing them their rentals from 10th September, 2004. The Defendant requested the Plaintiff to deduct the cost price by 50% of the amount quoted by the Plaintiff.

5. By e-mail dated 1st November, 2004, the Plaintiff’s Agent declined to accept cost Depreciated Value (DV) of 8 containers and insisted that the Defendant shall pay DV of the containers as on 10th September, 2004, as per the terms of the Agreement. On 11th November, 2004 the Plaintiff raised invoice against the Defendant for US $ 17,090.50 towards DV of 8 containers. The Defendant, however, failed to pay the said amount. The Plaintiff’s Agent sent another e-mail to the Defendant making it clear that rentals would be continued to be billed until the DV were paid in full by the Defendant. On 23rd February, 2005, the Defendant by their e-mail informed the Plaintiff that the Defendant had initiated legal action against their Kuwait Agent for recovery/compensation for the lost containers. It is submitted that since the Defendant had not been using those containers, it would be contrary to normal business practice and not fair to pay rental for such containers so long as they were not recovered or compensated for. It is contended that the payment due from the Defendant would be only upto 10th