Caruppen Chetty Et Al. V. Habibhoy

Present: Lascelles C.J. and Middleton J.

CARUPPEN CHETTY et al. v. HABIBHOY.

277-D. C. Colombo, 31,911.

Damages-Breach of contract-Available market-" Sale of Goods Ordinance, 1896, " s. 49.

The defendant contracted to sell to plaintiffs certain cotton goods, which were manufactured by the defendant only, at a specified price, for one year. Subsequently the defendant refused to supply the goods at the contract price, and offered to sell the goods at Rs. 6 a bale over the contract price. Plaintiffs claimed Rs. 25 a bale as loss of profits on each bale. The District Judge awarded the plaintiffs damages at Rs. 6 a bale, as they could have bought the goods for Rs. 6 over the contract price from the defendant.

Held, that the measure of damages was the estimated loss directly and naturally resulting in the ordinary course of events from the seller's breach of contract, as there was no available market for the goods in question.

" It cannot be said that there is an 'available market' open to a plaintiff for a particular class of goods, when the only source from which they are procurable is the defaulting contractor himself."

THE facts are fully set out in the judgment of the Additional District Judge of Colombo (L. Maartensz, Esq.): -

By a contract dated August 5, 1910, the defendants agent agreed, to supply the plaintiffs with saries and dhooties for a term of one year at the rate of 30 bales a month at the prices specified in the contract. Saries and dhooties were supplied in accordance with the contract in the months of September and October.

Subsequently the defendant, who is a resident of Bombay, objected to the saries and dhooties being supplied at the prices agreed on, and instructed his agent not to supply the goods at the contract rates, but to offer them to the plaintiffs at the rate of 3 cents over and above the contract price for each sarie and dhootie. 200 saries and dhooties made up a bale, and accordingly the price of each bale was increased by Rs. 6. The plaintiffs insisted on having the saries and dhooties at the contract price, which was refused, and there was a failure by the defendant to supply the bales due for the months of November and December.

The plaintiffs allege that they used to make a profit of Rs. 25 or Rs. 35 per bale, and claim a sum of Rs. 1,500 as damages incurred by them by reason of the defendant's failure to supply the bales due in the months of November and December.

The defendant in his answer repudiated the authority of his agent to enter into the contract, but the objection was not pressed at the trial,

and the only issue tried was as to the amount of damages, if any, plaintiffs were entitled to. The saries and dhooties which the defendant's agent agreed to supply were of a peculiar kind, manufactured only at the Spinning and Weaving Mills belonging, to the defendant at Wellawatta, and the plaintiffs were in the habit of taking the whole supply manufactured and re-selling it at a profit.

The plaintiffs contend that the market price is the price at which they could have sold the saries and dhooties. The defendant, on the other hand, contends that the market price was the price at which he was willing to sell the saries and dhooties, and that the plaintiffs are only entitled to the difference between the contract price and the market price, and admits the claim to the extent of Rs. 360. He also contends that the plaintiffs might have purchased the saries and dhooties at the increased price of Rs. 6 per bale regardless of the contract, thereby mitigating the damages as far as possible, and without prejudicing his right to recover the difference in price under the contract. To which the plaintiffs replied that the price at which the contractor was willing to sell could not be regarded as the market price, as it was not shown that there were any other purchases or sales; that the plaintiffs had a monopoly with respect to sar

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