Silva & Nagendra V. Haniffa

1920. Present: Ennis J. and De Sampayo J.

SILVA & NAGENDRA v. HANIFFA.

332 D.C. Colombo, 52,882.

Indent for goods by defendant through a commission agent from a foreign, company-Action instituted by commission agent for damages for breach of contract.

The defendant delivered to the plaintiffs (commission agents) an order for certain goods addressed to a company in Japan. The Japanese company accepted the order, and goods were consigned direct to the defendant, and the bill of exchange was drawn on the defendant. The defendant accepted the bill, but dishonoured it at maturity. The plaintiffs paid it, sold the goods by public auction, and instituted this action after giving credit for the price realized at the sale.

Held, that the plaintiffs had not the status to maintain this action, as they were not the agents of the foreign firm.

THE facts are set out in the following judgment of the District Judge:-

The plaintiffs are commission agents. On May 7, 1918, the defendant delivered to them an order for certain copper drawn up in the form P 1. This form is headed with the plaintiffs' names, and the

order was addressed to Otaki & Co. in Tokio. In "doe course an acceptance D 1 arrived from Japan and was delivered to the defendant by the plaintiff. Later the invoice of the goods D 2 was similarly received and handed to defendant. These goods were consigned to the defendant at the same time the shippers drew against the defendant for the value of the goods by a bill of exchange. This bill was accepted on presentment, but was dishonoured by the defendant at maturity. Thereupon the plaintiffs sold the goods by public auction, and are suing the defendant for the difference between the amount realized by the sale and the value of the goods with incidental expenses.

The only issue to decide is, whether the plaintiffs have the necessary status for maintaining this action.

The rights of the plaintiffs are entirely governed by the dames and conditions of P 1.

Under this the defendant agreed as follows (omitting unnecessary words):-

" Should I fail to pay at maturity such draft I authorize your agents to dispose off the goods by public auction on my risk in such manner as may appear best to your agents, and I hereby bind myself to, make good any loss or deficiency that may arise from such sale and all expenses, and in such case I agree to accept your account sales as correct, and, if necessary, to the same being used by you or your agents in any Court against me without further proof, and, besides, you or your agents shall be at liberty to stop all shipments of any goods which I may have ordered. "

Then follows certain conditions under which the plaintiffs were entitled, in case of any dispute, to cancel this order or to submit the matter to arbitration, the plaintiffs were declared not liable for damages in case of delay, and they were also given the option in certain circumstances of cancelling the order without payment of any compensation.

It appears to me that the parties clearly contemplated that in case of default by the defendant the plaintiffs should have the necessary authority to sue him in an action like the present. I accordingly give judgment for the plaintiffs as prayed for, less Its. 104.72 commission which is now waived, and costs.

The indent (P 1) was as follows:-

P1.

Colombo,-. 191-.

Indent No.-

Silva & Nagendra, 16, Keyzer street, Colombo.

Messrs. G. Otaki & Co. From .

DEAR SIRS,-I / WE, the undersigned, request you to purchase, yourselves or through your agents, on my/our account and at my/our risk, the whole or any part of the under-mentioned goods for shipment to Ceylon on the conditions stated below. Draft at -- days through the Honk Kong & Shanghai Banking Corporation, Ltd. Colombo.

For reimbursement I/We authorize you, your agents, to draw on me /us at current rate of exchange in sterling through above bank for invoice value. Buy

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