Bartleet & Company V. Ebrahim Lebbe Marikar

1938 Present: Poyser S. P. J. and Wijeyewardene A. J.

BARTLEET & COMPANY v. EBRAHIM LEBBE MARIKAR

142-D. C. Colombo, 3,234

Contract Broker employed for purchase of rubber in London-Purchaser's intention to speculate-Failure to take delivery of rubber-Sale at loss-Bond to pay amount of loss-Not a wagering contract.

The plaintiffs, as brokers, purchased rubber for the defendant on the London market under a contract entered into by the later in the following terms : - ?As arranged please buy seven hundred tons rubber on London, June-December, 1929 at the rate of one hundred tons each month at the current market rate. Also I allow you to have the selling as well?.

The plaintiff carried out these terms of the contract but the rubber that could have been delivered each month was sold at a loss. The defendant had no intention of taking delivery, his object being to speculate on the differences in the prices. The defendant paid the loss for some months and defaulted later. He then entered into a bond to pay the loss due from him, upon which the plaintiff instituted the present action.

Held, that the contract was not a wagering contract and that the bond was enforceable.

Woodward et al. v. Wolfe (1936, 3 A. E. R. 529) followed.

Held, further, failure on the part of the plaintiffs to comply with the requirements of section 7 of the Business Names Registration Ordinance, No. 6 of 1918, subsequent to the institution of the action does not affect his right to enforce the contract, which must be determined as at the time at which the action was instituted.

Jamal Mohideen v. Meera Saibo (22 N. L. R. 268) followed.
 
THIS was an action instituted by the plaintiffs to recover a sum of Rs. 101,771 on a mortgage bond executed by the defendant. The defendant pleaded that the bond was given for an illegal consideration

and was not enforceable. The plea was based on the ground that the liability arose out of certain wagering contracts in respect of the purchase and sale of rubber. The learned District Judge held that the contracts were not wagering contracts and gave judgment for the plaintiffs.

H. V. Perera, K. C. (with him E. F. N. Gratiaen and U. A. Jayasundere), for first defendant, appellant. -Three points can be taken on behalf of the defendant.

The plaintiffs are partners. One of them died after the institution of the action and before date of judgment. The provisions of section 7 of the Registration of Business Names Ordinance, No. 6 of 1918, were not complied with, and section 9 would therefore be applicable. Under section 7, notice of the death should have been given to the Registrar of Business Names within fourteen days in the prescribed manner.

[WIJEYEWARDENE J. -There is a distinction between ?enforceable? and ?maintainable?.]

The general principle is that rights must be determined as at the date of the action. See Jamal Mohideen & Co. v. Meera Saibo et al. 1

It must be admitted that the default was subsequent to the contract in question and the institution of the action, but that case did not deal with the position resulting from a default occurring during the pendency of an action.

The procedure followed in the commission proceedings in London was irregular and the evidence recorded there should not have been admitted. The Commissioner administered the oath to himself. This was improper. The oath should have been taken before somebody else and the Commissioner should then have subscribed his name.

To come to the main point, the contract in question cannot be enforced as it is a wagering contract. The principles governing wagering contracts are stated in Tarrant et al. v. Marikar2. It is the substantial agreement which must be taken into consideration although the form of it may speak of a different agreement. As indicated by D 13-D 16, plaintiffs were acting as principals and not as brokers. One cannot be a prin

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