Alawdeen, S.M.K. V. Holland Colombo Trading Society, Ltd.

1952 Present : Gratiaen J. and Gunasekara J.

S. M. K. ALAWDEEN et al., Appellants, and HOLLAND COLOMBO
TRADING SOCIETY, LTD., Respondent

S. C. 311-D. C. Colombo, 20,182

Contract-Sale of goods-Repudiation by one party-Termination of contract- C. I. F.-Bill of lading-Requisites of valid tender thereof-Breach of contract- Justification-Plea taken at late stage.

In a contract for the sale of goods, one of the terms was that " any tender or delivery of the goods or of the bill of lading or of such delivery order or other document or documents as will enable the buyer to obtain possession of the goods shall constitute a valid tender or delivery ". The sellers caused the goods to be placed aboard the ss. " Laurenskerk " at the port of Rotterdam for shipment to Colombo under a contract of affreightment with the owners of that vessel, the terms and conditions of which were set out in a bill of lading which provided inter alia that the carriers could, if they thought it necessary, or expedient, arrange for the goods to be transhipped at any stage of the voyage under a fresh contract of affreightment with the subsequent carriers.

The bill of lading was received by the sellers in Colombo in due course and, while the goods were still on board the ss. " Laurenskerk ", the sellers offered to deliver it, duly indorsed, to the buyers upon payment of the price. On 28th February, 1948, the buyers rejected the tender.

Held, that the sellers had made a valid tender in terms of the contract and therefore became entitled to sue the buyers immediately for breach.

The sellers, however, elected to treat the contract as still subsisting. Thereafter an explosion occurred on board the ss. " Laurenskerk " and the goods were transhipped to the ss. " Triport" for on carriage to Colombo, such transhipment being expressly authorised by the terms of the original bill of lading. On arrival of the ss. " Triport" in Colombo with the goods, the sellers again tendered the original bill of lading and demanded payment of the contract price. The buyers rejected the tender, whereupon the sellers instituted the present action.

Held, that the sellers had no cause of action against the buyers, as the original bill of lading did not give the buyers a right to receive the goods from the actual carrier thereof at the time of the tender.

Further, 1. A valid tender does not always necessitate actual physical production of the document tendered for inspection. 2. A contracting party who gives a wrong reason for an earlier refusal to perform his contracted obligation is not thereby precluded from pleading subsequently a justification which in fact existed, whether he was aware of it or not.

APPEAL from a judgment of the District Court, Colombo.

H. V. Perera, Q.C., with V. A. Kandiah, for the defendants appellants.

N. K. Choksy, Q.C., with S. J. Kadirgamar and G. L. L. de Silva, for the plaintiff respondent.

Cur. adv. vult.

290

August 18, 1952. GRATIAEN J.-

This is an appeal from a judgment and decree of the District Court of Colombo awarding the plaintiffs a sum of Rs. 13,697.06 as damages against the defendants for breach of contract.

On 5th September, 1947, the defendants placed a written order (P8) with the plaintiffs for a certain quantity of " white shirtings " of a specified description to be imported at the defendants' risk and account upon certain terms and conditions which would regulate the proposed contract. The offer contained in P8 was in due course accepted by the plaintiffs on 25th September, 1947, and in the result there came into existence a binding contract of sale between the plaintiffs (as sellers) and the defendants (as buyers) upon, inter alia, the terms and conditions set out in the document P8. The relevant terms and conditions of the contract may be summarised as follows :-

(a) the price was fixed on c.i.f. terms-meaning in this c

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