Hirdaramani Ltd. V. De Silva, T.A.K.

1953 Present: Gratiaen J. and Gunasekara J.

HIRDARAMANI LTD., Appellant, and T. A. K. DE SILVA,
Respondent

S. C. 94-D. C. Colombo, 21,772M
 

Contract-Novation-Ingredients necessary.

P. T., who was carrying on a business, bound himself and his heirs, executors and administrators to pay monthly a certain sum of money to the plaintiff. Subsequently a private limited liability company acquired the business. P. T. who was the managing director of the company, continued the monthly payments notwithstanding the cessation of his private business. After he died the company made similar payments subject however to the express qualification that the payments were ex gratia. In an action instituted by the plaintiff for a declaration that the company was liable to continue to make such monthly payments-

Held, that the claim of the plaintiff was insupportable in law. A novation of a debt cannot, in the absence of any express declaration by the parties, be held to exist except by way of necessary inference from all the circumstances of the case.

APPEAL from a judgment of the District Court, Colombo.

H. W. Jayewardene, with D. R. P. Goonetilleke, for the defendant appellant.

Sir Ukwatte Jayasundera, Q. C., with L. G. Weeramantry and O. M. de, Alwis, for the plaintiff respondent.

Cur. adv. vult.

March 3, 1953. GRATIAEN J.-

On 29th January, 1944, an agreement was entered into between three persons named Paramanand Tourmal, T. A. K. de Silva (who is the plaintiff) and A. C. P. Wijeratne (who is the plaintiff's brother-in-law). Paramanand Tourmal had for many years been carrying on business in Colombo under the name style and firm of " Hirdaramani". He employed the plaintiff as his " leading Jeweller ", and Wijeratne as " assistant Jeweller ".

The agreement arrived at between these three parties was, inter alia, to the following effect:

" (a) The said Silva shall retire as leading jewellery maker in the firm of Hirdaramani as from the 1st day of February, 1944, and shall in consideration of the sum of Rs. 475, being the purchase price, deliver to Mr. Paramanand all machines tools and other implements that are now at Hirdaramani and owned by Silva.

(b) The said Wijeratne shall as from 1st February, 1944, serve under Mr. Paramanand as leading jewellery maker on such remuneration as may be agreed upon from time to time and shall devote his whole time and attention to such work and shall not work for any other person or firm whomsoever without the consent first had and obtained from Mr. Paramanand.

(c) In consideration of the services rendered as aforesaid by Silva and as long as Wijeratne is employed under Mr. Paramanand he Mr. Paramanand shall as from 1st February, 1944, pay to Silva monthly at the end of each and every month a sum of Rs. 150 during the lifetime of Silva.

(d) Towards the payment of the aforesaid monthly sum of Rs. 150 by Mr. Paramanand he the said Wijeratne shall contribute a sum of Rs. 75 monthly from his remuneration.

(f) In the event of the said Wijeratne dying or being dismissed from service or being incapacitated by illness or otherwise or leaving the service of Hirdaramani at any time or in the event of the death of Silva then the payment to Silva of the said sum of Rs. 150 shall immediately cease anything herein contained to the contrary notwithstanding. "

The term " Paramanand Tourmal" was expressed to include his heirs, executors and administrators, but no provision was made for the eventuality of an assignment of the business by the proprietor during his lifetime.

Paramanand Tourmal ceased to carry on the business of " Hirdaramani " in his own right in 1946, and a private limited liability company, known as Hirdaramani Ltd., and incorporated on 27th June, 1946, acquired the business. In fact he was the Managing Director of the new Company until he died in March, 1948.

It is common ground that, notwithstanding the cess

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