Abdul Hamid Et Al., V. Odhavji Anandji & Co., Ltd.

[PRIVY COUNCIL]

1955 Present: Lord Morton of Henryton, Lord
Radcliffe, Lord Keith of Avonholm, Lord Somervell of
Harrow and Mr. L. M. D. de Silva

ABDUL HAMID el al., Appellants, and ODHAVJI ANANDJI
& CO., LTD., Respondents

PRIVY COUNCIL APPEAL NO. 40 OF 1954

S. C. 240-D. C. Colombo, 21,162
 

Sale of (foods-Wrongful refusal to accept the goods- Measure of damages-Special damage-Sale of Goods Ordinance, s. 49.

Where, in a contract of sale of goods, the buyer wrongfully refuses to take delivery of the goods and there is no available market for the rejected goods at the time of the refusal to accept , then the goods may be sold as soon as buyers can be found. In such a case the amounts realised later, if reasonable steps are taken, are the best measure of their value at the date of the breach of contract ; the prima facie measure of damages that can be claimed under section 49 of the Sale of Goods Ordinance is the difference between the contract price and the value at the date of the breach.
.
APPEAL from a judgment of the Supreme Court delivered on March 9, 1953, by Gratiaen J. (Gunasekara J. agreeing).

Joseph Dean, for the defendants appellants.

J. F. Donaldson, for the plaintiffs respondents.

Cur. adv. vult.

May 16, 1955. [Delivered by LORD SOMERVELL OF HARROW]

This is an appeal by buyers who wrongly rejected goods under a contract of sale. It is submitted on their behalf that the damages awarded are excessive and should be reduced or a new trial ordered.

Under a contract dated 24th December, 1946, the appellants, merchants in Colombo, agreed to buy from the respondents, merchants in Mombasa, 60 tons of cowpeas as per sample approved at £51 per ton c.i.f. Colombo shipment per s.s. " June Crest". The " June Crest" was then loading and arrived at Colombo on or about 14th January, 1947. The documents with a bill of exchange for the contract price attached were forwarded to the National Bank and presented to the appellants. The appellants refused to accept the bill which, was noted for non-payment on 29th January. On that day and again on the 4th February, the respondents cabled to the appellants that unless the draft was paid within forty-eight or twenty-four hours respectively, the respondents would sell. There was no reply. On 5th March the respondents' proctor wrote to the appellants.

Dear Sir,

I have been consulted by Messrs. Odhavji Anandji & Co., Ltd., of Mombasa, to take steps against you for the breach of contract entered into with them on 24th December, 1946, by your representative Mr. M. Y. Aboobucker, for the purchase by you of 60 tons of cowpeas at £51 per ton c.i.f. Colombo.

The goods were duly shipped by s.s. " June Crest " which sailed from Mombasa on or about 28th December, 1946, with goods.

You have failed to accept the goods and honour the relative Bill of Exchange for £3,134 3s. 1d.

As you have failed to take delivery of, and pay for, the goods in spite of my clients' requests, my clients will now dispose of the goods on your account and at your risk, according to their earlier intimations to you, and file action against you for the recovery of any deficit.

As the quantity of goods is very large the sale of the whole quantity in bulk at an auction sale may not be as advantageous as a sale by private treaty, and so my clients intend to have the goods sold by private treaty unless you prefer a sale by public auction, in which event you must inform me forthwith.

Before doing so, I am giving you a final opportunity of fulfilling your obligations under the contract.

If I don't hear from you within 24 hours agreeing to meet the draft and take the goods, my clients will proceed to dispose of the goods as stated above.

The disposal of the goods will be done by my clients without prejudice to their legal rights under this contract and purely with a view to reducing their ultimate claim against you as far

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