1987 PLP 984 (CLC)

(iv) N.K. Gandhy v. D.P. Edu1ji & Co. Ltd. P L D 1951 Lah. 262. (v) Muhammad Ibrahim Khan v. P. Prasad. A I R 1960 All 252. (vi) Kohistan Travel Service v. Punjab P L D 1977 Lah. 85. (vii) Muhammad Yakoob v. Health Officer 1973 S C M R

184. For the argument that interim relief under Order XXXVIII, Rule 5 or Order XXXIX, Rules 1 and 2, C.P.C. ought not to be granted solely for the reason that the defendant is a foreign party and regarding the principles for grant of attachment before judgment or temporary injunction, learned counsel cites the following judgments:‑-- (viii) New Bengal Shipping Co. v. E.L. Stun P L D 1952 Dacca 22. (ix) H.Nizamuddin & Sons v. M.V. Oromee P L D 1977 Kar. 722. (x) Associated Drillers v. Dirk Verstone P L D 1979 Kar. 734 (xi) M E C Shipbreakers Ltd. v. Peason Investment P L D 1982 Kar. 701 (xii) D.H.L. International v. N.T.C. Ltd. 1982 C L C 1360 (xiii) Severanix v. The King A I R 1950 Cal. 156 (xiv) Faqir Ali v. Muhammad Hayat P L D 1976 Lah. 298 (xv) Muhammad ldris v. Collector of Customs P L D 1971 Kar. 736. (xvi) Shah Nawaz Ltd. v. Khawaja Autocars Ltd P L D 1979 Kar. 38.

5. In my view, no case has been made out for attachment before judgment of the payments, which are to be made by ATTOCK CEMENT to UZIN or for granting a temporary injunction restraining ATTOCK CEMENT from making the payment to UZIN in respect of any bill. A reference to the provision of rule 5 of Order XXXVIII, of the Code of Civil Procedure shows that the conditions required to be satisfied by a plaintiff before an order for attachment before judgment of the properties of the defendants can be passed have not been satisfied by the plaintiff. The pleadings dc not show prima facie that UZIN with intent to obstruct or delay the execution of the decree that may be passed against UZIN in the present suit is about to dispose of the whole or any part of its property or is about to remove the whole or any part of its property from the local limits of the jurisdiction of this Court. The allegation that UZIN is repatriating any amount outside Pakistan has been denied by UZIN through counter‑affidavits. Even otherwise, it is not prima facie established that UZIn has repatriated any amount with intent to obstruct or delay the execution of the decree that may be passed against UZIN in the present suit. I am also not inclined to grant~'~ temporary injunction restraining defendant No.3 from making payment, of any nature whatsoever in respect of any bill to UZIN. The claim ford damages will have to be established by the plaintiff through evidence) to be recorded in the present suit. ATTOCK CEMENT apparently has) made or is making payment to UZIN under the terms of turn‑key contact' between them. Prima facie no suspicion attaches to the payments being made by ATTOCK CEMENT to UZIN. No case has been made out at this stage for the grant of a temporary injunction restraining ATTOCK CEMENT from making payment of any bill to UZIN. C.M.A. No.1836 of 1985 is in the circumstances dismissed.

6. The other application is CMA No.1837 of 1985 which plaintiff ASIACON has filed for appointment of a receiver to take possession of the plaintiffs plant, machinery and equipment. Both Messrs Mansoorul Arifin and Muhammad Sharif, Advocates, had taken me through the relevant articles of the main contract between UZIN and MIC and the sub‑contract between MIC and ASIACON. Learned counsel had also referred to various affidavits, counter‑affidavits and rejoinders filed by the parties. The submission of Mr. Mansoorul Arfin was that UZIN had no authority or power to use plant, machinery and equipment of ASIACON, whereas according to Mr. Muhammad Sharif under the terms of the main contract between UZIN and MIC and also under the articles of the sub‑contract between MIC and ASIACON and also under the law, UZIN have the right to use the said plant, machinery and equipment brought by ASIACON on the site, for the purposes of completion of main project. It may be observed here that UZIN terminated the main contract with MIC and thereafter gave the work to two other contractors namely MIC (defendant No.4) and CONTINENTAL ENGINEERING (defendant No.5) and the work which has been assigned by UZIN to these two contractors includes the work, which was being carried out by ASIACON under the sub‑contract with MIC. The position that emerges is that after the termination of the main contract by UZIN, ASIACON have also gone out, as they were the sub‑contractors of MIC and the work, which was being done by ASIACON on the project, is being done by MIC and CONTINTENTAL ENGINEERING who are also using the machinery and equipment of ASIACON, which had been brought or the site by ASIACON for the purposes of carrying out the work under the sub‑contract with MIC. It was submitted on behalf of the plaintiff ASIACON that the machinery and equipment of ASIACON is not only deteriorating but also being destroyed during their use in the project after the ouster of ASIACON. Mr. Mansoorul Arfin had referred to Article 1 relating to the definites in the main contract between UZIN and MIC, wherein terms "contractor" and "sub‑contractor" are defined to include successors and approved assigns of the contractor or sub‑contractor. According to Mr. Mansoorul Arfin, ASIACON are neither the successor nor assigns of MIC according to the definition of the sub‑contractor given in Article 1 of the main contract. Mr. Muhammad Sharif learned counsel for UZIN, had agreed that ASIACON were not assigns but were a sub‑contractor of MIC. According to Mr. Mansoorul Arfin, under the main contract action could be taken by UZIN ii relation to the plant and machinery of MIC and/or their successors and assigns but not the plant and machinery and other articles which belong to a sub‑contractor of MIC. Mr. Muhammad Sharif had, on the other hand, argued that although ASIACON are neither succesors nor assigns of MIC, they, are nevertheless a sub‑contractor of MIC bound by the terms of the main contract between UZIN and MIC. Reference was made specifically to Articles 20 and 37 of the main contract between UZIN and MIC and it was also pointed out that by Article 8.1 of the sub‑contract between MIC and ASIACON most of the articles of the main contract between UZIN and MIC were specifically made part of the sub‑contract between MIC and ASIACON and these articles include Articles 20 and

37. According to Mr. Muhammad Sharif, Article 1.3, 1.4.2 and Article 8.1 of the sub‑contract between MIC and ASIACON read with Articles 20 and 37 of the main contract between UZIN and MIC entitle UZIN to use the machinery brought by ASIACON as the site for the purposes of the work on the project. In Article 20 of the main contract, Mr. Muhammad Sharif laid emphasis on the words that MIC was required "to provide" all constructional plant and temporary works required for the expeditious and satisfactory construction of the works and that all constructional plants, temporary works and materials provided by MIC shall when brought on to the site be deemed to be exclusively intended for the construction and completion of the works and MIC shall not remove the same or any part thereof without the consent in writing of UZIN. It was submitted by Mr. Muhammad Sharif that ASIACON were aware of Article 20 of the main contract and, therefore, when they brought their machinery on site, in view of Article 8.1 of the sub‑contract read with Articles 20 and 37 of the main contract, action could be taken by UZIN against the machinery brought on site by ASIACON. Reference was also made to Article 37(8)(a) of the main contract, which gives right to UZIN to use machinery brought or provided by MIC on site. Mr. Muhammad Sharif also emphasized the delay in filing of the present suit. It was pointed out that after termination of MIC's contract, UZIN gave the works to MLC, and UZIN remained under the impression that they were entitled to use the machinery brought on site by ASIACON as no objection was taken. Learned counsel also submitted that the suit has been filed with mala fide intentions at the instance of MIC and real intention of filing of the present suit is to stop the work on the project. It was submitted that although four big Pakistani companies were also defendants, as interim relief has only been claimed against UZIN a foreign company who has been singled out by the plaintiff and this shows mala fides of the plaintiff. According to the learned counsel, no case has been made out for appointment of a receiver. In support of his proposition that in spite of there being no privity of contract between ASIACON and UZIN, ASIACON is bound by the provisions of the main contract between UZIN and MIC, and UZIN is entitled to use plant, machinery and equipment of ASIACON for the purposes of the project in question. Mr. Muhammad Sharif, learned counsel for UZIN, referred to certain passages in GAJRIA ON BUILDING AND ENGINEERING CONTRACTS, Ilnd. Edition at page 716 and on HUDSON ON BUILDING AND ENGINEERING CONTRACTS Xth Edition at page 767 and the cases cited in this book by Hudson. Mr. Sharif specially relied upon the following English decisions:‑

(i) Nokes v. Concaster Ammalgamated Collieries Ltd. 1940 A C 1014. (ii) Chandler Bros Ltd. v Boswell (1936) 3 A E R 179. (iii) Dunlop & Ranken Ltd v. Hendal Steel Structure Ltd (1957) 1 WLR 1102. (iv) Quinn v. J.W. Green (Painters) Ltd (1965) 3 A E R 765

7. As observed earlier, the admitted position is that there is no of contract between UZIN and ASIACON. It is also an admitted position that the plant, machinery, and equipment for which the plaintiff' is seeking the appointment of a receiver, belong to ASIACON. Admittedly no notice was given by UZIN to ASIACON in connection with the termination of the contract between UZIN and M.I.C. The terms of sub‑contract between MIC and ASIACON make it apparently clear the ASIACON can have no direct contact with UZIN. It is also apparent from the record that UZIN were aware of the fact that MIC had sub‑contracted the work to ASIACON; perhaps it was with the knowledge if not consent or approval of UZIN. UZIN were also aware that a lot of plant, machinery and equipment was going to be brought in and in fact had been brought by the ASIACON on site for the purposes of carrying out the work under their sub‑contract with MIC. After a perusal of the relevant provisions of the sub‑contract between ASIACON and MIC, I am prima facie of the view that by the terms of this sub‑contract, ASIACON had not agreed that action could be taken by UZIN against the plant, machinery and equipment of ASIACON that was brought on the site. What had been apparently agreed, according to my view, was that MIC could take action against ASIACON including action in respect of the plant, machinery and equipment of ASIACON brought on to the site under the same circumstances and on the same terms, in which UZIN could have taken action against MIC under the terms of the main contract between UZIN and MIC. Prima facie I am of the view that by incorporation of various clauses of the main contract in the sub‑contract through Article 8.1. of the sub‑contract (which include Articles 20 and 37 of the main contract), ASIACON had not rendered themselves liable directly to UZIN so that UZIN may take action against the plant, machinery and equipment of ASIACON. I had asked Mr. Muhammad Sharif whether according to his interpretation of the terms of the main contract and sub‑contract, ASIACON are entitled to take action against UZIN for any damage that might be caused to ASIACON. The reply was that ASIACON could not take any action against UZIN in respect of the plant, machinery and equipment brought by ASIACON on the site under the sub‑contract but UZIN were and are entitled to take action in respect of the plant, machinery and equipment of ASIACON brought on site including use of the same for the purposes of project. According to the learned counsel, UZIN had rights against ASIACON but ASIACON had no right at all to protect its plant, machinery and equipment and if at all ASIACON has a claim, it may proceed against M I C. The English authorites cited by the learned counsel for UZIN are not relevant, as they do not relate to the rights and liabilities of the owner and a sub‑contractor with whom the owner has no privity of contract. The English cases cited by the learned counsel for the UZIN are cases between contractors and sub‑contractors where there was privity of contract between the parties. I am, therefore, of the view that prima facie UZIN have no right to use the plant, machinery and equipment which had been brought by ASIACON on the site under the sub‑contract with MIC and although action can be taken by UZIN against M I C under Articles 20 and 37 of the main contract, the terms of the main contract and the sub‑contract do not prima facie entitle UZIN to use plant, machinery and equipment of ASIACON. It was also contended by Mr. Muhammad Sharif that even if 1 come to the conclusion that prima facie UZIN has no right to use the said machinery, yet this is not a case for appointment of a receiver to take over such machinery. According to the learned counsel, the plaintiff has assessed their damages in pecuniary terms; no irreparable damage will be caused to them if receiver is not appointed; balance of convenience also lies in not appointing a receiver and that in case a receiver is appointed it will cause colossal loss to UZIN, as the completion of the entire project, which is at its closing stages will be in jeopardy. I do not agree with Mr. Muhammad Sharif that this is not a case for appointment of a receiver. It has already been noticed that admittedly the plaint, machinery and equipment, in respect of which interim relief by way of appointment of a receiver is sought by the plaintiff, belong to plaintiff ASIACON; the said plant, machinery and equipment is being used by the new sub‑contractor of UZIN; and that during such use such plant, machinery and equipment must obviously be undergoing deterioration and wastage and that prima facie such use of plaintiff's machiner is unauthorised. Nevertheless I am mindful of the serious complications that may arise for UZIN in case a receiver is appointed, as this is bound to delay the completion of the project. I have, decided to put certain terms in my order to protect the rights and interests of both the plaintiff ASIACON as well as UZIN. The plaintiff has assessed the value of their plant, machinery and equipment, which is on site, at Rs.1,21,80,295 Mr. Muhammad Sharif had submitted during the arguments that very little of this plant, machinery and equipment is being used by UZIN through their sub‑contractor and ASIACON can take away such machinery and equipment which is not in use by UZIN and which is not required for the purposes of completion of the project. Nazir of this Court is appointed receiver to take over all the plant, machinery and equipment of the plaintiff, which is lying at site‑details whereof are given in Annexure 'C' to the plaint and prepare its inventory. This order appointing Nazir as receiver will become effective on 1‑1‑1986. In case UZIN, defendant No.2 furnishes a security in the sum of Rs.1,00,00,000 to the satisfaction of the Nazir of this Court by 31‑12‑1985, this order of appointment of receiver shall stand automatically recalled. Such security will protect the interest of the plaintiff ASIACONI in respect of its claim relating to plant, machinery and equipment C.M.A. No.1837 of 1985 stands disposed of accordingly. M . Y . H . / 5026 / K Application disposed of accordingly