P L D 1970 Karachi 577 (PLP)

3. Learned counsel's first submission, which he argued very feebly, was that the suit was barred by the provisions of Entry No. 35 of the Second Schedule to the Provincial Small Causes Court Act, 1887 (hereinafter called the Act), by which the jurisdiction of the Small Causes Court in Karachi is regulated. Section 15(1) of the Act, in so far as it is relevant, states as follows :‑ "15(1).‑A Court of Small Causes shall not take cognizance of the suits specified in the Second Schedule as suits excepted from the cognizance of a Court of Small Causes." In order to determine whether the applicants' suit is barred, it is necessary to examine the provisions of the Second Schedule of the said Act. In support of his submission, learned counsel merely referred me to Entry No. 35(1) of the Second Schedule and stated that the claim of the plaintiff fell under this entry. Entry No. 35(1) states as follows "35(1).‑A suit for compensation for injury to the person in any case not specified in the foregoing sub‑clauses of this clause." According to learned counsel, the loss suffered by the applicants falls within the meaning of the words "injury to the person". Learned counsel was not able to explain how the respondent's failure to collect the proceeds of a cheque would amount to an injury to the person of an applicants. But, as l have observed, he did not press this argument. The words "injury to the person" are plain and unambiguous, and are used in reference to personal injuries as distinct from injury to the property of a person, therefore the claim of the applicants does not fall under H Entry 35(1) of the IInd Schedule and their suit is not barred under the IInd Schedule of the Act; the submission of learned counsel is without merit.

4. Learned counsel's second submission, on which he placed great stress, was that the applicant's suit was barred by the provisions of section 3 of the Conciliation Courts Ordinance, 19ol (hereafter called the said Ordinance). According to learned counsel, the preliminary objection taken by the respon dent in its written statement that the Small Causes Court did not have the pecuniary jurisdiction to hear the claim of the applicants had reference to section 3 of the said Ordinance. I may observe here that it was unfortunate that the learned Judge dismissed the suit of the applicants on such vague pleadings. However, as the question raised is a question of law, I have heard arguments on it, and I shall now consider these arguments.

5. I shall first set out the relevant provisions of the said Ordinance. Section 3 of the said Ordinance, in so far as it is relevant to this Revision Application, states as follows 3. (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1898 (Act v of 1898) or in the Code of Civil Procedure, 1908 (Act V of 1908)‑ (a) all cases falling under Part I of the Schedule shall, save as otherwise provided, hereinafter be referred to conciliation under this Ordinance, and no civil or criminal Court shall have jurisdiction to try any such case; and (b) any of the cases falling under Part 11 of the Schedule may be so referred if all the parties thereto agree to such a reference. As the suits excluded from the cognisance of the Courts are set out in the Schedule to the Ordinance, it is necessary to examine the Schedule. The claim of the applicants is a money claim and as they were not prepare to refer it to the Conciliation Court, only the entri.s in section (B, of Part I of the Schedule are relevant. According to learned counsel for the respondent the entry in section (B), which is relevant, is the first entry. This entry states : "Suit for the recovery of the money due on contracts, receipts or other documents". The claim of the applicants against the respondent is admittedly not based on the cheque, which they had delivered to the respondent for collection, because the respondent only acted as a collecting agency their claim is based on the failure of the respondent to carry out its duties properly as a collecting bank. However according to the respondent it has entered into an agreement with the applicants for the collection of their out station cheques, therefore the applicant's cause of action arose out of a contract.

6. As a plaintiff is entitled to file a suit in any manner he wishes, in order to ascertain the nature of the applicants' claim, I have to consider only the plaint in Suit No. 531 of 1964. According to the plaint, when the respondent had presented the applicants' cheque to the City (:o‑operative Bank for payment, it had received a draft from the City Co‑operative Bank, Sukkur payable on the Karachi Branch of the City Co‑operative Bank. The respondent had then illegally exchanged that draft with the National Commercial Bank for a cheque payable by the National Commercial Bank which had been dishonoured, so that the applicants had suffered a loss. The contention that the respondent acted illegally in failing to obtain payment of the draft issued by the City Co‑operative Bank is not based on any contract, nor does the plaint contain any averment of any violation of contractual rights. On the contrary, in para. 7 of the plaint, the applicants have given particulars of the acts which, in their submission, constitute negligence by the respondent, and these particulars specify the manner in which the respondent has deviated from the usual banking practice and thereby caused loss to the applicants. The particulars do not contain any reference to any contract, and the cause of action in the plaint is based only on the respondent's failure to carry out the duty imposed on it under law or by custom as bankers. The claim is therefore not based on a breach of contract, but is a claim in tort. Additionally, I have to observe that even in the written statement, the contention of the respondent is that it has acted in accordance with the usual banking practice and that it has not been negligent in any manner. Thus the respondent has also not based its defence in its written statement on any contractual relationship. In view of the pleadings, it is therefore not open to the respondent to contend that the plaintiffs' suit was a suit for money due on a contract.

7. However, learned counsel for the respondent submitted that when the applicants opened an account with the respondent it was assumed that the respondent would collect the outstation cheques of the applicants, therefore the failure of the respondent to collect the proceeds of the cheques in dispute ultimately amounted to a breach of contract. Assuming for the sake of argument that the respondent is entitled to advance this plea and that its failure to collect the proceeds of the cheque in dispute amounted to a breach of contract by the respondent, according to the plaint, this failure also amounted to a breach by the respondent of its obligations under the law as bankers. In these circumstances, on the assumption that the submission of learned counsel for the respondent is correct, the applicants have elected in their plaint not to seek contractual relief for the loss suffered by them, but only to pursue their remedy in tort. The provisions of the said Ordinance do not apply to actions in tort, and a Conciliation Court cannot take cognizance of such a claim. In these circumstances, are the applicants barred from seeking relief in tort merely because they might have an alternative remedy in contract? As the Ordinance does not contain any provision in this respect, I shall first consider the position under the Common Law.

8. A tort is a breach of a duty imposed by the law towards persons generally, whilst contractual liability is created by an agreement which is enforceable in law. Generally parties are free to enter into agreements which may affect their obligations in law. Thus to take common example, a bailee may enter into a contract with the bailor either to restrict or to enlarge the obligations imposed on him under the general law. In such circumstances in the event of an injury, the bailor may sometimes l find it an advantage to sue the bailee for breach of contract and sometimes it may be more advantageous to him to sue the bailee in tort, and it is settled law that the bailor can generally sue the bailee in tort or in contract at his option, but he cannot recover damages twice for the same injury. Thus to quote a very eminent authority, Winfield in the Law of Tort states at page 6, 7th Edition as follows :‑ . . . . . . . . though liability in tort and in contract are quite distinct, the same facts may nevertheless create alternative liability in tort or in contract. A dentist who contracts to pull out my tooth is, of course, liable to me for breach of contract if he injures me by an unskilled extraction. But he is also liable to me for the tort of negligence ; for everyone who professes skill in a calling is bound by the law, agreement or no agreement, to show a reasonable amount of such skill. I cannot recover damages twice over, but I may well have alterna tive claims for damages under different heads of legal liability. In another famous commentary on the Law of Tort, Clarke and Lindsell on Torts (12th Edition), the learned authors state in paragraph 5 as follows :‑ "If the claim depends upon the proof of the terms of the contract, the action does not lie in tort, so a claim for wrongful dismissal is a claim in contract, and so is wrongful expulsion from school, or from a Trade Union. On the other hand, where a claim would arise from the relationship between the parties independently of the terms of the contract, an action will lie in tort at the election of the plaintiff although he might alternatively have pleaded in contract. Thus, a railway company is clearly liable for injury caused by its servant's negligence independently of contract, and it has been held that a passenger under contract can recover in tort. Likewise, a bailee of a chattel as a rule owes a duty of care under the contract of bailment, but an action will lie in tort and any person who handles o. interferes with the property of another owes him a duty not to damage the property by his negligence, and may be sued in tort irrespective of whether he is also under a contractual liability." As our Law of Torts is based entirely on the Common Law, the principles laid down in the commentaries quoted are fully applicable to the case before me, and that has also been the view in all the commentaries on the Law of Tort in the sub‑continent. Thus, Anand and Sastri in the Second Edition of their Commentary on the Law of Tort state at page 44 as follows :‑ "

29. Tort and contract.‑A breach of contract is also a tort, where the defendant owes a duty to the plaintiff both under contract and independently thereof under some law. Thus, it is an implied term of every contract between a surgeon and the patient that the surgeon shall use such reasonable care as should be expected of a man in his position: moreover, in any operation which he may perform, the surgeon, independently of the contract, owes a duty towards the patient t o use reasonable care. Negligence on his part will be both a breach of contract and a tort. The general rule is that where tort and contract overlap, the co‑existent rights and duties do not adversely affect one another. The breach of duty in tort is considered entirely on its own and is not qualified in any way by the contract, subject to this, that where the duty in tort is expressly or implicitly qualified by agreement between the parties, the plaintiff cannot ignore the modification of his rights brought about by the contract. Such modification cannot, however, affect the claims of third parties against the defendant or of the plaintiff against the third parties." The views expressed in these observations state the correct law before the said Ordinance was enacted.

9. The Legislature is presumed to be aware of the law, when it enacted the said Ordinance, it knew that a person aggrieved by a breach of contract might also have a remedy in tort on the same facts, yet it has barred the Courts from taking cognizance of actions in contract, but not of actions in tort. I may point out here that the said Ordinance has set up Conciliation Courts, consisting of laymen, compulsorily to try the disputes specified E in section B of the Schedule of the said Ordinance, and has ousted the jurisdiction of the regular Courts only in respect of the disputes specified in that section B. It is relevant to observe here that whilst the Ordinance bars the right of representation by counsel, the disputes set out in section B are disputes of a simple nature, which can generally be decided by laymen without expert knowledge of law, unlike actions in tort which laymen would be unable to decide without the assistance of counsel. Therefore the omission of actions in tort from the list of disputes specified in section B appears to me to be deliberate, and manifests the intention of the Legislature to exclude the jurisdiction of the Courts only to the extent expressly enacted in section B. Additionally, it is a cardinal principle in the interpretation of statutes that the jurisdiction of the regular Courts can only be excluded by express provision in that respect or by necessary intendment. As I have observed, the Legislature was aware that the same facts might give a cause of action both in contract and in tort, yet it has barred the jurisdiction of the Courts only in respect of actions in contract. Therefore according to the established principles for the interpretation of statutes, the absence of any reference to actions in tort in section B of the Schedule of the said Ordinance clearly means that the jurisdiction of the Courts to hear such actions is not barred by the said Ordinance, the applicants were therefore entitled to file a suit against the respondent provided their cause of action was based solely in tort. As the cause of action in the suit filed by the applicants is based solely on the alleged negligence of the respondent, the trial Court erred in dismissing the suit.

10. The Revision is therefore allowed with costs and the trial Court shall now proceed to hear the suit of the applicants according to law without any further delay. A. E./S. A. H. Revision allowed.