P L D 1968 Karachi 136 (PLP)

Thus, the last date for delivery was 28th February 1965. But before this date could be reached, the District Magistrate imposed ban on the movement of rapeseed by rail or road out of the Tharparkar District. It is agreed between the parties that this order was made on 25‑2‑1965 under section 144, Cr. P. C. The text of the order has been produced in paragraph 6 of the plaint as under:‑ "Order under section 144, Criminal Procedure Code. Whereas it has been brought to my notice that there has been export of Jambha, Turia, Mustard oil and their products on large scale out of the district which has caused danger to health and economic condition of the people of the district. Whereas' an emergency has arisen and it is necessary to pass this order for public peace and safety. Now, therefore in exercise of the power conferred on me by section 149, Cr. P. Code, 1, Syed Alamdar Raza, C. S. P., District Magistrate, Tharparkar do hereby order that for a period of one month from the date of this order the export of Jambha, Turia and Mustard oil or other products out of the district by means of rail and road is completely banned with immediate effect: This order shall be given publicity by publication in the official Gazette and by affixing copies thereof on the Notice Boards of the Tehsil Offices in the District. It shall also be proclaimed by beat of drum in the towns. Given under my hand and seal of the Court, this 25th day of February 1965. (Sd.) S. A. Raza, C. S. P. District Magistrate, Tharparkar." The defendants, however, denied this text of the order in paragraph 10 of the written statement, stating that the text of the order as produced in paragraph 6 was not admitted in view of the Governmental notification. Though the defendants placed main reliance for their defence on the order of the District Magistrate under section 144, Cr. P. C., they refused to admit the correctness of the text of the order as reproduced in paragraph 6 of the plaint without, however, producing the text of the order themselves. The incongruous position was realized by the defendants at the time of arguments, after they had already closed their evidence. The defendants then made an application under Order XVIII, rule 17, and with Order XIX, rule 1, and section 151, C. P. C., for permission to bring on record the certified copy of this order. But on comparison I did not find any 'difference between the text of the order as contained in paragraph 6 of the plaint, and the text of the certifier copy of the cider which the defendants sought to be brought on record. Mr. Jan Muhammad Dawood opposed this application on two fold contention, that is, that the certified copy of the order was being tendered at a very late stage and that, there being no difference between the text of the order as reproduced in the plaint and the text of the certified copy tendered by the defendants, the latter should not be allowed to go back on their pleadings. It was suggested by the learned Advocate that the defendants' plea as to the frustration of the two contracts in suit should be deemed to have been abandoned by reason of the defendants' failure to produce the District Magistrate's order on which relied for their plea of frustration, an order while according to the defendants' own case, should be different from the one reproduced in the plaint. I am unable to accept these contentions. The defendants own pleadings have, no doubt, placed them in a difficult situation. But the issue as to frustration by reason of the District Magistrate's order under section 144, Cr. P. C., has been expressly raised by the parties in issue No.

1. It is correct that the defendants omitted to produce a certified copy of this order and denied, in my opinion thoughtlessly, the text of the order shown by the plaint. But there is no difference between the text of the certified copy of the order sought to be produced by the defendants, and the text as reproduced in the plaint. For the purpose of deciding issue No. 1, the text of the order under section 144, Cr. P. C. as given in plaint may, therefore, be accepted as the correct text.

7. The question then arises whether this order of the District Magistrate, Tharparkar, frustrated the two contracts in suit. Under section A of the Contract Act, this frustration may be due to performance having become either unlawful or impossible. Mr. Nasirn Farooqi, the defendants' learned Advocate, has contended that the contracts became both unlawful as well as impossible of performance. But the contention that the contracts became unlawful assumes the validity of the District Magistrate's order which, as noted already, purports to have been made under section 144, Cr. P. C. The part of this section relevant to the present dispute is subsection (1), which is in the following terms:‑- "144 (1). In case where, in the opinion of a District Magistrate, Sub‑Divisional Magistrate, or of any other Magistrate (not being a Magistrate of the third class) specially empowered by the Provincial Government or the District Magistrate to act under this section (there is sufficient ground for proceeding under this section and) immediate prevention or speedy remedy is desirable; Such Magistrate may, by a written order stating the material facts of the case and served in manner provided by section 134, direct any person to abstain from a certain act or to take certain orders with certain property in his possession or under his Management, if such Magistrate considers that such direction is likely to prevent, or tends to prevent, obstruction, annoyance or injury, or risk of obstruction, annoyance or injury, to any person lawfully employed, or danger to human life, health or safety, or a disturbance of the public tranquillity, or a riot, or an affray." Thus, the doing of certain acts may be prohibited under this section, if such prohibition is likely to prevent, or tends to prevent, obstruction, annoyance or injury, or risk thereof, to any person lawfully employed, or danger to human life, health, safety, or disturbance of public tranquility, or riot or affray. But these are not the purposes for which the District Magistrate's order in question was promulgated on 25th February 1967. The order, as reproduced in the plaint, shows that it was promulgated to prevent danger to the health and economic condition of the people of the Tharparkar District. This last purpose, the prevention of danger to economic condition of the people, is obviously not within the purview of section 144, Cr. P. Code, and it is not understood as to how export from Tharparkar District of certain varieties of oil‑seeds could constitute a hazard to public health. It appears that what the District Magistrate sought to achieve was to regulate the economic life of his district by issuing a fiat under section 144, Cr. P. C. This he was not competent to do and his order, therefore, is tainted with illegality. This illegal order would not make the performance of the contracts unlawful. The unlawfulness contemplated by section 56 of the Contract Act is one which is, the result of a valid law, or of a valid order made in exercise of lawful authority. No lawful authority vested in to District Magistrate under section 144, Cr. P. Code to regulate the movement of commodities within or outside his district. The defendants cannot place reliance on the District Magistrate's order in question to support their plea of frustration of the contracts in suit.

7. But the defendants also rely on the immossibility of performance of the contracts in suit by reason of the District Magistrate's order under section 144, Cr. P. C. For considering this contention, the terms of the contracts may again be referred to. The contracts were for sale of the 1965 crop rapeseed, of the quality known as "Mirpur Line", which is grown in the District of Tharparkar. The sales were forwarded that is, for delivery of the goods in future which time was stipulated in the contracts to be upto 28th February 1965. The delivery was to be effected at Karachi by presentation of railway receipts to the buyers. The question is whether it was an implied condition of the contracts that the rapeseed deliverable to the buyers was the rapeseed which the sellers should themselves dispatch by railway from any station within Tharparkar to Karachi, or, that the rapeseed bought by these sellers from this district should arrive at Karachi by railway. As to the meaning of implied condition with regard to commercial contracts it may best be expressed in the words, of Scrutton, L. J. in Comptoir Commercial Anverpois v. Bower Son & Co. ((1920) 1 K B 868). An implied condition, it was observed in. this case, is a term of the contract which is so necessary that both parties to the contract should be deemed to have intended that it should be a term of the contract; and have not expressed it in the contract because its necessity was so obvious that it was taken for granted. This observation as to the meaning of "implied condition" was noted with approval by the Judicial Committee of the Privy Council in Pragdas Mathuradas v. Jeewanlal Ltd. (P L D 1962 P C 162).

8. There is no evidence to support the suggestion that it was the intention of the parties that the rapeseed that should be delivered to the buyers should be the rapeseed bought by the sellers themselves from Tharparkar District, or despatched by them by railway to Karachi from any station within this district. It is not disputed that if no ban had been imposed on the movement of rapeseed from Tharparkar, it would have been open to the sellers to adopt either of the following two methods for completing the delivery of the contracted goods. The sellers could present to the buyers railway receipts of rapeseed consignments which they themselves might have bought and dispatched from any station in Tharparkar. Or, the sellers could purchase from merchants in Karachi consignment of Mirpur line rapeseed, and deliver to the buyers railway receipts for these consignments. It was not necessary that the sellers should themselves buy rapeseed in Tharparkar and despatch the same to the buyers at Karachi. The sellers could have purchased these goods in Karachi. It cannot, therefore, be concluded that both the sellers as well as the buyers intended, as a necessary term of the contact; that the consignments to be supplied to the buyers should be only those consignments which were bought and despatched by the sellers themselves from Tharparkar, inability of the buyers to despatch rapeseed from Tharparkar due to the order of the District Magistrate would, therefore," by itself be not sufficient to frustrate the contracts.

9. However, notwithstanding that the condition as to actual depatch of rapeseed by the sellers from Tharparkar has not been proved to be a part of the contract, it is still open to the sellers to show that the order of the District Magistrate under section 144, Cr. P. C., banning movement of rapeseed, made it impossible for the sellers to fulfil the contracts. But the sellers had to prove this impossibility, which they failed to do. No evidence was led by them to show that the railway administration obeyed the District Magistrate's . order under section 144, Cr. P. C., notwithstanding its obvious illegality, or that the sellers tendered to the railway consignments of rapeseed at any station in Tharparkar for despatch to. Karachi but that the railway refused to accept these consignments: There is also no evidence that the railway administration at various stations in Tharparkar refused to accept the consignments of rapeseed from other merchants also. It has also not been shown that the sellers were unable to obtain consignments of Mirpur line, rapeseed in Karachi or the commercial centres nearer Tharparkar, or that they made any efforts to obtain these goods at these places, or even that the goods of the contracted quality were not available in these markets at all. On the other hand, as soon as the order under section 14.1, Cr. P. C. was promulgated, the sellers took the stand that they were discharged from these contracts, and refused to consider the buyer‑offer contained in their two letters Exhs. 10/4 and 10/5, both dated 26th February 1965, to accept tender of delivery, at any station within 'Tharparkar District. Thus, on the evidence brought in 'the suit, no conclusion can be reached that the two contracts in suit did in fact become impossible of performance by reason of the ban imposed on movement of rapeseed from Tharparkar.

10. This view which I have taken of the defendants' plea with regard to impossibility of performance finds support from the decision of the Judicial Committee of the Privy Council in Pragdas Mathuradas v. jeewanlal Ltd., to which a brief reference has been made above. In this case, a contract was made on 8‑12‑1941 for forward delivery at Calcutta of Penang tin. On 7‑12‑41 Pearl Harbours was attacked by the Japanese, and on the following days the Japanese army invaded Malaya. The sellers then took the stand that the basis of the contract was forward contract of sale of Penang tin, and the invasion of Malaya by the Japanese army made the shipment of tin; from Penang impossible, with the consequence that the contract was frustrated. It was held that the contract did not contain any implied condition that Penang tin ordered by the sellers should arrive in Calcutta, as such term was not so necessary that both parties must have intended it to be a term of the contract. This conclusion was arrived at on the finding that there was no evidence that the buyers knew or cared whether the tin would be supplied from a consignment ordered by the sellers from Penang, and, further that the sellers could have purchased stocks of Penang tin in Calcutta itself.

11. Issue No.1.‑‑In view of what has been stated above, my finding on issue No. 1 is against the defendants, and I accordingly hold that, the two contracts in suit neither became unlawful, nor impossible of performance, by order of the' District Magistrate, Tharparkar,' promulgated on 25th February 1965, under section 144, Cr. P. C.

12. Issue No. 2.‑This issue was raised at the instance of Mr. Jan Muhammad Dawood, the learned Advocate for the plaintiffs who, however, did not address any arguments thereon. I, therefore, treat this issue as having been dropped.

13. Issue No.. .3.‑The onus under this issue was on .the defendants, but they failed to bring any evidence to show whether under the bye‑laws of the Karachi Grain sad Seed Merchants Association, there was recission of the two contracts. Nor were any arguments addressed by Mr. Nasim Farooqi on this point and on the further point as to what would be the effect of such recission on the sellers' obligations under contracts. My finding on this issue is, therefore, against the defendants.

14. Issue No. 4.‑The defendants' partner, namely D. W. Abdus Sattar, tendered in evidence 13 contracts Exhs. 9/1 to 9/13, which were entered into by the defendants with some suppliers in Mirpurkhas. The witness stated that there was no delivery under these contracts due to the imposition of ban on movement of rapeseed from Tharparkar. This evidence was sought to be used to support .the suggestion that the fulfilment of the contracts in suit was dependent on performance of contracts entered into by the ‑defendants with their suppliers. I fail to see any substance in this argument. 'The contracts in suit do not contain any term that delivery would be tendered only if the sellers received delivery from their own suppliers. Nor can any term of this nature be implied in the contracts, as such a term cannot be treated as a necessary term. The finding on this issue is, therefore, against the defendants.

15. Issues Nos. 5, 6 & 7.‑‑In view of the findings on issues Nos. 1 to 4, I have to hold that the defendants committed breach of the two contracts in suit, and as such are liable in damages to the plaintiffs. It was stated by the defendants at the bar on 2‑2‑1967, the statement having been recorded in the order of the day, that the measure of damages, in case it was held that the defendants committed breach; should be on the basis of the market rates on 1‑3‑1965, as given in the plaint. The market rate on this date was Rs. 45.00 per maund, as against the contracted rate of Rs. 31.50 per maund. It is not disputed that one bag contains two maunds of rapeseed. On the basis of the difference of Rs. 13.50 between the contracted rate and the market rate, the plaintiffs are entitled to damages in the sum of Rs. 44,550.00.under the first contract dated 25th July 1964, (Exh 10/1) and Rs‑. 40,500.00 under the second contract dated 28th July 1964 (Exh. 10). The plaintiffs are also entitled to refund of the advances made by them to the defendants in the sums of Rs. 3,300.00 and 3,000.00 under these contracts. The aggregate of this amount comes to Rs. 91,350.00 (Rupees ninety‑one thousand and three hundred fifty) which the defendant are liable to pay to the plaintiffs. The plaintiffs are entitled to a decree for this amount.

16. I, therefore, decree the suit for Rs. 91;350.00 (Rupees ninety‑one thousand three hundred fifty) with costs and interest at three per cent. per annum simple from l6'e date of the decree until payment. K. M. A. Suit decreed.