1994 PLP 1380 (CLC)

"So far as I recollect the construction work was discontinued somewhere in 1979, and in so far as the contractor is concerned he subsequently wanted to re‑start the work and made request in that behalf. I see Exh. 5/47‑A and say that on the second page thereof, marked Exh. `X' the intimation for discontinuation by the Architect is confirmed." The receipt of the abovementioned document marked `X' has been denied by the plaintiff. The defendants claim this to be part of Architect's letter Exh. 5/47 (A), copy of which was admittedly received by the plaintiff. The Architect, however, was not called as witness to prove that the said document was part of Exh.5/47 (A) or that its copy was sent to and received by the plaintiff. But, even if assumed as part of Exh. 5/47 (A), the document would still be of no help to the defendants, for, on their own showing it was allegedly written by defendant No. 3 who was neither a party to the agreement nor authorised to terminate the same and admittedly Exh. 5/47 (A) was written on 3‑9‑1980, long after stoppage of the work by defendants in January 1980. Issue No. 1 is accordingly decided in the affirmative and issue No. 8 in the negative. \Issues Nos. 3, 4 and 7 are inter‑connected and are being taken up together. Plaintiff's counsel has submitted that the plaintiff was required to execute several extra items referred to in the deposition of plaintiff's witness Yousuf, which items had been claimed in the plaintiff's running bills but were not paid for. He has submitted that after adjusting the cost of material supplied by the defendants the total amount of all running bills of the plaintiff add up to Rs.11,04,112 while the fatal amount paid to the plaintiff against these bills was Rs.7,42,000 as such, a sum of Rs.3,62,112 remained unpaid. Defendants' counsel's submission on these issues was that all the items being claimed as extra work were included in plaintiff's running bills. Each bill was thoroughly checked by the Architect and then certified for such payment as was considered due to the plaintiff on the basis of work done. The payment for which the respective bill was certified was paid by the defendants, and in the process due to duplication in payment, the plaintiff has been overpaid. The admitted position appears to be that the defendant No. 3 was appointed Architect to supervise the construction of the building. The periodic running bills submitted by the plaintiff used to be scrutinised by the defendant No. 3 and passed for such payment as he considered appropriate on the basis of work done. The running bills included claims for the alleged extra works too and while some of these were rejected by the Architect, others were passed for payment either as claimed or at reduced rates. For instance in the 3rd running bill (Exh. 5/26) the plaintiff claimed Rs.18,500 for extra excavation, Rs.15,000 for extra work of providing 1:4:8: C.C. between foundation 5 and 6 and Rs.4,500 extra masonry work on footing Nos. 6 and

7. In Architect's letter (Exh. 5/27) dealing with this bill, the first item was passed for payment of Rs.9,250, second item for full Rs.15,000 and the third item for Rs.2,500 Similarly, in the 4th running bill (Exh. 5/28), the claim for Rs.40,000 for raising the height of ground floor by 2 feet was allowed in full while certain other extra items were disallowed. Similar rejections and reductions were made in respect of other items too. Apparently at that time the plaintiff accepted such cuts in its bills, for, otherwise it would have undoubtedly taken this up with the defendants without loss of time and perhaps would also have reclaimed the disputed amount in its next bill as it did once in the case of unpaid amount of Ist running bill, when in its 2nd running bill it included the amount of Rs.18,833.12 by way of Ist running bill balance payment." Had the plaintiff, raised such dispute at the earliest the defendants would have had the opportunity to examine the objection and if these were considered unreasonable to terminate the contract at the initial stage in pursuance of Clause 24 thereof. It is apparent that while the work continued, the plaintiff, by its conduct, made the defendants believe that the cuts in running bills were acceptable, to it, but, once the work was discontinued at the instance of defendants in January, 1980, it made a claim of all the rejected items of the various running bills in its 8th bill, dated 16‑2‑1980 (Exh. 5/35). There could hardly be any justification for such a belated claim. As would appear from the subsequent events, the claim made in 8th running bill was more to put pressure on the defendants to allow resumption of the work then to press the claim. This would be obvious from the fact that though 8th bill was not passed for payment, yet no protest was made by the plaintiff, instead, it submitted its 9th running bill dated 26‑5‑1980 wherein the items of 8th bill were admitted and in its letters dated 26‑5‑1980 (Exh. 5/79) and 16‑6‑1980 (Exh. 5/80) while it sought defendant's instruction for the resumption of the work and requested for early payment of the 9th running bill, no reference was made to the unpaid 8th bill. Relevant portion from plaintiff's letter (Exh. 5/80) addressed to the defendant No. 1 may be reproduced as under: "Payments of 9th Running Bill have also been withheld. The work of construction beyond 2nd floor has been 'suspended since about more than 5 months." again, "In the circumstances stated above we request earnestly that necessary instruction about the construction works may please be given to us at a very early date and the payment of our 9th running bill may kindly be made to us as early as possible." Had the plaintiff considered himself to be entitled to any payment under the 8th Running Bill‑ he would have not abandoned the same. As regards 10th running bill, that is almost repetition of the 8th Bill,‑,which had already been given up by the plaintiff, except for the item relating to 9th Bill. In so far as the 9th Bill was concerned, the same had been approved by the Architect for Rs.96,000 and there appears to be no reason to disregard the recommendation. The rate agreed between the parties being mainly on constructed area basis, as distinct from item‑wise basis, it was for the plaintiff to establish that the items claimed by it by way of extra work items were not covered by the constructed area rate. This the plaintiff having failed to do, it is not possible to find fault with the assessment of the Architect. In the circumstances of the case, in my view, the recommendation of the Architect with regard to the amount payable on plaintiff's Running Bills Nos. l to 7 and 9 should be taken to be a fair basis for determining the amount if any, payable to the plaintiff for the work executed by it. As is apparent from Exhs. 5/22. 5/25, 5/27, 5/29, 5/31, 5/34 and 5/47 the payments recommended by the Architect against plaintiff's aforesaid bills, after deducting the cost of material supplied by the defendants, total to Rs.8,47,770.49. As against this the total amount paid by the defendants Nos. 1 and 2 to the plaintiff was Rs.7,42,

000. This is borne out from admission made in para. 7 (b) of the written statement filed on behalf of defendant No. 2 as well as his cross‑examination where he stated that: "With regard to the question about which I had undertaken to give reply I say that documents Annexure `B' to the plaint and Annexure `M' with the written statement are the relevant document and such document indicate the relevant figures of payment. I do note remember the date of the last payment made by me." Under Annexure B' to the plaint the total amount of payment to the plaintiff is shown as Rs.7,42,

000. No doubt in Annexure `M' to the written statement (same as Exh. 7/1) the defendants have claimed payment of Rs.7,87,000 but have not been able to establish payment in addition to the admitted amount of Rs.7,42,

000. The plaintiff in his cross‑examination denied having received payments of Rs.25,000 and 45,

000. There is, therefore, no safe basis to assume payment to the plaintiff in excess of Rs.7,42,

000. Accordingly, taking Architect's recommendation as base for plaintiffs entitlement, an amount of Rs.1,05,77.49 is still payable for the work done by the plaintiff under the agreement, inclusive of the extra work. Issues No. 3, 4 and 7 are decided accordingly. On issue No. 2 the submission of the plaintiffs counsel was that at no time any defect or deficiency in the work was pointed out to the plaintiff and even after completion of the work by the plaintiff, none of the defendants raised any objection to the quality of the work. On the contrary the contention of the defendants' counsel was that the deficiencies had been referred to in Exhs. 5/3 to 5/20 and in addition the Architect used to point out defects at the site as also in his letters this issue appears to be relatable to para 4 of the written statement where it has been stated that "However, the work done by them on the ground floor (shops) and first floor is deficient in respect of the following items: (1) Finishing of stairs. (2) Finishing of well for a car lift. (3) Well for passenger lift. (4) Finishing of lavatory. The above averment is, however, not supported by any letter of the defendants, though in his cross‑examination the defendant No. 2 did mention that: "The Lavatory, Plumbing white‑washing works of the contractor are still incomplete and yet they have been paid for", but such passing reference at the stage of evidence, without any support from the correspondence cannot be given much weight. In so far as Eons. 5/3 to 5/20 are concerned these are in the nature of periodical inspection reports and generally appear to favour plaintiff's contention that its work was satisfactory. Mere mention of a few defects in some of these would not mean the defects had not been rectified later. Had plaintiff's work been deficient, the Architect would not have recommended payment therefor, I would therefore hold that there was no deficiency in such work of the plaintiff as had been passed for protect. The issue is decided accordingly. Payment by the Before taking up issue No. 5, it will be convenient to deal with issue

6. While discussing issue No. 8 it has already been held that in respect of 4 storeys the contract was valid and it was not terminated by the defendants in accordance with the provision thereof. As such the plaintiff would be entitled be compensated for the loss caused to it, "which naturally arose in the usual rise of things from such breach, or which the parties knew, when they made contract, to be likely to result from the breach of it", as provided under ion 73 of the Contract Act. However, it is a settled principle that m order entitled to compensation for breach of contract, the party claiming compensation must establish specifically the loss suffered by it, a mere general ration cannot be made basis for awarding compensation. Here sensation/damages has been claimed by the plaintiff on two counts: (i) Rs.3,00,000 by way of "damages on balance of work on 6 storey approximately cost of Rs.30,00,000 profit @ Rs.3,00,000 10% amounting to (ii) Rs.37,500 by way of salary to employees from June 1980 to December 1980 and hire charges for machinery for 5 months. In so far as the first item is concerned all that has been stated by plaintiff's witness in his deposition is that: "Because of stoppage of work beyond Ist floor I suffered losses to the extent of Rs.3,00,000 which also I am entitled to recover from the defendants." There is neither any explanation nor details of the so‑called loss nor has the same been substantiated by document or other evidence. I am afraid a bare statement like the one made by plaintiffs witness cannot be made basis for awarding damages/compensation. As to the second item, the plaintiffs witness has stated that: "Because of the work we engaged services of Chowkidar Supervisor and equipment and on these items we incurred about Rs.37,500 as expenses which we are entitled to recover from the defendants. In (sic) produce 18 receipts showing the work done as Exh.5/55 to Exh.5/72." The plaintiff is more specific on this‑item of its claim. However, it has not justified the reason for employing the employees and retaining the equipments for such a long period after the work had admittedly been suspended in January 1980. It is also a cardinal principle for awarding damages for breach of contract that in estimating the loss for breach the means available for mitigating the loss should be taken into account. In the present case after the suspension of work in January 1980 there could be no justification for the plaintiff to continue to employ Supervisor or Chowkidar up to December, 1980 or to continue to keep construction machineries at site, all the more when these were on rent. Therefore, I find no justification for plaintiff's claim for salary of employees from July to December, 1990 and hire charges for the machineries also up to December 1980. Accordingly issue No. 6 is decided in the negative. This brings me to the remaining two issues Nos. 5 and

9. In view of the foregoing discussion on the various issues my finding on these is that though the plaintiff is not entitled for reimbursement of the entire amount as claimed, it is entitled to receive from the defendants Nos. 1 and 2 and these defendants are liable to pay, jointly and severally, to the plaintiff the sum of Rs.1,05,770.49 for work done by the plaintiff. Accordingly plaintiff's suit is decreed against the defendants Nos. 1 and 2, jointly and severally, in the sum of Rs.1,05,770.49 with interest @ 10% per annum from the date of suit till payment and with proportionate costs. AA/A‑1451/K Suit decreed.