Please write the case summary of your respective case as mentioned below (feel free to change/add

headers):

Nihit/Kaustab:

1) Case Name (Details):

Satyanarayana Vs Narayan Rao 1999 (Quasi Contract)

What happened?

Apellant – Satyanarayana – wants to buys a house.

1st Defendant – V Narayana Rao - Owner of a property house

2nd defendant- R Sridhar - Agent for selling house

Case description:

1st D entered into a contract with 2nd D that – 2nd D has got every right to enter into any sale agreement
on the property on behalf of 1st D

Hence, Appellant entered into agreement with 2 nd to buy property for a consideration of Rs 5 lakh.
Appellant paid 1Lakh to 1st D & 2nd each. However the sale agreement fell through. The appellant did not
go for specific performance instead he demanded his money back

2nd D repaid him with interest and court also decreed that.

Suit against the 1st D was dismissed because there was no privity of contract b/w the 1 st D & the plaintiff.
The plaintiff appealed to high court met with the same fate. It was also dismissed on the grounds of
stranger to contract.

So appellant appealed to SC. This time he invoked Contract Act Section 70-72.

Contract Act Section 70-72

The amount was given to D1 by appellant as he wanted to purchase the property. The agreement to sell
was entered through the second defendant whom the first defendant had authorized to enter into any
such agreement on his behalf.

The appellant could not have paid to the 1 st D but for agreement to sell i.e. it was a non gratuitous act.
The defendant en-cashed the check hence benefited from the act. Therefore if appellant accept
pleadings of 1st D (privy to contract) then amount of Rupees 1 Lac with interest had been given by
appellant under some mistake i.e. it was not made gratuitously. Hence this would come under section
70-72 of the Indian contract act (Quasi Contract)
Final Judgement

SC upheld the appeal of appellant and asked 1 st defendant to pay the due amount with interest.

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Please write the case summary of your respective case as mentioned below (feel free to change/add
headers):

Ashish Korde:

2) Case Name (Details):

(Essentials of Valid contract 1979) Commissioner of Wealth Tax Vs Her Highness Vijayaba

What happened?

His highness Bhojjarajji of Gondal died on July 31, 1952 leaving behind considerable property. Disputes
arose between his two sons older one Vikramshingji and younger Shivraj Singhjji over this property.
Younger brother was contemplating to sue his older brother, but their mother her highness Vijayaba
intervened. Vijayaba gave a letter dated May 14, 1953 to younger brother which said that his father had
agreed to pay him Rs Fifty lakhs. And now if his older brother doesn’t give him that money, then his
mother herself will give him the same amount.

Older brother paid only 20 lakh to younger one. On Sept 12, 1959 their mother, keeping her word,
transferred War Stock valued 11 lakh to younger son and agreed to hand over ornaments for rest of the
claim(19 lakh balance). On February 22, 1962, their mother again paid Rs 10 lakh to the younger son.
(Now 9 lakh was the balance to be given)

Vijayaba (Mother)’s wealth was assessed on 1 st Dec 1959, 31st Dec 1960 & 31st Dec 1961. The remaining
19lakh to be paid at the end of 31 st Dec 1961 was held as a debt owed by her and it was deductible
under Wealth Tax Act from her total assets. (You can get certain consideration in taxes by showing such
debts)

Advocate Mr. Ahuja alleged that there was no consideration for mother in the letter dated May 14,
1953. And hence under section 25 of Contract Act, it was a void contract. But it was argued by the court
that this was a family arrangement, with written and oral proof. And thus can be considered as a
consideration.

Mr. Ahuja again alleged that letter dated May 14, 1953 was a contingent contract (if/else conditions)
under section 31 of Contract Act. But court argued that under section 32 of Contract act, such a contract
becomes enforceable by law when the future event contemplated in such contingent contract has
happened. In this case contingency happened when older brother gave only 20 lakhs instead of 50. And
thus the liability of mother became enforceable by law.
Which Acts were considered?

Contract Act Section 25: Agreement without writing or registration is void. (Agreement without
consideration is void)

Contract Act Section 31: A "contingent contract" is a contract to do or not to do something, if some
event, collateral to such contract, does or does not happen.

Contract Act Section 32: Contingent contracts become enforceable by law when contemplated event in
the contract has happened.

Final verdict:

The liability of mother became enforceable by law after the contingency happened and amount of 19
lakhs was shown as debt in her account. All the objections by Mr. Ahuja were overruled.

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Himanshu Agarwal:

10) Case Name (Details): Quantum Meriut, Puran lal Sah vs State of UP

What happened?

The Case is against the decree and judgment issued by the Allahabad high court which dismissed the suit
of plaintiff to claim damages owing to less price for the work he did

The plaintiff went into a contract with the state of UP for construction of “Mile 3”. He quoted a price 13
pc less than the other people.

Now he alleges that, the rates given in the tender were calculated assuming that the stone was available
near the construction site (26 chains, as in schedule B). He says that no stone was available and he had
to fetch the stone from far off places thereby increasing his cost. Also, he had to perform extra work due
to the shale rock presence at the working site.

Why the suit was filed:

1. No stones available nearby as indicated in the tender notice

2. Shale rock found which increased the amount of work
3. Extra work done other than what was contracted for after getting assurance from local officers
for higher payment
The appellant made an estimate for the above three and filed a claim to the respondent which was
refused and hence the suit was filed.

The defendant pleaded that

1. The calculations were based on the assumption that the stone is available at 26 chain but no
guarantee was given that it is available there. The Quarry was owned by the cantonment and
the permission to obtain stones from this quarry entirely was the responsibility of the appellant
which he failed to do.
2. The quantity of shale rock shown by the plaintiff is incorrect and in any case the extra work
needs to be performed to the extent of 30pc of the actual work at the agreed price. The para 5
of the notice indicated that if there is any extra work which needs to be performed and if a price
revision for it is desired, it has to be bring to notice of the engineer in charge before starting the
work. The appellant failed to do so and therefore it’s his obligation to perform the work with the
current prices.

Which acts could’ve been considered?

It is apparent that the contractor failed to read the contract properly and assumed certain things out of
it. Upon finding that the stone is not available at the 26 chain distance, he had intimated the authorities
about it. He should have initiated the proceedings for the voidable contract there itself quoting a
unilateral mistake. A mere assurance from the local officers could not help him in getting higher prices
for his work. In this case, he should have gone for a new contract (discharge of the old one - Novation)
to ensure that he is not put to loss.

Which laws were considered?

Final verdict:

Puran lal Sah lost the claim.

Ashish Mahalka:

Case Details:

Performance of Contract(National Insurance v Seema Malhotra)

What happened?

Yash Paul Malhotra entered into an insurance contract with National insurance co on 21.12.1993 by
insuring his maruti car. He gave a cheque of rs 4492 towards the first installment of the premium and
the company issued a cover letter stating the contract details. Unfortunately, he met with an accident
on 31.12.1993 in which he died and his maruti car has completely damaged. Now on 10.1.1994, the
bank on which the cheque was drawn by the insured sent an intimation the insurance co that the
cheque was dishonoured as there were no funds in the account of the deceased. On 20.1.1994, the
insurance co sent a letter to the wife of the deceased stating that the policy remains cancelled with
immediate effect.(these words are very imp) Now when the family of the deceased claimed for the
insurance of the car, the co refused. The family filed a case in State consumer protection committee. But
their case was repudiated stating that there was no contract. As the essence of contract includes
proposal, acceptance and consideration. In the absence of any consideration, the contract is void.

Now the family went to the Jammu n Kashmir high court which reversed the order passed by the state
commission and ordered the insurance co to honour the claim. Their point was that the insurance co
while cancelling the policy chose it to do with immediate effect (i.e. 20.1.1994) and not when the policy
was issued (21.12.1993). Since the date of liability is before the cancellation of the policy, the co is liable
to pay the claim. What it can do though is deduct the amount of premium they were supposed to
receive. And hence the co went to the SC.

The judgement:

Deals with section 51, 52 and 54 of the Indian Contract Act.

Section 51 – reciprocal of promises – unless the promisor has performed his act or willing to perform,
the promisee is abstained from performing his promise.

Section 52 – the order of the reciprocal promises has not been provided, hence it will be performed in
the order the nature of the transaction warrants.

Section 54 – same related to the non-performance of one of the persons. If he does not perform his act,
he has no claim to ask for the performance from the other person.

Hence based on the above sections, it was decided that since the premium amount was not received by
the insurance co, consideration of the agreement has not been done and in such a case, the contract
stands void. [ section 25]. Hence the insurance co is not liable to pay the insurance claim.

Vinayak Rakkasagi:

1) Case Name (Details):

Col Mac Pherson Vs MN Appanna and others (Offer and Acceptance)

What happened?

MN appanna(plaintiff) asked for specific performance as part of contract from Col.Mac(1 st defendant).

1st Defendant – Col Mac - Owner of a bungalow

2nd defendant- Subbayya – Potential buyer of bungalow

Case description:

Colonel owned several estates in Mercara. White was manager of one estate and Young was manager
for another. Young was looking after bungalow “Morvern Lodge”. Appanna through White sent a
cable(telegram) that he wants to buy bungalow for 4000. (1 st June 1944) Cable “ Have enquiries about
bungalow, quote lowest price”. On 24 th July Appanna sent another cable that he is ready to pay 5K.

In the meantime Young sent a cable from other end that “There is an offer of 6K for immediate
possession” Young received a reply on 8th August that Colonel wont sell for less than 10K. But on 7 th
August appanna told young that he is ready to pay higher price as well. Appanna was communicated
that its not less than 10K. He readily accepted counter offer of 10K on 14 th August. But it was only verbal
offer of acceptance.

But 3 days later on 17th August Subbayya offered 10.5 K to young for purchase of bungalow and he
expected that Young cabeled Colonel. But young dint convey this offer. Instead he sent a cable on 26 th
August that “There is offer of 10 K. May I sell?” Same day White also sent a wire that He received an
offer of 11K for immediate acceptance. So Colonel replied that “Accept 11K offer and give possession
when money is fully deposited to my account from Young”. Hence Subbayya got the bungalow.

Appanna filed a case that there was a concluded contract as he has accepted counter offer made by
Colonel.

Final Judgement

Court held that Colonel was in communication with both White and Young and 10K was not a counter
offer but he was inviting offers. Inviting offers does not equal to offer itself. So Colonel was not liable to
pay anything to Appanna, as there is no breach of contract on his part.

Kunal Ahuja:

Case 8 : Ghaziabad Development Authority vs Union of India

What Happened?

The GDA has from time to time promoted and advertised several schemes for allotment of developed
plots for construction of apartments and/or flats for occupation for the allottees. If they default or don’t
perform within allotted time, the consumer can file a case at:

 Monopolies and Restrict Trade Practices Commission

 Consumer Disputes Redressal Forum

In case of delay, 3 questions are asked in the appeal:

  Whether compensation can be claimed by claimants for “mental agony”
 Whether in absence of contract or promise held out by GDA, will interested be directed to be
paid?
 If so, what is the rate to be paid?

What Acts/Laws considered:

Based on Contract Act and Specific Relief Act

Principle is to put aggrieved party in the same position as far as possible had the contract not been
breached.

FOR MENTAL AGONY:

 Chitty on Contracts:

Normally no damages allotted for mental anguish or distress exception being “to provide peace
of mind or freedom from distress”

Despite this, court does not award damages for employee wrongfully dismissed for anguish and
vexation since these damages are not awarded in commercial contracts

 Normally, vendor (on default) gives the market value of the land at the fixed time of completion
minus contract price. The purchases may claim the loss of profit he intended to make from a
particular use of the land if the vendor had actual or imputed knowledge thereof.

FOR AWARD OF INTEREST:

Section 34 CPC – Payment of interest at the reate at which money is lent or advanced by national banks
in relation to commercial transactions.

Here, as per Section 34 of Civil Procedure Code, no interest payment required. However, per general
provisions of Section 34 and justice, equity, good conscience would authorize the Redressal Forums and
Commissions to also grant interest appropriately under the circumstances of each case. Therefore,
interest can be granted on equitable grounds.

Verdict:

 No Mental agony payment

 The rate of 12% pa for the consideration paid by purchaser earlier. Here, if the contract had a
provision of no interest payment on default, that too will not work unless the circumstances
created for the refund are by the claimant itself

During hearing, allotment of another flat was given as an option to the purchaser. Purchaser refused on
account of location and high cost.
Case 3 - Soundarya

Summary:

Plaintiff: Girdharilal Parshottamdas & Company (P)

Defendant: Kedia Ginning Factory and Oil Mills (D)

P commenced action in Civil City Court, Ahmedabad against D.

Plea: D failed to supply cotton seed cake, which they had agreed to under oral contract

P: cause of action rose at Ahd, as :

1. P accepted offer here

2. D bound by contract to supply here
3. D to receive payment through bank here

D: submitted that:

1. P had offered to buy oil seed cake and this offer was accepted by D at Khamgaon
2. Delivery was to be made at K
3. No part of cause of action of suit risen w/in jurisdiction of Ahd Civil Court

Part 1 : Trial Court found:

1. P made offer to D to purchase goods

2. P = offeror, D = acceptor of offer
3. D accepted offer at K
4. Goods to be delivered at K
However, the court held that the place where acceptance of offer is intimated to offeror is place
where contract is made, thus Civil Court at Ahd has jurisdiction.

D contended that place where offer is accepted is where contract is made in case of telephone contract.
(That is, the same rules for written contract apply to telephone) . P contend that telephonic contract
means parties are almost in presence of each other, instantaneous intimation of offer, acceptance etc.
Thus, not analogous to offer by post.

English common law and judicial precedents: rule of instantaneous comm diff from post rules. Contract
complete when acceptance received by offeror and made at place where acceptance received. (Same in
State Court decisions in US).

Authors opinion: trial court right, part of cause of action within jurisdiction of Ahd as acceptance
communicated by tel to P here.

Relevant Sections:

Contract Act: does not expressly deal with place of contract.

Sections 3 & 4 of the Indian Contract Act - communication, acceptance and revocation of proposals.

Courts in India generally guided by rules of English Common Law.

Other part:

Proposer (Plaintiff, P) claiming benefit of completion of contract at Ahd.

Word of acceptance spoken at Khamgaon. Acceptance put into course of transmission at Khamgaon and
heard clearly at Ahd, through phone. Author finds it diff to say that contract was made at Ahd where
acceptance was heard and not at K, where it was spoken. (Language of section 4 of contract act, in his
opinion covers case of communication over telephone.)

Acc to these words, he holds that the contract was complete at K. He points out that the same result
obtains in America, Canada and France.

He would allow the appeal with costs.

Court decision:

Against author’s decision. D’s appeal dismissed with costs

Relevant UK Case:

1. Entores Case : proposer in London, acceptor in Amsterdam: telex machine. Was contract made
where acceptor tapped out message or where the receiving machine reproduced this in
London?
2. Lord Denning - leading judgement
3. Says similar to verbal
4. Held that contract made in London