Explanation. Where the performance of an engagement would involve the production of a certain thing, it is not necessary to the validity of a tender that the thing should actually be produced, if the person entitled to claim performance does not require that it should be produced. Joint Liabilities and Rights. 47. When two persons have jointly come under an engagement by contract to a third Devolution of joint person, then, unless a contrary intention appears by the contract, the liability to perform liabilities. the engagement rests, as between them and him, on those two persons during their joint lives, and after the death of either, on his representative jointly with the survivor, and after the death of the survivor, on the representatives of both jointly. 48. As between themselves, persons who have jointly come under an engagement are Liability of persons bound, unless a contrary intention appears by the contract, to bear the burden of its per- jointly bound. formance equally; and if one of them is unable to bear his share of the burden, the others must make up the deficiency by equal contributions. Explanation. This rule is not to prevent a surety from recovering his disbursements from the principal, or to entitle the principal to recover anything from the surety. Illustrations. (a.) A., B., and C. are under a joint engagement to pay D. the sum of 3,000 rupees. A. is insolvent, but his assets are sufficient to pay one-half of his debts. A.'s estate pays 500 rupees. B. and C. must pay 1,250 rupees each. (b.) A., B., and C. are under a joint engagement to pay D. 3,000 rupees, A. and B. being in fact only sureties for C. C. is unable to pay anything, and A. pays the whole. A. is entitled to receive 1,500 rupees from B. (c.) A., B., and C. are under a joint engagement to pay D. 3,000 rupees, A. and B. being in fact only sureties for C. C. is unable to pay; A. and B. are compelled to pay the whole sum. They are entitled to recover it from C. 49. Where two persons have jointly come under an engagement by contract to a third Release of one joint person, a release of one of them by such third person does not discharge the other; contractor. neither does it free that one from responsibility to the other. 50. When a person has come under an engagement by contract to two other persons Devolution of joint jointly, then, unless a contrary intention appears by the contract, the right to claim per- rights. formance rests (as between him and them) with them during their joint lives, and after the death of either, with his representative jointly with the survivor, and after the death of the survivor, with the representatives of both jointly. Illustrations. A., in consideration of 5,000 rupees lent to him by B. and C., enters into an engagement by contract with Power to terminate Contract. 51. When a party to a contract has refused to perform, or disabled himself from per- Power to terminate forming, his engagement in its entirety, the party who has entered into the reciprocal contract on refusal of engagement may put an end to the contract, provided he has not signified, expressly or party to perform it wholly. impliedly, that he acquiesced in its continuance. Illustrations. (a.) A., a singer, enters into an engagement with B., the manager of a theatre, to sing at his theatre two nights in every week during the next two months, and B. engages to pay her 100 rupees for each night's performance. On the sixth night the singer wilfully absents herself from the theatre. B. is at liberty to put an end to the contract. (b) A., a singer, enters into an engagement with B., the manager of a theatre, to sing at his theatre two nights in every week during the next two months; and B. engages to pay her at the rate of 100 rupees for each night. On the sixth night the singer wilfully absents herself. With the assent of B. she sings on the seventh night. B. has signified his acquiescence in the continuance of the contract, and cannot now put an end to it, but is entitled to compensation for the damage sustained by him through her failure. for Compensation. 52. A person who rightfully puts an end to an engagement is entitled to compensation Party rightfully termiany damage he has sustained. nating contract, entitled to compensation. Payment of sum speci fied to be paid in case of breach. 53. When a contract has been broken, if a sum is named in the contract itself as the amount to be paid in case of such breach, the amount so named shall be paid accordingly; but if no sum has been named in the contract itself, the party who suffers by such breach is entitled to receive from the party who has broken the contract, compensation for loss or damage caused to him thereby. Provided that it has naturally arisen in the usual course Payment of compenof things from such breach, or that it was in the knowledge of the parties at the time they sation. made the contract, that such loss or damage would probably result from the breach of it. Such compensation is not to be given for any remote and indirect loss or damage sustained by reason of the breach. Explanation. In estimating the loss, the means which existed of remedying the inconvenience caused by the non-performance of the engagement, must be taken into account. Illustrations. (a.) A. enters into an engagement by contract, that in case he fails to pay B. 500 rupees on a certain day, he shall inmediately become liable to pay him 1,000 rupees. A. fails to pay B. 500 rupees on the day named. A. has become liable to pay B. 1,000 rupees. (b.) A. enters into an engagement by contract, that if he practises as a surgeon in the town of Z., he shall pay B. 5,000 rupees. A. commits a breach of the engagement. The sum of 5,000 rupees is actually payable by A. to B. (c.) A. agrees to sell and deliver 50 maunds of saltpetre to B. at a certain price, to be paid on delivery. A. breaks his engagement. B. is entitled to receive from A., by way of compensation, the sum, if any, by which the contract price falls short of the price for which B. might have obtained 50 maunds of saltpetre of like quality at the time when the saltpetre ought to have been delivered. (d.) A. hires B.'s ship to go to Bombay, and there take on board on the 1st of January a cargo (which A. is to provide) and to bring it to Calcutta; the freight to be paid when earned. B.'s ship does not go to Bombay, but A. has opportunities of procuring suitable conveyance for the cargo upon terms as advantageous as those on which he had chartered the ship. A. avails himself of those opportunities, but is put to trouble and expense in doing so. A. is entitled to receive compensation from B. in respect of such trouble and expense. (e.) A. agrees to sell and deliver to B. on the 1st of January, at a stated price, a certain quantity of cotton, to be paid for on delivery. Afterwards, on the 1st December, A. announces to B. that he does not intend to perform his engagement, and on the 1st of January he delivers no cotton to B. B. is entitled to receive from A., by way of compensation, the excess, if any, of price of the like quantity of cotton on the 1st of January over the contract price. (f.) A. agrees to sell and deliver to B. on the 1st of January a certain quantity of sugar, for which B. pays him in advance. Afterwards, on the 1st of December, A. informs B. that he does not intend to deliver the sugar, and on the 1st of January he does not deliver it. B. is entitled to receive from A. the money paid, together with current mercantile interest, and also, by way of compensation, the excess, if any, of the sum for which the sugar could have been procured by him on the 1st of January, over the sum paid in advance. (g.) A. agrees to buy of B., at a stated price, 50 maunds of rice, no time being fixed for delivery. A. afterwards intimates to B. that he will not accept the rice if tendered to him. B. is entitled to receive from A., by way of compensation, the amount, if any, by which the contract price exceeds that which B. could have obtained for the rice at the time of the refusal, (h.) A. agrees to buy B.'s ship for 60,000 rupees, but breaks his engagement. A. must pay to B., by way of compensation, the excess, if any, of the contract price over the price which B. can obtain for the ship at the time of the breach of engagement. (i.) A. agrees to buy of B., at a stated price, 100 bales of jute, to be delivered on the 1st of January. Afterwards, on the 15th of December, A. gives notice to B. that he will not accept the jute; on the 1st January the jute is tendered to A., who refuses to accept it. A. must pay to B., by way of compensation, the excess, if any, of the contract price over the sum which B. could obtain for the jute on the 1st of January. (j.) A., the owner of a boat, enters into an engagement by contract with B. to take a cargo of jute to Mirzapore, for sale at that place, starting on a specified day. The boat does not start at the time appointed, whereby the arrival of the cargo at Mirzapore is delayed beyond the time when it would have arrived if the boat had sailed according to the contract. After that date, and before the arrival of the cargo, the price of jute falls. The messure of the compensation payable to B. by A., is the difference between the price which B. could have obtained for the cargo at Mirzapore at the time when it would have arrived if forwarded in due course, and its market price at the time when it actually arrived. (k.) A. engages to repair B.'s house in a certain manner, and receives payment in advance. A. repairs the house, but not according to contract. B. is entitled to recover from A. the cost of making the repairs conform to the engagement. (1.) A. agrees to let his ship to B. for a year from the 1st of January next for a certain price. Freights rise, and on the 1st of January the hire obtainable for the ship is higher than the contract price. A. breaks his engagement. He must pay to B., by way of compensation, a sum equal to the difference between the contract price and the hire which could be obtained for the use of the ship on the 1st of January. (m.) A. engaged to supply B. with a certain quantity of iron at a fixed price, being a higher price than that for which A. could procure and deliver the iron. B. wrongfully refused to receive the iron. B. must pay to A., by way of compensation, the difference between the contract price of the iron and the sum for which A. could have obtained and delivered it. (n.) A. delivers to B., a common carrier, a machine, to be conveyed, without delay, to A.'s mill, informing B. that his mill is stopped for want of the machine. B. unreasonably delays the delivery of the machine, and A. in consequence loses a profitable contract with the Government. A. is entitled to receive from B., by way of compensation, the average amount of profit which would have been made by the use of such machine during the time that delivery of it was delayed, but not to the loss sustained by not obtaining the Govern ment contract. (0.) A. having entered into an engagement with B. to supply B. with 1,000 tons of iron at 100 rupees a ton, to be delivered at a stated time, enters into an agreement with C. for the purchase of a certain quantity of iron at 80 rupees a ton, telling C. that he does so for the purpose of performing his engagement with B. C. fails to fulfil his engagement with A., who cannot procure other iron, and, in consequence, fails to fulfil his engagement with B. C. must pay to A. 20,000 rupees, being the profit which A. would have made by the performance of his engagement. (p.) A. entered into an engagement with B. to make and deliver to B. by a fixed day, for a specified price, a certain piece of machinery. A. did not deliver the piece of machinery at the time specified, and in conse quence of this B. was obliged to procure another, at a higher price than that which he was to have paid to A., and was prevented from fulfilling an engagement under which he lay to a third person at the time of his contract with A. (but which had not been then communicated to A.), and was compelled to make compensation for breach of his engagement. A. must pay to B., by way of compensation, the difference between the contract price of the piece of machinery and the sum paid by B. for another, but not the sum paid by A. to the third person by way of compensation. (9.) A., a builder, undertakes to erect and finish a house by the 1st of January, in order that B. may give possession of it at that time to C., to whom B. has agreed to let it. A. is informed of the agree ment between B. and C. A. builds the house so badly that before the 1st of January it falls down, and has to be rebuilt by B., who in consequence loses the rent which he was to have received from C., and is obliged to make compensation to C. for the breach of his engagement. A. must make compensation to B. for the cost of re-building the house, for the rent lost, and for the compensation made. (r.) A. sells certain merchandise to B., warranting it to be of a particular quality, and B., in reliance upon this warranty, sells it to C. with a similar warranty. The warranties are broken, and B. becomes liable to pay C. a sum of money by way of compensation. B. is entitled to be reimbursed this sum (s.) A. engages to supply B. with a threshing machine on the 15th of August; he is aware at the A. (t.) A. has entered into an engagement by contract to pay a sum of money to B. on a day specified. A. does not pay the money on the day appointed. B., in consequence of not receiving the money on that day, is unable to pay his debts, and is totally ruined. A. is not liable to make good to B. anything except the principal sum he contracted to pay, together with interest up to the day of payment. (u.) A. engaged to deliver 50 maunds of saltpetre to B. on the 1st of January at a certain price. B. afterwards, before the 1st of January, agreed to sell the saltpetre to C. at a price higher than the market price of the 1st of January. A. broke his engagement. In estimating the compensation payable by A. to B. the market price of the 1st of January, and not the profit which would have arisen to B. from the sale to C., is to be taken into account. (v.) A. engaged to sell and deliver 500 bales of cotton to B. on a fixed day. A. broke his engagement, and B. having no cotton, was obliged to close his mill. A. is not responsible to B. for the loss caused to B. by the closing of his mill. (w.) A. agreed to sell and deliver to B. on the 1st of January certain cloth which B. intended to manufacture into caps of a particular kind, for which there was no demand except at that season. The cloth was not delivered till long after the appointed time, and too late to be used that year in making caps. A. is entitled to receive from B., by way of compensation, the difference between the contract price of the cloth and its market price at the time of delivery, but not the profits which he expected to obtain by making caps, nor the expenses which he has been put to in making preparation for the manufacture. (x.) A., a ship-owner, agreed with B. to convey him from Calcutta to Sydney in A.'s ship, sailing on the 1st of January; and B. paid to A. by way of deposit one-half of his passage money. The ship did not sail on the 1st of January, and B., after being in consequence detained in Calcutta for some time, and thereby put to some expense, proceeded to Sydney in another vessel, and in consequence, arriving too late in Sydney, lost a sum of money. A. is liable to repay to B. his deposit with interest, and the expense to which he was put by his detention in Calcutta, but not the sum of money which he lost by arriving in Sydney too late. PART III.-ON CERTAIN OBLIGATIONS RESEMBLING THOSE CREATED BY CONTRACT. another to believe in things, when the other acts on such belief. a non-existent state of 54. Where a person has, either by words spoken or written, or by his conduct, led Effect of one person another to believe that a certain state of things exists which does not really exist, with intentionally leading the intention that the other shall act upon such belief in a transaction between them, and the other accordingly acts upon such belief; the person who has caused such belief is bound to place the other in the same position as if such a state of things had existed, or, in default, to make compensation to the other in respect of any loss or damage which he has incurred by acting upon such belief. 55. A person who, by a false representation, induces another to enter into a contract with a third party, is bound to make good the representation if he knew it to be false, or if, in the due discharge of his duty, he ought to have known it to be so. Illustrations. (a.) A. is trustee for B. of certain property. B. creates a charge upon the trust property, of which notice is given to A. B. afterwards enters into treaty with C. for the sale of the property. C. asks A. whether the property is incumbered or not. A. not remembering the notice, replies in the negative, and C. thereupon buys the property. A. as well as B. is responsible for the discharge of the incumbrance. (b.) A. conveys his property to B., upon a secret trust for A.'s benefit and permits B. to appear as the owner of it. B. alienates the property to a person who is not aware of the trust. A. cannot dispute the alienation. (c.) A. being applied to by B. for merchandise upon credit, asks C. whether B. is in good circumstances. C., knowing B. to be deeply in debt, with the intention of inducing A. to comply with B.'s wishes, replies that B. is in good circumstances. In consequence of this reply, A. lets B. have the merchandise on credit. B. becomes insolvent before the time for payment arrives. C. is liable to make good to A. the value of the merchandise. (d.) C., without any particular knowledge of B.'s means, speaks of him in the presence of A. as a person in good circumstances. A. in consequence lets B. have merchandise on credit. B. becomes insolvent. C. is not liable to make good to A. the value of the merchandise. Effect of one person, by a false representation, inducing another to contract with a third party. 56. If one person makes a deliberate statement as to his own future conduct to another, Representation as to with the intent that it should be acted upon, and the other acts upon the faith of such future conduct. assurance, the person who made the statement must make it good. Illustration. A. holding a decree against B., and knowing that B. is desirous to be married to C., assures the father of C. that he will never enforce the execution of the decree against B. C.'s father, relying on this assurance, permits the marriage to take place. A. is not entitled to enforce the execution of the decree. contracting. 57. If a person incapable of entering into a contract, or any one whom he is legally Supply of necessaries bound to support, is supplied by another person with necessaries suited to his condition in to persons incapable of life, the person who has furnished such supplies is entitled to be reimbursed from the property of such incapable person. Illustrations. Reimbursement of per (a.) A. supplies B., a minor, with necessaries suitable to his condition in life. A. is entitled to be reimbursed from B.'s property. (b.) A. supplies the wife and children of B., a lunatic, with necessaries suitable to their condition in life. A. is entitled to be reimbursed from B.'s property. 58. A person who is interested in the payment of money which another is bound by law son paying what an- to pay, and who therefore pays it, is entitled to be reimbursed by the other. other is bound to pay. Effect of agreement for Illustration. A. holds some land in Bengal as zamíndár. B. holds the land on a lease granted by A. The revenue payable by A. to the Government being in arrear, his land is advertised for sale by the Government. Under the revenue law, the consequence of such sale will be the annulment of B.'s lease. B., to prevent the sale and the consequent annulment of his own lease, pays to the Government the sum due from A. A. is bound to make good to B. the amount so paid. 59. Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and the other enjoys the benefit thereof, the latter is bound to restore or to make compensation to the former in respect of the thing so done or delivered. This rule shall apply, notwithstanding that there shall have been a larger contract between the parties, which has been put an end to by reason of a breach thereof. Illustrations. (a.) A., a tradesman, leaves goods at B.'s house by mistake. bound to pay A. for them. B. treats the goods as his own. He is (b.) A. contracts with B. to deliver to him 250 maunds of rice before the 1st of May. A. delivers 130 maunds only before that day and none after, B. retains the 130 maunds after the 1st of May. He is bound to pay A. for them. (c.) A., a singer, enters into an engagement with B., the manager of a theatre, to sing at his theatre for two nights in every week during the next two months, and B. engages to pay her 100 rupees for each night's performance; on the sixth night the singer wilfully absents herself from the theatre, and B. in consequence puts an end to the engagement. B. must pay A. for the five nights on which she had sung. 60. A person who finds goods belonging to another, and takes them into his custody, is subject to the same responsibility as a bailee. 61. A person to whom money has been paid by mistake or under coercion is liable to repay it. Illustration. A. and B. jointly owe 100 rupees to C. A. alone pays the amount to C., and B., not knowing this fact, pays 100 rupees over again to C. C. is bound to repay the amount to B. PART IV.-SALE OF GOODS. 62. In the following chapter the word " goods" is used to denote every kind of moveable property. 63. Sale is the exchange of anything which is property for a price. It involves the transference of the ownership of the thing sold from the seller to the buyer. 64. Sale is effected by offer and acceptance of ascertained goods for a price, or of a price for ascertained goods, together with payment of the price or delivery of the goods, or with tender, part payment, earnest, or part delivery, or with an agreement, express or implied, that the payment, or delivery, or both, shall be postponed. Illustrations. (a.) B. offers to buy A.'s horse for 500 rupees. A. accepts the offer, and tells B. to take away the horse, The horse has been sold to B. approves of (b.) A. sends goods to B., with the request that he will buy them at a stated price if he approves of them, or return them if he does not approve of them. B. retains the goods, and informs A. that he them. The goods have been sold to B. (c) B. offers A. for his horse 1,000 rupees, the horse to be delivered to B. on a stated day, and the price to be paid on another stated day. A. accepts the offer. The horse has been sold to B. by offer and acceptance with an agreement to postpone delivery and payment. (d.) B. offers A. for his horse 1,000 rupees, on a month's credit. A. accepts the offer. The horse has been sold to B. by offer and acceptance with an agreement to postpone the payment. (e.) B., on the 1st January 1863, offers to A. for a quantity of rice 2,000 rupees, to be paid on the 1st March following, the rice not to be taken away till paid for. A. accepts the offer. The rice has been sold to B. 65. By an agreement for the sale of a thing which has yet to be ascertained, made, or sale of thing to be as finished, no ownership of any portion of that thing passes to the buyer until it is ascer tained, made, or finished. certained, made, or finished. Sale of goods which Illustration. B. orders A., a barge-builder, to make him a barge. The price is not made payable by instalments. While the barge is building, B. pays to A. money from time to time on account of the price. The ownership of the barge does not pass to B. until it is finished. 66. Where by an agreement for the sale of goods the seller is to do anything to them the seller is to put into for the purpose of putting them into a state in which the buyer is to take them, the sale is not complete until such thing has been done. state in which buyer is to take them. Illustrations. Illustrations. (a.) A., a ship-builder, agrees to sell to B. for a stated price, a vessel which is lying in A.'s yard; the vessel to be rigged and fitted for a voyage, and the price to be paid on delivery. Under the agreement a sale is not effected until the vessel has been rigged, fitted up, and delivered. (b.) A. contracts to build a ship for B. for a price, payable by instalments dependent on the progress of the building of the ship, and the ship is to be built under B.'s superintendence. The ownership of the materials incorporated with the ship passes to B. at the time of incorporation. as this was intended by the parties, but the materials lying in A.'s yard, though suited and intended for the ship, do not pass to B. until they are actually incorporated with the ship. 67. Where anything remains to be done to the goods by the seller for the purpose of ascertaining the amount of the price, the sale is not complete until this has been done. Illustrations. (a.) A., owner of a stack of bark, agrees to sell it to B. at 100 rupees per ton; B. agrees to take and pay for it on a certain day. Part is weighed and delivered to B.; the ownership of the residue is not transferred to B. until it has been weighed pursuant to the contract. (b.) A. agrees to sell a heap of clay to B. at a certain price per ton; B. is by the agreement to load the clay in his own carts, and to weigh each load at a certain weighing machine which his carts must pass over on their way from A.'s ground to B.'s place of deposit. Here nothing more remains to be done by the seller, the sale is complete, and the ownership of the heap of clay is transferred at once. Sale of goods when seller has to do anything thereto in order to ascertain price. 68. Where the goods are not ascertained at the time of making the agreement for sale Sale when goods are it is necessary to the completion of the sale that the goods shall be ascertained. Illustration. A. agrees to sell to B. 20 tons of oil in A.'s cisterns. A.'s cisterns contain more than 20 tons of oil. B. has not acquired the ownership of any portion of the oil. unascertained at date of agreement. 69. Where the goods are not ascertained at the time of making the agreement for sale, Ascertainment of goods but goods answering the description in the agreement are subsequently appropriated by by subsequent appropriation. one party for the purpose of the agreement, and that appropriation is assented to by the other, the goods have been ascertained, and the sale is complete. Illustration. A. having a quantity of sugar in bulk, more than sufficient to fill 20 hogsheads, agrees to sell B. 20 hogsheads of it. After the agreement, A. fills 20 hogsheads with the sugar, and gives notice to B. that the hogsheads are ready, and requires him to take them away. B. says he will take them as soon as he can. By this appropriation by A. and assent by B., the ownership passes to B. 70. Where the goods are not ascertained at the time of making the agreement for sale, Ascertainment of goods and by the terms of the agreement the seller is to do an act with reference to the goods by seller's selection. which cannot be done until they are appropriated to the buyer, the seller has a right to select any goods answering to the agreement, and by his doing so the goods are ascertained. Illustration. B. agrees with A. to purchase of him at a stated price, to be paid on a fixed day, 50 maunds of rice out of a larger quantity in A.'s granary. It is agreed that B. shall send sacks for the rice, and that A. shall put the rice into them. B. does so, and A. puts 50 maunds of rice into the sacks. The goods have been ascertained. 71. Where an agreement is made for the sale of immoveable and moveable property combined, the ownership of the moveable property does not pass before the transference of the immoveable property. Illustration. A. agrees with B. for the sale of a house and furniture. The ownership of the furniture does not pass to B. until the house is conveyed to B. Agreement for sale of immoveable and moveable property combined. 72. Where goods are sold by auction, there is a distinct and separate sale of the goods Sale of several lots by in each lot, by which the ownership thereof is transferred as each lot is knocked down. auction. 73. A buyer to whom the ownership of the goods sold has passed, is liable to bear any Buyer's risk. loss arising from the destruction or injury of the goods. Illustration. B. offers and A. accepts 100 rupees for a stack of fire-wood standing on A.'s premises, the fire-wood to be allowed to remain on A.'s premises till a certain day, and not to be taken away till paid for. Before payment, and while the fire-wood is on A.'s premises, it is accidentally destroyed by fire. B. must bear the loss. 74. A valid agreement for the sale of goods may be made either by word or mouth or Agreement for sale by writing. 75. The ownership of goods may be acquired by buying them from any person who is in possession of them: provided that the buyer acts in good faith, and under circumstances which are not such as to raise a reasonable presumption that the person in possession has no right to sell them. Illustrations. (a.) A. steals a cow from B. and sells it at a cattle-market to C., a purchaser, in good faith. A. is afterwards convicted of the theft. B. cannot recover the cow from C. (b.) A., a person whose rank and occupation are not such as to account for his having plate in his possession, sells a piece of plate to B. without giving a satisfactory explanation of the manner in which he had become possessed of it. The plate had, in fact, been stolen from C.; C., on proof of the theft, can recover the plate from B. (c.) A., a commercial agent, to whom goods have been consigned, with instructions not to sell them without may be oral or written, Acquisition of ownership of goods by purchase from their pos sessor. |