The Doctrine of Frustration of Contract I / Section 56 of The Indian Contract Act, 1872 III

“This Court in Satyabrata Ghose v. Mugneeram Bangur & Co., AIR 1954 SC 44 considered the applicability of Sections 32 and 56 while considering the Doctrine of Frustration of Contract. Naihati Jute Mills Ltd. v. Khyaliram Jagannath, AIR 1968 SC 522 held, if the contract contains implied or expressly a term according to which it […]

Contract of Service v. Contract for Service

“In a society which has moved away from being a simple agrarian society to a complex modern society in the computer age, the earlier simple test of control, whether or not actually exercised, has now yielded more complex tests in order to decide complex matters which would have factors both for and against the contract […]

Harassment of Agriculturists

“S. Ambika Devi entered into a tripartite agreement with M/s. Nandan Biomatrix Ltd. and its franchisee M/s. Herbz India. She purchased 750 kilograms of wet musli at the rate of Rs. 400/- per kilogram. M/s. Nandan Biomatrix Ltd was to buy back the produce at a minimum price of Rs. 1,000/- per kilogram. It […]

Unconscionable Bargain

“In Brojo Nath Ganguly, (1986) 3 SCC 156 this Court considered the concept of unconscionable bargain. “The word ‘unconscionable’ is defined in Shorter Oxford English Dictionary, [Third Edition, Volume II, Page 2288] when used with reference to actions, etc. as “showing no regard for conscience; irreconcilable with what is right or reasonable”. An unconscionable bargain […]

The Contra Proferentem Rule VI

An unfortunate incident occurred at Pemberton Soaring Centre at Pemberton in British Columbia. The following were considered: The Aircraft Act, 1934; The Aircraft Rules, 1937; The Aeronautics Act, 1985 [Canada]; The Canadian Aviation Regulations [SOR/96433], Concise Oxford Advanced Learner’s Dictionary [9th Edition, 2015] and Cambridge Advanced Learner’s Dictionary [4th Edition, 2013]. The conclusion: ‘Smart-Personal Accident-Individual […]

Reservation in Appointment/Promotion

“It is settled law, State Government cannot be directed to provide reservations for appointment in public posts [C.A. Rajendran, (1968) 1 SCR 721]. Similarly, State is not bound to make reservation for Scheduled Castes and Scheduled Tribes in matters of promotions. However, if they wish to exercise their discretion and make such provision, State has […]

Medical Negligence and Consumer Law II

“Medical negligence comprises of the following constituents: (i) legal duty to exercise due care on the part of the medical professional; (ii) failure to inform the patient of the risks involved; (iii) the patient suffers damage as a consequence of the undisclosed risk by the medical professional; (iv) if the risk had been disclosed, the […]

The Revival of Ray XXXV

“Erusian Equipment and Chemicals Ltd. v. State of West Bengal, (1975) 1 SCC 70 and Raghunath Thakur v. State of Bihar, (1989) 1 SCC 229 as well as Southern Painters v. Fertilizers & Chemicals Travancore Ltd., 1994 Supp (2) SCC 699; Grosons Pharmaceuticals (P) Ltd. v. State of U.P., (2001) 8 SCC 604 and B.S.N. […]

Sapan Dhawan’s Stolen Maruti Zen

On the night of 01.08.1998, Sapan Dhawan handed over his Maruti Zen and its keys to Taj Mahal Hotel. The Maruti Zen was stolen. United India Insurance [Vehicle-Insurer/Subsequent Subrogee] and Sapan Dhawan [Vehicle-Owner/Subsequent Subrogor] sought compensation for ‘deficiency in service’. The manner in which the Maruti Zen was stolen revealed Taj Mahal Hotel was responsible […]

Ex Turpi Causa Non Oritur Actio

Kedar Nath Motani, (1960) 1 SCR 861 had an occasion to consider the question of application of the maxims ‘ex turpi causa non oritur actio‘ and ‘ex dolo malo non oritur actio‘. Three-Judge Bench, speaking through M. Hidayatullah, J (as His Lordship then was), observed thus: “The correct position in law, in our opinion, is, […]

Care For Elders ≠ Undue Influence

“Deceased undisputedly was over 80 years. Plaintiff pleaded that by reason of age and sickness, the mental capacity of the Deceased was impaired. There is no evidence whatsoever of his mental status. There can be no presumption with regard to the same only because of old age to equate it with complete loss of mental […]

Fraud v. Misrepresentation

“A perusal of the definition of the word ‘fraud’, as defined in Section 17 of The Indian Contract Act, 1872 would reveal that the concept of fraud is very wide. It includes any suggestion, as a fact, of that which is not true, by a person who does or does not believe it to be […]

Non-Signatories to Arbitration II

Arbitration Agreements need not be a formal contract. Section 7(4)(b) states, an Arbitration Agreement can be derived from exchange of letters, telex, telegram or other means of communication, including through electronic means. What is required to be ascertained is, intention of parties to refer their disputes or differences to Arbitration. A common-sense approach must be […]

The Question of Implication

“Nabha Power Ltd. v. Punjab State Power Corporation Ltd., (2018) 11 SCC 508 referred to various English and Australian Judgments. We do not wish to burden this Judgment with all the English and Australian Judgments reproduced. However, it will be relevant to refer to the following passage reproduced in Nabha Power Ltd.: “The question of […]

Non-Signatories to Arbitration I

The legal position as to when a Non-Signatory to an Arbitration Agreement can be impleaded and subjected to Arbitration Proceedings is no more res integra. Three-Judge Bench in Chloro Controls India Private Limited, (2013) 1 SCC 641 opined, invoking ‘Doctrine of Group of Companies’, Arbitration Agreement entered by a Company, being one within a Group […]

The Revival of Ray XXII

Hon’ble Justice Arun Misra, while explaining Section 108 of The Companies Act [Ram Parshottam Mittal v. Hotel Queen Road Pvt. Ltd., Civil Appeal No. 3934 of 2017], quoted Hon’ble Chief Justice of India, Hon’ble Justice A.N. Ray [Mannalal Khetan v. Kedar Nath Khetan, (1977) 2 SCC 424]; My Lord, Mannalal Khetan v. Kedar Nath Khetan, […]

Well-Known Principles of Interpretation

“Court’s task is to ascertain the intention of the parties by examining the words they used and giving them their ordinary meaning in their contractual context. It must start with what it is given by the parties themselves when it is conducting this exercise. Effect is to be given to every word, so far as […]

Contracts of Insurance I

“Contracts of insurance are governed by the principle of utmost good faith. The duty of mutual fair dealing requires all parties to a contract to be fair and open with each other to create and maintain trust between them. In a contract of insurance, the insured can be expected to have information of which she/he […]

Section 12(5) of The Arbitration Act III

“Section 12(5) is a new provision which relates to the de jure inability of an Arbitrator to act as such. Under this provision, any prior agreement to the contrary is wiped out by the non-obstante clause in Section 12(5) the moment any person whose relationship with the parties or the Counsel or the subject matter […]

Four Crore Apartment

“Araya Complex”, Sector 62, Golf Course Extension Road, Gurugram Respondent/Flat Purchaser – Apartment Buyer’s Agreement – Appellant/Builder. Appellant/Builder, Failed! Respondent/Flat Purchaser, NCDRC, Consumer Complaint. “Respondent – Flat Purchaser could not be compelled to take possession at such a belated stage. The inordinate delay in handing over possession of the flat clearly amounts to ‘deficiency of service’. A […]

The Last Word

A Diversion for Lawyers and Others

Contract Law