Case: Hanumant Vs. The State Of Madhya Pradesh

follow that, in a bargain and sale such as this, the closing or even the destruction of the Mills would affect a contract between third parties, which is in terms absolute; but the Mills did continue to exist and did continue to manufacture the goods in question, only they were made for and delivered to somebody else. (6) We agree with the reasoning of the Privy Council, and it seems to us that the considerations which prevailed with them must govern the construction of the agreement with which we are concerned in this case. The agreement does not seem to us to convey the meaning that the delivery of the goods was made contingent on their being supplied to the respondent-firm by the Victoria Mills. We find it difficult to hold that the parties ever contemplated the possibility of the goods not being supplied at all. The words prepared by the Mill are only a description of the goods to be supplied, and the expressions as soon as they are prepared and as soon as they are supplied to us by the said Mill simply indicate the process of delivery. It should be remembered that what we have to construe is a commercial agreement entered into in a somewhat common form, and, to use the words of Lord Sumner in the case to which reference has been made, there is nothing surprising in a merchants binding himself to procure certain goods at all events, it being a matter of price and of market expectations. Since the true construction of an agreement must depend upon the import of the words used and not upon what the parties choose to say afterwards, it is unnecessary to refer to what the parties have said about it. (7) Even apart from the construction of the agreement, it seems to us that the plea of the respondents must fail on their own admissions. The defendant has stated in his evidence that he had not sold the 61 bales of cloth to any other person at the time he received the telegraphic notice of 20/11/1941 (Exhibit 1). On his own admission, therefore, he was in a position to supply 61 bales of the contracted goods at the time when the breach of the agreement is alleged to have happened. That being so, we are unable to hold that the performance of the contract had become impossible. The matter however does not rest there. Guruprasad, a clerk of the Mills Company, who is the second witness for the defendants, has made an important statement to the following effect: The customers all place their requirements before the sales Manager. If the goods required are ready, they are sold to the customers and if they are not ready and if the customer wants them to be manufactured they are delivered to the customers after manufacture. An order book in maintained at the Mills. Such being the practice which prevailed in the Victoria Mills, it was for the defendants to show that an order for the manufacture of the contracted goods was placed with the Mills and yet the Mills failed to supply the goods. No such evidence has however been offered by the defendants. The High Court has surmised that it might not have been possible to supply the goods within the period mentioned in the agreement, but there is no material to support that statement. (8) In these circumstances, this is obviously not a case in which the doctrine of frustration of contract can be invoked. That doctrine has been explained in a number of cases, some of which are referred to in the judgement of the High Court, but the latest pronouncement with regard to it is to be found in the speech of Viscount Simon in British Movietonews Ltd., v. London and District Cinemas Ltd., (1951) 2 ALL E. R. 617 in which the Lord Chancellor referred with approval to the following enunciation of the doctrine by East Loreburn in a previous case: . . . a Court can and ought to examine the contract and the circumstances in which it was made, not of course to vary, but only to explain it, in order to see whether or not from the nature of it the parties must have made their bargain on the footing that a particular thing or state of things would continue to exist. And if they, must have done so, then a term to that effect will be implied, though it be not expressed in the contract . : . . no Court has an absolving power, but it can infer from the nature of the contract and the surrounding circumstances that a condition which is not expressed was a foundation on which the parties contracted. (9) It seems necessary for us to emphasize that so far as the Courts in this country are concerned, they must look primarily to the law as embodied in Ss. 32 and 56. Indian Contract Act, 1872. These Sections run as follows: 32. Contingent contracts to do or not to do anything if an uncertain future event happens cannot be enforced by law unless and until that event has happened. If the event becomes impossible such contracts become void. 56. An agreement to do an act impossible in itself is void. A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent unlawful, becomes void when the act becomes impossible or unlawful. The enforcement of the agreement in question was, as we have already pointed out, not contingent on the happening of an uncertain future event, nor does the present case fall within the second paragraph of S. 56, which is the only provision which may be said to have any relevancy to the plea put forward by the respondents. Clearly, the doctrine of frustration cannot avail a defendant, when the non-performance of a contract is attributable to his own default.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds](6) We agree with the reasoning of the Privy Council, and it seems to us that the considerations which prevailed with them must govern the construction of the agreement with which we are concerned in this case. The agreement does not seem to us to convey the meaning that the delivery of the goods was made contingent on their being supplied to the respondent-firm by the Victoria Mills. We find it difficult to hold that the parties ever contemplated the possibility of the goods not being supplied at all. The words prepared by the Mill are only a description of the goods to be supplied, and the expressions as soon as they are prepared and as soon as they are supplied to us by the said Mill simply indicate the process of delivery. It should be remembered that what we have to construe is a commercial agreement entered into in a somewhat common form, and, to use the words of Lord Sumner in the case to which reference has been made, there is nothing surprising in a merchants binding himself to procure certain goods at all events, it being a matter of price and of market expectations. Since the true construction of an agreement must depend upon the import of the words used and not upon what the parties choose to say afterwards, it is unnecessary to refer to what the parties have said about itA contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent unlawful, becomes void when the act becomes impossible or unlawfulThe enforcement of the agreement in question was, as we have already pointed out, not contingent on the happening of an uncertain future event, nor does the present case fall within the second paragraph of S. 56, which is the only provision which may be said to have any relevancy to the plea put forward by the respondents. Clearly, the doctrine of frustration cannot avail a defendant, when the non-performance of a contract is attributable to his own default.