S SAMA Vs. PRESIDENCY TALKIES PTE LTD

JUDGEMENT

(1.) THIS appeal arises out of execution proceedings in a suit, C. S. 262 of 1945, filed by one S. Sama, the first appellant, now represented by his legal representatives, appellants 2 to 5. This Sama produced a picture "rajasuyam" in 1941-42 and in connection therewith he entered into a financing agreement for securing a loan of Rs. 51,000 under which the distribution and the negative rights of the picture were pledged and the respondents herein are the pledgees. The picture was released in 1942, and was run till September 1945. The picture proved to be disappointment and a great failure. It has been fully exploited by September 1945, and its earning capacity was nil at that stage. The first appellant thereupon filed C. S. 262 of 1945, for redemption of the pledge and also for taking the accounts of the exploitation of the picture by the pledgees. As a result of the account taking it was found that the moneys advanced by the financier (the pledgee) had been completely repaid and that the first appellant was further entitled to get a sum of Rs. 3,250 from the defendants. Panchapagesa Sastri J. directed as a part of the redemption decree that the defendants should deliver to the plaintiff (Sama) the negatives, 19 sound reels and 19 pictures reels in all 38 reels. Even during the course of the trial the defendants had delivered to the plaintiff 16 reels of which 10 reels were picture negatives and six reels were sound negatives, and the learned Judge directed that part satisfaction should be entered and the same incorporated in the decree to the extend of the delivery of the 16 reels as aforesaid. At this stage it may be mentioned that the ten picture reels and the six sound reels did not correspond and they were therefore absolutely useless to the plaintiff. He took up the matter in appeal and in O. S. A. 97 of 1949, the decree of the trial court directing recording of part satisfaction was modified with the result that the plaintiff was left to work out his rights in execution with regard to the return or the delivery of the reels.

(2.) THE preliminary decree by the trial Court was passed on 15th September 1949, while the appeal, O. S. A. 97 of 1949, was disposed of on 8th October 1952. The present execution petition E. P. 91 of 1955 was filed in September 1955, for recovering from the respondents compensation or value of the 38 reels on the ground that the respondents had failed to deliver the 38 reels, 19 sound reels and 19 picture reels in pursuance of the decree for redemption. Both before the Master and on appeal before Sadasivam J. the first appellant claimed his original cost of production of the picture as the correct measure of compensation or damages, relying on the principle of restitutio in integrum as the defendants were not in a position to return back the negatives. In the course of the hearing of the appeal it was stated before us that during the pendency of these proceedings the respondents were since able to trace the missing negatives and that they are now in a position to return back all the 38 reels. But learned counsel for the appellants stated that at this belated stage they are of no use whatsoever as negatives, and that the appellants would be entitled to the original cost of production of the picture. In other words, learned counsel for the appellant contended that the offer to return the 38 reels at this stage is futile, serves no purpose, and cannot improve the position of the respondents and that the matter should be dealt with on the footing that the respondents are in default in the matter of compliance with the terms of the decree for redemption. As we are of opinion that the appellants are bound to fail on the larger question touching the measure of compensation or ascertainment of damages it is unnecessary to consider how far the defendants could be absolved and be held to have complied with the terms of the decree for redemption in the light of the subsequent events.

(3.) THE first appellant examined eight witnesses and also filed some correspondence in support of his claim, and the Master on the evidence found that the value of the negatives is nil and the plaintiff-appellant was not entitled to any compensation and this view was affirmed by Sadasivam J. We are in entire agreement with the learned judge's appraisal of the evidence which has been adduced by the first appellant. On this evidence it is clear that the picture was a total failure, that by exploitation till 1944 it realised only a sum of Rs. 38,000 and that there were no demands for the purchase of the negative rights. The realisations even in the first week in important theatres of Madras like Paragan talkies and Majestic theatre in Bangalore and in such other important places have been very poor and meagre and that during the course of three years till september 1945, the picture has been exploited to its utmost and there was no question of its being exploited any longer in any theatre. In fact both before the learned Judge and before us learned counsel for the appellants accepted the position that there was and is no question of the picture being exploited by exhibition after September 1945, with the result that the matter has to be disposed of on the footing that its earning capacity became nil as early as september 1945. The first appellant produced some correspondence and examined himself, as well as P. W. 2, N. S. Iyer to establish that the plaintiff had received an offer for the purchase of the negatives for a sum of Rs. 85,000, but the learned Judge disbelieved and rejected the story on the ground that it was totally false and that even the correspondence has been got up for the purpose of this proceeding. The learned Judge has adverted to the fact that the person from whom an offer for the purchase of Rs. 85,000 was made was not even worth 85,000 pies and that this man had no experience and no knowledge whatsoever about the earning capacity of this picture. The plaintiff has not adduced any other evidence, of any other enquiry. In view of this the main stand of the plaintiff had been throughout that the true measure of the compensation is his original cost of production of the picture even if it turned out that the picture was not capable of earning any income. The main argument of the learned counsel for the appellants was that whatever may be the earning capacity of the picture as a wasting asset under the terms of the preliminary decree the first appellant was entitled to a return of the 38 reels in specie, and that if the defendants-respondents defaulted to comply with the terms of the decree the plaintiff will be entitled to his original cost of production on the basis that it represents the cost of replacing the lost reels. In support of this contention, learned counsel relied upon the decision in Hall Ltd. v. Barclay, 1937-3 all ER 620. The headnote of the case may be conveniently extracted as containing a statement of the relevant facts: