ALAGAPPA CORPORATION Vs. UNITED BROKERS

JUDGEMENT

(1.) The defendants who are called United Brokers sold 700 ordinary shares of the Steel Corporation of Bengal, Ltd., to the plaintiff-corporation. The sales were on 11th May, 1945 of 100 shares at Rs. 33-1-0 and 200 shares at 33-1-6, 100 shares at Rs. 33 per snare on 12th May, 1945, and 200 shares at Rs. 33 per share on 16th May, 1945. Besides these transactions of sale, the defendants took upon themselves the liability to deliver to the plaintiffs 100 ordinary shares of the same Steel Corporation at Rs. 31-11-0, which was an obligation of Messrs. Dalal & Co. The suit is to enforce specific performance of the contract to sell and, in the alternative for damages of Rs. 13,506-4-0, on the basis of the value of the shares at Rs. 52 per share on the date of the plaint. There is also a claim for the recovery of Rs. 612-8-0, being the dividend which has accrued due on the 700 shares. In addition, the plaintiffs seek payment of a sum of Rs. 484-6-0, being the amount due to them on statement of account, after giving credit to a sum of Rs. 500 which the defendants paid on 24th October, 1945.

(2.) The defendants have raised several pleas in answer to the claim. In the first place they say that Dr. Sir Alagappa Chettiar is not the sole proprietor of the plaintiff-firm as is alleged and that the suit is therefore not maintainable. The second contention which practically is the primary defence, is that the plaintiffs and the defendants were both acting as Brokers and were intermediaries for principals for the purpose of bringing about contracts between them and that therefore neither of them were parties to the contract for sale or purchase. The plaintiffs knew that the defendants were to get delivery of the shares from their sellers and that therefore there was no liability whatever either for specific performance or damages on their part until their sellers delivered the shares to them. The plaintiffs purchased some of the shares themselves and thus acted in breach of the contract between the parties, which was that they should act as the defendants agents for sale to third parties. They are not liable for the dividends. The plaintiffs are not entitled to any damages, nor to specific performance.

(3.) It would thus be seen from what has been stated above and a study of the written statement that there is really no answer to the plaintiffs claim for payment of the sum of Rs. 484-6-0 said to be due on account. As a matter of fact, when the plaintiffs sent a statement of account to them, for Rs. 984-6-0, on 18th October, 1945, the defendants forwarded a cheque for Rs. 500 on 22nd October, 1945, adding these words: