PRATAP SINGH Vs. BANK OF AMERICA

JUDGEMENT

(1.) THIS is an appeal from the decision of Vimadalal J. given on the preliminary issue of jurisdiction. By his judgment and order dated February 24, 1976 he held that this Court had no jurisdiction to entertain and try the appellant plaintiff's suit and answered the preliminary issue in the negative and against the plaintiff and consequentially the suit was dismissed with costs.

(2.) THE plaintiff had filed the suit against the Bank of America, National Trust and Savings Association (hereinafter referred to as the 'Bank of America'), a corporation incorporated in the United States of America. The plaint, however, goes on to describe the defendant further as having a principal place of business in India located at 18, Bruce Street, Bombay -1. The claim in the suit is a money claim for Rs. 5,40,000 (Rupee equivalent of 'U.S. Dollars 72,000) and for compensation and damages assessed by the plaintiff in respect of various items specified in para. 115 of the plaint. This claim for compensation and damages is claimed in respect of certain Time Certificates of Deposit issued by the Bank of America, two of which had been issued by its Banking Office at San Francisco and one by its Banking Office at Los Angeles in the State of California, U.S.A. The plaintiff claims to have lost these certificates in London together with a cashier's cheque for interest. The loss was reported to the two offices. The plaintiff claims that thereafter the defendant insisted upon various formalities being complied with by the plaintiff, which it was not entitled in law to do and was contrary to true legal position pertaining to the three Time Certificates of Deposit as also contrary to certain oral talks set out in the plaintiff's pleadings which are unnecessary to be referred to in this judgment. Although, according to the plaintiff, these demands were illegal and improper, he was forced to comply with the same in order to salvage his funds. The plaintiff also claims that this improper, invalid and illegal course of action was resorted to by the defendant on several improper considerations which are set out in para. 96 of the plaint. In the subsequent paragraphs of the plaint various acts of commission and omission on the part of the defendant and its several officers concerned with the plaintiff's application for issue of fresh certificates or for the reimbursement of the amount due under the lost three certificates have been set out, and in consequence the plaintiff has crystalised his monetary claim and the heads thereof in para. 115. It may be mentioned here that ultimately before the issue of fresh Time Certificates of Deposit the plaintiff was required to execute in favour of the defendant an Indemnity and Hold Harmless Agreement by which he, inter alia, agreed to indemnify the defendant Corporation against any and all loss, cost and expense by reason of the issue of the replacement Time Certificates of deposit. This agreement provided that it can be legally enforced in Punjab, India, as well as Los Angeles, California, United States of America. The claim of the plaintiff encompasses claims by way of compensation and damages for mental distress, worry, anxiety, injury to feelings, deterioration in health, loss of income of private practice, travelling expenses, cancellation of certain business arrangements and other expenses.

(3.) THESE paragraphs of the plaint which are material for our purposes are dealt with in paras. 86, 87, 88 and 90 of the written -statement. However, it must be stated that initially in para. 2 of the written -statement the defendant -respondent has taken the plea of want of jurisdiction in the forefront and hence these paragraphs of the written -statement are required to be read together with the said paragraph. Paragraph 2 and paras. 86 to 90 of the written -statement read as follows: 2. Without prejudice to the aforesaid submission, the defendant in any event submits that this Hon'ble Court has no jurisdiction to entertain and try this suit as no part of the cause of action has arisen within the jurisdiction of this Hon'ble Court and the defendant does not carry on business in Bombay within the meaning of Clause XII of the Letters Patent. The defendant says that the defendant is a Corporation incorporated in the U.S.A. and has an office in Bombay only for the purpose of carrying on its banking business. The defendant in any event submits that the plaintiff's right to file the suit, if any, was in the United States or in the State of Punjab in view of the Indemnity and Hold Harmless Agreements entered into between the plaintiff and the defendant on 26th January 1968 and 9th February 1968 at San Francisco, California, U.S.A.... 86. With reference to paras. 124, 127 and 128 of the plaint, the defendant denies that the branch of the defendant in Bombay constitutes the defendant in Bombay. The defendant is a company incorporated in U.S.A. The defendant further says that the entire transaction in suit is governed by the Californian law. 87. With reference to para. 125 of the plaint, the defendant denies that the defendant is at present found in Bombay or resides or dwells in Bombay. The defendant admits that the defendant carries on business in Bombay but denies that the Same gives jurisdiction to this Hon'ble Court under Clause XII of the Letters Patent. The defendant in any event submits that in respect of the alleged cause of action the plaintiff and the defendant are governed by the Californian laws and this Hon'ble Court has no jurisdiction to entertain and try this suit. 88. With reference to para. 126 of the plaint, the defendant denies that it is fair to require the defendant to submit to the suit in Bombay. The defendant says that on the contrary, it is highly improper for the plaintiff to have filed this suit in this Hon'ble Court when no part of the cause of action has arisen within the jurisdiction of this Hon'ble Court. The transaction referred to in the plaint arises outside India, all documents, papers, vouchers and the evidence of the parties is outside India and it would be highly inconvenient to defend the present suit in Bombay. 89. With reference to para. 129 of the plaint, the defendant craves leave to refer to Section 801 of the Californian Corporation Code and referred to in the said para. for its true interpretation. The defendant says that the said section applies only to a corporation formed under the Californian laws, The defendant says that the defendant is formed under the Federal laws and the said section does not apply to the defendant. The defendant in any event denies that the said section permits the suit being filed in any court in the world. The same only refers to a court within the State of California. 90. With reference to para. 130 of the plaint, the defendant denies that the defendant agreed to submit to the jurisdiction of the Courts in India for the reasons mentioned therein.