KALUNDAIVELU PILLAI Vs. RAMASAMI NAICKER

JUDGEMENT

(1.) The plaintiffs, here respondents, obtained a decree against the two defendants, 2nd defendant being the petitioner in this Court, for Rs. 400 in the following circumstances: Plaintiffs, it is not disputed, owed 1 defendant Rs. 400 and, it is proved, paid it to 2nd defendant, 1 defendant's agent, as such. Second defendant, however, did not account to the 1 defendant for the money, misappropriating it. First defendant then obtained a decree for it against the plaintiffs who did not appear or plead discharge. On these facts the lower Court dismissed the plaintiff's suit against the 1 defendant; but gave a decree against the 2nd defendant; and the question in this revision petition is, whether it was right in law in doing so.

(2.) It is clear, that if it was not, plaintiffs will have paid what they owed twice. But that result cannot affect the decision because it is entailed, not by anything in the legal relation between the parties before me, plaintiffs and 2nd defendant, but by the failure of the former to take advantage in the previous suit against them of the plea of discharge, which was open to them. It was no doubt suggested on their behalf during the hearing of this petition that they should now be allowed to making defendant a party to it and claim a reversal of the lower Court's decree in his favour. But it would have been useless to allow this in the absence of any possibility that their contention would succeed. The case must be dealt with as between them and 2nd defendant alone on the issue whether, in the circumstances, they are entitled to recover from him in consequence of his failure to account to his principal.

(3.) Under Section 233, Indian Contract Act, in cases where an agent is personally liable, a person dealing with him may hold either him or his principal or both of them liable. But t is not shown how, under any provision of law or in virtue of any principle, 2nd defendant was under any liability to plaintiffs in respect of the money received by him from, them. This was the basis of the decision in Ellis V/s. Goulton (1893) 1 Q.B. 350 : 62 L.J.Q.B. 232 : 4 R. 267 : 68 L.T. 144 : 41 W.R. 411. Lord Esher and Smith, L.J., dealing with and rejecting seriatim the various heads of liability which could conceivably be relied on; and so also, although the reasons are given more shortly, in Bamford V/s. Shuttleworth (1840) 11 A. & E. 926 : 52 R.R. 542 : 113 E.R. 666 and Stephens V/s. Badcock (3). Against these authorities, plaintiffs have relied first, on the dictum of Blackburn, J., in Pollard V/s. Bank of England (1871) 6 Q.B. 623 : 40 L.J.Q.B. 233 : 23 L.T. 415 : 19 W.R. 1168 and Taylor V/s. Metropolitan Railway Co. (1906) 2 K.B. 55 : 75 L.J.K.B. 735 : 95 L.T. 149 : 32 T.L.R. 470 in which that dictum is quoted with approval. "Where money has been paid under a mistake of fact to an agent, it may be recovered back from him unless he has in the meantime paid it to his principal or done something equivalent to payment to him, in which case the recourse...is against the principal only," But in the present case, as in Ellis V/s. Goulton (1893) 1 Q.B. 350 : 62 L.J.Q.B. 232 : 4 R. 267 : 68 L.T. 144 : 41 W.R. 411 and the cases cited with it, there was no question of mistake, the absence of any being referred to explicity in Stephens V/s. Badcock (1832) 3 B. & Ad. 354 : 1 L.J. (N.S.) K.B. 751 37 R.R. 448 : 110 E.R. 133 and the two cases last referred to must be distinguished on that ground.