KARL ETTLINGER Vs. CHAGANDAS AND CO

JUDGEMENT

(1.) The plaintiffs, Ettlinger & Co., a firm of naturalized Germans, doing business in London, made a contract on the 24th July 1914, with the defendant firm, through their London agent, Smith, by which the defendants agreed to supply the plaintiff firm with 1000 tons freight at 11s. 6d. per ton, the material to be carried being manganese from the Port of Bombay for Antwerp, shipment in September. On the 7th of September 1914, the defendants telegraphed to the plaintiffs that owing to force majeure the contract was cancelled. The plaintiffs refused to accept the cancellation and hold the defendants to account for damages.

(2.) It is contended on behalf of the defendants that they are absolved from performance of the contract on three grounds: (1) that the export of Manganese from India was prohibited by the Government of India Notification of the 5th of August 1914, published in Bombay on the 7 of August 1914; (2) that the performance of the contract became impossible as no freight was procurable during the month of September from Bombay to Antwerp; (3) that it was an implied condition, and of the essence of the contract, understood by both parties to be so, that there should be freight available from Bombay to Antwerp.

(3.) With the assistance of the learned counsel on both sides I have been able to take a fairly comprehensive survey of this field of law brought up-to-date in the recent work of Mr Trotter. It is clear that the law of India is very different from what was the law of England on the point of impossibility of performance. How far the law of England has, in recent times, been modified and brought more closely into accord with the Indian law, as expressed in Section 56 of the Indian Contract Act, would be a matter of long, difficult and delicate critical analysis. In this country, whatever may have been the law of England, and whatever may now be the opinion of eminent Judges and Jurists in that country, it cannot be denied that after the contract has been made to do a certain act or acts, and those acts become impossible, the contract is void. Section 56 deals with two grounds upon which executory contracts become absolutely void: the first of these is that which I have just stated, namely, that the act to be done should, after the contract has been made, become impossible. The second is that the acts necessary to be done in order to carry out the contract should, after the contract has been made, and through no fault in the parties to that contract, become unlawful. The latter part of the section deals with cases where the acts to be done were at the time the contract was made lawful but a legal prohibition has supervened after the making, but before the performance of the contract, and extends to such cases the general principle of law applicable to all contracts and expressed in Section 23.