PACIFIC MINERALS LTD Vs. SINGHBHUM MINING SYNDICATE

JUDGEMENT

(1.) This is a suit for the recovery of the sum of Rs. 5500 as damages sustained as the result of breach of a contract to deliver 2000 tons of manganese ore. The defendants carry on business, inter alia, in the district of Singhbhum and own a manganese mine in the district of Vizagapatam. Apparently, the price of manganese ore varies considerably, from time to time, and when prices are low it is not profitable to work a considerable number of mines actually existing in this country. In recent years however, the price of manganese has risen, with the result that a large number of small mines which had not been worked for years, were again brought into operation, and a considerable number of new firms and companies sprang up, dealing in production and sale of manganese ore. The ore varies in quality, that is to say, the actual amount of manganese in the material taken from the mine varies from 40 to 50 per cent. English and European buyers are interested mostly in ore of the higher percentages whereas in the East and in Japan there is a demand for the lower percentages. The principal area in India from which manganese ore is derived is the Central Provinces, but there are one or two large mines in Vizagapatam also.

(2.) The defendants apparently had entered into a contract with a man named Patel, under which he agreed to take the whole of the output of their mine. Owing to his failure to fulfil this contract, the defendants found themselves with 2000 tons of manganese ore 41 per cent. upon their hands in the early part of 1936 and they were anxious to sell it. The plaintiffs heard of this and wrote a letter dated 29 April 1936, to the defendant's Manager at Salur in Vizagapatam, saying that they understood that the defendants had 2000 tons of manganese ready at Vizagapatam port, and asking for his lowest quotation, with an approximate idea of its analysis. The Manager was G.E. Bennett, and he replied on 1 May, telling the plaintiffs that he would forward their letter to his Head Office who would take up the matter direct with them. On 16 May, the defendants wrote saying that they had 2000 tons of manganese ore for disposal and quoted a rate, which they stated was the same as the plaintiffs had quoted them for some previous parcel, that is to say, Rs. 9-2-0 Ex Stack Docks, for 41 per cent. grade, plus or minus 0-4-0 unitage. Further they gave the approximate analysis and said that if the terms were acceptable to the plaintiffs they would like an advance of 50 per cent. against value. They concluded by asking the plaintiffs to send their reply "to our Manager at Salur, a copy of which may be sent here for our information."

(3.) The meaning of the term 41 per cent. grade plus or minus 0-4-0 unitage is that the material contained 41 per cent. ore and that it was to be sold upon the condition; that if it turned out to be one or more per cent higher or lower than the figure quoted, then the matter would be adjusted by adding or deducting 0-4-0 per ton for each unit of percentage higher or lower than 41 per cent; thus 41 per cent. being. Rs. 9-2.0, 40 per cent. would be Rs. 8-14.0, and 42 per cent. would be Rs. 9-6-0 and so on.