AMANCHI VENKATRAMA SASTRULU Vs. NAMA VENKANNA (DEAD)

JUDGEMENT

(1.) The defendant gave a lease of about 11 acres of inam land for 5 years to the plaintiff beginning with 1911. Before the cowle to the plaintiff the lands had been leased to another person. The plaintiff attempted to take possession of the lands but was unable to get them in the first year. In the second year he was able to get possession of a few acres and in the third year a few more. The suit was instituted for damages for failure to give possession. The defence was that there was no undertaking to give possession, that the defendant did give possession of the lands that the damages were excessive and that the plaintiff was not entitled to maintain the suit. The District Munsif held that the suit was maintainable and following The Zamindar of Vizianagaram v. Behara Suryanarayana Pantulu (1901) I.L.R. 25 Mad. 587 gave the plaintiff a decree for his share of the crops as estimated in the cowle Exhibit A. This decree was confirmed on appeal.

(2.) In the second appeal it was not disputed that the suit was properly instituted. The only point seriously argued related to the measure of damages. Mr. Narasimha Rao relying upon Mahamed Esa Khan v. Baboo Keshub Lal (1870) 14 W.R. 382 contended that the plaintiff is only entitled to nominal damages. The general rule as to damages whether they relate to moveable or immoveable property is contained in Section 73 of the Indian Contract Act. Two considerations arise in assessing damages : (1) whether the damages naturally arose in the usual course of things from the breach and (2) whether the plaintiff had means of remedying the inconvenience and has neglected to avail himself of them. In The Zamindar of Vizianagaram v. Behara Suriyanarayana (1901) I.L.R. 25 Mad. 587 the learned Judges without discussing the question, under very similar circumstances like the present, say : " The measure of damages is the amount of profits with interest thereon at 6 per cent. per annum which would have accrued to the plaintiff if he had been put in possession of the villages and was in enjoyment of the same during the term of the lease." In my opinion the observations are fully supported by the English authorities. In Fletcher v. Tayleur (1855) 17 Common Bench Page 21the defendant had contracted to build a ship which was to be delivered to the plaintiff in August 1854. It was not delivered till March 1855. It was held that as the primary object of the ship was to earn freight by carrying passengers, the measure of damages was the value of the profits which could have been obtained between the date fixed for the delivery and the date on which the ship was actually delivered. Wills, J., stated the law to be " that the measure of damages for the breach of a contract for delivery of a chattel should be governed by a similar rule to that which prevails in the case of a breach of contract for the payment of money " and concluded by saying " the measure of damages in such a case as this was held by analogy to be the average profit made by the use of such a chattel." In In re Trent and Humber Co. (1868) 4 Ch. A. 112, 117 the Lord Chanceller said: "The measure of damages is prima facie the same which would have been earned in the ordinary course of employment of the chattel in the time." This principle was accepted as good law in The owners of the steamship Grade v. The owners of the steamship Argentino (1889) 14 App. Cas. 519. In Jaques v. Miller (1877) 6 Ch. D. 153 which was a case of an agreement to grant a lease Mr. Justice Fry after examining the case-law on the point said : " The question of damages is a more difficult one. Damages are claimed, in addition to the specific performance of an agreement, in respect of the delay which was caused by the defendant s wilful refusal to perform his contract and the consequent loss of profit to the plaintiff. I think I am at liberty to consider what would have been the value of the possession of the premises to the plaintiff for the period between the 5th of September 1876, and the time when he actually obtained possession of the other premises". Although this case was overruled by Marshall v. Berridge (1881) 19 Ch. D. 233 on another question the principle as to damages enunciated by the learned Judge was accepted in Royal Bristol Permanent Building Society v. Bomacha (1887) 35 Ch. D. 390. There are cases which draw a distinction between what are primary and secondary profits. Under the first heading profits or advantages which are the direct and immediate fruits of the contract are included. Under the latter class profits expected from dependent and collateral engagements entered into on the faith and in expectation of the performance of the principal contract are brought in. The decision in Mahabala Bhatta v. Kunhanna Bhatta (1898) I.L.R. 21 M. 372 to which our attention was drawn belongs to the latter category. In the present case the parties must have contemplated that the plaintiff would have cultivated the lands in a husbandlike manner and that he would have derived profit therefrom. That undoubtedly is what is known as the primary profits, and there is no reason why the plaintiff should not be entitled to it. The principle is neatly stated in Sedgwick on Damages Vol. III, Section 984; "The general principle in this case is the same as in cases of refusal to convey although the Courts are more nearly agreed in adopting the principle of complete compensation for the loss of the bargain. The ordinary rule is to allow the difference between the rental value of the premises for the term and the rent reserved." In another place (Section 187) it is stated: "The rental value of a building will be the measure of damages in an action for delay in delivering possession." Applying this test to the present case it is the net profit which the plaintiff would have derived, that should be awarded to him. The District Munsif was wrong in holding that the decree which he gave represented the net profit of the lands. From the evidence of the plaintiff it is clear that it was the gross produce. From this, deduction will have to be made for the expenses of the cultivation and for the failure of season if any, during the period for which damages are claimed. The amount which has been fixed in the contract should not be the criterion for assessing damages. Further as was pointed out in one of the cases already quoted the opportunities which the plaintiff had of renting other lands should be taken into account. Therefore before finally disposing of this case we must ask for a finding on this question namely: (1) What was the net profit which the plaintiff could have derived during the period he was out of possession ?

(3.) The finding should be given on the evidence on record within 6 weeks; and 7 days will be allowed for objections. Phillips, J.