PRADEEP B. v. Lizy George

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **FRIDAY, THE 22ND DAY OF MAY 2020 / 1ST JYAISHTA, 1942** ## **RFA.No.654 OF 2004** **AGAINST THE JUDGMENT & DECREE IN OS 28/2000 OF SUB COURT, PALA** **APPELLANTS/1ST DEFENDANT & LEGAL REPRESENTATIVES OF DECEASED 2ND DEFENDANT:** |**1**|**PRADEEP B., BHADRA BHAVAN,**| |---|---| ||**KADAPPATTOOR, MEENCHIL, PALA.**| |**2**|**BHADRAN.B. BHADRA BHAVAN KADAPPATTOOR (DIED)**| ||**MEENACHIL TALUK, PALA.**| ||**ADDL.A3 TO A5 IMPLEADED**| |**ADDL.**|<br>**MINI BHADRAN**| |**A3**|**W/O LATE BHADRAN.B.,AGED 50 YEARS BHADRA**| ||**BHAVAN,KADAPPATTOOR,MEENACHIL,PALA.**| |**ADDL.**|<br>**DEEPAK BHADRAN**| |**A4**|**S/O LATE BHADRAN.B.,AGED 32 YEARS,**| ||**BHADRA BHAVAN,KADAPPATTOOR,MEENACHIL,PALA.**| |**ADDL.**|<br>**SANDEEP BHADRAN**| |**A5**|**S/O LATE BHADRAN.B.,AGED 27 YEARS,**| ||**BHADRA BHAVAN,KADAPPATTOOR,MEENACHIL,PALA.**| ||**ADDL.A3 TO A5 ARE IMPLEADED AS THE LRs OF DECEASED**| ||**2ND APPELLANT AS PER ORDER DATED 6.9.2016 IN**| ||**I.A.2149/2016**| ||**BY ADVS.**| ||**SRI.PHILIP T.VARGHESE**| ||**SRI.THOMAS T.VARGHESE**| ||**SMT. MONISHA K.R.**| ## **RESPONDENT/PLAINTIFF:** **LIZY GEORGE @ LIZY AMMA, PARAMPUZHA PUTHENVEETTIL HOUSE, VELLOOR, PAMPADY, KOTTAYAM.** **R1 BY ADV. SMT.LEENA KRISHNAN R1 BY ADV. SRI.M.NARENDRA KUMAR** RFA.No.654 OF 2004 2 **THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 21-11-2019, THE COURT ON 22-05-2020 DELIVERED THE FOLLOWING:** RFA.No.654 OF 2004 3 ## **JUDGMENT** ## **Dated this the 22nd day of May 2020** Aggrieved by the judgment and decree in O.S. No. 28 of 2000 on the file of the Sub Court, Pala, the 1[st] defendant has filed this appeal. A suit for damages filed by the respondent/plaintiff for a sum of Rs.2,15,000/- with interest was allowed in part directing the defendants to pay a sum of Rs.1,50,000/- . 2. The brief facts required for the disposal of this appeal are as follows: (The parties are referred to as the plaintiff and the defendants for the sake of convenience.) The plaintiff and the 1[st] defendant entered into an oral agreement on 27.12.1996 for slaughter tapping of 222 rubber trees in a property in Sy. No. 16/1 of Meenachil village. An amount of Rs.50,000/- was paid by the plaintiff to the 1[st] defendant as advance. Later, the terms of the agreement was reduced into writing on 7.1.1997 and an amount of Rs.50,000/- was also paid on 11.2.1997. On 27.5.1997 the plaintiff again paid an amount of Rs.1,00,000/- and slaughter tapping has commenced by her. While so, it was learned that the property where the rubber trees were standing belonged to the 2[nd] defendant, the mother of the 1[st] defendant, when she obstructed the plaintiff from continuing with rubber tapping though the period of the agreement was from 30.12.1996 to 31.12.1998. Since RFA.No.654 OF 2004 4 obstruction was made from continuing with slaughter tapping of the rubber trees, the plaintiff filed a suit as O.S. No. 586 of 1998 before the Munsiff's Court, Pala on 21.10.1998 and obtained an order of interim injunction restraining the 1[st] defendant from cutting and removing the rubber trees. Thereafter, the 2[nd] defendant filed O.S. No. 589 of 1996 on 26.10.1998 against the plaintiff to restrain her from obstructing the 2[nd] defendant from cutting and removing the rubber trees. The 2[nd] defendant had entered into an agreement with one George to cut and remove the rubber trees in her property for a sum of Rs.2,30,000/- with the intention to prevent the plaintiff from removing the trees on the basis of the agreement with the 1[st] defendant. The agreement between the 1[st] defendant and the plaintiff was actually with the knowledge/consent of the 2[nd] defendant. In fact the plaintiff received only Rs.40,000/- as the value of the trees which had already been cut and removed till the 3[rd] week of November, 1997. If the plaintiff had continued with the slaughter tapping of rubber trees, she would have obtained an amount of Rs.2.6 lakhs as value and Rs.1,50,000/- as profit. But that was lost and hence the suit for realization of a sum of Rs.2,15,000/- as compensation for breach of contract . 3. The defendants together had resisted the suit contending that the plaintiff had not complied with the terms of the agreement executed on 7.1.1997 for cutting and removal of the trees. It is of course admitted that the total consideration was Rs.5,25,000/and out of the same Rs.50,000/- was paid as advance. Though the RFA.No.654 OF 2004 5 agreement was to pay Rs.2,00,000/- on 20.1.1997 and Rs.1,50,000/- on 20.1.1998 and the balance amount of Rs.1,25,000/- before the removal of the trees, the amount was not paid by the plaintiff. In fact, she paid only Rs.15,000/- on 11.2.1997 and Rs.1,00,000/- on 27.5.1997. The plaintiff was not at all regular in effecting payments and was not ready to comply with the terms of the agreement. She was also using chemicals to extract the maximum latex from the rubber trees and that also caused damages to the tree and at that stage, the agreement with George was entered into by the defendants. In fact, the plaintiff had abandoned the work and because of the same, the defendants had suffered heavy loss and was forced to enter into an agreement with George for a sum of Rs.2,30,000/-. In fact the plaintiff is liable to compensate the defendants and hence the suit is only to be dismissed is the stand taken by the defendants. 4. Before the court below, the plaintiff was examined as PW1 and Exts. A1 to A4 were marked. On the side of the defendants, DWs 1 to 3 were examined and Exts. B1 to B4 were marked. After evaluating the evidence, the court below decreed the suit in part directing the defendants to pay a sum of Rs.1,50,000/- for breach of contract with costs. 5. The said judgment and decree has been challenged by the appellants, the 1[st] defendant and the legal representative of the 2[nd] defendant, mainly on the ground that the agreement between the plaintiff and the 1[st] defendant is not a genuine one and so the plaintiff RFA.No.654 OF 2004 6 is not entitled to get any amount as compensation from the defendants. 6. Heard Adv. Monisha K.R., the learned counsel for the appellants and Adv. M. Narendra Kumar, the learned counsel for the respondent. 7. Admittedly, the property in which the rubber trees were standing belonged to the 2[nd] defendant, the mother of the 1[st] defendant. 222 rubber trees were standing in 60 ares of land in Re-Sy. No. 14/1 of Meenachil Village. The plaintiff's case is that the 1[st] defendant had approached her for slaughter tapping of the rubber trees as if the rubber trees were standing in his property and thus an oral agreement was entered into between them as early as on 27.12.1996 and later Ext.B1 agreement was executed on 7.1.1997. The period fixed for slaughter tapping of the rubber trees was for two years from 30.12.1996 to 31.12.1998. The plaintiff's case is that an amount of Rs.50,000/- was paid as advance on the date of the oral agreement, Rs.50,000/- was paid on 11.2.1997 and Rs.1,00,000/- was paid on 27.5.1997. So in total an amount of Rs.2,00,000/- was received by the 1[st] defendant on the basis of the said agreement. According to the plaintiff, before the expiry of the contract period itself the suit was filed by the 2[nd] defendant restraining her from cutting and removing the trees and so she could not continue with the work. In fact, the 2[nd] defendant had also entered into an agreement with one George for the very same work for a sum of Rs.2,30,000/-. The main contention raised RFA.No.654 OF 2004 7 by the defendants is that the contract between the plaintiff and the 1[st] defendant is a void one and hence the plaintiff is not entitled to realize any amount from the defendants as damages/compensation. The learned counsel for the defendants has relied on the judgment in **Kuju Collieries Ltd.** v. **Jharkhand Mines Ltd** ((1974) 2 SCC 533) so as to argue that there is no valid agreement between the parties so as to enforce against them and to realize any amount as compensation on the basis of an illegal agreement. It is argued by the learned counsel that there is much difference between a contract and an agreement and when an agreement is an invalid one, there is no contract to be enforced against the party and here, there is no valid contract between the parties and therefore the learned trial Judge is not justified in decreeing the suit. 8. The argument of the defendants is that there is no valid contract between the parties and the alleged agreement dated 7.1.1997 is void in the eye of law and therefore Section 65 of the Contract Act is not applicable to the facts of the present case. Admittedly, the property belongs to the 2[nd] defendant. The 1[st] defendant has absolutely no right over the property so as to enter into a valid contract for slaughter tapping with the plaintiff for the trees standing in the property owned by the 2[nd] defendant. The 1[st] defendant has no case that he has obtained any power of attorney or any kind of right/authority so as to enter into a contract with the plaintiff for slaughter tapping of the trees in the property. RFA.No.654 OF 2004 8 9. The suit document is Ext.B1 dated 7.1.1997. According to the plaintiff, though the oral agreement was on 27.12.1996, the same was reduced into writing only on 7.1.1997. The payment of advance amount of Rs.50,000/- was on 27.12.1996. As per the terms of the agreement, on 20.1.1997 the plaintiff had to pay a sum of Rs.2,00,000/- to the 1[st] defendant and Rs.1,50,000/- on 20.1.1998 and the balance to be paid only at the time of completion of the agreement. Ext.B1 is styled as an agreement. The term “Agreement” is defined in Section 2(e) of the Indian Contract Act, 1872 as under: _“every promise and every set of promises, forming the consideration for each other, is an agreement.”_ Section 2(h) defines “contract” as “ _an agreement enforceable by law is a contract_ .” Section 2(g) says that “ _an agreement not enforceable by law is said to be void._ ” Therefore only when an agreement is enforceable by law, it becomes a contract. 10. As referred above, it is to be noted that the property where the rubber trees were standing to be slaughter tapped as per Ext.B1 belonged to the 2[nd] defendant. But the agreement was executed by the plaintiff and the 1[st] defendant, without any power of attorney or document giving right to the 1[st] defendant to enter into an agreement with the plaintiff to deal with the trees standing in the RFA.No.654 OF 2004 9 property. But, it is pertinent to note that the plaintiff has no case that the agreement is a void one because of the fact that it was executed by the 1[st] defendant who is not the owner of the property or a person entrusted with any right to deal with the property. But, what emerges from the pleadings is that the 2[nd] defendant was fully aware of the above transaction and it was with the consent or knowledge of the 2[nd] defendant, the 1[st] defendant entered into the agreement with the plaintiff. So, no contention has been raised on the allegation that the document was executed by a person who is having no right and thereby made the agreement as a void one. The aggrieved party is independent to choose the action but he has no such grievance. So, it is not necessary to look into those aspects and the real issue which is pending between the parties is with regard to the claim raised by the plaintiff as damages from the defendants together. The court below by the impugned judgment had decreed the suit allowing the plaintiff to realize a sum of Rs.1,50,000/- as damages for the breach of contract from the defendants and their assets with interest. 10. So, in order to deal with the question whether the plaintiff is entitled to realize any amount as damages, the paramount question for consideration is whether sufficient pleadings and evidence are available on record so as to grant a decree against both the defendants. 11. On a perusal of the agreement marked as Ext.B1, admittedly the payment was not effected by the plaintiff strictly in RFA.No.654 OF 2004 10 terms of the agreement. In fact, Rs.50,000/- was advanced on 27.12.1996 even before the execution of Ext.B1 and Rs.50,000/- was paid on 11.2.1997. So there was no payment of Rs.2,00,000/- on 20.1.1997 in tune with the terms of the agreement. Another amount of Rs.1,00,000/- was paid by the plaintiff on 27.5.1997. So in total an amount of Rs.2,00,000/- was paid by 27.5.1997 though the plaintiff was supposed to pay Rs.2,00,000/- on 20.1.1997 itself. Of-course the period fixed extend upto 31.12.1998. But, admittedly the plaintiff has not paid the amount fixed by the parties in terms of the agreement. The plaintiff has a case that she could slaughter tap the trees only upto the month of November, 1997. On the other hand, the defendants contended that trees were tapped and major portion of the trees were cut and removed till December, 1998. When the plaintiff has a case that she could tap the rubber only upto the month of November, 1997 and when the defendants denied the same, definitely the burden to substantiate the same is on the plaintiff. But, no evidence was adduced by the plaintiff in support of her case and also to discharge the burden. It is pertinent to note that the plaintiff has filed the suit on 21.10.1998 so as to restrain the defendants from interfering with exercising her right on the basis of Ext.B1. Ext.A1 is the copy of the plaint. If she tapped the rubber only upto the month of November, 1997, why she waited almost for a period of one year for filing the suit, has not been answered satisfactorily by the plaintiff and hence her case that she could tap the rubber only upto the month of November, RFA.No.654 OF 2004 11 1997 and thereby sustained heavy loss, is not supported by any evidence. 12. Significantly, the suit has been filed by her not to get back the amount of Rs.2,00,000/- paid by her on the basis of Ext.B1, but, for realization of money as damages. The dispute lies with regard to the claim for damages alone. 13. From the records it is quite clear that the agreement made by the plaintiff and the 1[st] defendant is in fact cannot be considered as a contract, which is enforceable by law mainly for the reason that it is not executed by a person who is having a legal right to do so. The learned counsel for the plaintiff relying on Section 65 of the Contract Act has also raised a contention that she is entitled to get compensation for the loss sustained by her. It is appropriate to reiterate Section 65 of the Contract Act to appreciate the contentions raised by the parties in this litigation. Section 65 of the Contract Act reads as follows: _“_ **65. Obligation of person who has received advantage under void agreement, or contract that becomes void** _.-_ When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it.” In **Kuju Collieries Ltd's case** (supra) the Apex Court has held that when an agreement is not lawful and therefore void, it cannot be considered as a contract but only as an agreement and when an agreement is void, at the very inception or it found as void subsequently due to subsequent happenings, Section 65 of the RFA.No.654 OF 2004 12 ## Contract Act did not apply. Paragraph 6 of the said decision reads as follows: “6. We are of the view that Section 65 of the Contract Act cannot help the plaintiff on the facts and circumstances of this case. Section 65 reads as follows: _When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it._ The section makes a distinction between an agreement and a contract. According to Section 2 of the Contract Act an agreement which is enforceable by law is a contract and an agreement which is not enforceable by law is said to be void. Therefore, when the earlier part of the section speaks of an agreement being discovered to be void it means that the agreement is not enforceable and is, therefore, not a contract. It means that it was void. If may be that the parties or one of the parties to the agreement may not have, when they entered into the agreement, known that the agreement was in law not enforceable. They might have come to know later that the agreement was not enforceable. The second part of the section refers to a contract becoming void. That refers to a case where an agreement which was originally enforceable and was, therefore, a contract, becomes void due to subsequent happenings. In both these cases any person who has received any advantage under such agreement or contract is bound to restore such advantage, or to make compensation for it to the person from whom he received it. But where even at the time when the agreement is entered into both the parties knew that it was not lawful and, therefore, void, there was not contract but only an agreement and it is not a case where it is discovered to be void subsequently. Nor is it a case of the contract becoming void due to subsequent happenings. Therefore, Section 65 of the Contract Act did not apply.” So, Section 65 has no application in this case in the light of the ratio laid down by the Hon'ble Supreme Court in the above referred decision. Such being the case, the question to be looked into is whether there is sufficient evidence so as to conclude whether the RFA.No.654 OF 2004 13 plaintiff is entitled to realize any amount from the defendants as damage **s.** In **Food Corporation of India** v. **M/s. Laxmi Cattle Feed Industries** (AIR 2006 SC 1452) it has been laid down that only if there is sufficient evidence, a decree for damages can be granted. 14. At the outset, it is to be noted that except the evidence adduced by the plaintiff as PW 1, nobody was examined as a witness to support her case. An amount of Rs.2,15,000/- has been claimed as damages by the plaintiff on the allegation that if she had cut and removed the trees in terms of the agreement without any obstruction from the side of the defendants, she would have earned an amount of Rs.2,60,000/- after deducting 25% towards maintenance and Rs.25,000/- as labour charges. So, she had lost Rs.1,50,000/- as profit by the sale of the latex which can be extracted by slaughter tapping. So also, 220 rubber trees would have fetched a total value of Rs.3,25,000/-, out of which she would have received a profit of Rs.65,000/-. On this assumption she has claimed Rs.2,15,000/- as damages. 15. The court below on the finding that she might have obtained Rs.1,00,000/- as the value of the latex as she had tapped the rubber trees only up to September, 1998 and as she had paid Rs.2,00,000/-, she is entitled to get back Rs.1,00,000/- from the defendants. Then, it was observed that she is entitled to get Rs.50,000/- as a mark of damages and thus in total she is entitled to RFA.No.654 OF 2004 14 get Rs.1,50,000/- from the defendants. But records would indicate that the calculation made by the court below is without any basis. It is pertinent to note that the plaintiff's case itself is that she had received Rs.40,000/- as the value of the latex. But no document was produced by her to show that she had received only Rs.40,000/- as the value of the latex. So also the finding of the court below that she might have received Rs.1,00,000/- as the value of the latex by the slaughter tapping of the rubber trees is also without any basis. Sufficient materials are not available on record to make such a calculation. It is significant to note that the defendants had filed another suit against the plaintiff as O.S. No. 589 of 1998 before the Munsiff's Court, Pala. Ext.A2 is the copy of the plaint. Ext.A3 the copy of the decree shows that the suit was dismissed as not pressed. Since the plaintiff has approached the court for a decree for realization of money as damages, the burden is upon her to establish that she sustained loss because of the interference by the defendants and especially by the execution of Ext.B4 by the 2[nd] defendant in favour of the above mentioned George on 2.10.1998 for slaughter tapping of the very same trees in the property. Of course, during the pendency of Ext.B1, Ext.B4 had been executed by the 2[nd] defendant in favour of George as referred above. The case of the plaintiff that she could tap rubber only upto the month of November, 1997 stands disproved by the evidence of DW 2 who had conducted the tapping work for the plaintiff and according to him, the rubber trees were tapped up to the month of September, 1998. His RFA.No.654 OF 2004 15 evidence is substantiated by the filing of the case by the plaintiff against the defendants on 22.10.1998 (Ext.A1). So, that part of evidence also stands against the case of the plaintiff. Since she failed to produce evidence to the effect that so far she had received only Rs.40,000/- as the value of the latex and sustained loss to the tune of Rs.1,50,000/-, it is not possible to grant a decree in her favour as prayed for before the court below. The court below has also went wrong in assessing the damages without sufficient materials on record. Of course, she paid Rs.2,00,000/- not in tune with the terms of the agreement, but receipt of the same is accepted by the defendants. So also the facts available would show that she could cut and remove the rubber trees and conduct slaughter tapping at least till the month of September, 1998 or till the filing of the suit against the defendants. The total consideration fixed as per this agreement was Rs.5,25,000/-. She has no case that she paid the whole amount mentioned in Ext.B1 or any amount apart from Rs.2,00,000/-. So in the absence of relevant documents in support of her case that she sustained huge loss and entitled for damages, I find that the court below went wrong in granting a decree for a sum of Rs.1,50,000/- against the defendants. Sections 65, 70 or Section 71 of the Contract Act will not rescue the plaintiff in order to get a decree as the terms of the agreement cannot be considered as a contract strictly in terms of the Contract Act. So I find that the plaintiff is not entitled to get a decree for a sum of Rs.1,50,000/- as damages for breach of contract from the defendants RFA.No.654 OF 2004 16 and their assets as granted by the court below. In short, the suit is liable to be dismissed. Hence, the appeal stands allowed by setting aside the judgment and decree under challenge. The parties shall bear their respective costs. **Sd/-** **SHIRCY V.** **JUDGE** **sb**