Pannanlal Jankidas V. Mohanlal, AIR 1951 SC 144
Facts:
Plaintiff, as agents of the defendant had stored the goods in government godowns, requiring permit to supply them to the defendants.
Due to fire in godown, the goods got burned up and plaintiff got compensation of 50% of damage caused in respect of the goods as they were uninsured.
However, plaintiff sued defendant to the indemnified against the rest 50% of damages caused to the goods while handling those as latter’s agent.
The defendant pleaded, and it was found as a fact that plaintiff had agreed to insure the goods and even charged defendants, nevertheless omitted to insecure the goods.
They further pleaded tat they were entitled to set off or counter claim for the value of the goods destroyed as damages caused to them by the neglect or breach of duty of the plaintiff’s
Issue:
What damages are plaintiff’s liable to pay to the defendants for failure to insure the goods which were destroyed?
Held:
the intervention of government in passing this ordinance could not increase or add to the liability of the appellants for the breach of contract or breach of duty and therefore, they were not liable to pay the compensation which would have been receivable by the respodents if the goods had been insured.
Granting that they were in default and had committed a breach of duty in not insuring the goods according to the instructions or the agreement, defendant could not recover anything more from them than the nominal damages for breach, because the policy of fire insurance, if taken out, would not have given to the defendants money in respect to damage due to fire in godown.
Therefore, if an agent is ordered to procure a policy of insurance for his principal and neglets to do it, and yet the policy, if procured, would not have entitled the principal, in the events which have happened, to recover the loss or damage, the agent may avail himself of that as a complete defence.
Conclusion:
In this supreme court held that the party in breach must compensate in respect of the direct and consequesnces flowing from the breach and not in respect of loss or damage indirectly or remotely caused.
Calico Printer’s Assn V. Barclays Bank, (1931) 145 LT
It is possible for a principal to sue a sub-agent if the use of a sub-agent contemplated by the principal and the privity was authorised.
State of T.N. V. S.A. chettiar, AIR 1988 mad 248
The suit was laid by the respondent herein praying for the relief of rendition of accounts by the appellant. The circumstances giving rise to the second appeal are:
The appellant appointed the respondent as an agent for procurement of paddy and rich and also as a hulling agent and the respondent had to purchase paddy from the producers with his own money and after converting the paddy into rice, supply the some to the appellant or as directed by it. The work of hulling agency consisted of hulling for the appellant paddy and supply rice as directed by it. Agreements in the prescribed forms were executed by the
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