# Haruey v. Faeey l1893 J A.C. 552 applied

- **Citation:** [1951] 1 S.C.R. 161
- **Court:** Supreme Court of India
- **Decided:** 1951
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/haruey-v-faeey-l1893-j-a-c-552-applied-172
- **Pages:** 7

## Headnote

S.C.R.
SUPREME COURT REPORTS
COL. D.I. MAc PHER:SON
ti.
M. N. APPANNA AND ANOTHER.
fSAIYID FAZL ALI, MuKHERJEA and
CHA.NDRASEKHAllA AIYAR JJ.]
161
Contract-OOer and acceptanc~tatement of lowest price and
counter-offer disting1111hell.
On receiving an offer from A for the purchase of a house belonging to B, Y w!Jo was looking after . the house c.abled to B
that there was an offer of Rs. 6,000 for the house. B sent a cable
in reply on the 5th August, 1944, that he would not accept less
than Rs. 10,000.
Y conveyed this informatio_n to A on the 9th
and on the 14th A wrote a letter to Y stating that he thereby
confirmed the oral offer of Rs. 10,000 that he had made to Y
on the 11th. On the :6:h Y cabled to B as follows : "Offered
Rs. 10,000. May I sell". On the same day, W, another frienJ
of B, with whom also B was in correspondence, sent an offer for
Rs.
11,000 and B accepted it.
A sued for specific performance
alleging that B's cable of the 5th was a counter-offer
anJ as he
had accepted it on the 14th, there was a concluded contract for
sale in his favour on that day.
Held, that the table sent 1>y B on the 5th was a men: statement of the lowest price at . which he would sell and contained no
implied contract to sell at that price. A's letter of the 14th was
under the circumstances only a fresh offer; and as B had not
accepted it ~ere was no concluded contract in favour of A.
Haruey v. Faeey l1893 J A.C. 552 applied.
CML
APPELLATE
JURiso1CT10N.
Appeal
from a
judgment and decree of the Judicial Commissioner of
Coorg, dated 1st April, 1946, in Original Suit No. 1
of 1945.
C.R. Pattabhi Raman, for the appellant..
Jindra Lal, for the respondent.
195L February 9.
The judgment of the Court
was delivered by
!95!
Feb.9
FAZL ALI J.--This is an appeal from a judgment
Fad ~Ii]~
of the Judicial Commissioner of Coorg in a suit filed
bv the first respondent (hereinafter referred to as the
plaintiff) against the appellant (hereinafter referred to
as . the first defendant)
and the second respondent
195!
Col. D.I.
Mae Pherso•
v.
M. N. APP.•••
and amJther.
Fa<l Ali].
162
SUPREME COURT REPORTS
(1951)
(hereinafter referred to as the second defendant), for
the specific performance of a contract.
The first
defendant owned a bungalow in Mercara known as
"Morvern Lodge".
The suit which has given rise to
this appeal was instituted by the plaintiff for the
specific performance of an alleged contract of sale in
respect of this bungalow.
It appears that the first defendant owned certain
estates in Mercara, and one Mr. White was an alternative director in one of the estates, and Youngman
was the manager of another estate also belonging to the
first
defendant
and
was
looking
after
"Morvern
Lodge" during his absence.
It seems that
about the
middle of 1944, the plaintiff asked White if he would
cable to the first defendant his offer of Rs. 4,000 for the
bungalow, and, on the 1st June, 1944, White sent
a
cable to the first defendant to the following effect :-
"Have enquiries
Mercara
bungalow if for sale,
wire lowest figure."
On the 24th July, 1944, the plaintiff wrote to the
first defendant that he was prepared to purchase the
bungalow for Rs. 5,000 and if the offer was acceptable
to him, he (the first defendant) should inform the
plaintiff to which bank he should issue a cheque in
payment of the price. This letter was followed up by
a cable from Youngman to the first defendant to
the
following effect :-
"Have
had
offer
Morvern Lodge
rupees
~ix
thousand for immediate possession."
On the 8th August, 1944, Youngman received a
cable from the first defendant saying : "Won't accept
Jes~ than rupees ten thousand". On the 7th August,
1944, the plaintiff wrote to Youngman asking him
whether his offer had been accepted, and saying that
he was prepared to accept any higher price if found
reasonable. Meanwhile, on the 8th August, the first
defendant sent
an
airgraph
to
Youngman,
which
states inter alia :-
"I got a cable from you a few days
ago saying
you had had an offer of

## Text

S.C.R.
SUPREME COURT REPORTS
COL. D.I. MAc PHER:SON
ti.
M. N. APPANNA AND ANOTHER.
fSAIYID FAZL ALI, MuKHERJEA and
CHA.NDRASEKHAllA AIYAR JJ.]
161
Contract-OOer and acceptanc~tatement of lowest price and
counter-offer disting1111hell.
On receiving an offer from A for the purchase of a house belonging to B, Y w!Jo was looking after . the house c.abled to B
that there was an offer of Rs. 6,000 for the house. B sent a cable
in reply on the 5th August, 1944, that he would not accept less
than Rs. 10,000.
Y conveyed this informatio_n to A on the 9th
and on the 14th A wrote a letter to Y stating that he thereby
confirmed the oral offer of Rs. 10,000 that he had made to Y
on the 11th. On the :6:h Y cabled to B as follows : "Offered
Rs. 10,000. May I sell". On the same day, W, another frienJ
of B, with whom also B was in correspondence, sent an offer for
Rs.
11,000 and B accepted it.
A sued for specific performance
alleging that B's cable of the 5th was a counter-offer
anJ as he
had accepted it on the 14th, there was a concluded contract for
sale in his favour on that day.
Held, that the table sent 1>y B on the 5th was a men: statement of the lowest price at . which he would sell and contained no
implied contract to sell at that price. A's letter of the 14th was
under the circumstances only a fresh offer; and as B had not
accepted it ~ere was no concluded contract in favour of A.
Haruey v. Faeey l1893 J A.C. 552 applied.
CML
APPELLATE
JURiso1CT10N.
Appeal
from a
judgment and decree of the Judicial Commissioner of
Coorg, dated 1st April, 1946, in Original Suit No. 1
of 1945.
C.R. Pattabhi Raman, for the appellant..
Jindra Lal, for the respondent.
195L February 9.
The judgment of the Court
was delivered by
!95!
Feb.9
FAZL ALI J.--This is an appeal from a judgment
Fad ~Ii]~
of the Judicial Commissioner of Coorg in a suit filed
bv the first respondent (hereinafter referred to as the
plaintiff) against the appellant (hereinafter referred to
as . the first defendant)
and the second respondent
195!
Col. D.I.
Mae Pherso•
v.
M. N. APP.•••
and amJther.
Fa<l Ali].
162
SUPREME COURT REPORTS
(1951)
(hereinafter referred to as the second defendant), for
the specific performance of a contract.
The first
defendant owned a bungalow in Mercara known as
"Morvern Lodge".
The suit which has given rise to
this appeal was instituted by the plaintiff for the
specific performance of an alleged contract of sale in
respect of this bungalow.
It appears that the first defendant owned certain
estates in Mercara, and one Mr. White was an alternative director in one of the estates, and Youngman
was the manager of another estate also belonging to the
first
defendant
and
was
looking
after
"Morvern
Lodge" during his absence.
It seems that
about the
middle of 1944, the plaintiff asked White if he would
cable to the first defendant his offer of Rs. 4,000 for the
bungalow, and, on the 1st June, 1944, White sent
a
cable to the first defendant to the following effect :-
"Have enquiries
Mercara
bungalow if for sale,
wire lowest figure."
On the 24th July, 1944, the plaintiff wrote to the
first defendant that he was prepared to purchase the
bungalow for Rs. 5,000 and if the offer was acceptable
to him, he (the first defendant) should inform the
plaintiff to which bank he should issue a cheque in
payment of the price. This letter was followed up by
a cable from Youngman to the first defendant to
the
following effect :-
"Have
had
offer
Morvern Lodge
rupees
~ix
thousand for immediate possession."
On the 8th August, 1944, Youngman received a
cable from the first defendant saying : "Won't accept
Jes~ than rupees ten thousand". On the 7th August,
1944, the plaintiff wrote to Youngman asking him
whether his offer had been accepted, and saying that
he was prepared to accept any higher price if found
reasonable. Meanwhile, on the 8th August, the first
defendant sent
an
airgraph
to
Youngman,
which
states inter alia :-
"I got a cable from you a few days
ago saying
you had had an offer of Rs. 6,000 for Morvern Lodge.
S.C.R.
SUPREME COURT REPORTS
163
At the same time I got one from White saying value
of Bungalow was Rs. 10,000.
So wired you-'W on't
accept less
than Rs.
10,000'." On the 9th August,
1944, Youngman, wrote to the plaintiff as follows :-
"In reply to your letter, dated 7th August, I
received yesterday a cable from
Col.
MacPherson
regarding your offer of Rs. 6,000, which reads as
follows:-
'Won't accept less
than
rupees
ten
thousand'
MacPherson."
The plaintiff has stated in his plaint that this letter
of Youngman was received by him on the 14th August,
1944, and he immediately accepted
the "counter-offer
made by the first defendant'', and confirmed it ' in
writing in a letter addressed to Youngman. In his
evidence, however, the plaintiff has stated that he met
Youngman on the 11th August after receiving his
letter and told him personally that he would. pay
Rs. 10,000 for the bungalow and will require immediate
delivery.
There was also some talk about the ·con..,,
veyance charges, and ultimately the plaintiff
agreed
to bear those charges. - Afterwards, he wrote to Youngman a letter on the 14th August in which after refering to the conversation he had with the latter he
stated as follows :-
"I hereby confirm my oral offer of ten thousand
for the bungalow.
I shall be grateful if you will kindly
hurry · up with consultation with
your
lawyersat
Madras and make arrangements to receive the money
and hand over the bungalow as early as pJacticable."
It appears that three days later, i.e., on the 17th
August, one Subbayya wrote to Youngman stating
that "he confirmeC:! his offer of Rs. 10,500 made to
him (Youngman) the previous day for the purchase of
the bungalow", and he expected that
the latter had
cabled
to the first defendant communicating the offer
_as promised.
It seems that Youngman did not communicate Subbayya's offer to the first defendant, but
sent a cable to him on the 26th August to the following
effect:-
t95t
Col. D. I.
Ma& Pherson
v.
M. N. Appanno
and Another.
Fa~l Ali].
1951
Col. D. J.
Mae Ph1rson
v.
M. N. Appanna
and Lf.notlur.
Fad Ali J.
164
SUPREME COURT REPORTS
[1951]
"Offered ten thousand Morvern Lodge immediate
possession, May I sell." On the same day, White
cable to tho first defendant in the follow~ng terms :-
"'Hold offer for Morvern Bungalow rupees
eleven
thousand
cash
subject
immediately
acceptance
and
occupation. Strongly recommended acceptance."
On the 29th August, Youngman sent an airgraph to
the first derendant in which he wrote as follows :-
"Thank you
for
your airgraph letter of
8th
August which reached me on 24th instant.
I cabled
you on Saturday an offer of Rs. 10,000 for Morvern
Lodge from the would be purchaser who previously
had offered Rs. 6,000, but I had a call from White a
day or two ago and he tells me that he cabled an offer
on the same day of Rs. 11,000. I except you will have
answered these and will have accepted White's offer.
If you have decided will you please arrange for a
Power-of-Attorney to be prepared as soon as possible."
'• · In the meantime, the first defendant sent a cable to
White to the following effect :-
"Accept rupees eleven thousand MorVern Lodge
occupation permitted when full amount deposited
my
account Mercantile Bank Madras inform Youngman."
Thereafter, the second defendant paid the amount
of Rs. 11,000 and occupied the bungalow.
The question to be decided in this case is whether
in view _of the correspondence which has been reprc>·
duced, it could be held that there was a concluded
contract for the sale "Morvern Lodge" in favour of
the plaintiff on the 14th August, as stated by him in
the plaint.
The Judicial Commissioner of Coorg
who
tried the suit held that there was a concluded contract,
but, instead of giving to the plaintiff a decree for
specific performance, awarded a sum of Rs. 3,000 as
compensation to him. Against this decree, the first
defendant alone has appealed, after obtaining a certificate under section 109(c) of the Civil Procedure Code
from the Judicial Commissioner.
The
plaintiff has
not preferred any appeal.
S.C.R.
SUPREME COURT REPORTS
165
The plaintiff's case is that the cable sent by the first
defendant on the 5th Augus~, and received by Young- .
man on the 8th, to the effect that · he would not accept
less than Rs. 10,000, was a counter-offer made by him
through Youngman to the plaintiff, and the contract
was completed as soon as he accepted it. We however
find it difficult to hold on the entire facts of the case
that there was any concluded contract on the 14th
August, 1944, and we are supported in this view by
the well-known case of Harvey v. Facey(1), in which
the facts were somewhat similar to those of the present
case.
In: that case, the appellants had telegraphed to
the respondents "Will you sell us B.H.P.?
Telegraph
lowest cash price", and the respondents had telegraphed in reply, "Lowest price for B.H.P. £900,"
and
then the appellants telegraphed, "We agree to buy
B.H.P. for £900 asked by you. Please send us your
title-deed in order that we may get early possession,"
but received no reply. On these facts, the Privy Council held that there was no contract, and Lord Norris,
who delivered the judgment of the Board, observed
as follows :-
"The third telegram from the appellants treats
the answer of L.M. Facey stating his lowest price as
an unconditional offer to sell to them at the price
named.
Their Lordships cannot treat
the
telegram
from L. M. Facey as binding him in any respect, except
to the extent it
does by its terms, viz.,
the
lowest
price.
Everything else is left open, and the reply
telegram from the appellants cannot be treated as an
acceptance of an offer to sell them; it is an offer that
required to be accepted by L.M. Facey. The contract
could only be completed if L.M. Facey
had accepted
the appellant's last telegram.
It has been
contended
for the appellants that L.M. Facey's telegram should
be read as saying 'yes' to the first question put in the
appellant's telegram, but there is nothing
to support
that contention. L.M. Facey's telegram gives a precise
answer to a precise question, viz., the price. The Contract must appear
by the telegrams, whereas
the
(I) (1893) A. C. SS2.
1951
Col. D. I.
Mlll: Phmon
v.
M. N. Apparuuz
and Anotlwr
Far.l Ali].
1951
C.I. D. I.
Mae PIITTun
v.
JI. N A/"'4nna
and Anoti\er.
,
166
SUPREME COURT REPORTS
[19511
appellants are obliged to contend that an acceptance
of the first question is to be implied.
Their Lordships
are of opinion that the mere statement of the lowest
price at which the vendor would sell contains no implied contract to sell at that price to the persons making
the inquiry."
The conclusion at which we have arrived is strengthened by certain facts which emerge from the correspondence between the parties. The real question is
whether the first defendartt had made
a counter-offer
in his cable of the 5th August or he was merely
inviting offers.
The plaintiff in his letter of the 14th
August addressed to Youngman, stated that he confirmed· his oral offer of ten thousand for the bungalow,
and he did not say in so many words that he accepted
the 'counter-offer' of the first defendant. Similarly,
in the cable which Youngman sent to the first defendant on the 28th August, he did
not state that the
latter's offer had, been accepted, but stated that he had
been offered Rs. 10,000 for the bungalow and concluded
with the
words "May I sell?" Neither party thus
treated
the first defendant's cable as containing
a
counter-offer.
On the other hand, they proceeded on
the footing that the plaintiff had made an offer of
Rs. 10,000 which was subject to acceptance by the
first defendant.
Apparently, the first defendant was
in communication not only with Youngman but also
White, and both of
them rightly thought that no
transaction could be concluded without obtaining
the
first defendant's express assent to it.
Mr. Jindra Lal, counsel for the plaintiff, who pressed
his points with force and ability, contended that
by
the 26th August, 1944, Youngman had come under the
influence of the rival bidder or at least that of White
who was supporting him, and the cable to the first
defendant was
deliberately framed
by
Youngman in
such a way as to prejudice the plaintiff. There is
however nothing in the evidence to support such
an
extreme conclusion. On the other hand, Youngman
has frankly stated in his evidence that he felt it improper to entertain Subbayya' s higher offer and did
..
S.C.R.
SUPREME COURT REPORTS
167
not communicate it to the first defendant. This statement is supported by the cable of the 26th August and,
if Youngman can be said to have had any leaning at
all, it was certainly in favour of the plaintiff. In these
circumstances, it would be
difficult
to
hold
that
Youngman had deliberately misdescribed the plaintiff's
acceptance of the counter-offer as his offer in the
cable which he sent on the 26th August to the first
defendant.
It seems to us that the view taken by the Judicial
Commissioner is not correct, and, as there was no
concluded contract, the decree passed by him awarding .
compensation to the plaintiff for breach of contract
cannot be sustained. We therefore allow the appeal,
set aside the judgment and dtcree of the Judicial
Commissioner and dismiss the plaintiff's suit.
Having
regard to the circumstances of the case, we make no
order as to costs.
Appeal allowed.
Agent for the appellant : M. S. K. Sastri.
Agent for the respondent: Rajinder Narain.
THE STATE OF BOMBAY
v.
ATMA RAM SRIDHAR VAIDYA
[SHRI HARILAL KANIA C.J., SAIYID FAZL ALI,
PATANJALI SAsTRr; MuKHERJEA, DAs and
CHANDRASEKHARA AIYAR JJ.)
Constitution of fodia, Arts. 21, 22 (5)-Preventive detention
-Duty to communicate grounds and to afford opportunity to make
representation-Whether
distinct rights-Ground supplied
vague
-Non-supply of particulars or supply of particulars at later st.7ge
-Whether vitiates dttention-furisdiction
of court to consider
sufficiency of grounds-Preventive Detention A.ct (IV of 1950), s. 3.
The respondent was arrested on the 21st of April, 195(),
under the Preventive Detention Act, 1950, and on the 29th of
19Sl
Col. D. I.
Mil() Phersott
v.
M. N. APflanM
and ANJtlrer.
Fazl Ali].
1951
Jan. 25.