In an appeal against a decree for return of advance amount under a sale agreement, the High Court modified the decree, reducing the recoverable sum from Rs.5 lakhs to Rs.4.5 lakhs, recognizing partial breach and unproven quantum of damages.
Decree modified to grant recovery of Rs.4,50,000 with 6% per annum interest instead of Rs.5,00,000.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE P.SOMARAJAN
TUESDAY, THE 24TH DAY OF MAY 2022 / 3RD JYAISHTA, 1944
RFA NO. 687 OF 2012 (H)
AGAINST THE JUDGMENT & DECREE DATED 07.03.2012 IN OS No.402/2009 OF
ADDITIONAL SUB COURT, KOTTAYAM
APPELLANTS/DEFENDANTS:
1 VARGHESE @ THANKACHAN, AGED 71, S/o CHACKO, KALLOOPARAMBIL, PAKKIL.P.O, PALLOM KARA, NATTAKOM VILLAGE, KOTTAYAM TALUK.
2 SOSAMMA VARGHESE @ LEELAMMA, AGED 65, W/o VARGHESE, KALLOOPARAMBIL, PAKKIL.P.O, PALLOM KARA, NATTAKOM VILLAGE, KOTTAYAM TALUK.
BY ADVS. SRI.ALEX GEORGE
SRI.GEORGE ZACHARIAH ERUTHICKEL
RESPONDENT/PLAINTIFF:
MINDU KURIAN, AGED 31, EMPLOYED ABROAD, S/o KURIAN ZACHARIAH, KAMBAKKALUMKAL HOUSE, VELLOOTHURUTHY KARA, PANACHIKKADU VILLAGE, KOTTAYAM TALUK, KOTTAYAM DISTRICT - 686 001.
BY ADVS. SRI.DOMSON J.VATTAKUZHY SRI.MATHEW JOHN K
THIS REGULAR FIRST APPEAL HAVING COME UP FOR HEARING ON 24.05.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
RFA No.687 of 2012
2
JUDGMENT
In a suit for return of the advance amount, a decree
was granted in favour of the plaintiff directing repayment of the entire advance amount received which comes to Rs.5,00,000/- with interest thereof, based on Ext.A2 agreement for sale dated 13.01.2009. Aggrieved by the said decree and judgment, the defendants came up in appeal mainly on the reason that there is failure on the part of the trial court to appreciate the damages alleged to have been sustained due to the non-performance of Ext.A2 agreement by the plaintiff and also on the ground that the oral evidence tendered through DW1 and DW2 and Ext.B1 were not appreciated in its correct perspective and that has resulted in miscarriage of justice. There is no much dispute with respect to the due execution of Ext.A2 agreement for sale as early as on 13.01.2009 and also the receipt of an advance amount of Rs.5,00,000/-. Of course, there is a clause incorporated in Ext.A2 that in the event of failure to perform part of contract by the plaintiff,
RFA No.687 of 2012 3
the entire advance amount will be forfeited in accordance
with the law in force. Based on the forfeiture clause, it was submitted that the defendants are entitled to forfeit the entire advance amount received under Ext.A2 agreement for sale. The legal position is very much settled that unless there is pre-quantification or pre-estimate of damages that can be occasioned by the breach of contract or non-performance of the part of contract by the respective parties, the parties will stand governed by the provisions of the Contract Act; viz. Sections 73 and 74 of the Contract Act, for which necessarily there should be evidence to show the actual damages sustained. It is also well settled that even in the absence of evidence to show the actual damages, the court can exercise its jurisdiction to award reasonable amount by way of compensation, when there is breach of contract in performing part of contract by the proposed purchaser, the plaintiff herein. It is true that DW1 and DW2 were examined and Ext.B1 agreement for sale with respect to some other property was brought on record in order to show that the defendants had entered into an earlier contract for sale with his uncle for the
RFA No.687 of 2012 4
purchase of some other landed property. Altogether, an amount of Rs.7,00,000/- was paid on two occasions by way of advance out of the sale consideration. It was challenged mainly on the reason that Exts.A6 and A7 documents of transfer executed by DW2 Uncle would show that certain portions of property were sold even prior to the execution of Ext.B1 document. According to the plaintiff, the entire property owned by DW2 Uncle was disposed of under Ext.A6 and A7. But, it is contended by the learned counsel for the appellants that only some portions of property held by DW2 Uncle were disposed of under Exts.A6 and A7 documents and what is agreed to be purchased under Ext.B1 comes to
only 5 cents of property. It is true that there is no acceptable evidence to show the damages occasioned by the defendants on account of the breach on the part of the plaintiff. But it is an admitted case that the contract could not be enforced or executed due to the breach on the part of the plaintiff. If that be so, a reasonable compensation can be awarded so as to mitigate the damages.
An amount of Rs.50,000/- (Rupees fifty thousand only) is granted to the appellants taking into account all attending
RFA No.687 of 2012 5
circumstances and the decree of the court below will stand modified, granting a decree for recovery of Rs.4,50,000/(Rupees four lakhs fifty thousand only) with interest at the rate of 6% per annum from the date of suit till the date of realization. As such, the decree and judgment of the trial court will stand modified to that extent. Appeal is allowed in part accordingly. There is no order as to cost of suit and the appeal.
Sd/-
P.SOMARAJAN
JUDGE
DMR/-
3 issues framed by the court
Whether the trial court erred in failing to appreciate damages sustained due to non-performance of the agreement for sale.
Whether oral evidence tendered by the appellants regarding prior contracts was not appreciated correctly.
Whether a reasonable compensation should be awarded considering the breach and unquantifiable damages.
1 provisions across 1 enactments
VARGHESE @ THANKACHAN
SOSAMMA VARGHESE @ LEELAMMA
MINDU KURIAN
P. SOMARAJAN
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
