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Suit No. 178 of 1965

Suit No. 179 of 1965

Suits Nos. 178 and 179 of 1965, decided on 9th April, 1980.

‑‑ Ss. 173, 176, 177 & 178‑‑Pledgee, rights and obligations of General ownership in pledged goods‑Remains vested in pledgor‑ Pledgee--acquires special property /interest in pledged goods to extent of amount of loan advanced, interest thereon, and other expenses incurred according to law but right to sell such goods accrues to pledgee on default in payment of loan amount and service of notice‑Goods being once pledged, pledgee, held, does not become owner or entitled to sell good without any notice-- Pledged share scrips disposed of by defendant without serving notice on pledgee, with whom share not only deposited but Bank transfer forms duly verified also lodged, sale of shares, held, not legal.

Jaswant Rai Maniklal Akhaney v. The State of Bombay A I R 1956 S C 575 and A. M. Burq and another v. Central Exchange Bank Ltd. and others P L D 1966 Lab. 1 ref.

P. N. Krishna Pattar v. Kannambra Nayar Veetil Villa Amma Kutti, Neithlar's son Kunhunni Elaya Nayar and others A I R 1941 Mad. 249 distinguished.

‑‑ S. 78‑Pledge‑Share certificates along with Bank transfer forms duly verified ‑Held, constitute goods capable of being pledged.

Maneckji Pestonji Bharucha and another v. Wadilal Sarabhai Co. A I R 1926 P C 38 ref.

--- Ss. 53 & 89‑Shares of a public limited company‑Held, cannot be equated with bills of exchange.

‑‑.‑ S. 78‑Sale by pledgor of share scrips pledged with Bank --Bank delivering share scrips to purchaser acts as agent of pledgor-- Bank's position as appearing from correspondence and written statement being that of agent, Bank, held, could not urge to have not acted as agent in transaction in question.

Re The Deirdre Samuel The, Trustee v. Isidore Kerman (1945) 2 All E L R 71 not relevant.

‑‑ Ss. 182, 185 & 186‑Agent‑Consideration‑No consideration necessary to create agency‑Authority of agent‑May be express or implied‑Banks having special property/interest in pledged shares, payment against such shares to be received by such Banks not merely as ordinary Bankers but as agents having personal interest in transaction.

‑‑ S. 131‑Protection given by section‑Banks receiving pay order in their own name not as Bankers but agents having personal interest in pay order‑Section 131, held, not applicable to such case.

‑‑‑ S. 188‑Agent‑Authority‑Agent acting in capacity of principal or in capacity of an agent having personal interest in transaction, held, can sue and be sued.

Treatise on The Law of Agency by Fredman, 3rd Edn., pp. 157, 184, para. 1 ; Colonial Bank v. The Exchange Bank of Yarmouth, Nova Scotia (1886) 11 A C 84 ; Cliver v. Governor & Co. of The Bank of England (1902) 1 L R 610 ; Lord Mayor & Sheffield v. Barclay and others 1905 A C 392 ; Kerrison v. Glyn Mills Currie & Co. 81 K B I (465) ; National Westminster Bank Ltd. v. Barclays Bank International Ltd. and another (1974) 3 A E R 834 ; fuller v. Harrison 98 E R 1243 ; Bavins Junr. & Sims. v. London & South Western Bank Ltd. (1900) 1 Q B 270 ; Kleinworst, Sons & Co. v. Dunlop Rubber Co. 97 L T R 263 ; Official Assignee of the High Court of West Pakistan and others v. Lloyds Bank Ltd. P L D 1969 S C 301 and Bowstead on Agency, 14th Edn., p. 390, Art. 123 ref.

J. R. Thomson and others (Trustees) v. Clydesdle Bank Ltd. 1893 A C 282 distinguished.

‑Liabilities of.

‑‑ Ss. 65 & 72‑..Difference between Ss. 65 & '12‑‑Money paid under mistake by plaintiff's agent on supposition of having been getting genuine shares and transfer forms‑Recourse, held, can be taken to S. 72 for recovery of amount.

Girraj Bakhsh v. Kazi Hamidali I L R 1887 All. 340 ; Debi Prasad Agarwala v. Haft Syed Mehdi Hassan and others A I R 1940 Pat. 81 ; B. Raja Mohan Manucha and others v. B. Manzoor Ahmad Khan and others A I R 1937 Oudh 410 ; Province of West Pakistan and another v. Messrs Asghar Ali Muhammad Ali P L D 1968 Kar. 196 ; Thakurain Harnath Kuar v. Thakur Indar Bahadur Singh A I R 1922 P C 403 Mahanth Singh v. U. Ba Yi A I R 1939 P C 110; .Norwich Uniun Fire Insurance Society Ltd. v. W. M. H. Price Ltd. 1934 A C 455 ; Gurney and others v. Worrersley and another (1885) 24 L 1 46 ; Fibrosa Spolka Akcyjna v. Fairbairn Lawson Combe Barbour Ltd. 1943 A C 32 and Comptair D' Achar Et De Vente Dun Boerenbond Beige SJA v. Luis De Ridder k imiteda 1949 A C 293 ref.

‑‑ S. 72‑Suit filed against Bank for refund of money paid to against delivery of pledged share scrips subsequently proved to b4 forged ‑Bank having been acting as agent of pledgor and also: havingonersonal interest in transaction, held, liable to be sued fry, refund of amount of share scrips.

‑‑ S. 72‑Equitable relief‑Plaintiff not getting sale transactions registered with Stock Exchange with a view to avoid "lags" (fee) and not disclosing in his plaint regarding certain badla transactions subsequent to transactions forming basis of suit‑Held, evasion of payment of lags‑Not equated with evasion of public revenue -Non disclosure of "badla" transactions in plaint‑Does not constitute suppression of material particular. suit not being based on badla transaction.

‑‑ S. 173‑.Torts‑Wrongful act ‑May constitute breach of contract as well as a wrongful act under .Law of Torts ‑Person can take action under both laws but cannot recovery amount of damages twice.‑. [Damages].

Ganga Trading Co. v. United Commercial Bank Ltd. A I R 1957 Tri. 37 ; Hedley Byrne & Co. Ltd. v. Neller do Partner Ltd. 1964, L R A C 465 ; Donyghup v. Stevenson 1932 A C 562 ; Grant v. Australian Knitting Mills Ltd. and others 1936 L R A C 85 ; Charlesworth on Negligence, 6th Edn., p. 84, para. 135 and Selengor United Rubber Estates Ltd, v. Cradack and others 1965 L R (Ch. D) 896 ref.

‑‑ Plaintiff neither pleading nor deposing about relationship under which Bank (defendant) owned duty to plaintiff‑Negligence simpliciter, if any on part of defendant, held, could not entitle plaintiff to press Law of Torts into service.

Muhammad Ali Sayeed and Haider Ali Pirzada for Plaintiffs, J. II. P,ahimtoolah, Mansoorul Arfin, Afzal Nabi and K. A. Ghani for Defendants.

Dates of hearing : 20th, 24th, 25th, 26th and 27th February ; 2nd, 3rd and 4th March, 1980.

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