Judgement
This second appeal is brought by the plaintiff in O. C. 100 of 1950 on the file of the District Munsif Court Kakinada against the decree of the Subordinate Judge, Kakinada modifying that of the District Munsif. The appellant brought the suit for recovery of the value of 105 bags of paddy for the year 1949-50. He leased out the land to the defendant under Ex. A-1 on a rental of 105 bags a year. The lease deed inter alia provided that the rent was fixed irrespective of heavy rains or draught, etc. (athivrishti, anavrishti doshamula vagaira) and whether the tenant cultivated the land or not. As the lessee defaulted in payment of rent, the plaintiff was obliged to file the suit.
2. The suit was opposed chiefly on the plea that the defendant was not liable to pay the full rent as owing to unforeseen cyclone in October, 1949 there was damage to the crop on the suit land and it yielded only 60 bags in all.
3. The trial court decreed the suit in full being of the opinion that the expression athivrishti" covered a case of a cyclone also, and the defendant is not entitled to any rebate in the matter. On appeal, the learned Subordinate Judge came to the opposite conclusion. In his opinion the clause in question contained in the lease deed was not comprehensive enough to include a cyclone and that further since this was unforeseen and not provided for, it frustrated the common basis of the contract and hence the tenant could get equitable relief. He also came to the conclusion that the yield from the lands for that year was only 63 1/2 bags and that on equitable considerations the plaintiff should be given a decree only for 42 bags. The aggrieved plaintiff has preferred this appeal.
4. The view of the Subordinate Judge is canvassed before me. It is urged by Mr. Krishna Rao that the lower court erred in thinking that the word "athivrishti" embraced cyclone also, and that since the rent was fixed taking into consideration the vicissitudes of nature it is not open to a tenant to ask for abatement of rent on the occurrence of any of the contingencies envisaged in the lease deed.
The expression "athivrishti" means very heavy rains and a cyclone cannot be excluded from the purview of this term. In this case the damage to the crop is alleged to have been done by the crop having been submerged under water for a few days owing to the overflow of the irrigation canals. No particular damage was done by the gusts of wind.
The damage to the crop is attributed only to heavy rains which resulted in the irrigation canals being flooded with water. The reasoning of the Subordinate Judge therefore seems to be unsound.
5. Assuming the cyclone was an unforeseen contingency it is difficult to bring this case within the doctrine of frustration of a contract. We are not here concerned with the development of this concept in English law and the conflicting theories that are embodied in the decisions of the English, Courts. The law on the subject is codified in S. 56 of the Contract Act which recites;
"An agreement to do an act impossible in itself is void. A contract to do an act which, after the contract is made becomes impossible, or by reason of some event which the promiser could not prevent, unlawful, becomes void when the act becomes impossible or unlawful..................................."
The second paragraph enunciates the law relating to the rescission of a contract by reason of some supervening impossibility or illegality. It should be remembered that this section occurs in the chapter dealing with discharge of contracts. So the doctrine entrenched in this section can come into operation only when the performance of a contract becomes impossible or unlawful by an event that intervened subsequently. The lower court relied on Firm Sarada Prasad De v. Bhut Nath, AIR 1942 Cal 291 (A) and Twentsche overseas, Trading Co. v. Uganda Sugar Factory Ltd. AIR 1945 PC 144 at p. 145 (B) to support its conclusion. These pronouncements are not relevant to the present enquiry since there is no question of the contract being discharged here.
6. As pointed out by their Lordships of the Supreme Court in Satyabrata Ghose v. Mugneeram Bangur and Co., 1954-1 Mad LJ 41 : (AIR 1954 SC 44) (C) the word "impossible has not been used in the sense of physical or literal impossibility. The performance of a contract may not be physically impossible but it might be impracticable or useless having regard to the object and purpose the the parties had in view. So, the section applies when the performance of a contract is beset with practical difficulties. The supervening event should take away the basis of the contract. It should be of such a character as to strike at the root of the contract. It is difficult to bring within the ambit of the rule a case where a contract has been given effect to i.e., where one of the parties to it has performed his part of it, and it remains for the other to fulfil his obligations under the contract.
In such an event the party who had the advantage of the contract cannot be relieved from his liability on the covenants, merely because some event had occurred which had resulted in some loss to him. In this case, there is no scope for the application of the doctrine of frustration, as the lessee had full use of the land, raised the crops and harvested them, his only complaint being, that consequent on the cyclone, his crops were under water for a number of days resulting in damage thereto and ultimately in poor yield. In effect, the claim amounts only to a rebate of the rent.
7. The rule relating to frustration of a contract cannot come into play merely because fulfilling the terms of the contact is burdensome or more expensive to one of the parties. This principle is enunciated in some of the decided cases. In Hari Laxman v. Secretary of State, ILR 52 Bom 142 : (AIR 1928 Bom 61) (D), a suit was brought by the Secretary of State for India in Council against the lessee of the salt pans belonging to Government for recovering the rent and cost of repairs which the latter were bound to make under the agreement.
The defendants sought to escape from their liability for payment of rent and for making repairs, on the defence that there was a strike of local workmen which rendered it impossible to manufacture salt. This defence was not given effect to. It was decided that the defendants could not be excused from paying the rent and carrying out the repairs on account of the alleged strike of workmen as they could employ workmen on payment of higher wages and that the contract did not become impossible of performance.
8. The rule stated in Sankaran v. District Board of Malabar, 66 Mad LJ 108 : (AIR 1934 Mad 85) (E), also accords with this view. The proposition that the concept embodied in S. 56 of the Contract Act is inapplicable to a case where the contract has not ceased to be executable and the parties stuck to it throughout the relevant period finds support in this pronouncement. The position is stated thus by Denning, L. J. in Davis Contractors v. Pareham Urban District Council, 1955-1 QB 302 at p. 308 (F).
"This case then becomes simply one where, without the fault of either party, there has been an unexpected turn of events which renders the contract more onerous than the parties had contemplated. This is no ground for relieving the party of the obligation he has undertaken."
9. It is also apparent from the speech of the Lord Justice that the sanctity of the contract should be respected. In these circumstances, there is no scope for applying the principle of frustration of contracts, as what is asked for is not dispensing with the contract but a reduction of the rent.
10. This takes me to the point whether the tenant could have the benefit of S. 108 of the Transfer of Property Act. The learned Subordinate Judge thought that Subrahmahia Pathan v. Kattambath Rama, ILR 43 Mad 132 : (AIR 1920 Mad 584) (G) and Raman Nambiar v. Kannan Nambiar, 71 Mad LJ 352 : (AIR 1936 Mad 664) (H), support the view that equitable relief could be granted on the basis of the section. S. 108 (e) provides that :
"If, by fire, tempest or flood, or violence of any army or of a mob or other irresistible force, any material part of the property be wholly destroyed or rendered substantially and permanently unfit for the purposes for which it was let, the lease shall, at the option of the lessee, be void.
In ILR 43 Mad 132 : (AIR 1920 Mad 584) (G), a portion of the demised property became unfit for paddy cultivation because it was inundated by sea water. The point that arose there was whether the tenant could claim proportionate abatement because of this inundation. Justice Seshagiri Ayyar and Justice Burn expressed the opinion that notwithstanding inundation was not one of the instances enumerated in that clause, still since S. 108 was not exhaustive of the right of the tenant the claim for abatement was available to him.
They further held that though the section was not applicable to agricultural leases the principle underlying it would apply to them. It is apparent that the basis of that ruling was that a substantial part of the property was rendered unfit for the purpose for which it was let. It is the same principle that was followed by the Travancore High Court in Thomman Joseph v. Souriyer Thommah, 1945 Mad WN (Sup) 104 (I) which has been greatly relied on by Mr. Purnayya for the respondents. It does not take the matter any further.
The learned Judges have reiterated the statement of law contained in ILR 43 Mad 132 : (AIR 1920 Mad 584) (G). Nor does 71 Mad LJ 352 : (AIR 1936 Mad 664) (H) render any assistance to the tenant. Justice Venkatasubbarao who decided the case held that the word in S. 108-B (e) need not be restricted to flooding by sea water. To extend the principle as a rule of justice and equity, it should be established that the material part of the property was wholly destroyed or permanently made unfit for the purpose for which it was let.
So, to enable the tenant to ask for relief on the analogy of S. 108 of the Transfer of Property Act he should establish that a material part of the property has been substantially rendered unfit for the purpose of cultivation. In this case he has failed to do so. The only effect of the heavy rains was to damage the crop considerably and that he had not the benefit of the full yield. Therefore, this case falls outside the principle underlying that section and hence no equitable relief could be granted to him. It follows that he has to pay the rent provided for in the lease deed.
11. In the result a decree will be given in terms of the suit and the judgment of the lower appellate court is set aside and that of the trial court restored except with regard to costs. The parties will bear their costs throughout.
Appeal allowed.