Das, J.:— This second appeal arises out of a suit for damages for breach of warranty in respect of a motor car sold to the Plaintiff. The facts are shortly as follows:—
The Plaintiff is a practising pleader at Jalpaiguri. The Appellant Company which is Defendant No. 1 in the suit is a dealer in motor cars including Plymouth Motor Cars. One Sushil Kumar Poddar, Defendant No. 2, is said to be the local agent at Jalpaiguri of Defendant No. 1. Understanding that the Plaintiff was thinking of buying a new motor car, one Mr. Brookes, a representative qf Defendant No. 1, along with Defendant No. 2, called on the Plaintiff in the beginning of the year 1937. At that interview a brochure of new Plymouth Cars of 1937 model was made over by Brookes to the Plaintiff, and it is alleged that Brookes and Defendant No. 2 also represented to the Plaintiff that Plymouth Cars were excellent cars and would give trouble-free service for several years and would run several thousands of miles without any trouble. Brookes left saying that the Defendant No. 2 would again call on the Plaintiff. Defendant No. 2 called on the Plaintiff several times, and eventually in the beginning of April, 1937, the Plaintiff verbally placed an order with Defendant No. 2 as the local agent of Defendant No. 1 for the supply of a new Plymouth Car of 1937 model, and left the choice of the car to Defendant No. 1. The Defendant No. 2 came to Calcutta and placed the Plaintiffs order before Mr. Nicholls of Defendant No. 1 and asked the latter to arrange for delivering of a new Plymouth Car to the Plaintiff. As according to the rule and practice of Defendant No. 1 no car could leave the workshop without a formal contract being first executed, Defendant No. 2 signed the formal contract in his own name as if he was buying the car. The car was then despatched to Jalpaiguri by rail and was eventually delivered to the Plaintiff against payment on the 20th April, 1937. The car was registered at Jalpaiguri on the same day. The Plaintiff used the car from the 21st April, 1937, to the 15th August, 1937, when it broke down in the following circumstances. On the morning of the 15th August, 1937, the car was driven by the Plaintiff's chauffeur from the Plaintiff's house to the District Board Office for being washed and cleaned. After cleaning the car the chauffeur started the engine, and after the car had run a few cubits towards the Plaintiff's house, there was a loud noise in the engine. The chauffeur at once put off the ignition, and getting down from the car lifted the bonnet, but could not detect any defect. He then tried to start the engine again but could not do so. He then went to the office of Defendant No. 2 and brought the latter's mechanic with him. This mechanic could not detect any defect then. The car was then towed back to the Plaintiff's house. In the afternoon the mechanic called again and opened the engine case and found several broken parts. The Plaintiff promptly reported the matter to Defendant No. 1. The Defendant No. 1 instructed Defendant No. 2 to dismantle the engine and send the same to Calcutta. The Defendant No. 2 took charge of the car and examined the engine and sent a report to Defendant No. 1. Then Defendant No. 2 dismantled the engine and sent ir to Calcutta. The Defendant No. 1 took up the matter with Messrs. Chrysler Corporation, the manufacturers, and forwarded to them a report of the defects found by it on examination. The Defendant No. 1 informed the Plaintiff that the practice was for the customer to pay the cost of repairs in the first instance, and then to get a refund of the allowances made by the manufacturers. The Defendant No. 1 submitted an estimate for repairs amounting to Rs. 600. The Plaintiff declined to pay any cost of repair and insisted on a new car or at least a new engine unit being supplied. The Defendant No. 1 declined to do either. In November, 1937, while the Plaintiff was away from Jalpaiguri, the Defendant No. 1 replaced the broken parts and had the engine fitted up by Defendant No. 2. The car was then delivered to the Plaintiff who took it under protest, as Defendant No. 2 declined to remain in charge of the car any longer. The present suit was then filed by the Plaintiff against the Appellant Company and its local agent, claiming Rs. 1,500 as damages. The Defendant No. 2 in his written statement stated that he was only the agent of Defendant No. 1 and that the Plaintiff had no cause of action against him. Otherwise on facts he supported the Plaintiff's case.
2. The Defendant No. 1 in its written statement denied, amongst other things, that there was any contract between the Plaintiff and itself, or that it made any representation, or that the breakdown was due to any defect in the manufacture or fitting of the parts. Its case was that it sold the car to Defendant No. 2 who in his turn sold it to the Plaintiff. It suggested that the breakdown was due to mishandling of the car by the Plaintiff or his chauffeur. It submitted that in any event it had no means of discovering the alleged defects, and that the Plaintiff's cause of action, if any, was against the manufacturers and that the suit was bad for non-joinder of the manufacturers as a party. It also stated that the Plaintiff was bound by the manufacturers' limited warranty.
3. The trial Court found that in fact the Defendant No. 1 through its agent the Defendant No. 2 sold the car to the Plaintiff, that representations as to the excellence of the car and its trouble-free service for thousands of miles were in fact made by the representatives of the Defendant No. 1, that the defect was due to bad workmanship and fitting of the car, that there had been no mishandling of the car by the Plaintiff, that the Plaintiff had left the choice of the car to the Defendant No. 1 and did not examine the car, and even if he did, could not possibly have discovered the defects which were latent defects, and that the car was not in fact fit for the purpose for which it had been purchased and was not of a merchantable quality. The trial Court also found that the manufacturers' limited guarantee had never been shown or given to the Plaintiff. The learned Munsif commented adversely on the change of case as to the nature and cause of the break-down made at the trial by the Defendant No. 1. In the result the trial Court dismissed the suit against Defendant No. 2, and decreed the same in part against Defendant No. 1 and awarded damages which it assessed at Rs. 1,000.
4. The Defendant No. 1 appealed. The learned Subordinate Judge concurred in all the findings of fact by the trial Court and dismissed the appeal. The present second appeal is by Defendant No. 1 from the decision of the lower Appellate Court.
5. Dr. Pal, appearing in support of the appeal, first contended that the Appellant was equally ignorant of the defects and should not be penalised for the break-down for which it was not responsible. He relied on the case of M. Alister (or Donoghue) v. Stevenson(1) and submitted that the Plaintiff's cause of action, in the circumstances was really against the manufacturers'. Apart from the question whether the principle of liability of the manufacturer of an article of food, medicine or the like to the ultimate consumer to take care that the article is free from defects as are likely to cause injury to health which is established by this case, applies to the manufacturer of a motor car, it is clear on the authority of the House of Lords in Grant v. Australian Knitting Mills, Ltd.(2) that the consumer who suffers damage has two independent causes of action, one in tort against the manufacturer and the other on contract against his seller. It is, therefore, not correct to say that the only cause of action of the Plaintiff in this case is against the manufacturers.
6. Dr. Pal's next contention was based upon the provisions of sec. 16 of the Indian Sale of Goods Act. In view of the codification of the law in that Act, it is unnecessary for us to discuss the common law principle of caveat emptor and the qualifications engrafted thereon subsequently. The scheme of sec. 16 is to lay down the general principle and then to prescribe the exceptions thereto. The general rule as laid down in that section is a statement of the common law principle of caveat emptor, i.e to say, that there is no implied warranty or condition as to the quality or fitness for any particular purpose of goods supplied under a contract of sale. There are four exceptions to this rule, which are enunciated in the four clauses that follow. Conceivably this case might have come within the first exception, but for the fact that the car may be said to have been sold under a patent or trade name so as to attract the proviso to the first exception. The Plaintiff, therefore, sought to bring his case within the second exception mentioned in sec. 16, on the authority of the following observations of Farwell, L.J, in Bristol Tramways Co. v. Fiat Motors(3):— It is one thing to order an article known as a ‘Fiat Omnibus,’ an order which is intelligible only if there be such an article known to the public or the trade; it is quite another thing to order an omnibus to be made by the Fiat Company, although in the latter case that Company might adopt patterns and devices which were in its own exclusive property; the former is within the proviso, the latter is not. An omnibus made by the Fiat Company may well be described as a Fiat Omnibus, but such nomenclature does not necessarily constitute a trade name within the Act. If it did, a manufacturer could always get the benefit of the proviso by labelling all the goods made by him with his own name. Dr. Pal appeared to concede that it had been held in that case that the implied condition specified in the second exception applied to all goods Bought from a seller who dealt in goods of that description, whether they were sold under a patent or trade name or otherwise, and the proviso to the first sub-section did not apply to the second exception. We did not understand Dr. Pal to contend that a contract for sale of goods under a patent or trade name could not at the same time be said to have been a sale by description, so as to fall within the second exception. He did not argue that in this case the sale of the Plymouth car was solely a sale under a patent or trade name, and not a sale by description at all. We are, therefore, not called upon to express any opinion as to whether a contract of sale which does not fall within the first exception by reason of its being a sale of goods under a patent or trade name within the meaning of the proviso to that exception, may or may not fall within the second exception as a contract for sale of goods by description and imply the condition of merchantability. On the footing, therefore, that the present case is one of a sale by description, it cannot be disputed that it is a sale by a seller who deals in goods of that description, and that being so, it must follow that there is an implied condition in the contract of sale that the goods shall be of merchantable quality. The expression “merchantable quality” has not been defined in the Act nor has any exhaustive definition been laid down in any judicial decision. The definition given by Farwell, L.J, in The Bristol Tramways Co.'s case does not perhaps fully cover the case of latent defects. When a latent defect is discovered subsequently, it must be regarded as being in existence ab initio. If the defect be such as, if known at the time of sale, will make the article unmerchantable, then it must be accepted that the article Was unmerchantable ab initio. The matter may be viewed from another aspect also. The merchantable quality implied by the second exception may be regarded as part of the description of the article sold. When an article is sold by description, it may be regarded as a sale of an article of that description, which is free from any latent defect which, if known at the time, will make it unmerchantable. When, in such a case, a latent defect of that kind is discovered, it may be said that such an article with such a defect was not the article contracted for, and that the case falls within sec. 15. In this case both the Courts have found as a fact, that the particular car delivered to the Plaintiff was not what a Plymouth car of average quality may foe expected to be, and that the defect due to bad workmanship and faulty parts was a latent defect, arid that the Plaintiff did not examine the car, and could not have discovered the defect, even if he did, and that the defect made the car unmerchantable. The Appellant is bound by these findings of fact. In the premises it is clear that there has been a breach of the implied Condition of merchantability under the second exception of sec. 16, or of the implied condition of conformity with description under sec. 15, and in either case the Plaintiff can under sec. 13 treat such a breach as a breach of warranty and claim damages.
7. Dr. Pal then argued that on a breach of an implied condition the aggrieved party could repudiate the contract of sale and return the goods and claim a refund of the price, but he could not treat the breach of the implied condition as a mere breach of warranty and keep the goods and claim damages.
8. He contended that sec. 13 of the Indian Sale of Goods Act should be limited to a breach of an express condition and should not extehd to a breach of an implied condition. No authority has been brought to our notice in support of this contention, arid we see no reason to make any distinction between an express and an implied condition. To do so will necessarily involve adding the word “express” before the word “condition” in sec. 13 which is certainly not open to us to do.
9. No question has been raised as to the reasonableness of the quantum of damages awarded to the Plaintiff, and nothing need be said about it.
10. The result, therefore, is that we dismiss the appeal and confirm the decrees of the Courts below. The Plaintiff-Respondent will get the costs of this appeal.
Biswas, J.:— I agree.