1. This is a suit to recover damages in the sum of Rs. 4,500 for damage done to 37 bags of goat and sheep skins consigned on 17th June, 1927, by a firm of Messrs. B. Syed Sahib and Brothers at Cuddapah for delivery to the plaintiff firm at Trichinopoly. The consignment was sent under a risk note form A. The case for the plaintiff is that when the goods had to be transhipped at Arkonam on the 20th June, 1927, on opening the waggon it was found that the said skins were loaded along with four jars of a certain acid known as formal-de-hyde and as two of these jars had broken, the skins had become wet, that on the 29th June, 1927, the goods reached Trichinopoly, that, though open delivery was insisted on, the Railway Company declined to do so and the goods were taken delivery of and when they were taken to the plaintiff's tannery and the tanning processes were commenced it was found impossible to remove the hair from the skins and the goods had become valueless and therefore the plaintiff is entitled to recover damages. In paragraph 8 of the plaint the ground of attack was alleged thus:
In consequence of the negligence of the servants of the defendant company in loading the bags along with dangerous and offensive chemicals, contrary to the rules and in not taking proper care to prevent leakage of the jars, the plaintiff firm has sustained losses as detailed below.
2. The defence of the Railway Company is stated in paragraphs 7 and 9 of the written statement thus : Paragraph 7:
Paragraph 8 is not admitted and is denied. There was no negligence as alleged on the part of this defendant or its servants. The jar contained only formal-de-hyde which is not classified as a dangerous combustible or inflammable article and there is no rule alleged requiring the same to be carried separately. The suit consignment was carried and dealt with when in custody of this defendant with all the care and caution required under law. Hence this defendant is not liable in the suit.
3. Paragraph 9:
Further, the consignment was booked under conditions, the risk-note form A, executed by the sender and subject to the remark in the railway receipt " liable to dryage and damage" relieves the company from any liability whatsoever.
4. The. learned Subordinate Judge who tried the suit was of opinion that formal-de-hyde comes within the designation of dangerous goods, that the company in violation of their rules loaded the goods in the same vehicle as ordinary goods and that the damage was caused by the jars containing formal-de-hyde having broken, that the Railway Company was not protected by the risk note and that they were guilty of misconduct and tne plaintiff is entitled to get a decree and accordingly gave a decree for a sum of Rs. 3,300. The le'arned District Judge on appeal, also found that the plaintiff's skins were damaged and rendered substantially unfit for the purpose for which they were intended to be put by no other cause than the action of the formal-de-hydc which was spilt in the waggon in which they were being carried by the defendant company, that the solution in the jars contained full strength commercial formal-de-dyde which is really dangerous to the skins, but it is commonly known as an antiseptic and a disinfectant and it does not find a place in the schedule of dangerous goods prepared by the Indian Railway Conference Association, that the servants of the Company are not expected to have expert knowledge, that the Goods Traffic Book not having classed formal-de-hyde as dangerous goods the servants of the Railway Company were not guilty of any negligence and therefore they were not guilty of any misconduct and the defendant company is therefore exempt from liability. On appeal before me Mr. T.V. Ramanatha Ayyar has raised the following contention (i) the risk note form A was intended to be taken only when the goods are consigned at owner's risk, when the Railway Company charge less than the ordinary tariff rate, whereas in this case the company has taken the ordinary rate and though the plaintiffs signed Ex. A it should not exempt the company from liability and the taking of risk note form A itself was illegal and (2) that the Railway Company was guilty of misconduct in having loaded formal-de-hyde along with skins, formal-de-hyde being a dangerous and deadly poison coming within the meaning of dangerous goods according to Rule 34 of the rules issued by the Railway Company. It was contended in answer that the fact that the ordinary rates were charged by the Railway Company does not preclude them from taking risk-note form A and once that note had been executed the Railway Company is exempt from liability under Section 72 of the Indian Railways Act except upon proof of misconduct as indicated in the note, that formal-de-hyde is not dangerous and in any event the servants of the Railway Company were not negligent in the circumstances of this case and there was no misconduct on the part of the railway servants to make the administration liable.
5. In regard to the contention that the railway is not protected by risk-note form A, it is urged that Rule 39 of the Railway rules clearly indicates that the risk-notes are intended to be taken only when the goods are carried at less than the ordinary rates and Rule 39 runs:
Risk notes. In all cases when goods or live-stock are conveyed at the risk of the owner, or on the understanding that the risk accepted by the Railway is limited to-any extent below the full value of the consignment, or the several sums prescribed in the Indian Railways Act IX of 1890, the consignor is required to execute a risk note, prior to acceptance for despatch, on one of the forms given in Appendix D. The forms have been sanctioned for use by the Governor-General in Council in accordance with the provisions of Section 72 of the Indian Railways Act IX of 1890, and can be obtained at any goods booking station.
6. In my opinion the obligation of the Railway Company must be judged in the light of Section 72 of the Act.
7. Section 72 provides that the obligation of the railway administration is that of a bailee under Sections 151 and 152 of the Contract Act and that an agreement to limit that responsibility is void unless it is (a) in writing signed by or on behalf of the person consigning animals or goods and (b) is otherwise in form approved by the Governor-in-council. The section is plain and unambiguous and the Railway Company is protected from the -ordinary responsibility of a bailee if these two conditions above mentioned are satisfied, and it is not disputed that the risk note form A fulfils these two conditions. It is not permissible to import any other qualification or condition when the in language of the statute is plain. No doubt Rule 39 indicates that ordinary risk notes ought to be taken when the goods are consigned at the risk of the owner and the Rule says that the signor is required to execute it. There is nothing to preclude the railway company even when charging ordinary rates to take risk note A with reference to particular class of goods. In fact the risk note form A states that the form is to be used when articles are tendered for carriage which are either already in bad condition or so defectively packed as to be liable to damage, leakage or wastage, in transit. Even when ordinary rates are charged it is open to the railway company to consign it under risk note form A if the goods were of the description mentioned therein. The very risk note form A Ex. II signed by the plaintiff states:
Whereas the consignment of bags of goat and sheep skins is liable to damage....
8. It is contended by Mr. Ramanatha Ayyar there is no question of the bad condition of the goods in this case nor that the goods were defectively packed so that the risk note form A would not obviously apply to a case like this. He contends that so far as wet goat and sheep skins are concerned, under the rules of the Railway Company, no special conditions of packing were required and the only condition required is as stated in the rules issued by the Railway Company as special conditions applicable to certain goods at page 636:
Section 4, only accepted for carriage if they have been stripped of all flesh and are free from any unpleasant smell. If loaded with hides and skins, the mixed consignment is charged at the rates applicable to " Hides and skins", When carried in open wagons they must be protected by tarpaulins provided by senders. Railways do not allow the use of their sheets for such traffic.
9. On the other hand he says that the goods were packed in gunnies. To my mind defective packing does not necessarily mean packing not according to conditions prescribed by the railway. Defective means not perfect. Packing may be defective in the sense that the goods may be liable to damage, leakage or wastage.
10. The next question then arises whether the servants of the Railway Company are guilty of misconduct. It may be noticed that the word "misconduct" in the risk note forms was substituted in 1924 for the words 'wilful neglect, misappropriation, theft etc', and the circumstances under which the form was changed were noticed by Suhrawardy, J., in The Bengal Nagpur Railway Co. v. Moolji Sikka & Co. (1930) I.L.R. 58 Cal. 585 at 591 and 592 The word 'misconduct' has been variously interpreted by the learned Judges of the different High Courts. Three views have been taken.
1. The view taken by Guha, J., in The Madras and Southern Mahratta Railway Co. v. Sundarjee Kalidas (1933) I.L.R. 60 Cal. 996 at 1000:
It may be taken to be well settled now, that misconduct is not necessarily established by proving even culpable negligence. Misconduct is something opposed to accident or negligence. It is the intentional doing of something which the doer knows to be wrong, or which he does recklessly, not caring what the result may be.
This was cited with approval by Madhavan Nair, J., in The S.I. Ry and Co., Ltd. v. Dandhayutham Chettiar (1934) 67 M.L.J. 704. This is also the view taken by the Patna High Court in B.N. Ry. Co. v. Hukum" Chand A.I.R. 1930 Pat. 559 at p. 561 where James, J., says:
I do not consider that there is any necessity for discriminating between the meaning of the term "misconduct" in the new form and the term 'wilful neglect" in the old.... The reasonable view is to hold that the term misconduct means 'wilful neglect' including a fortiori anything more culpable and rendering it unnecessary to complicate the form unduly by mentioning theft, or criminal misappropriation or criminal breach of trust.
2. The view taken in The Bengal Nagpur Railway Co. v. Moolji Sikka & Co. (1930) I.L.R. 58 Cal. 585 at 591 and 592 by Suhrawardy, J., at page 592:
The present risk note, therefore, is wider and more comprehensive in enlarging the liability of the railway than the old form of the English note.... "Misconduct is distinguished from accident and is not far from negligence, not only gross and culpable negligence, and involves that a person misconducts himself when it is wrong conduct on his part in the existing circumstances to do, or to fail or omit to do (as the case may be), a particular thing or to persist in the act, failure or omission or acts with carelessness. The word 'misconduct' as used in the new risk note B is wide enough to include wrongful commission and omission intentional or unintentional - any act which it wrongfully did or which it wrongfully neglected to do, or to put it in another way did what it should not have done and did not do what it should have done.... I am not inclined to accept the view that misconduct only refers to acts of gross or culpable negligence and the term does not ordinarily cover acts of mere negligence. In my judgment, the word "misconduct" denotes any unbusiness-like conduct and includes negligence or want of proper care which a bailee is to take under Section 151, Indian Contract Act. The immunity, which the risk note brings to the railway company is by shifting the burden of proof.
This is the view which Mitter, J., of the same High Court also took in B.N. Ry. Co., Ltd. v. Moolji Sicka & Co. A.I.R. 1929 Cal. 654 and in Secretary of State v. Dhokalmal (1931) 35 C.W.N. 1250 and by another Bench in The Bengal Nagpur Railway Co. Ltd. v. Moolji Sicka & Co. (1931) 54 C.L.J. 314. In a later decision of the Patna High Court, Jamunadas v. E.I. Ry. Co. A.I.R. 1933 Pat. 630 at p. 632 Jwala Prasad, J., observes:
The word used in those risk notes is "misconduct" and not "wilful misconduct.
A mere omission to do what is expected of a person to do constitutes misconduct, whereas if such failure is directed to intentionally cause mischief or loss to any person, then it is called "wilful misconduct":
The railway administration or its servants might not have intended to cause any damage to the plaintiff's consignment and with that object neglected to do their duty, but a mere neglect of duty will charge them with misconduct and will bring the case within the Risk Notes.
Apparently in a way this seems to have been the view of Wallace, J., in M. & S.M. Ry. Co. v. Nallathambi Chetti & Co. (1927) 53 M.L.J. 407 where he says:
Obviously something more has to be shown, namely, that responsible care and caution, was not being used by the company or by their staff, or that the. staff was grossly insufficient for its purpose, so insufficient as to import negligence in the administration, or that as a matter of fact the staff was negligent and was not doing its proper duty.
3. The view taken by Fawcett, Ag. C. J., of the Bombay High Court in M. & S.M. Ry. v. Jumakhram (1928) 52 Bom. 770 is as follows:
In any case, the expression used in the present risk note is "misconduct" which does not ordinarily cover acts of negligence.
Kemp, Ag. C.J., of the same High Court in B.B. & C.I. Ry. v. Rajnagar Spinning Etc., Co. (1929) 54 Bom. 105 observes:
I am not prepared to accept the test of the meaning of the word 'misconduct' as what a reasonable man would have done under the circumstances. I think the word suggests that a railway servant had been guilty of doing something which was inconsistent with the conduct required of him by the rules of the company.
11. One thing is plain. The word 'misconduct' cannot obviously mean the same as 'wilful misconduct', an expression which is used in the English risk note forms in England and on the construction of which cases in England were decided. In my opinion the same interpretation should not be adopted in construing the word 'misconduct' in the risk note form A. In Lewis v. The Great Western Railway Co. (1877) L.R. 3 Q.B.D. 195 the distinction between misconduct and wilful misconduct is noticed.
12. Bramwell, L.J., observes at p. 206:
"Wilful miscondut" means misconduct to which the will is a party, something opposed to accident or negligence; the misconduct, not the conduct, must be wilful.
13. Brett, L.J., at p. 211 observes:
Care must be taken to ascertain that it is not only misconduct but wilful misconduct, and I think that those two terms together import a knowledge of wrong on the part of the person who is supposed to be guilty of the act or omission.
14. Cotton, L.J., observes at p. 213:
I do not think there can be any doubt at all that wilful misconduct is something entirely different from negligence, and far beyond it, whether the negligence be culpable, or gross, or howesoever denominated.
15. In In re City Equitable Fire Insurance Company Ltd. (1925) Ch. D. 407 at pp. 433 and 434. Romer, J., adopts the distinction thus laid down between mis" conduct and wilful misconduct in In Lewis v. The Great Western Railway Co. (1877) 3 Q.B.D. 195 vide also Forder v. Great Western Railway Co. (1905) 2 K.B. 532 In Norris v. Great Central Railway Co. (1915) 114 L.T. 183 where a Railway Company was charged with having allowed certain scenery to be carried in an open waggon, they were held not liable and protected by the risk note. Lush, J., observes:
There was no evidence at all upon his case of any intentional wrong conduct on the part of the servants of the railway company , looking at the case as a whole I think it is a case simply of carelessness--it may be gross, it may be what one may call ordinary carelessness, but the evidence for the plaintiff and evidence for the defendants in my opinion make no case whatever of anything beyond carelessness on the part of the company's servants. It is quite obvious, as I say, that that is not sufficient.
16. His Lordship by the use of the word 'intentional' in interpreting wilful misconduct clearly seems to indicate that misconduct is wrong conduct, and simple carelessness, though it was established in that case, would not come under the term 'wilful misconduct'. Thus it will be seen that the English cases lay stress on the word 'wilful'. From that stand point even culpable negligence or gross negligence would not be misconduct. So the interpretation placed in The Madras and Southern Mahratta Railway Company v. Sundarjee Kalidas (1933) I.L.R. 60 Cal. 996 by Guha, J., which is based on English cases is not sound and should not be adopted in the interpretation of the word 'misconduct' in the risk note A. The word 'misconduct' is a relative term and occurs in various Acts, for example, in the Arbitration Act, Legal Practitioners Act and in a number of other Acts. It has to be construed with reference to the subject-matter and the context wherein the term occurs having regard to the scope of the Act which is being construed. Misconduct literally means wrong conduct or improper conduct. For example, in construing the word 'misconduct' in English Arbitration Act Tindal, C.J., observes in Re Hall and Hinds (1841) 2 M. & G. 847 at 852 : 133 E.R. 987:
...The mistake and act of carelessness is so gross as to amount, though not in a moral point of view, yet in the judicial sense of that term, to misconduct on the part of the arbitrators. Lala culpa or crassa negligentia both by the civil law and our own, approximates to, and in many instances cannot be distinguished from, dolus malus or misconduct.
17. In Moore v. The High Bailiff of Brompton County Court (1893) 69 L.T. 140 a question arose whether a high bailiff of a County Court was guilty of misconduct in having sold in execution of a judgment goods which were found to be implements of the debtor's trade within the meaning of the term as used in the 50th section of the County Courts Act, 1888 and it was held that he was not guilty of misconduct, and in selling the goods he did not do it with a wrongful intention though he might be guilty of error of judgment or negligence. Re Hill(1868) L.R. 3 Q.B. 543 where an attorney acting as a clerk for a firm of attorneys was suspended for misappropriation of moneys received by him as balance of purchase money in completing a sale, it was held that though the misconduct was not strictly committed in his profession, it was misconduct which would prevent him from becoming an attorney and Blackburn, J., said:
It always should be considered whether the particular wrong done is connected with the character of attorney.
18. The word 'misconduct' in the risk note should therefore be construed in relation to the consignor and the responsibility judged accordingly. In my opinion the correct view is that laid down by Suhrawardy, J., and I agree with him that the present risk note is wider and more comprehensive in enlarging the liability of the railway than the old form or the English note and also with the definition of misconduct given by him namely 'misconduct' is distinguished from accident and is not far from negligence, not only gross and culpable negligence, and involves that a person misconducts himself when it is wrong conduct on his part in the existing circumstances to do or to fail to omit to do (as the case may be), a particular thing or to persist in the act, failure or omission or acts with carelessness. Judged by this test it will have to be seen whether in the present case the servants of the Railway Company were guilty of misconduct. The charge levelled is that at Cuddapah the wet skins were loaded in a waggon which contained formal-de-hyde. This again depends upon the fact whether formal-de-hyde comes under the designation of dangerous goods and in so loading the servants of the Railway Company acted negligently in such a manner as to make their act amount to misconduct. The Railway Companyhave published rules in regard to explosives and other dangerous goods which they undertake to carry. Section 47 of the Railways Act provides that the Railway Company is empowered to make general rules for declaring what shall be deemed to be, for the purposes of this act, dangerous or offensive goods, and for regulating the carriage of such goods. Under Section 54 the railway administration may impose conditions not inconsistent with this Act or with any general rule thereunder, with respect to the receiving forwarding or delivering of any animals or goods. Rules have been framed by the Railway Company in regard to the carriage of the explosive and other dangerous goods. Rule 1 says:
No explosives, or other dangerous goods, except those provided for in schedules I and II with conditions of carriage will, under any circumstances, be accepted for conveyance by rail.
19. Rule 4 says:
For the purposes of Section 59 of the Indian Railways Act, 1890, the commodities mentioned in Schedules I and II are hereby declared to be dangerous goods.
20. It may at once be stated that formal-de-hyde is not one of the commodities mentioned in Schedules 1 and II. Rule 36 gives the definition of dangerous goods under which it is stated that dangerous, corrosive and poisonous chemicals also will be dangerous goods. Rule 41 says:
Maximum quantity which may be despatched. There is no restriction as to the maximum quantity of dangerous gotfds other than explosives which may be despatched by goods train, but such goods shall be loaded in covered iron vehicles.
21. Rule 42 says:
Dangerous goods must not be loaded in the same vehicle as ordinary goods.
22. It will thus be seen that formal-de-hyde is not classed under dangerous goods either in Schedule I or Schedule II. If it were classed under dangerous goods special precautions are provided for its carriage namely that it should be conveyed in a covered iron vehicle. It is admitted in this case that formal-de-hyde was despatched from Bombay in an ordinary wagon intended to carry all items of goods and the railway servants at Cuddapah could not ordinarily be expected to know that formal-de-hyde would be dangerous goods, either from the classification contained in the rules published by the Railway Company or from the manner or method of carriage when the said goods arrived at Cuddapah. It is contended that formal-de-hyde of the full percentage is dangerous. But formal-de-hyde is also an antiseptic and a good preservative for hides in a weak solution and improves the tanning. So formal-de-hyde is only relatively dangerous. In fixing the responsibility on the railway servants for misconduct it is well settled the burden of proving misconduct under the risknote is on the consignor. There is nothing on the record to show that the servants at Cuddapah who actually loaded the wet skins in the carriage containing formal-de-hyde must reasonably haye been aware that the formal-de-hyde which was in the waggon was of the full strength and dangerous in the sense that they should not be loaded along with it. Giving the interpretation of the word 'misconduct' as including negligence as indicated by Suhrawardy, J., it cannot be said that the railway servants at Cuddapah who were responsible for the loading of the goods failed to take any care which was expected of them and necessary in the circumstances of this case. Therefore on the evidence of record it cannot be said that the servants of the Railway Company were guilty of misconduct and the defendants are therefore not liable for damages.
23. In the result the second appeal fails and having regard to the circumstances of this case I make each party to bear his or their own costs in this second appeal and the appellant do pay half the costs of the respondent in both tins lower courts.
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