Mr. Ramaswamy of Chennai placed an order with Mr. Shah of Ahmedabad for supply of Urid Dal on 10.11.2006 at a contracted price of Rs.40 per kg. The order was for the supply of 10 tonnes within a
month’s time viz. before 09.12.2006. On 04.12.2006 Mr. Shah wrote a letter to Mr. Ramaswamy stating
that the price of Urid Dal was sky rocketing to Rs.50 Per. Kg. and he would not be able to supply as per
original contract. The price of Urid Dal rose to Rs.53 on 09.12.06 Advise Mr. Ramaswamy citing the legal position.
Answers
Answer:
He cant escape from his liability or obligation..(at the direction of indian contract act, 1872)
Explanation:
He (mr shah) can not escape from his liability..
supervening impossibility which does not make contract void
Means commercial impossibility is not an excuse..
If contract is breached mr. Ramaswami can claim damage as ordinary in case of breach of contract..
Then damage will be present market value less contract amount..
Answer:
INCREASE IN PRICE OF URID DAL DOES NOT AMOUNT TO SUPERVENING IMPOSSIBILITY
NON DELIVERY OF URI DHAL TO MR.RAMSAWAMY RESULTS IN BREACH OF CONTRACT BY MR.SHAH
IF MR.RAMASWAMY REPUDIATES THE CONTRACT ON 04.12.2006 MR.SHAH IS LIABLE TO PAY DAMAGES OF RS.10 (50-40) TO MR RAMASWAMY
IF MR.RAMASWAMY WAITS TILL 09.12.2006 MR.SHAH IS LIABLE TO PAY DAMAGES RS.13(53-40)TO MR.RAMASWAMY.
HOWEVER IF SUPERVENING IMPOSSIBILITY ARISES(BAN OF URI DAL BY GOVT.)
MR.SHAH IS NOT LIABLE TO PAY MR.RAMASWAMY