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Section 3 in The Indian Contract Act, 1872
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Gujarat High Court
S. Manuel Raj And Co. vs J. Manilal And Co. on 29 August, 1962
Equivalent citations: AIR 1963 Guj 148, (1963) GLR 540
Author: V Raju
Bench: V Raju

ORDER V.B. Raju, J.

1. This revision application is filed by the original defendants. The plaintiffs placed an order on a printed form of the defendants on which it was printed in bold types "Subject to Madras Jurisdiction". An order form was signed by the plaintiffs and sent to the defendants. The learned Judge of the Court of Small Causes, Ahmedabad, rejected the contention of the defendants that only the Madras Court had jurisdiction, and decreed the suit. Therefore the original defendants have now come to this Court in revision. The main contention urged by them is that only the Madras Court has jurisdiction in view of the fact that the order form signed by the plaintiffs contains in bold types "subject to Madras jurisdiction" and it is also underlined in print. This contention must be accepted because when the order form signed by the plaintiff contains in bold types the words "subject to Madras Jurisdiction", it must be taken that the plaintiffs agreed to the term that only the Madras Court must have jurisdiction.

2. The learned counsel for the opponents contends that the words "subject to Madras jurisdiction" do not mean that Madras Court alone lias jurisdiction. He also contends that the finding that the Ahmedabad Court has jurisdiction is a finding of fact and cannot be interfered with in revision. He relies on Amritsar Transport Co. Ltd. v. S. Sohanlal, AIR 1957 I. and K. 7. Patel Bros, v. Vadilal Kashidas Ltd., AIR 1959 Mad 227, and on Section 3 of the Indian Contract Act. In AIR 1957 J. and K. 7, there was a receipt, which was signed by one of the parties, and the party who signed the receipt relied on the receipt to show that only the Courts of a particular place had jurisdiction. But the receipt which was relied on by him was not signed by the opposite party, but had been merely given to the opposite party. Therefore, that case does not apply to the facts of the present case. In the Madras case, which is strongly relied on by the learned counsel for the opponents, it was held that the words "subject to Bombay jurisdiction" printed on a document which evidenced the contract did not exclude the jurisdiction of any other Court and that ouster of jurisdiction of a Court to which a person is entitled to resort to under the C. P. Code or any other statute cannot be a matter of assumption or presumption but one to be proved by express words contained in the contract or at least by necessary or inevitable implication. The learned Judge there held that mere printing of the words "subject to Bombay jurisdiction" on the document which evidenced the contract cannot amount to a contract that both the parties agreed to have Bombay as the venue. for the settlement of disputes. The question whether parties to contract can select one of the two Courts having jurisdiction has not been argued.

3. When one of the parties to a contract signs a printed form printed by the other party containing the words "subject to the jurisdiction of a place Q" and sends the order form to the other party it must be assumed that that party agreed that Q is the place for the settlement of disputes. It is not open to a person who signs an order form of the opposite party containing the printed words to say that the printed words are not part of the contract. To take the view taken by the learned Judge of the Madras High Court would be to upset the commercial practice of India, and unless such a position is necessary in view of the wording of any particular section, I am not prepared to take that view. I am not prepared to upset the commercial practice of India unless the law requires me to do so. There is nothing in the law to hold that the expression "subject to jurisdiction of Q" printed at the top of a form may not bind M who signed the order form.

4. The learned counsel for the opponent has relied on Section 3 of the Indian Contract Act, which reads as follows:

"The communication of proposals, the acceptance of proposals, and the revocation of proposals and acceptances, respectively, are deemed to be made by any act or omission of the party proposing, accepting or revoking, by which he intends to communicate such proposal, acceptance or revocation, or which has the effect of communicating it." This section of the Contract Act must be given effect. On this point Mulla has observed as follows:

"English authorities have established that the first point to be considered is whether "the nature of the transaction is such that the person accepting the document may suppose, not unreasonably, that the document contains no terms at all, but is a mere acknowledgment of an agreement not intended to be varied by special terms (per Stephen, J. in Watkins v. Ryrnill. (1883) 10 QBD 178, (at p. 189) In short is the ticket a contract or a mere receipt'?

In Chapelton v. Barry U.C., (1940) 1 KB 532, P took a deck-chair from a pile near a notice reading "Hire of Chairs 2 d. per session of 3 hours." The notice asked hirers to obtain a ticket from D's attendant, and retain it for inspection. P obtained a ticket, pocketed it unread, sat on the chair and was injured when it collapsed. D relied on a pro-Vision on the ticket excluding liability, but the Court of Appeal held for P on the ground that the ticket was not a contractual document.

If the defendant has established that the document was contractual, he must further prove that he did what was reasonably sufficient to give the plaintiff notice of the conditions. This is a question of fact. (In Henderson v. Stevenson, (1875) LR 2 Sc and D. 470, where an endorsement on a steamboat ticket was not referred to on its face, and Richardson, Spence and Co. and Lord Gough S.S. Co. v. Rowntree, (1894) AC 217, where the ticket was folded up so that no writing was visible without opening it, a finding of fact that the passenger knew nothing of any conditions was supported. The correct form of putting the question of fact was laid down by the C.A. in Parker v. South Eastern Rly. Co., (1877) 2 CPD 416. See Madras Railway Co. v. Govinda Rau, ILR 21 Mad 172 (at p. 174), and for a general summary of the law, Hood v. Anchor Line, (1918) AC 837, where both the contract and a notice on the envelope enclosing it pointedly called attention to the conditions. Failure to read is no excuse; Sheik Dawood v. S. I. Ry. Co. Ltd., ILR (1945) Mad 174: (AIR 1944 Mad 444). In an English case, inability to read has been held to be no excuse; Thompson v. L.M. and S. Ry. Co., (1930) 1 KB 41 (Infra). It has been held that there is sufficient notice, if the face of a railway ticket refers to conditions on the back, which are not expressly reproduced, but incorporated by a reference to the time-tables of the railway Company: (1930) 1 KB 41. But the passenger is not bound by a purported exemption from liability, if the ticket is printed in such a way or delivered to him in such a state, as not to give reasonable notice on the face of it that it does embody some special conditions: Sugar v. L. M. and S. Ry. ( (1941) 1 All' ER 172. (Here the words "for conditions see back" were obliterated by the date stamp on the ticket.) In determining these questions the class of persons to whom the special conditions are offered, and the degree of intelligence to be expected of them, may properly be taken into account. (See Lord Ashbourne's remarks in (1894) AC 217 (supra)."

It is the contention of the learned counsel for the opponents that only the part at the bottom of the order form contains the conditions of the contract and not the words printed at the top. This contention is that the words "subject to Madras jurisdiction" are not a part of the contract but the rest of the document contains the terms of the contract. It is not their case that the printed form does not evidence the contract. It is conceded that the contract is contained in the document, namely, the order form. From the English cases cited by Mulla above, it would be clear that the words printed at the top would be a part of the contract and would be binding on the plaintiffs who have signed the order form. This is not a case of a ticket or a receipt taken by the plaintiffs but this is a case of an order placed by the plaintiffs themselves on a form signed by them and whatever is contained in the form would be binding on them in view of the signature on the form. It was easy for the plaintiffs to strike out the words "subject to Madras jurisdiction" before signing it. As they did not do so, these words are binding on the plaintiffs.

5. It is next contended that the words do not mean that the jurisdiction of other Courts is excluded. Under the law of Contract, certain Courts have jurisdiction, and it is with a view to exclude other Courts that the words like "subject to Bombay jurisdiction," "subject to Madras jurisdiction" and so on are written in printed forms. The object of printing such words in the contract is to exclude the jurisdiction of other Courts and to give sole jurisdiction to one Court. With respect, I find it difficult to agree with the View taken by the learned Judge of the Madras High Court, I am not prepared to upset the commercial practice of India.

6. The next contention that this is a finding of fact which cannot be interfered with in revision. The order form is an admitted document and it is admitted that it is signed by the plaintiffs. On these admissions the only inference that can be drawn is that the words "subject to Madras jurisdiction" are a part of the contract. To take any other view of admitted facts is erroneous and on the face of admitted facts such a finding can always be interfered with in revision.

I, therefore, allow this revision application, set aside the decree of the lower Court and the lower Court is directed to return the plaint for presentation to the proper Court The revision application is allowed with costs.