ZAFFAR HUSSAIN MIRZA, J.-This is the Letters Patent Appeal arising out of judgment dated 21-10-1968 whereby a learned Single Judge of the erst--while High Court of West Pakistan, Karachi decreed the suit filed by the respondent against the appellant for Rs. 2,21,062.95. This suit was filed by the respondent Hasham Isshaq against Karachi Gas Company Limited, the appellant herein, on a foreign judgment, namely, the judgment passed by Her Majesty's Supreme Court of Kenya dated 27-5-1963 in a pending suit between the parties herein. The respondent obtained a decree in the sum of African Shillings 2,80,340.79 which was affirmed on appeal filed by the present appellant by the Court of Appeal for Eastern Africa at Nairobi. The respondent having failed to obtain satisfaction of the decree filed a suit on the Original Side of this Court for a decree on the aforesaid judgment. The appellant invoking the aid of the exceptions contained in section 13 of the Code of Civil Procedure raised several legal pleas at the trial, but before us the main question urged is that the two foreign Courts incorrectly determined and applied the proper law of contract which was applicable in the facts and circumstances of this case and, therefore, the foreign judgments upon which the suit was founded are not conclusive and binding upon the appellant in the Courts of this country.
2. The facts of the case are not very much in, dispute and may be briefly stated. The respondent is admittedly a merchant residing and carrying on business in Kenya. It is common ground that a contract was duly entered into between the parties for the sale by respondent to the appel--lant- Company of 100000 feet of 4" pipe which were located in Mombasa, Kenya at the price of Pakistani Rs. 3 per foot, F. O. B. Mombasa payable in the month following that of delivery. It is also admitted that of delivery. It is also admitted that the appellant-Company by their letter dated 14-5.1956 addressed to the local agent of the respondent cancelled the order for the supply of goods for reasons stated in the letter. The respondent then on 26-9-1956 re-sold the goods by public auction and claimed damages being the difference between the contract price and the amount realised from the auction sale as storage charges for the period the goods were kept ready for delivery.
Before the Kenyan trial Court the appellant challenged the jurisdiction of that Court and further pleaded that the proper law of contract was that of Pakistan and that, by virtue of the provisions of Foreign Exchange Regulations Act, 1947 of Pakistan, the performance of the contract was frustrated After hearing the evidence of the parties the Kenyan trial Court repelled the pleas raised in defence by the appellant holding that it had jurisdiction to entertain the suit and that the contract had not been frustrated. Upon these findings the trial Court at Kenya passed a decree in favour of the respondent as prayed for. As regards the question of proper law of contract applicable to the case the trial Court expressed its conclusion in the following words; "In the instant case, and I have come to the conclusion not without difficulty, I find that from the indicia of the documents, cables and correspondence, in particular those documents, etc. Uptill the rime of cancellation the proper law to be applied was the law of Kenya. Under that law, as I hold, there was a clear breach of a concluded contract by the defendants and the defence of frustration is not available to the defendants."
The appellant appealed before the Court of Appeal at Nairobi which was dismissed. It may be stated that before the Court of. Appeal at Nairobi the appellant expressly raised the question of jurisdiction of the Courts at Kenya to entertain and try the suit filed by the respondent and also that the trial Court had erred in rejecting the plea of frustration of contract based on the law of Pakistan.
The Court of Appeal on the question as to the proper law of -contract to be applied in this case made the following observations; "I am of the view that it is not necessary for the determination of this case to decide what is the proper law of the whole contract as it appears to me that the parties intended that, in so far as the shipment and delivery of the goods were concerned, these were to be carried out in accordance with the law of Kenya, but, in so far as it concerned the importation into Pakistan and the payment of the purchase price, this was to be governed by the law of Pakistan."
On the merits the issues before the Kenyan Court of Appeal between the parties were as to where delivery was to be effected and where was the payment .In Pakistani Rupees to be made. The Court of Appeal, on the first issue held that according to the terms of contract it was clearly stipulated that delivery was to be "F. O. B. Mombasa" and, therefore, notwithstanding the term of contract regarding the rejection of goods in Pakistan, the delivery was to be made on board the ship at Mombasa and the goods thereafter were to be at the buyer's risk. However, on the question of place of payment the Court of Appeal did not agree with the finding recorded by the Kenyan Trial Court and held that the payment was to be made in Pakistani Rupees during the month following that in which the goods were delivered, for the reason that since the payment was to be made in Pakistani Rupees the inference would be that the payment was to be effected in Pakistan where Pakistani Rupee is the legal tender. The Court of Appeal further proceeded to examine the plea of frustration of contract on the admitted position that the contract would be frustrated if the defendant could not obtain an import permit or permission to pay purchase money to a non- resident of Pakistan provided that the appellant had taken all reasonable steps to obtain permit or permission to pay and had been unable to do so. In this connection the Court examined the provisions of the Foreign Exchange Regulation Act, 1947 as in force in Pakistan. The Court held (page 133 of the paper-book) that the provisions of sub--section (2) of section 21 of the Foreign Exchange Regulation Act would apply and that it was an implied term of the contract in question that the payment should not be made except with the permission of the Central Government or the State Bank. 1 he conclusion was, therefore, reached by the Court that the appellant had to obtain an import permit or licence and a permission to pay the purchase price to the respondent, a non-- resident of Pakistan. Out of the aforesaid two requirements, the first one was a direct term of the contract and the second an implied term. On the aforesaid premises the Court then examined the evidence on record and after a thorough assessment thereof came to its conclusion in the following words:- "In my view, the defendant has not, on the evidence, established that he took all reasonable and necessary steps to obtain the import licence or permit or to obtain permission for payment to the plaintiff of the purchase price and the learned trial Judge was fully justified and correct in his finding that the defence of frustration had not been established."
3. Now the effect of section 13 of the Code of Civil Procedure is that a foreign judgment is conclusive as to matters directly adjudicated upon between the parties except in the cases specified in clauses (a) to (f) there--of We agree with the view of the Indian Supreme Court in the case of Viswanathan v. Abdul Wajid AIR1963SC1, and held that in considering whether a judgment of a foreign Court is conclusive, the Courts in Pakistan will not enquire whether conclusions recorded thereby are supported by the evidence, or are otherwise correct, because the binding character of the judgment may be displaced only by establishing that the case falls within one or more of the six clauses of section 13, and not otherwise. Before the learned Single Judge the conclusiveness of the foreign judgment was impeached on the basis of clauses (c) and (f) of section 13. The learned Single Judge agreed with the conclusions of the foreign Courts that the contract in question was governed by the law of Kenya with whose legal system, according to the learned Judge, "it had the closest and most substantial connexion". In his opinion, therefore, no exception could be taken to the foreign judgment, which appeared to have correctly decided the question of the choice of the proper law of contract on a correct view of the Principles of International Law. On the plea of frustration of contract the learned Single Judge after considering sections 5 and 21 of the Foreign Exchange Regula--tions Act, 1947 came to the conclusion that the contract did not in any way contravene these provisions and was, therefore, not illegal. He also agreed with the conclusions arrived at by the foreign Courts that the contract was not frustrated and that the appellant had committed breach of contract by not making any attempt to obtain an import permit from the Import./Export Authority, but instead approached the State Bank of Pakistan and that also for the first time on 5-7-1956 after repudiating the contract.
4. It will be proper to set out the relevant part of section 13 on which reliance is placed on behalf of the appellant which reads as under :-- "13. A foreign judgment shall be conclusive as to any matter thereby directly jadjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title except-
(c) where it appears on the face of the proceedings to be founded on an incorrect view of international law or a refusal to recognize the law of Pakistan in cases in which such law is applicable;
(f) where it sustains a claim founded on a breach of any law in force in Pakistan."
Before us it was urged on behalf of the appellant that the foreign Courts and the learned Single Judge have incorrectly applied the proper law of contract in this case in accordance with the principles of international law and,. Therefore, on their face the foreign judgments are founded on an incorrect view of international law. The argument was that in the facts and circumstances of this case the proper law of contract applicable was the law of Pakistan and not of Kenya. The first question that arises for consideration, is, therefore, as to what is the proper law of contract applicable in this case? Now admittedly the parties did not at the time of making the contract expressly select the law by which it is to be governed. It is well settled that where there is no express choice of the proper law, it is open to the Court to determine whether there is any implied or inferred choice. Of law in the parties' contract, a clear example of such a case as pointed out by Cheshire and North on Private Interna--tional Law (10th Edition) is that where the parties agree that any disputes shall be submitted to the Court of or Arbitration in, a particular country. But where there is no choice of proper law by the aforesaid two tests attributable to the intention of the parties what is the course open to the Court? In Cheshire and North's Private International Law (10th Edition) at page 207 the Authors stated the modern criterion in such cases as follows :- "All doubts as to the correct approach to the matters were, however, virtually dispelled by the decision of the Court of Appeal in The Assunziane (1954) 1 All E R 278, where, despite certain references to the criterion of the presumed intention, the more realistic and objective test of the reasonable man was clearly adopted."
After citing the observation of Singleton, . L. J. The Authors proceeded to observe . "In other words, where it has not been expressly chosen, the proper. . Law depends upon localization of the contract. The Court imputes to the parties an intention to stand by the legal system which, having regard to the incidence of the connecting factors and of the circumstances generally, the contract appears most properly to belong. In short, the proper law, as Westlake stressed, is `the system of law by reference to which the contract was made or that with which the transaction has the closest and roost real connexion'. Any reference to the parties' intention is little more than a legal fiction. Indeed Lord Denning, M. R. Has said that the determination of such a system of law `is not dependent on the intention of the parties. They never thought about it. They had no intention upon it. We have to study every circumstance connected with the contract and come to a conclusion."
This then is the view of the Private International Law which guides the Court in the choice of proper law. Indeed this is the passage on which reliance was placed by the learned counsel for the appellant as the correct view of the law to determine the question raised. This is also the basis on which, on a proper analysis of the foreign judgment in this case, the decision was founded by the foreign Court. No exception can, therefore, be taken to the view of the learned Single Judge that the foreign Court proceeded on a correct view of the International Law.
5. It was faintly contended that the Kenyan Appeal Court in holding that the contract was governed so far as shipment and delivery of goods were concerned by the law of Kenya, but as to the import of the goods, in Pakistan and the payment of the price it was to be governed by law of Pakistan, had taken a perverse view of the international law, for, no contract could be intended to be governed by two systems of law. We find no force in this submission and consider it best to refer to the observation in the book on the Private International Law already referred to at page 195 "The `proper law of the contract' is a convenient and succinct expres--sion to describe the law that governs many of the matters affecting a contract. It has been defined as that law which the.
English or other Court is to apply in determining the obligations under the contract'. However, ascertained, and this as we shall see has been the subject of controversy, it consists of a single system, but it is essential to appreciate at the outset that not all the matters affecting a contract are necessarily governed by one law. The correct enquiry is not-what law governs a contract? It is- what law governs the particular question raised in the instant proceedings? `The fact that one aspect of the contract is to be governed by the law of one country does not necessarily mean that that law is to be proper law of the contract as a whole'. Not only may the parties agree that different contractual issues should be governed by different laws, but even where there is no such agreement the circumstances may some--times require different questions to be submitted to different laws. The questions, for instance, whether agreement has been reached, whether the parties possess capacity, whether the contract is formally valid or what interpretation is to be put upon a particular clause in the contract do not necessarily fall to be governed by the same law.
Nevertheless, the Court will not repel and without good reason split a contract in this respect, and it can be said that in all cases there is a primary system of law, called `the proper law of the contract', which usually governs the most matters affecting the formation and substance of the obligations."
The question for adjudication in the present case undoubtedly was whether the repudiation of the contract by the appellant was justified on the basis of the provisions of the Foreign Exchange Regulations Act and whether the contract was frustrated thereby. The foreign Court as has been show above, had applied the law of Pakistan in determining this question and, therefore, acted in consonance with the international law so far as the question of import permit and the restrictions imposed by the Foreign Exchange Regulations Act, 1947 are concerned. Since the judgment apparently is founded on this basis, in our opinion, no exception can be taken t it in terms of clause
(c) of section 13 of the Code of Civil Procedure, for, clearly the foreign Court did not refuse to recognize the law of Pakistan as t the relevant matter, namely, the securing of import permit and the making of payment under the contract with the prior permission of the Central Government or the State Bank. We agree with the learned Single Judge that nothing in section 21 of the Foreign Exchange. Regulations Act rendered the contract illegal and unenforceable at the relevant time.
6. It was next urged that the principles enunciated above for the deter--mination of the proper law of contract were not correctly applied in this case. In this connection following circumstances were pointed out which according to the argument show that the transaction had the closest and most real connection with the law of Pakistan :--
(i) The proposal and acceptance preceding the formation of the contract were both made at Karachi.
(ii) The payment under the contract was to be made in Pakistani Rupees. . (iii) Right of rejection of goods reserved to the buyers which apparently was exercisable at Karachi.
(iv) The contracting parties at initial stage of the negotiation were both at Karachi.
(v) Respondent has a place of business and a local agent at Karachi.
(vi) Purchase Order prepared and executed in Karachi.
(vii) Confirmation of the Purchase Order having been received by the seller came from Nairobi to Karachi.
(viii) Nothing was clearly stipulated in the terms of contract regarding payment of freight but overall provision in the contract for payment of price in Pakistani currency.
(ix) Termination of contract at Karachi.
It was argued that the only nexus of the contract with Kenyan law was that the goods were located in , that country, but since the goods had to be delivered with a challan and an invoice, the intention to be inferred was that the delivery was to be effected at Karachi. It was also urged that "F.
O. B. Mombasa" was mentioned only for the purpose of arriving at the proper .Price to be payable.
As we have already indicated, this Court cannot sit in appeal over the findings and conclusions of fact recorded by the foreign Court . Or whether such findings are supported b evidence or not.
These matters are, conclusive and cannot be re-opened in these proceedings. As already pointed out, it -has been found by the foreign Court that the delivery . Under the contract in question was to -b effected at Mombasa. This being a quest)on of fact or at any rate is question of the interpretation of the contract upon the evidence. We are clearly of the opinion that these matters cannot-bere-opened in terms of section 13 of the Code of Civil Procedure. Be that as it may, as pointed out earlier, the only issue between the parties before the foreign Courts was whether the appellant fulfilled his undertaking by making necessary application for an import permit and obtaining other necessary permissions for paym ent of the price in .Pakistani currency to a non- resident. This question has been examined by the foreign Courts as found by the learned Single Judge properly after taking into consideration the provisions of the Foreign Exchange Regulations Act, 1947. The finding of the Foreign Courts is that the appellant did not do everything in his power to obtain an import permit and in fact he did not at all apply for such permit to the relevant Authorities. The evidence produced by the appellant as regards the permission from the State Bank was also duly considered by the Courts at Kenya and a finding recorded against the appellant. The judgments are, therefore, conclusive and binding on the appellant.
7. In the result, this appeal fails and is accordingly dismissed with costs.