S. A. NUSRAT J -This judgment will dispose of civil appeals No. K-21/72 and K-22/72, both of which have been brought to challenge the judgment of the erstwhile High Court of West Pakistan, Karachi Bench dated 24th May, 1967, passed on a Letters Patent Appeal filed by Haji Mousa Haji Omer against the judgment of a learned Single Judge of the said High Court dated 28-9-1961. The Civil Appeal No. K-21/72 has been filed by Messrs South British Insurance Company Ltd., while the civil appeal No.K-22/72 has been filed by Messrs Ahmad Abdul Ghani.
2. Messrs Haji Moosa Haji Omer entered into a C. I. F. Chittagong contract sometime in March/April, 1951, for the supply of 100 bales of cotton yarn with a foreign company named Messrs Richard & Company. Hong Kong, through a local indentor. They opened a letter of credit with Habib Bank in respect of the contract in favour of the foreign seller. The contract provided that the goods would he received per vessel s. s. Sanbay" from Hong Kong for delivery at the port of Chitt4gong sailing on or about 5th April, 1951. Messrs Haji Moosa Haji Omer then agreed to sell the said consignment of cotton yarn by delivery of the relevant shipping documents comprising of the bill of lading, the Marine Insurance policy issued by the South British insurance Company Ltd., and the invoice of Messrs Richard & Company, Hong Kong, against payment of Rs. 1,32,800. On the conclusion of the contract the importers cleared the shipping documents from the Chartered Bank at Karachi, through Habib Bank and handed them over to the broker who, in turn, made over the same to Messrs Ahmad Abdul Ghani against payment of the contracted price by a cheque drawn in favour of the seller, Messrs Haji Moosa Haji Omer.
3. As nothing was heard about the consignment for about six months, Messrs Ahmad Abdul Ghani by a letter dated 5-10-1951, demanded proof from Messrs Haji Moosa Haji Omer with regard to the goods having been shipped from Hong Kong on pain of institution of legal proceeding for .The recovery of the sum of Rs. 1.32.800 paid on 25-4-1951. The letter was replied by Messrs Haji Moosa Haji Omer on 15-10-1961 (Exh. 27) wherein it was stated by them that they stood discharged after having delivered the relevant documents as the contract was C. I. F. As goods did not arrive at all, Messrs Ahmed Abdul Ghani filed a suit on the original side of the High Court for the recovery of Rs.
1,32,800 with interest at the rate of six percent per annum and Rs. 5,000 for damages for the loss suffered by them, against Messrs Haji Moosa Haji Omer. The plaintiff's case was that either the goods had not been shipped at all, in which. Case, Messrs Haji Moosa Haji Omer were liable to them for return of purchase price of goods or in the alternative if the goods had been shipped, the Insurance Company was responsible for reimbursing them for the value of the goods because of non-delivery of the same. The defence set up by Messrs Hay Moosa Haji Omer was that they had passed on the shipping documents relating to a C. I. F. Contract entered into by them with Messrs Richard and Company, the foreign exporters, in good faith and without notice or knowledge of any defect. They repudiated any liability on the ground that the assignment of the contract had been duly made for consideration. Inter alia, it was also pleaded that the suit was bad for nonjoinder of necessary parties, namely, the Shippers and the Insurers. However, Messrs South British Insurance Company Ltd., were impleaded in the suit as defendant No. 2 at the instance of the plaintiff later.
4. The suit was resisted by the Insurance Company on the ground that the insurance policy was issued in the name of Messrs Richard & Company, who never had in their possession or ownership or control the goods in question and at no time came to have any insurable interest therein. In the alternative, it was pleaded that the goods had either never left the foreign company's where house or if they did so they were not shipped per "s, s. Sanbay" but had been removed by the said Messrs Richard & Company before the vessel sailed, on her voyage. It appears that at one stage it was said that the goods, after having been shipped by "s. s. Sanbay", had been trans-shipped at Singapore to another vessel, which arrived at Chittagang without the goods. This fact was also denied by the Messrs South British Insurance Company Ltd., so that the plaintiff or the local importers were put on proof to show that the goods were actually shipped or were lost due to any casualty.
5. Several issues were framed and oral and documentary evidence was produced by the parties during the trial of the suit. The learned trial Judge held that the subject matter of the suit was a C. I.
F. Contract, that the local purchaser (plaintiff) had been influenced into purchasing the shipping documents on a representation made by the local importers that the goods had been shipped but that it was not possible to conclude from the evidence that the goods had been shipped at all. If, however, the shipment and trans-shipment had taken place, as alleged, then the contract between the parties could not be invalidated on the allegation of a mutual mistake. It was, however, found by the learned judge that the bill of lading was either a forged document or was Broker of in the course of its operation by unwarranted and unauthorised means. He found that it was reasonable to conclude that there was so much "misrepresentation, mechanisation and fraud" in the shipment of the cargo that it will be atrocious to give the benefit of the situation to the shippers or to saddle the insurance company with liability on the basis of the policy issued by them. It was further, held that the mere transfer of shipping documents by the local sellers to the purchaser did not absolve the sellers of the liability arising out of the transaction, when the goods in fact had not been delivered. In consequ--ence of such findings, that suit was decreed for Rs, 1,32,800 against Messrs Haji Moosa Haji Omer and dismissed against the Insurance Company:
6. Messrs Haji Moosa Haji Omer filed Letters Patent Appeal challen--ging the judgment and the decree passed against them as aforesaid. The learned Division Bench of the High Court, upon hearing the appeal, reversed the finding of the trial Court that the bill of lading was either a forged document or that it was broken off in the course of its operation by unwarranted and unauthorised means. It was observed that the delivery of the shipping documents to the buyer was symbolical of the goods purchased, placing the cargo at the buyer's risk and entitling the seller to the payment of the price. In the circumstances, it was held that the local sellers: namely Messrs Haji Moosa Haji Omer lead acted in good faith and, therefore, stood exonerated of any responsibility for the amount of the goods. It was also found that the local seller had made no represen--tation to the local buyer. The bill of lading and other documents were held to be prima facie proof of the shipment having been made. As the Insurance Company had issued a supplementary cover for the alleged transshipment of good at Singapore, this circumstance was held to be sufficient to discharge the onus, which rested on the plaintiff for proving the actual shipment. As there was undoubtedly non-delivery of the goods, it was held that the Insurance Company could not escape the liability, As a result of these findings the learned Letters Patent Bench, in exercise of power under Order XLI, rule 33, C. P. C. Decreed the claim of the plaintiffs against the Insurance Company to .The extent of Rs. 1,20,470/10 being equivalent to the exchange value of -- 12,980.00 which the Insurance Company had undertaken to pay under the Insurance Policy. With such findings the appeal of Messrs Haji Moosa Haji Omer was allowed and the decree passed against them was set aside with costs throughout.
7. Mr. Yousaf Rifi, learned counsel for Messrs South British Insurance Company, the appellant in Civil Appeal No. K-22 of 1972, took us through the original and the appellate's judgment of the High Court and referred to the relevant issues and the evidence in support of the same. In particular, he referred to issues Nos. 6, 7, 8 and 9 concerning the liability of the Insurance Company and the shipment of the goods.
8. The learned Letters Patent Bench although clearly found that there was no direct evidence to show that the goods had been shipped but relying on a letter of the insurer addressed to Messrs Richard and Company, (Exh. K-3) , came to hold that the goods were shipped by "s. s. Sanbay" and were latter transshipped by "s. s. Warora". This letter was in the nature of an endorsement on the policy issued by the insurer and apparently was issued on the basis of representation made by Messrs Richard and Company that the vessel "s. s. Sanbay" was unable to proceed to Chittagong and the goods were transshipped at Singapore per as "s. s. Warora" sailing on 19-8-1951 to Chittagong. The contents of Exh. X 3 were accepted without any evidence in support of the same. In any case, the allegations contained in Exh. X 3 stood. Completely belied by a telegram (Exh. 23) of the Messrs Richard and Company dated 12-11-1951 which they had sent to Messrs Ahmad Abdul Ghani in reply to the latter---s telegram dated 5-11-1951 (Exh. 21), in which, after stating that the goods were not yet received, information was sought from Messrs Richard and Company, as to where the same were. In the said Exh. 23 Messrs Richard and Company, after acknowledging the receipt of Exh. 21, had stated that they were arranging for the, goods and Messrs Ahmad Abdul Ghani were assured that they were responsible for the same. Thus as per said Exh. 23, it was clear that the shippers were still in the process of making arrangement for the goods. This and other exchange of correspondence also goes to show that Messrs Ahmad Abdul Ghani were directly dealing with the shippers being conscious of their obligations and entitlement under the C. I. F.
Contract, without recourse to the sellers, Haji Moosa Haji Omer. Although in the earlier part of the judgment of the learned Letters Paten Bench reference was made to Exh. 21 and 23 but the said documentary evidence was not `considered while placing reliance on Exb. X 3, which [he was discussed in isolation. The findings making the appellant liable, on such evidence, are not supportable.
9. Mr. Yousaf Rafi, for the Insurance Company, further invited our attention to a letter of Messrs Ahmad Abbdul Ghani dated 5-I1-1951 addressed to Messrs Richard and Company (Exh. 30). In this letter Messrs Ahmad Abduf Ghani had admitted that according to the information collected by them the goods had not been shipped at all and had also enquired as to why the goods were not shipped as per "S. S. Sanbay" or Steamer Inchimull or s. s. Warora and further threatened to proceed against the shippers (Messrs Richard and Company) for the recovery of their loss amounting to Rs. 1,60,000. However, admittedly in the suit, which was filed later, the said shippers were not impleaded.
10. Learned counsel for Messrs Ahmad Abdul Ghani was unable to challenge the above documentary evidence nor he was able to support the judgment decreeing the suit against the insurers or any other legal grounds.
11. Coming to the appeal filed by Messrs Ahmad Abdul Ghani, their grievance, as contained in their memo of the appeal is, that the learned appellate Court was not justified in holding that Messrs Haji Moosa Haji Omer were not in any manner liable and as such the suit should have been decreed against both the defendants.
12. The learned Letters Patent Bench dismissed the suit against Messrs Haji Moosa Haji Omer on the legal consideration that the delivery of shipping documents namely: invoice bill of lading and policy of insurance were symbolical of delivery of the goods purchased, placing the same at the buyer's risk and entitling the seller to payment of their price. It was found that all the legal requirements under the C. I. F. Contract having been duly fulfilled by Messrs Haji Moosa Haji Omer, they could not be held responsible for the shipment of the goods or had any hand in their shipment or in the preparation of the various documents was further held that the bill of lading was not a forged document nor there was any iota of evidence to support the finding of the learned Single Judge that Messrs Haji Moosa Haji Omer had made any misrepresentation or played fraud on Messrs Ahmad Abdul Ghani.
13. Learned counsel for the appellant, Messrs Ahmad Abdul Ghani, was unable to point out any fault regarding this part of the judgment of the learned Letters Patent Bench, whereby the suit against Messrs Haji Moosa Haji Omer was dismissed.
14. The upshot of the above discussion is that the civil appeal No. K-21/72 filed by Messrs South British Insurance Company Ltd., is allowed and the impugned judgment dated 24-5-1967, decreeing the suit against the said appellant, is set aside and is maintained in relation to the dismissal of the suit 'against Haji Moosa Haji Omer. The Civil Appeal No. K-22/72 filed by Messrs Ahmad Abdul Ghani fails and is dismissed.
13. The overall result, therefore, will be that the suit of the plaintiff Messrs Ahmad Abdul Ghani will stand dismissed in toto. There will be, however, no order as to costs as the parties nave alternately shared success and loss during the proceedings.