Andhra HC (Pre-Telangana)
Mir Qudrath Ali Khan (Alias) Nawab ... vs Muzaffar Ali Khan on 30 November, 1992
Equivalent citations: 1994(1)ALT591
JUDGMENT V. Neeladri Rao, J.
1. This appeal and the cross-objections are directed against the Judgment in O.S. No. 291 of 1982 (old O.S. No. 995 of 1980) on the file of the Addl. Chief Judge, City Civil Court, Hyderabad.
2. The facts which give raise to these proceedings are as under: The plaintiff is an Architect. He was engaged by the defendant for construction of Shalimar Cinema Theatre, which was originally named as Pakeezah. Ex.A-1 agreement dated 7-10-1977 was executed by the plaintiff ,and defendant. The material terms of the said agreement are as follows:
"1. We shall render you the complete services for execution of above project namely:
(a) Preparation of complete set of architectual designs/drawings;
(b) structural Engineer's services i.e., designing of R.C.C. and other structural members;
(c) preparation of estimates and tender documents;
(d) calling of tenders and submission of comparative statements;
(e) Co-ordination between you and all contractors/agencies;
(f) supervision and quality check of the construction;
(g) scrutiny and checking of contractors bills;
(h) Assistance and advise in selection of Materials/agencies;
(i) Assistance in preparing project reports and technical feasibility report for your bank;
(j) issue of valuation certificates as and when required by your Bank and other agencies.
2. For all the above our comprehensive services will charge you five per cent (5%) of the total cost of your project as our fee.
3. The fee shall be payable at the following instalments:
(a) Advance, on signing this contract of the project cost .. 1/2% (half percent)
(b) After submission of our final drawings for authorities sanction .. 1/2% (half per cent)
(c) At the time of calling tenders/ commencement of construction .. 1% (One per cent)
(d) At the plinth level of the construction .. 1/2% (Half per cent)
(e) At the time of lintal levels .. 1% (One per cent)
(f) At the time of 1st floor (or balcony) Roof level .. 1% (One per cent)
(g) After completion of the project .. 1/2% (Half per cent) of the balance as per final executed cost.
4. All the earlier instalments would be based on the approximate estimated cost of the project. However, the final instalment of fee would be based on the actual executed cost of the project.
5. ... ... ...
6. You shall not remove us from your this service till the whole project is completed in all respect. For, further alterations/improvements/ developments of the property/project you shall consult us and shall not appoint any other agency.
7. The above term may be amended suitably at any time by mutual consent."
On 13-10-1977 an amount of Rs. 10,000/- was paid to the plaintiff as contemplated under Clause 3 (a) of Ex.A-1. The plaintiff prepared a set of drawings and designs as per Ex.A-2 and submitted the same to the concerned authorities on 20-12-1977. That plan was ultimately approved by the Commissioner of Police, Hyderabad as per Ex.A-3 proceedings. When the defendant did not pay the fee as contemplated under Clause 3 (b) of Ex.A-1 the plaintiff issued notices to the defendant demanding the fee. The latter did not pay the same to the plaintiff. When the defendant was proceeding with the construction of the cinema theatre, without payment of the fee of the plaintiff the latter filed O.S.No. 6021 of 1971 on the file of the IX Assistant Judge, City Civil Court, Hyderabad restraining the defendant from engaging any Architect other than the plaintiff, Ad interim injunction was granted in I.A.No. 477 of 1979 and later it was vacated by observing that alternative remedy of damages is available. Then the plaintiff filed this suit. The plaintiff estimated the cost of the theatre at Rs. 40,00,000/- and demanded Rs. 2,00,000/- as damages; as 5% of the total cost of the project is his remuneration. The suit was filed for recovery of Rs. 1,90,000/- towards damages for breach of the contract as an amount of Rs. 10,000/- was already paid by alleging that the defendant committed breach of contract in not taking his services as Architect as per Ex.A-1 agreement The plaintiff also pleaded inter alia in para 7 of the plaint that in view of the high inflationary market trend, the estimated cost of theatre is bound to escalate further, and it may exceed Rs. 40,00,000/- during the long period required for its completion and he reserves his right to raise his claim of damages later as his fee is based and linked with the finally executed total cost of the defendant's theatre.
3. The defendant raised various pleas; (i) there was no agreement and there was no mutuality between the parties. The plaintiff got the terms of Ex.A-1 typed and obtained the signature of the defendant, (ii) the defendant came to know later that the plaintiff had no experience in the construction of theatre. Clause 6 in Ex.A-1 was got inserted with mala fide intention and it was unethical on the part of the plaintiff to have such a clause in Ex.A-1. (iii) the plaintiff was paid Rs. 10,000 /- for the work rendered by him. It was obligatory on the part of the plaintiff to plead and to establish the actual damages suffered by him and the steps taken by him to mitigate the damages. There is obsolutely no-pleading with reference to the above aspect and the suit is liable to be dismissed on this ground alone, (iv) The estimated cost of the defendant's theatre is only Rs. 27,00,000/-. The plaintiff is not entitled to a fee of Rs. 2,00,000/- or the claim for damages cannot be a case of specific enforcement of the contract without performing the work, and (v) the suit is barred by limitation.
4. Though in the written statement the defendant had not specifically pleaded that he terminated the services of the plaintiff after Ex.A-2 plan was approved by the concerned authority i.e., the Commissioner of Police, he as D.W.1 deposed that he terminated the services of the plaintiff as the latter had not chosen to the plan, when irregular levels were noticed after demolition of the existing building on the side on which this theatre was intended to be constructed. Admittedly the services of the plaintiff were not terminated. Ex.A-2 plan prepared by him was approved by the concerned authorities. The defendant engaged M/s. Narendra Associates as the architects and plan was revised by them and construction was completed. While it was stated for the defendant that the construction of the theatre was completed in the year 1983, it was stated for the plaintiff that the construction was completed in the year 1984. But admittedly the construction was over by the time of the commencement of the trial of this suit.
5. The trial Court held that the defendant committed the breach of contract. By relying upon Ex.B-10, the assessment order in regard to wealth tax of the defendant for the year ending 31-3-1983, the lower Court observed that 80% of the civil work of the cimema theatre was completed by 31-3-1983 and the net value of the civil work of the theatre was Rs. 21.43 lakhs and Rs. 5.30 lakhs had to be added towards the cost of remaining 20% of the civil work and thus the total cost of the civil work comes to Rs. 26.73 lakhs. An amount of Rs. 15,00,000/- was added to the same towards the cost of equipment including projector, furniture, fixture, air cooling etc., and thus the total cost of Rs. 41.73 lakhs (Rs. 26.73 + Rs. 15) was arrived at. The remuneration at the rate of 5% on the same comes to Rs. 2,08,650/-. The lower Court decreed the suit for Rs. 1,90,000/- by observing that the plaintiff restricted his claim towards damages at Rs. 2 lakhs and filed the suit for the balance of Rs. 1,90,000/- after giving credit of Rs. 10,000/- already received by him.
6. The defendant preferred the appeal by raising inter alia the following pleas. (1) The plaintiff is entitled to only one per cent of the cost of the project as the fee had to be paid on stages for the services rendered and on the principle of quantum on meruit, the plaintiff is entitled to the fee for the services rendered and (2) in any case the plaintiff is entitled to be remunerated only for the partial services as per the table contained in para 13 of the All India Architects Diary.
7. The plaintiff filed the cross-objections by pleading that the lower Court having found that the plaintiff is entitled to Rs. 2,08,650/-, the decree should have been passed for Rs. 1,98,650/-, instead of limiting it to Rs. 1,90,000/-, by directing the plaintiff to pay additional court fee.
8. C.M.P.No. 13096 of 1989 was filed under Order 6 Rule 17 C.P.C praying for a decree for Rs. 3 lakhs along with interest at 18% p.a.
9. C.M.P.No. 13095 of 1989 was filed under Section 151 CPC praying for award of increased damages in cross-objections, based on additional evidence prayed for in CMP Nos. 19980 and 19981 of 1988.
10. The first contention raised for the defendant is that there was no consensus ad idem as between the parties. This argument was advanced with reference to Clause 6 in Ex.A-1. It stipulates that the plaintiff shall not be removed till the work of the theatre is completed in all respects. It further states that for further alterations/improvements/developments of the property/project, the defendant shall consult the plaintiff only, and shall not appoint any other agency. The second part of this clause does not arise for consideration for disposal of this appeal. This is not a suit for injunction. In fact, the defendant terminated the services of the plaintiff. When, in fact, the plaintiff filed the suit for injunction restraining the defendant from engaging another architect, ad interim order of injunction, which was granted, was set aside by observing that alternative remedy of damages is available. Hence, it is not necessary for the plaintiff even to rely upon the first part of this clause to claim the damages. When this clause has no bearing for determining the points for consideration and when the other clauses in Ex.A-1 are not dependent on Clause 6, it is not necessary to consider as to whether, in fact, the defendant did not know the full impact of this clause before he signed Ex.A-1 agreement. Hence, there is no need to advert to it, and suffice it to observe that this point does not arise for consideration for determining the claim of the plaintiff.
11. It is evident from the evidence of the defendant as D.W.1 that he terminated the services of the plaintiff. Of course, he deposed that as the plaintiff had not drawn the revised plan and as he was not co-operating, he terminated the services of the plaintiff. But the defendant had come up with such a version at a belated stage and hence no credence can be given to the same. Thus, there are no grounds for interfering with the finding of the trial Court that it is the defendant who committed the breach of contract.
12. Of course, the learned Counsel for the defendant submitted that the plaintiff had no experience in construction of the cinema theatres and the defendant came to know of it at a later stage. But it was not even pleaded that because of that, the defendant terminated the services of the plaintiff. It was stated for the plaintiff that the fact that Ex. A-2 plan drawn by him (the plaintiff) was approved by the concerned authority establishes that he has requisite knowledge in drawing plans and designs for construction of cinema theatre. It is not necessary to further dilate upon it as it was not even pleaded that the services of the plaintiff were dispensed with on the ground that he had no experience in construction of the theatre. In this context, it is suffice to refer to the deposition of P.W.2 which is to the effect that the plaintiff did the services as the architect in construction of Raj and Rathi Theatre at saifabad and Subhas theatre, without any further discussion.
13. One of the pleas for the defendant is that the plaintiff had not taken any steps for mitigating the damages, and he had not even pleaded as to what steps were taken for mitigating the same. The lower Court observed that the question of mitigation does not arise as the plaintiff cannot enter into any contract of any one else by offering consultancy service to construct a theatre as per Ex.A-2 plan. The question of mitigation does not arise in case of professionals. There will not be any limit in regard to the work that can be accepted by any architect. Further there may be instances where a professional may be having ample time at his disposal and still no one may come forward to engage his services. Thus, whether the professional is busy or not, the question of mitigation of damages does not arise. If one of the clients commits breach of contract, and even if some more clients engaged the same architect later, the person who committed breach cannot claim that the remuneration received from the new contracts should be taken into consideration for reducing damages. In case of an employee, who agreed to work for full time on wages, cannot attend to the work of the other at the same time. But it is not so in regard to the professionals. They can attend to the work of more than one during the same day, same week or month. We, hence, feel that the contentions for the defendant that the plaintiff neither pleaded nor established about the mitigation of damages cannot be countenanced. Therefore this suit is liable to be dismissed on that ground is not tenable.
14. The next important point for consideration is in regard to the quantum of damages. It is mainfest from Ex.A-1 that the plaintiff is entitled to 5% of the total cost of the price. The plaintiff estimated the cost of the project at Rs. 40 1akhs when he drafted the plaint in 1980. It was also pleaded therein that by then 50% of the work was completed. Of course, it was averred in the plaint that the plaintiff reserved the right to claim the enhanced damages by paying the difference in Court fee by alleging that in view of the escalation of cost at the time that it may be taken for completion of the work, there will be increase in the cost of the project. But the plaintiff had not chosen to amend the plaint, though the construction of this theatre was over even by the date of the commencement of the trial of this suit. In the cross-objections it was stated that . the lower Court should have decreed the suit for Rs. 1,98,650/ - by directing him to pay the additional Court fee.
15. But C.M.P.No. 13096 of 1989 was filed on 6-9-1989 under Order 6 Rule 17 CPC praying for amendment of the plaint so as to claim Rs. 3 lakhs instead of Rs. 1,90,000/-. Even according to the plaintiff, the completion of this theatre was over by 1984. Thus by 6-9-1989, the claim for this additional amount is barred by limitation. On that ground CMP No. 13096 of 1989 had to be dismissed.
16. Section 41 of the Andhra Pradesh Court Fees and Suits Valuation Act (for short 'Court Fees Act')/ relied upon for the plaintiff in the cross-objections relates to mesne profits. Hence the plaintiff cannot rely upon the same in a suit for damages. It is open to the plaintiff to give up part of the amount claimed by way of damages. It is necessary to pay the ad valorem Court fee. It is not open to the plaintiff in a suit for damages to plead or contend that he is prepared to pay the balance of Court fee in case it is found that he is entitled to an amount higher than the amount claimed as damages. The plaintiff also relied upon Bhag Singh v. Union Territory of Chandigarh, through the Land Acquisition -Collector, Chandigarh, to urge that the should be given an opportunity to pay the deficit Court fee and decree has to be passed for the amount to which the Court found that he is entitled to. Whether the enhanced compensation can be awarded in a land acquisition proceedings, when the amount claimed is less, was the point that had arisen for consideration in the above case. It was observed therein that:
"Where land is acquired under the Land Acquisition Act it would not be fair and just to deprive the holder of his land without payment of the true market value when the law, in so many terms, declares that he shall be paid such market value.....The State Government must do what is fair and just to the citizen and should not, as far as possible, except in cases where tax or revenue is received or recovered without protest or where the State Government would otherwise be irretrievably be prejudiced, take up a techical plea to defeat the legitimate and just claim of the citizen. This was not a dispute between two private citizens where it would be quite just and legitimate to confine the claimant to the claim made by him and not to award him any higher amount than that claimed though even in such a case there may be situations where an amount higher than that claimed can be awarded to the claimant as for instance where an amount is claimed as due at the foot of an account."
This is a suit between two private citizens. This is not a claim on the foot of an account. It is, thus, manifest from the above judgment that in this case the plaintiff cannot claim any amount more than the amount claimed and he had to confine himself to the claim made by him. Thus, even this decision does not help him to claim an amount more than the amount claimed in this suit. As the plaintiff had not chosen to pray for amendment of the plaint within the period of limitation, he is not entitled to claim any amount over and above the amount prayed for in the suit. Hence, the cross-objections are liable to be dismissed.
17. It was merely averred in the plaint that the total estimated cost of the project is 'Rs. 40 lakhs. But the data on the basis of which it was arrived at was not furnished either in the plaint or in the evidence of the plaintiff as P.W.1. Even P.W.4 merely stated that the cost had come to Rs. 3,800/- per seat and the total seating capacity of this theatre was about 1,200/-. He had also not furnished the necessary data to show as to how that figure was arrived at. In the written arguments submitted in this Court it was stated that the plaintiff had given the cost of calculations in the lower Court and they are as under:
"1. Cost calculation -I Rs. 55,24,900-00
2. " " -II Rs. 57,09,990-00
3. " " -III Rs. 66,76,296-00
4. " " -IV Rs. 57,75,000-00
5. " " -V Rs. 59,22,500-00
6. " " -VI Rs. 55,00,000-00
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Average of above six calculations: Rs. 58,51,447-00"
------------------
18. A perusal of the written arguments submitted for the plaintiff in the . lower Court discloses that the first calculation was arrived at on the basis of the particulars furnished in Ex.B-10. The particulars as per the said calculation are as under:
"(1) 80% cost of civil works as on 31-3-1983 ... 32,73,000/-
(2) 20% balance cost of civil works as on 31-3-1983 ... 8,18,250/-
(3) Cost escalation on 20% balance work executed
between March 1983 to March 1985 ... 1,63,650/-
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Total civil works cost ... 42,54,900/-
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(4) Cost of projection system installation, screen
and its fittings, air-cooling plant ducting,
electric wiring, installation fittings etc., Diesel
Generator, seating arrangement fittings
other wooden works furniture, false ceiling
including wooden structure etc., wall panellings
and interior decoration etc., Rs. 24,00,000/-
----------------
66,54,900/-
N.B: Break up figures in regard to the above are given at page 57 of the
written arguments filed in the lower Court by the plaintiff.
Total project cost ... Rs. 66,54,900/-
Less: Cost of land. ... Rs. 11,30,000/-
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Net cost of the project. Rs. 55, 24,900/-"
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19. The plaintiff deposed that in 1980 the defendant submitted an estimate of the total cost of project as Rs. 39,00,000/- while borrowing from the Bank. On that basis the second calculation was made by adding 10% of the total for each year from 1980 till 1984 by treating the estimated cost in 1980 as Rs. 39 lakhs. While so working out, the total cost as in 1984 was arrived at Rs. 57,09,990/-. The third calculation was prepared on the basis of the evidence of P.W.4 which is to the effect that the cost of theatre with 1200 seats is at Rs. 3,800/- per seat in 1980. Just as in the second calculation memo, 10% was added towards cost escalation for each year and the cost in 1984 was arrived at Rs. 66,76,296/-.
20. The defendant as D.W.1 denied the suggestion that he submitted the estimate of the cost of construction in 1980 before the Bank as Rs. 39 lakhs and he further deposed that he does not remember whether the value of the equipment is about Rs. 15 lakhs. The 4th calculation was prepared on the basis of those suggestions. Further the plaintiff added Rs. 3,75,000/- towards the Cost of interior decoration and the total was arrived at Rs. 57,75,000/-.
21. The defendant as D.W.1 deposed that it is incorrect to say that cost of equipment, fittings and fixtures would be 40 to 50% of the total cost of the project. Basing upon the suggestions and the figures given in Ex.B-10, the 5th calculation was made and it is as follows:
(a) 80% of the civil work cost .. Rs. 32,73,000/-
(b) Balance 20% work cost .. 8,18,250/-
---------------
Total .. 40,91,250/-
Less: Cost of land .. 11,30,000/-
---------------
Balance total civil work cost .. 29,61,250/-
Add equivalent cost of all equipment, fixtures,
fittings and interior decoration etc., 29,61,250/-
---------------
Total cost of project 59,22,500/-
---------------
22. The defendant denied the suggestion that if the cost of equipment, fixtures and fittings are also taken into account, the total cost of the theatre would exceed Rs. 55 lakhs. He further denied the suggestion that he invested unaccounted money to the tune of several lakhs of rupees in constructing the theatre. On the basis of the said suggestions, the plaintiff prepared VI calculation by estimating the costs as more than Rs. 55,00,000/-. (In view of the throat trouble, the learned Counsel for the plaintiff-respondent could not advance arguments and hence the plaintiff was permitted to argue in person and he also submitted his written arguments).
23. There is no evidence in regard to the costs of projector, screen, air-cooling etc., referred to in the first calculation and as such the same cannot be considered.
24. It is true that the plaintiff filed I.A. 970 of 1985 under Order 16 Rule 2 CPC praying for summoning the Manager of the State Bank of Hyderabad, Gunfoundry Branch, Hyderabad along with the loan documents relating to the defendant in respect of the theatre of the defendant. The same was dismissed on 10-10-1985 and I.A.No. 100 of 1986, which was filed for reviewing the said order was dismissed on 21-3-1986. It is open to the appellant to challenge the correctness of the said orders in this appeal even though the plaintiff had not filed the revision petitions against the said orders. The plaintiff also filed CMP No. 19981 of 1988 in this Court praying for summoning the same. The plaintiff wants to rely upon the said estimate which was furnished to the Bank in 1978 but even that was only an estimate. The plaintiff had not chosen to issue notice to the defendant to produce his account books which would disclose the actual cost incurred in construction of this theatre. When the burden is upon the plaintif to prove the quantum of damages claimed, it is for him to adduce necessary evidence or to take steps for issual of the notice to the defendant if the record available with the defendant helps him in establishing his case. But he had not chosen to do it.
25. It is evident from Clause 3 (a) of Ex.A-1 that half per cent of the project cost had to be given as advance on signing the contract. The plaintiff is the architect. It is for him to estimate the project cost. On that basis, an amount of Rs. 10,000/- was paid as an advance. The learned Counsel for the defendant submitted that if the payment of Rs. 10,000/- as advance under Clause 3 (a) is taken as basis, and as half per cent of the project cost had come to Rs. 10,000/-the total cost works out to Rs. 20 lakhs only. When the plaintiff himself estimated the project cost at Rs. 20 lakhs in October 1978, the estimate of Rs. 40 lakhs in drafting the plaint in 1980 had to be treated as exaggerated, urged the learned Counsel for the defendant. Be that as it may, the estimate furnished before the Bank in obtaining the loan will not be a safe guide to arrive at the cost of the project. It may not be unusal to exaggerate the cost to have more amount as a loan. Anyhow when the plaintiff himself is an architect and when he estimated the project cost at only Rs. 20 lakhs in 1978, he should have given the data on the basis of which he arrived at the estimate as Rs. 40 lakhs in 1980. The fact that the plaintiff had not chosen to issue notice to the defendant to produce his accounts and instead filed a petition only to summon the estimate furnished before the Bank in 1980, and when he himself estimated the project cost at Rs. 20 lakhs only October 1978, it suggests that the plaintiff wants to take advantage of the figures which are favourable to him even though they are mere estimates but not actuals. So, we feel that even the estimate given by the defendant to Bank does not help us to calculate the cost of this cinema project.
26. The estimate submitted by the defendant in regard to the cost of this cinema project before the Bank cannot be held as conclusive when the said estimate was made to obtain a loan. When it is not a case of admission made before the plaintiff, it does not amount to estoppel. Hence C.M.P.No. 1998 of 1988 had to be dismissed.
27. When the estimate of Rs. 39 lakhs given by the defendant to the Bank even if true cannot be held as conclusive, it had to be held that there is no basis even for calculation No. II and hence, the same cannot be adopted.
28. P.W.4 had not given the data to arrive at the cost of the theatre at Rs. 3,800/- per seat. On the basis of such lumpsum figure, it is not possible to state whether the said estimate is correct or not. When a claim is based on the basis of the calculation, it is not only necessary but also just and reasonable to furnish the calculations so as to enable the opposite party to challenge the lumpsum figure given if it is not correct. In Perestrello-e- Companlia Limitada v. United Paint Co., Ltd., 1969 (1) W.L.R. 570 it was observed that a plaintiff, who based his claim on precise calculation must give the defendant access to the facts on which they are | based. It is a case of an estimate given by the architect. It can necessarily be on the basis of the various calculations. The data on which the said estimate is based was not placed before the Court. Hence even calculation III also cannot be adopted.
29. While adverting to calculation -II, we observed that the estimate of Rs. 39 lakhs even if true cannot be held as conclusive. Further the defendant did not admit the value of projector, screen etc., which was suggested as Rs. 15 lakhs. Thus, there is no basis even for calculation IV.
30. The defendant had not admitted that the costs of equipment, fittings and fixtures would be 40% to 50% of the total cost of the project. The mere suggestion which he denied cannot be held as evidence. Thus, even calculation V cannot be accepted.
31. The calculation VI is purely on the basis of a suggestion to the defendant which was denied. Hence, this calculation also cannot be adopted.
32. The contentions for the defendant are:
(1) that the plaintiff is entitled to compensation for the work done on the principle of quantum meruit;
(2) even as per All India Architects Diary, the plaintiff is entitled to compensation only upto the extent of one per cent, for the fee payable. In case of termination and abondanment as per the above Diary is to pay the fee one level, above the level of work at which it was abandoned or the services were dispensed with, and (3) in any case the damages as on the date of the breach alone have to be paid.
33. A decision of the Rajas than High Court in Kotah Match Factory, Kotah v. State of Rajasthan, is relied upon for the defendant to urge that the principle of quantum meruit is applicable in view of the facts in this case. Even therein it was observed that the claim for compensation under Section 70 of the Contract Act is not founded upon contract but on quasi-contract or restitution. The principle of quantum meruit is embodied in Section 70 of the Contract Act. In that case it had become necessary to rely upon Section 70 of the Contract Act when it was held that there was no valid agreement between the parties, even though there was an agreement in pursuance of which the claimant executed some work. But in this case there was a valid contract between the plaintiff and the defendant, and the plaintiff claimed damages on breach of contract committed by the defendant. Thus, it is not a case where the principle of quantum meruit had to be applied.
34. In 1938 (3) All England Law Reports 203 which was also relied upon for the defendant, it was held that the defendants therein were liable to pay the plaintiff for the work actually done in respect of stage (b). The said calculation was arrived as the parties therein agreed that the fee of the architect should be in accordance with the scale of professional charges of the Royal Institute of British Architects. The said scale provided that in cases where the project was abandoned, the fee payable depended upon the stage of the work that had been completed. The decision therein was given on the basis of the agreement in regard to the fees and not on the basis of quantum meruit principle. Thus, even the above judgment does not help the defendant herein to support the contention that in case of abandonment or termination of the services of an architect, the fee had to be paid only for the work done. Thus, this contention for the defendant is not tenable.
35. The learned Counsel for the defendant had drawn our attention to para 13 of Conditions of Engagement and Scale of Professional Fees and Charges of All India Architects Directory. It stipulates that if the architect performs part of the services only for any reason including the reason for termination of the services of the architect, the charges in respect of the services performed shall be as provided in para 13.1 to 7. Para 13.2 lays down that if draft sketches and architect's estimate of cost based upon covered areas have been submitted by the client, the charge shall be 10% of the architect's fee. (The fee of architect is the fee which would have been payable, had the project been completed to the end of the construction stage.) It was vehimently argued for the defendant that as in this case the plaintiff had only submitted the sketches and designs, his fee should be limited to 10% of the total fee payable.
36. In the foreword to the conditions of Engagement and Scale of Professional Fees and Charges it is stated that the Indian Institute of Architects, in order to maintain the highest standards of practice and conduct, has adopted for use by all members of the Institute, the conditions of Engagement and Scale of Professional Charges revised to conform with local requirements and conditions as provided under para 13.1. It was urged for the plaintiff that he is not a member of the Indian Institute of Architects. It had to be borne in mind that the defendant had not even pleaded in the written statement that the plaintiff is at best entitled to the fee as provided under para 13.2 of the conditions referred to above. As it is evident that the Scale of Professional Charges as provided under para 13 is applicable only in regard to the members of the Indian Institute of Architects, and as it is not established that the plaintiff is a member of the said Institute, the defendant cannot invoke para 13.2 of the Conditions referred to.
37. The damages as on the date of breach have to be ascertained, urged the learned Counsel for the defendant. The date of breach is material in case of breach of contract of sale of goods. The difference between the contract price and the market price had to be awarded as damages. As market price will be fluctuating, it is necessary to ascertain the date of breach, to adopt the market rate as on that date of breach to quantify the damages. If the market rate is less than the contract price. But where a service contract is broken by the employer, the measure of damages is obtained by considering the usual rates of wages for the employment contracted for. The same principle holds good even in a case where contract engaging a professional is broken. The measurement of damages, in such a case, is the fee which the professional would have been entitled to if the contract is performed, as such the date of breach is not material for ascertainment of damages payable by the party who engaged the professional.
38. The learned Counsel for the defendant relied upon the following decisions also. In G.D. Gear & Company v. French Cigarettes Company Ltd., Lahore, AIR 1931 Lahore 742 it was held that the price of the goods is the measure of damages in case of non-marketable goods. In Bismi Abdullah & Sons, Merchants & Commission Agents v. The Regional Manager, F.C.I. Trivandrum and Anr., it was held that only nominal damages are payable if they were laches on the part of the plaintiff, who had a right to re-sell, sold them after a lapse of 4 1/2 months and after there was crash in the market. In Fateh Chand v. Balkishan Dass, it was held that in Indian Law there is no distinction between stipulation for liquidated damages and penalty and the damages not exceeding the amount stipulated have to be paid. In Pasalapudi Brahmayya and Anr. v. Teegala Gangaraju, it was held that when a servant stipulated to pay a particular sum for absence beyond fixed date, the employer is not entitled to the said amount and he is entitled to only the damages suffered. In view of the facts considered in T.K. Sundaram v. The Co-operative Sugars Ltd., Chittoor, AIR 1988 Madras 161 it was held that the amount stipulated therein was not penalty. When the purchaser terminated the contract on the ground that there was no restriction for import into Australia, the loss of profit was ascertained as 71 /2% in Samuel Fitz. & Co., Ltd., No. 26 Chowringhee, Calcutta v. Standard Cotton And Silk Weaving Co., Calicut, AIR 1945 Madras 291. There is no need to deliberate about those judgments as they are not helpful for measuring damages in this case.
39. In Nagpur Nagarik Sahakari Bank Ltd., v. Union of India, it was held that whereas loss in terms of money can be determined, it must be proved. The defendant, who committed breach of contract had to pay the remuneration which the plaintiff would have been entitled to if the contract was performed. Thus, the loss in terms of money in this case can be determined. But the plaintiff claimed a lumpsum figure as damages without furnishing the data on which the said amount was arrived. Even P.W.4 has not furnished the basis for arriving at the cost of the theatre at Rs. 3,800/- per seat. So, they cannot be relied upon for want of necessary particulars. The plaintiff had not chosen to issue notice to the defendant to produce his accounts wherein the particulars of expenditure for construction of this theatre are noted. Even the plaintiff stated that Ex.B-10 cannot be taken as basis for it does not include some items of expenditure.
40. The lower Court had taken Ex.B-10 as basis. But the lower Court included the cost of projector etc., to arrive at the cost of the theatre. It is on the basis that the cost of cinema project includes the cost of projector, screen, chairs etc., It is not clear from the terms of Ex.A-1 agreement as to whether the cost contemplated for fixation of fee of the plaintiff is the cost of the civil work or whether it includes the cost of projector, screen, A.C. equipment, chairs etc. As already noted, the plaintiff had to be paid half per cent of the total cost as advance and an amount of Rs. 10,000/- was paid towards the same. When the advance amount was ascertained as Rs. 10,000/- it can be held that the cost of project was estimated at Rs. 20 lakhs. It is not the case of the plaintiff that some ¦ one else, but not he, who estimated the cost of project for determining the amount payable as advance. It is undisputed that the defendant has no experience in cinema business or even in construction of the cinema theatre. The plaintiff was engaged as an architect. It is for him to give the estimate. It is, hence, reasonable to hold that the estimate was made by the plaintiff for working out the amount payable as advance. But he had not chosen to give the particulars on the basis of which he estimated the project cost as Rs. 20 lakhs. If those particulars are given, it would have been known as to whether the cost of the theatre including the projector was taken into consideration for estimating the cost of the cinema project.
41. Before adverting to the aspect as to whether the cost of equipment i.e., the projector, A.C. equipment, screen, chairs and other furniture etc., has to be included for fixing the fee of the plaintiff, it is convenient to refer to the various authorities relied upon by the plaintiff. C-1.01 of Schedule 'C of the Fee Guide amended upto March 1988 of the Royal Austrian Institute of Architects lays down that the cost of works shall inter alia include the cost of service installations, fixed or built-in-furniture and equipment, mechanical and electrical equipment appertaining to the building whether covered by a monetary sum, a provisional sum, a prime cost sum, or not, which the architect has had to co-ordinate or make provision for in the documentation. Article 312 of Instruction Sheet AIA Document B-141 a (America) lays down that the construction cost shall include the cost of any equipment which has been designed, specified, selected or specially provided for by the Architect. Part 3.104 of Conditions of Engagement of Royal Institute of British Architects stipulates that the total construction cost shall include the cost of built-in furniture and equipment, but where the cost of any special equipment, equipment is excluded from the total construction cost, the architect shall charge for work in connection with such items on a time basis. Singapur Institute of Architects, 1984 page 96 is also referred to wherein it is stated that the fee of the Architect shall be 7 1/2% of the total cost of the executed work including the cost of all services and installations of whatever kind. Section 3.1.2 of Pertubuhan Akitek Malaysia Kdn Architects Director provides that the cost of a unit shall be computed by including the total cost of all the builders works, built-in fittings, integral services and installations, site and external works and infrastructure services serving the immediate site on which the units are constructed.
42. It is manifest from the above that as to whether the cost of equipment has to be included in the cost of the project for ascertaining the fee of the architect is not uniform and it varies from country to country. Probably it is dependent upon the nature of the services rendered by the architects in the various countries.
43. Clause 4(5) of the Condititions of Proforma Agreement as per Architects (Professional Conduct) Regulations, 1989 provides that the cost of project shall be the cost of the building work as calculated on the accepted tenders including the cost of structural, sanitary, plumbing and electrical work, sanitary and electrical fittings and fixtures, lifts, escalators, mechanical equipments, landscaping, interior and graphic signage i.e., on all items on which the architect had rendered professional services but shall exclude the cost of the client's site office, cost of land and cost of supervisory staff. These regulations of 1989 are not applicable for in this case, the work was completed in 1983/1984. But the same was referred to in order to compare it with the relevant stipulations in other Countries. Even the above clause indicates that the cost of equipment referred to has to be included only in a case where the architect had rendered professional service in regard to the same. "There is no need to elaborate in regard to this clause or it is not applicable to the claim made in this case.
44. The plaintiff has given the lumpsum figure of Rs. 40 lakhs as the cost of the cinema project in drafting the plaint. It was not even whispered in the plaint that the said amount of Rs. 40 lakhs includes the cost of projector, screen, A.C. equipment, chairs in the auditorium and the other furniture etc. When the plaint does not disclose that the cost of the cinema project includes the cost of projector etc., for ascertainment of the fee of the architect and as there is no uniformity in regard to the said aspect in the various Countries and as even then terms of Ex.A-1 agreement do not specifically spell out that the cost of the project includes the cost of the equipment, it had to be held that there is no plea to the effect that the cost of cinema project includes the cost of the equipment for determination of the fee of the architect and the Court cannot take cognizance that it so includes for there is no uniformity in regard to the relevant clauses in the various countries and as even 1989 Regulations issued by the Council of Architecture in India provide that the cost of the equipment had to be included only when the architect renders professional service in regard to the same. So, we have to observe that the lower Cour erred in adding Rs. 15 lakhs towards the cost of equipment including projector, screen, furniture, fixtures, air-cooling etc., to Rs. 26.73 lakhs the cost of civil work arrived at by relying upon Ex.B-10. But the defendant averred in his written statement that the cost of cinema project was Rs. 27 lakhs. As the said figure is more than Rs. 26.73 lakhs arrived at on the basis of the figures referred to in Ex.B-10, the former can be treated as the cost of the project for determination of the fee of the plaintiff. As the fee of the plaintiff is 5% of the total cost of the project and as in view of the material on record, the cost of cinema project had to be held as Rs. 27 lakhs, the plaintiff is entitled to Rs. 1.35 lakhs towards his remuneration. Out of it, an amount of Rs. 10,000/- was already paid to the plaintiff as advance. Hence, the plaintiff would have been entitled to Rs. 1.25 lakhs as remuneration if his services were not discontinued. The same amount can be fixed at as damages, for the plaintiff could have been entitled to the said amount if his service was not terminated. Hence, the decree amount has to be reduced from Rs. 1.90 lakhs to Rs. 1.25 lakhs.
45. The suit was filed even before the construction of this cinema theatre was completed. It is a case of anticipatory breach. It is not shown for the defendant as to how this suit was barred by limitation. The said plea of limitation is not tenable. Hence it has to be held against the defendant.
46. The lower Court awarded 18% interest on the amount awarded as damages. No arguments were advanced challenging the order of the lower Court in regard to interest. Hence, we are not adverting to the same.
47. In the result, C.M.P. Nos. 19980 and 19981 of 1988 and C.M.P. Nos. 13095 and 13096 of 1989 are dismissed. The cross-objections are dismissed. The Appeal is allowed in part by modifying the decree of the lower Court by substituting Rs. 1.25 lakhs for Rs. 1.90 lakhs. In the circumstances, the parties have to bear their respective costs in this Appeal and the Cross-objections.