Bombay High Court
Pandu Laxman Gawand vs Municipal Corporation Of Bombay on 25 November, 1929
Equivalent citations: AIR 1930 BOMBAY 414
JUDGMENT Anderson Marten, Kt., C.J.
1. This is an appeal from the judgment and decree of Mr. Justice Jhaveri by which it was ordered " that the defendants do jointly and severally pay to the plaintiffs by way of specific performance of the contract in the plaint mentioned the sum of Rs. 18,565 for debt and interest", and costs and interest on judgment, and it was further ordered " that on the defendants paying to the plaintiffs the said sum of Rs. 18,565 hereinabove mentioned the plaintiffs do execute a deed of conveyance in favour of the defendants of the property marked C and coloured green on the Plan hereto annexed and marked RME/1863.
2. The defendants say that there never was a concluded contract; and, secondly, that if there was any contract, it never received the necessary sanction under the City of Bombay Municipal Act, 1888; and that in any event, the plaintiffs having themselves broken the contract by not constructing certain roads which they had agreed to make, are disentitled from obtaining either specific performance or damages; and finally, that in any event, the plaintiffs are barred by laches from obtaining specific performance.
3. It is conceded that the form of the decree is wrong. It should have been prefaced by a declaration that the contract ought to be specifically performed, and then an order for payment could have followed (see Seton, Vol. Ill, 6th Edition, Chap. 50). As it is the decree seems to confuse two separate things, specific performance and damages for breach of contract. But it is specific performance which the plaint primarily asks for. Damages for breach of contract form the alternative claim. Accordingly, the first question for determination is, what is the contract which the plaintiffs ask to be specifially performed? That discloses a curious state of affairs. At the bar the learned Advocate General has asked that we should grant specific performance of the contract contained in the letter of November 16, 1920, signed by defendant No. 1 Pandu Laxman and his deceased brother Kashinath Laxman, and addressed to the Municipality. Alternatively, he has asked that we should grant specific performance of the contract contained in that letter as varied by a subsequent letter of September 29, 1921, addressed by Pandu and Kashinath and defendant No. 4 Thamabai, and as further varied by the letters of November 10, 22 and 25, 1921, and December 9, 1921, which are set out at pp. 13 to 16 of our appeal book.
4. Then as regards the dispute about the roads, the learned Advocate General states that the position of his clients the plaintiffs is that they are not prepared to construct or covenant to construct the entirety of the road shown in red lines and running from west to east past plot B in the plan, Exhibit B. Nor are they prepared to make the entirety of that road on the plot to the south of the green plot C, and stretching over plot B and some un-coloured land to the red line marking the southern boundary of that road. They are only prepared to make a road on half that plot, namely, on the northern half nearest plot. This was in answer to the question of the Court as to whether, if a decree for specific performance was granted in the ordinary way, what covenants, if any, ought to be imposed on the plaintiffs to construct any and if so what road.
5. Now, unfortunately in the present case, the Municipality never put this alleged contract into a formal document. We have to turn from one letter to another to see what is the alleged state of affairs at different dates. And I must refer to them in some detail to explain the complications that have arisen.
6. [His Lordship then dealt in detail with the correspondence and continued as follows:] As regards the condition of the road...there is a direct conflict of testimony between those two engineers. The learned Judge, who had the benefit of seeing the witnesses, does not express any opinion on this conflict of testimony. And so I may say at once, that after considering this matter, I would hold that the plaintiffs have not established that even half of this road to the south of plot C has been properly-made up in accordance with the contract, If it comes to the question of the onus of proof in that respect, I think it is on the plaintiffs. Apart from that, I would prefer the evidence of the defendants' architect, who deposes that he actually saw the site only a short while before he was giving evidence, to that of the Municipal engineer, who does not say the same thing, and who may possibly be relying on information given by his subordinates, who in fact did not give any evidence. Therefore, on the facts, I would hold that at any rate the southern half of that road was not made up at all, and that as regards the contest as to the northern half nearest the defendants' property, that has not been made up in accordance with the intention of the parties. How far there was any binding agreement to make up that road, I will deal with that later.
7. I will now come to the main questions in the case. I think they were correctly formulated by Mr. Setalvad, in his clear argument, for the appellants. Question (1): Was there a contract in law which the Municipality could enforce 1 There the main point is whether the second arrangement of September 29, 1921, was ever sanctioned by the Corporation. In this connection any variations between that arrangement and the previous one of November 16, 1920, will assume importance. Question (2): If there was a contract, did not the Corporation break it by failing to make a road to the south at the date of suit ? Question (3) alternatively: Whether in any event, the Municipal Corporation were entitled to specific performance-either against the three defendants or any of them ?
8. Now, taking the first question, I will first take the case as finally put to us by the Advocate General for the Corporation, namely, on the basis that we are asked to grant specific performance of the contract of November 16, 1920, and no other, and not as varied by any subsequent documents. The first answer that is made to that plea is that that is not the contract pleaded, and that is not the contract which the learned Judge found. If one looks at the answer given by the learned Judge to issue No. 1, namely,-" What is the agreement between the parties " his answer was, " As alleged by plaintiffs." When I turn to the plaint-which, in my opinion, was carefully and cleverly drawn'- it is clear that the contract pleaded and the only contract pleaded is that contained not only in the letter of November 16,1920, but also in the second arrangement of September 29, 1921, and the subsequent correspondence to which I have already referred. In other words, it is the learned Advocate General's alternative contention which is put forward in the pleading, and accepted by the learned Judge, and not the one with which I am now dealing.
9. I refer in particular to paragraphs 2 and 4 of the plaint.
10. [After referring to the two paragraphs his Lordship continued:] I am not, however, prepared to hold that even though the con-" tract of November 16, 1920, is not the precise contract sued on, nor the one that the learned Judge found, yet the plaintiffs are necessarily debarred from Saying that one of the documents alone constituted a contract on which they are entitled to rely on before us. For the sake of argument I will assume that they are entitled to do so even at this late stage. But even then they get into further difficulties.
11. The first is that there was no acceptance of the offer contained in the letter of November 16, 1920. It will be remembered that this was only an offer, and that the Corporation's resolution set out at p. 11 resolves that " sanction be given to the acceptance of the offer." But there is no acceptance in writing. There is no oral acceptance so far as anything of that nature has been brought to our attention. It is contended by counsel for the plaintiffs that this point was never pleaded. But whatever may be the defects in the original written statement at page 33, a supplemental written statement at page 48 pleaded after taking inspection of the plaintiffs' documents that, "these defendants submit that no legal or binding contract was entered into by the first plaintiff with the defendants," Moreover, that point was taken in the Court below as appears from the judgment of the learned Judge at p. 60 where he says: " It is complained that the sanction was not communicated to the defendants, but the whole correspondence in 1921 proceeds on the basis of such communication and knowledge." As to that, I am unable to draw that inference from the subsequent correspondence between the parties. It does not state, as far as I can see, that the sanction of the Corporation was given or that the acceptance of the original offer was ever made. On the contrary, what we find is that a fresh set of proposals are made by the letter of September 29, 1921, That letter refers no doubt to the preceding letter of November 16, 1920, but not a word is there said that the offer contained in that prior letter had been accepted by the Corporation. And it may be that the Corporation deliberately did not accept that prior offer owing to the difficulties that had arisen owing to third parties having made a claim to Pandu's share, and to it being necessary to revise the earlier proposals in certain respects. Therefore, it seems to me that that difficulty alone is one which the plaintiffs have not surmounted.
12. Even if they could get over that difficulty, I fail to see how they can obtain any judgment against Thamabai, who is not a party to this first alleged contract. It was argued before us that she had subsequently concurred. But unless you find that there j was a contract between her and the Corporation binding on both of them, I think she could not be sued either for specific performance or for damages for breach of contract. Of course, it will be borne in mind that it is not contended here that the parties who did sign the document of November 16, 1920, had any authority or power to bind Bai Thamabai. And as regards ratification, there was no ratification of the alleged contract of November 16,1920, standing by itself.
13. A further question arose as to whether in any event specific performance could be obtained against the remaining two persons who did sign the document of November 16,1920. If it had been merely a contract for purchase, it would be one thing. In fact the contract contained in effect an agreement to sell and also an agreement to buy. But if the whole contract could not be enforced inasmuch as the two vendors could not make out a title to the whole property, it would seem difficult to enforce their obligations of purchase under the rest of the contract. However, I need not decide that point. Nor need I decide whether damages could have been awarded for breach of contract against these two persons, inasmuch they had agreed to sell land to which they had no complete title or because they had failed to buy land which they had agreed to buy. As regards the former point the authorities in this Court, so far as I recollect, are not altogether clear as to the circumstances under which damages for such a breach of contract can be obtained in this High Court.
14. I say this because as a matter of common sense, I think it is quite impracticable to grant specific performance alone of the alleged arrangement of November 16, 1920, and to ignore the subsequent written documents, and also what subsequently was done by the parties. It is clear to my mind that whatever arrangement was come to in November 1920, it was altered by the subsequent documents of September 1921 and the later correspondence. The parties have acted under that later arrangement, and it seems to me that it would be quite inequitable to grant specific performance on the earlier document alone. Therefore my conclusion on this part of the case is that I would refuse to grant specific performance of the alleged contract of November 16, 1920, which was neither pleaded, nor acted upon, and which was afterwards varied, and which the learned Judge had in effect found against the respondents.
15. I now come to the second alleged contract of September 29, 1921, as varied by the correspondence I have already mentioned. And I must here refer to the exact variations between it and the earlier alleged contract, because they are material on the point of sanction by the Corporation. Now to start with, there was one clear variation. A new party was brought in, namely, Bai Thamabai. Further, the Municipality were to buy the whole property through the Land Acquisition Officer. The effect of the first arrangement was, I think, that they were to buy plots A and B through the Land Acquisition Officer (see para 5). As regards plot 0, according to the contention of the learned Advocate General, the defendants were to retain that, and we are asked by him to construe the words "we agree to purchase" in paragraph 3 as meaning " we agree to retain". But under this document of September 29, 1921, it is clear that the whole of the property,-C as well as A and B,-was to pass through the land acquisition proceedings, and that the whole compensation was to be paid to the three owners, and that then these owners were to pay it back to the Corporation, plus the Rs. 8,166 I have already mentioned, and plus another sum of Rs. 550 in connection with the Farzandari tenure.
16. Now stopping there, that seems to me a different arrangement from that contained in the first contract. In the first place, i.e. the original two vendors were not able to make out a title, it was open to the Corporation, I take it, to rescind the contract at once on finding out the true state of affairs. That might be a matter to take back to the Corporation for its approval or disapproval. Further, if everything was to go through the Land Acquisition Officer, who was to make his award as regards all the land, and so on, then I take it that there would be at any rate some more expense involved on the Corporation, which they might or might not be willing to incur. It will also be remembered that by this time, there was a difficulty as to the title, not only because of the third party Bai Thamabai coming in, but also because certain outside parties were claiming Pandu's share. As a result of that we find that a term as to Pandu passing an indemnity bond is for the first time Introduced in Clause 7. Moreover, by the subsequent letter of the defendants' solicitors of November 25, 1921, it was stated that the conveyance was only to be completed "forthwith upon the expiry of the period of limitation for such reference to the High Court," that is, until the High Court had determined who were the true owners of the property. That in itself necessitated another adjustment, namely, that proposed in the same letter of November 25, 1921, that the defendants were to be monthly tenants of the Municipality,-I gather at a nominal rent, although that is not expressly mentioned,-and on the other hand were to pay six per cent, interest pending the completion of the conveyance. That also seems to me to be a variation of the original arrangement. Further, we also find that Clause 8 of the original contract, which allowed the Municipality to enter upon the premises and construct the road thereat before the actual transfer took place, does not reappear in the alleged contract of September 29, 1921. There is, however, in the letter of the defendants' solicitors of November 25, 1921, an express statement that the defendants are "to allow the Municipality- to take possession of such portions of the plot to be acquired as are required for the making of a road as are already indicated on the plan.
17. These variations bring me to the point of the sanction of the Corporation. It is argued for the plaintiffs that the Corporation having given their sanction to the contract of November 16, 1920, that was a sufficient sanction for the subsequent arrangement of September 29, 1921, and the subsequent correspondence. To explain that point I must refer to the City of Bombay Municipal Act. Section 91 enables Government to order proceedings to be taken for acquiring immoveable property on behalf of the Corporation. Section 92 provides:-
With respect to the disposal of property belonging to the corporation the following provisions shall have effect, namely-...
(c) with the sanction of the corporation, the Commissioner may lease, sell or otherwise convey any property, movable or immoveable, belonging to the corporation;
(d) the sanction of the standing committee or of the corporation under Clause (b) or Clause (e) may "be given either generally for any class of cases or specially in any particular case;
(e) the aforesaid provisions of this section shall apply, respectively, to every disposal of property belonging to the corporation made under or for any purpose of this Act.
18. Now what we have here is partly a contract for the acquisition of property by the Corporation, and partly a contract for the sale of that property by the Corporation to the defendants. It is the latter 1 am considering and admittedly Section 92, cls. (c), (d), and. (e) apply to it.
19. Then Section 69 provides:-¦ With respect to the making of contracts under or for any purpose of this Act, the following provisions shall have effect, namely-
(a) every such contract shall be made on behalf of the corporation by the Commissioner;
(b) no such contract for any purpose which, in accordance with any provision of this Act, the Commissioner may not carry out without the approval or sanction of some other municipal authority, shall be made by him until or unless such approval or sanction has first of all been duly given;,..
(c) the foregoing provisions of this section shall apply, respectively! to every contract which the Commissioner shall have occasion to make in the execution of this Act; and the same provisions of this section which apply to an original contract shall be deemed to apply also to any variation or discharge of such contract.
20. Now, it is argued by the learned Advocate General, first, that the approval in Section 69 (b) is to the "purpose " referred to in that sub-section, and not to the contract; and, secondly, that the "purpose" was sanction within Section 92 (d) by the resolution of February 14,1921, and that that resolution covered the subsequent contract of September, 1921, and the later negotiations. Speaking for myself, I agree with the first part of the argument but not with the second. I think that as regards Section 69 (b), the approval or sanction is to be given for the " purpose " referred to there. In this connection I draw express attention to the next clause, namely, (c), which says: " no contract, other than an agreement for the acquisition of immoveable property, which will involve an expenditure exceeding five thousand rupees, shall be made by the Commissioner unless the same is previously approved by the standing committee." There the striking difference in the language shows that where the Legislature intended the approval of the Standing Committee to the contract itself it said so clearly. But as regards the other point on Section 69 (b), in my judgment, the only sanction given was to the acceptance of the offer contained in the original letter of November 16, 1920, and to no other. In other words, it was a sanction given in a "particular case " within Section 92 (d). And having regard to the variations in parties and terms between the first alleged contract and the subsequent alleged contracts, I do not think it can be properly said that this initial sanction covered what subsequently took place. Nor, in my opinion, would that sanction enable the Commissioner to say, " I had agreed to sell the property to A. But I cancel that contract, and now I go and sell it to a totally different person.
21. It is next contended that the sanction given by the later resolution of April 19, 1926, Part 2, p. 16, had a retrospective effect, In my opinion, that is not correct. In the first place, authorities such as Young & Co. v. Mayor, &c, of Royal Leamington Spa (1883) 8 App. Cas. 517, which has been followed in this Court in Ahmedabad Municipality v. Sulemanji (1903) I.L.R. 27 Bom. 618 : S.C. 5 Bom. L.R. 592 and in Radha Krishna Das v. The Municipal Board of Benares (1905) I.L.R. 27 All. 592) establish the proposition that provisions of this nature are not merely directory but compulsory, and that if not complied with, there is no binding contract in law.
22. Then as regards the argument that it can be given effect retrospectively, in the first place, Section 69 (b) expressly provides that " approval or sanction has first of all been duly given", that is, before the contract can be entered into. Here the sanction was expressed to be given in 1926 and the contract was in 1921.
23. Further, although there are some authorities to show that in the case of an executed contract, it is not ultra vires for a Corporation to decline to rely on some statutory flaw in the formation of the contract, see, for instance, Brooks, Jenkins & Co. v. Torquay Corporation [1902] 1 K.B. 601 and Bournemouth Commissioners v. Watts (1884) 14 Q.B.D. 87, yet in the present case the contract was not executed but executory, for, on my finding of fact half the road has not yet been made, and admittedly the other half is still to be made. Further, those authorities seem to show that it is only optional for the Corporation to rely upon that point in an executed contract, and not compulsory. That would not, however, be sufficient here because there would be no mutuality. It would be open to the Corporation to say that there was no binding contract, because the requisite sanction under the Act had not been obtained. Indeed, for the purpose of testing the plaintiffs' argument, we have more than once put the converse case of what would have happened, supposing the defendants had endeavoured to sue the plaintiffs on the alleged original contract of November, 1920, or the subsequent arrangement of September, 1921, and if a plea of want of sanction was set up.
24. One further authority was cited to us on this point of Melliss v. Shirley Local Board (1885) 14 Q.B.D. 911, a decision of Mr. Justice Cave. But this case was reversed by the Court of Appeal (1885) 16 Q.B.D. 446, on another point.
25. In the result, therefore, my opinion is that there was no valid sanction to the second alleged contract of September, 1921. Nor for the matter of that, was there any valid sanction to the contract as pleaded in the plaint and as found by the learned Judge because in my opinion the variations effected in September, 1921, were such as in any event necessitated a fresh sanction by the Corporation I would, accordingly, answer the first of the defendants' questions in the negative, viz., that there is no contract in law which the Corporation are entitled to enforce.
26. I go now to the second question, namely, supposing that in fact, and contrary to my view, there was a valid contract, then did the Municipality break it ? Now this brings me to the construction of the alleged contract as regards the making of the road. I won't repeat what I have already said, but I think it is clear that it was not merely the road to the west running north and south-what I will call the main road-that was to be made, but it was also the road to the south of plot C running east and west which was to be made. I agree with the suggestion made by my brother Blackwell that the words " roads in front of the plot" mean the roads fronting the plot, for the plot had two frontages, one to the west and one to the south. I also think that the statement Exhibit H and the oral evidence given at the trial are admissible to explain what was meant by " roads in front of the plot," and as explaining how this sum of Rs. 8,166 was in fact made up. It may possibly be also justified under the Indian Evidence Act, Section 92, because it shows that there was a want or failure of consideration, as contended for in effect by the defendants, namely, that they were paying extra for betterment in respect of these roads, and if they did not get them, there would be pro tanto a failure of consideration.
27. Further, in my opinion, what was arranged was that the defendants were to pay for the whole road and not for the whole of half a road. There is a substantial difference between those two propositions, and I do not accept the plaintiffs' contention that they were only to make what they were paid for, and that they were under no obligation to make more than half the road to the south of plot C. Whether or not they were obliged to make the entire road from west to east as shown on the plan, I do not think; it necessary to decide. But there are strong arguments of common sense why there should be that obligation. On the other hand, if one came to embody that obligation in a covenant in the conveyance, one can see that the advisers of the Municipality would have to be careful as to what precise obligations they were to incur for this construction of a side road, which was not a part of the original scheme.
28. I may here merely allude to a point which cropped up at the last moment, namely, as to whether the Corporation had ever power to make a side road. I£ they had not, then the whole of this contract was ultra vires. Bat I pass that by, because it merely arose almost accidentally at the end of the case.
29. The learned Judge appears to have confined his attention to the argument as to whether the making of this road was a condition precedent to payment by the defendants. With all respect to the learned Judge I do not think that was the correct point. _ I agree with him to this extent that there was no condition precedent here binding on the Corporation to make the road before payment. On the other hand, I think that there was no condition precedent here as contended for by the Corporation that they were entitled to be paid before they started making the road. For one thing, I regard Clause 8 of the original contract, by which the Municipality were to be allowed to enter upon the premises and construct the road thereat before the transfer as entirely negativing that contention. It shows that it was within the contemplation of the parties that the Municipality might at any rate begin to make the road before the money was paid.
30. In my opinion, one ought here to apply Section 52 of the Indian Contract Act and say that as "the order in which reciprocal promises to be performed is not expressly fixed by the contract, they shall be performed in that order which the nature of the transaction requires." I appreciate, of course, that there is in one sense no express contract by the Municipality to make those roads. On the other hand, I think there is an equally clear implied contract by them to make them. That indeed is the very ground on which they obtained this greatly increased price for the land in question. Mr. Setalvad in his reply pointed out the increase, viz., that whereas under the award the defendants obtained Rs. 6,922 for 604 square yards, they were paying under the alleged contract Rs. 8,166 for 416 square yards and had in addition to refund the Rs. 6,922. Therefore they were paying in all Rs. 15,088. This included betterment to the exent of Rs. 2,328. In fact, according to Mr. Setalvad's figures, the defendants received payment at the rate of Rs. 11 per square yard, but had in return to pay at Rs. 38 per square yard.
31. My view then of the implied term under these various documents is that the Municipality were to make the road on south within a reasonable time. Now have they done that ? What are the dates? The first arrangement was in November 1920, the second arrangement in September 1921. Knowledge of the High Court decree in July 1924. Demand of payment and repudiation June 1925. Suit brought September 1926. And half the road partially made, say, in 1927. I am of opinion that this long lapse of time five years and upwards,-was not a, reasonable time for the plaintiffs to take for the construction of this small piece of road, and that they were not entitled to wait until the defendants paid, and that accordingly the plaintiffs have broken their contract in this respect.
32. We have read carefully the correspondence which took place in 1925 when the demands for payment were made by the plaintiffs and refused by the defendants. But in effect it amounts to this that by their letter of June 25, 1925, the solicitors for the Corporation stated "it was no part of the contract that the road to the South of your clients' property should be constructed, and unless our claim is paid within 14 days from this date, proceedings will be instituted." And the reply was: "Our clients state that the demand made is unsupportable. The repudiation by your clients-of this agreement is indeed surprising. Your clients' attitude in this matter must be made clear. Do your clients repudiate the liability to make the roads ? We shall thereafter reply to your letter," There the correspondence stopped. As I have already said, both parties might have put their case too high in the correspondence. But the fact remains that the Municipality insisted on payment and the defendants refused. In my opinion, the defendants were right in 1925 is refusing to pay unless half the road was then done. It comes, therefore, to this that in my judgment the plaintiffs, having committed a breach of the contract on a material point, are not entitled either to specific performance or to sue for damages, and accordingly defendants' question 2 should be answered in the affirmative, and question 3 in the negative.
33. [After referring to other points not material to this report His Lordship continued:] I have spoken of the appellants as if they were all the defendants. In fact only defendants Nos. 1 and 4 have appealed, and not the legal representatives of Kashinati, the other deceased owner. Nor were the latter made parties to the appeal. But under Order XLI, Rule 4, the ground being common to all the defendants, we reverse the decree in the lower Court in favour of all the defendants.
34. Accordingly, our order will be that the appeal be allowed, and both orders of the lower Court be discharged, that the suit be dismissed, and that the plaintiffs should pay the costs of the appellants, defendants Nos. 1 and 4, of the suit throughout, including those of this appeal, and that they should also pay the costs, if any, of defendants Nos. 2 and 3 of the suit in the Court below.
Blackwell, J.
35. Apart from any other question, this appeal, in my opinion, succeeds upon the ground that the plaintiffs are unable to prove any contract which is enforceable by law. The powers of the Municipal Corporation in reference to the making of contracts and disposal of property are dealt with in the City of Bombay Municipal Act, 1888, Sections 69 and 92. The relevant portions of Section 92 are to be found in Clauses (c) and (d). Under Section 92 (c) the Commissioner may with the sanction of the Corporation sell immoveable property. Under Section 92 (d): " the sanction of the standing committee or of the corporation under Clause (b) or Clause (c) may be given either generally for any class of cases or specially in any particular case." The relevant part of Section 69 is to be found in sub-paragraphs (a) and (b). Under sub-paragraph (a) every contract is to be made on behalf of the Corporation by the Commissioner, and under (b): " no such contract for any purpose which, in accordance with any provision of this Act, the Commissioner may not carry out without the approval or sanction of some other municipal authority, shall be made by him until or unless such approval or sanction has first of all been duly given". It is to be observed with regard to Section 69 (6) that the approval or sanction there referred to is approval or sanction of the purpose, and not approval or sanction of the contract. This is of importance having regard to a question which I will refer to later. Applying the principles laid down by the House of Lords in Young & Go, v. Mayor, &c, of Royal Leamington Spa (1883) 8 App. Cas. 517--a case which has been followed in India in the authorities to which the learned Chief Justice has referred-I am clearly of opinion that these provisions in the City of Bombay Municipal Act are obligatory and not merely directory. Accordingly, in my judgment, to enable the plaintiffs to succeed, they must prove that the requirements of those sections have been complied with. In my opinion, they have failed to do so, for reasons which I will briefly indicate.
36. The Advocate General has asked this Court to decree specific performance of an alleged contract contained in a letter of November 16, 1920. That is not the contract relied upon in the plaint. In my opinion there never was such a contract. It is true that the offer contained in that letter was sanctioned by the Corporation by a resolution dated February 14, 1921. But having regard to Section 69, Sub-clause (b), of the City of Bombay Municipal Act, to which I have referred, a contract cannot be made by the Municipal Commissioner until or unless such approval or sanction has first of all been duly given. There is no evidence in this case that there was either before or after the resolution of sanction, any acceptance of the offer contained in the letter of November 16, 1920, or that any such acceptance was ever communicated to the defendants. The Corporation, therefore, cannot, in my opinion, rely on this letter as containing the terms of the contract upon which they are entitled to sue.
37. In the alternative, the Advocate General asked this Court to decree specific performance of a contract contained in the letter of November 16, 1920, as varied by letters dated September 29, November 10, 22, 25, and December 9, 1921. The Advocate General contended that the variations contained in these subsequent letters were not variations of the original contract, but were merely variations in carrying that contract out. I am unable to agree with this contention. It is plain from the terms of the letter of September 29, 1921, that further proposals were being put forward upon the basis that no concluded contract had ever been come to. The letter begins by asking for " confirmation of the following proposals. " Moreover, the proposals then put forward were made for the first time by the three owners of the property,-the original offer having been made by two of them alone. Again, cls. 3, 4 and 7 of the fresh proposals contain terms of a character different from those which are to be found in the original offer. Then a fresh term is for the first time introduced by the letter of November 10, 1921,-the owners agreeing to abide by the valuation of the Land Acquisition Officer as to the value of the land. Next a proposal is made by the engineer of the Corporation in the letter dated November 22, 1921, that the owners should pay six per cent, interest on the compensation money. Following upon that, counter proposals are made on behalf of the owners in the letter of November 25, 1921, and these are finally accepted by the engineer of the Corporation in his letter dated December 9, 1921. In my opinion, it is impossible to regard the arrangement thus finally come to as a mere variation of the original arrangement. There were new proposals made by different persons containing different terms.
39. There was, in my opinion, a concluded agreement between the parties by reason of the letter of the engineer of the Corporation dated December 9, 1921. The question, however, then arises whether it is an agreement which is enforceable in law. I am clearly of opinion that it is not. The original sanction given by the Corporation with specific reference to the terms of the first offer was a sanction given specially in a particular case and not a sanction given generally, either form of sanction being permissible under the terms of Clause (d) of Section 92. The sanction to the original proposal having been given in that particular case with reference to the particular offer then made, I am clearly of opinion that the plaintiffs cannot rely on that sanction as authorising the making by the Commissioner of a subsequent contract without reference to the Corporation. With regard to the agreement finally come to by virtue of the letter of December 9, 1921, no sanction was obtained from the Corporation until April 19, 1926. The sanction then given is in these terms: " That as recommended by the Standing Committee in para 2 of their resolution No. 72, dated April 7, 1926, approval be given to the terms of settlement arranged in respect of the acquisition of the property bearing N. S. No. 1863 (part) at Dadar Kumbharwada Plot No. 52 Case No. M/75 mentioned in the Commissioner's Letter No. S. E 94/A dated February 23, 1926." Turning to the letter of the Municipal Commissioner there referred to, it will be seen that that letter sets out the history of the negotiations between the parties. It refers to the fresh proposals mad(c) by the letter of September 29, 1921, to the fact that they were subsequently modified, and the letter ends by requesting the sanction of the Standing Committee and the Corporation with retrospective effect to the modified arrangement set out in the letter. It may be noted that even if retrospective effect could in law be given to the modified arrangement as requested by the Municipal Commissioner, the resolution passed by the Municipal Corporation did not in terms so provide.
40. What then is the legal position resulting ? No contract has in fact been made between the parties after sanction given by the Corporation, and having regard to the provisions of Section 69 (b) of the Municipal Act it is plain that no contract can be made until and unless sanction has first been given. In my opinion, therefore, the Corporation cannot enforce the agreement finally arrived at by virtue of the letter of December 9, 1921.
41. If, contrary to my opinion, there exists in this case any contract enforceable by the plaintiffs in law, a further question arises whether the plaintiffs can ask for specific performance in the events which have happened. There has been an acute controversy between the parties in regard to the alleged obligation by the Corporation to construct a road to the south of plot C. It is, in my opinion, very unfortunate that the agreement relied upon by the plaintiffs in these letters should be so indefinite as to the making of the road that such a controversy between the parties as to the alleged obligation of the Corporation could be possible. The vagueness of the documents imposes upon the Court the obligation of ascertaining, if it can, the extent of the obligation, if any, upon the Corporation in regard to the construction of the roads. Turning to the original offer of November 16, 1920, the two owners agreed to purchase the land there referred to and to pay Rs. 8,166 for, inter alia, "part of the cost of making roads in front of the plot to be given to us." I draw attention to the fact that the word used is "roads" in front of the plot and not "road". Before passing from this offer to the subsequent letter, it is important, I think, to observe that by Clause 8 the owners were to allow the Municipality to enter upon the "premises and construct the road thereat before the actual transfer of land takes place." Having regard to that provision, I am clearly of opinion that it was the intention of the parties at that stage at any rate that the Municipality should within a very short time of the making of the agreement enter upon the land and start constructing the road.
42. Turning next to the proposal put forward by the owners in the letter of September 29, 1921, it will be seen from Clause 4, that they agreed to pay the sum of Rs. 81 (j6 and a further sum of Rs. 550, and that it was expressly provided that those sums should include, inter alia, "the cost to the Municipality of making roads in front of the plot to be sold to us." That clause went on to provide that "the payment shall be made on the execution of the conveyance to us of the land aforesaid agreed to be sold to us," Stopping there, I do not think that the making of the roads was a condition precedent to the contract, and if circumstances had permitted of a conveyance being tendered by the Corporation to the defendants shortly after this offer had been finally accepted as it was on December 9, 1921, the defendants, in my opinion, would have been bound to pay whether the roads had then been constructed or not, That question, however, does not arise because no conveyance was ever tendered. It is admitted by the plaintiffs that in fact before the suit was brought they never constructed the road to the south of plot 0 or any part thereof. After the suit was brought, they purported to construct half the road fronting that plot, there being a controversy between their engineer and the defendants' engineer whether in fact even that half road had been properly and fully constructed.
43. It may here be mentioned that the controversy which arose by reason of third parties making a claim to the first defendant Pandu's half share in this property in question was decided by a decree of this Court passed on February 26, 1923, as a result of which Pandu was declared the half owner of the share. The Corporation, therefore, if they had been diligent, could within a short time of February 1923 have ascertained who the real owners of the property were, and they might, if they had been so minded, have then proceeded to construct the road to the south of the plot. They did not do so, and not until July 5, 1924,-having taken no steps to construct the road or any part thereof,-did they put forward a claim on the defendants for payment of Rs. 15,690 odd. Their letter making this claim was not replied to by the defendants until April 22, 1925, when by their solicitors they put forward a contention that they were entitled to have the entire road to the south of plot C constructed before they were under any obligation to complete the contract. That claim was repudiated by the Corporation in a letter of April 30, 1925, wherein it was alleged that it was never agreed "that the whole of the road on the south of the plot will be constructed by the Municipality." The defendants again put forward a claim to have the entire road constructed, and in their letter of June 25, 1925, the solicitors for the Corporation contended that no such condition ever formed part of the contract, and they called upon the defendants to pay a sum of Rs. 15,140-15-6. That demand the defendants declined to comply with.
44. Now, this being the controversy between the parties as appearing from the correspondence, what is the obligation imposed upon the Corporation by the alleged agreement or agreements upon which they rely ? In this connection, it must be borne in mind that the defendants were to pay the sum of Rs. 8,166 to the Corporation in addition to handing over to them the sum of Rs. 6,922, the amount awarded as the value of the land. In that sum of Rs. 8,166 is included a sum of Rs. 3,258 as the cost of making half the road. In addition to that, there is a sum of Rs. 2,328, as a charge for betterment. Having regard to the fact that the defendants were paying this large sum for betterment, and that they were making the payment of Rs. 8,661 as part of the cost of making roads in front of the plot, I am clearly of opinion that there was an implied obligation on the Corporation to construct roads in front of plot C both on the west and on the south at any rate to the extent of those plots. In my opinion it is quite unreasonable to suppose that the defendants would have agreed to pay this large sum, including the amount for betterment, unless the Corporation were impliedly bound to give them the benefit of the whole road. If, as contended by the Advocate General, the only obligation upon the Corporation so far as the defendants are concerned was to construct hall a road, and if they were not bound to construct the whole road unless and until the adjoining owner on the other side provided the money therefor, these defendants might have had to wait indefinitely for the construction of the road for which, in my opinion, they were paying this large sum of money. I think it quite unnecessary to decide whether the higher case put forward by the defendants, namely, that the Corporation were bound to construct the entire road is or is not sound. But I am clearly of opinion that the lesser case put forward by them, namely, that the Corporation were bound to construct the whole road fronting plot C on both sides, succeeds, This being my view as to the implied obligation, the Corporation, in my opinion, clearly broke it. Accordingly, even if there is any enforceable agreement in law upon which they could sue, they are in my judgment precluded by reason of their own breach of that alleged agreement from seeking either specific performance or damages. Accordingly, in my opinion, this appeal succeeds.