Law: Contract Act (IX of 1872)

Section: 230

Law: Civil Procedure Code (V of 1908)

Section: 7

Contract Act (IX of 1872)----S. 230-Principal and agents Contract entered into by agent on behalf of principal-Breach-Agent, except in three contingencies mentioned in S. 230 not personally liable-Both principal and agent cannot be sued in same suit-Civil Procedure Code (V of 1908), O. VI, r. 7.   In the case of a contract whether an agent, apart from the cases specially mentioned in section 230 of the Contract Act, 1872, is to be taken to have contracted personally or merely on behalf of the principal, depends on what appears to have been the inten tion of the parties to be deduced from the nature and terms of the particular contract and the surrounding circumstances. The test question in eases within the principle of section 230 of the Act is always to whom credit was given by the other party, or, if that cannot be proved as a fact, to whom it may reasonably be pre sumed to have been given. The section provides that the agent, except in the three cases specified therein, is not personally bound by the contract. On breach of such contract, therefore, both the principal and agent cannot be sued Lin the same suit.   Nicholas Schinas v. Nemazie and another A I R 1952 Cal. 859 and Messrs The Bombay Company Ltd. v. Haji Adam Haji Peer Muhammad Issak P L D 1959 Kar. 411 ref:   Civil Procedure Code (V of 1908)-----O. VI, r. 7-Principal and agent-Contract entered into by agent on behalf of principal Breach-Both principal and agent cannot be sued at same time.   JUDGMENT   The plaintiffs' suit for recovery of Rs. 58,864 and damages amounting to Rs. 27,918 is based on the following facts: Plaintiffs are a registered firm with their principal place of business at Gujranwala. Defendant No. 2 is a contractor and auctioneer carry ing on business at Karachi, and the case of the plaintiffs is that on 26-4-60 they purchased 31,532 lbs. of scrap copper wire for Rs. 56,400 through the intervention of defendant No. 2. The wire was lying in the compound of the Central Telegraph Stores at Karachi under the administration of defendant No. 1. Plaintiffs were directed by the subordinates of the Post and Telegraph Department to make payment of the…