“Case Analysis- Assignment”

Legal Aspects of Business

Case: MacPherson v. Appanna, 1951 AIR 184

Facts:
1. Case is regarding apparent validity of contract based on acceptance of a
condition as an offer.
2. Appellant – Col. D L MacPherson was the first defendant.
3. First Respondent - M N Appanna was the plaintiff. The second Respondent
– was the second defendant.
4. Mr White was the manager of another one of the first defendant’s estates.
5. On 24th July first respondent offered 5000 rupees for the sale of Movern
Lodge.
6. On the 8th of August Youngman received instruction from the appellant to
sell Movern Lodge for a minimum price of 10000 rupees.
7. On 9th August Youngman informed the first respondent that they won’t
take less than 10000 rupees.
8. On 14th August first respondent conveyed acceptance of the offer.
9. On 26th August Youngman informed the appellant of 10000 rupees offer
made by the first respondent asking to sell and Mr White informed the
appellant of an offer of 11000 rupees made by the second respondent.
10.Appellant accepted the offer made by the second respondent.
11.First Respondent sued appellant for breach of contract and court granted
3000 rupees as a relief.

Case analysis:

The first defendant' owned a bungalow in Mercara known as "Morvern Lodge ".It
appears that the first defendant owned certain estates in Mercara, and Mr. White
was an alternative director in one of the estates, and Youngman was the manager
of another estate also belonging to the first defendant and was looking after
“Morvern Lodge” during his absence. The plaintiff desired to buy “Morvern
Lodge” owned by the first defendant in Mercara. The plaintiff conveyed his offer
to buy the Morvern Lodge to the first defendant. MacPherson responded to the
offer saying that he would not accept anything less than 10,000 Rupees. The
plaintiff took this to be a counteroffer and accepted it immediately. In the
meantime, the first defendant accepted another offer made by the second
defendant. The second defendant paid the 11,000 rupees and occupied the
Bungalow. The Judicial Commissioner of Coorg held in favour of the plaintiff. It
was against this order that this appeal was made under section 109(c) of the Civil
Procedure Code.

The decision of the court:

• The Judicial Commissioner of Coorg held that there was a concluded
contract, but instead of giving the plaintiff a decree for specific
performance awarded a sum of Rs 3000 as compensation to him.
• The plaintiff himself in his letter responding to the alleged counter-offer
said that he was confirming his offer and not the counter-offer of the
plaintiff. Even the manager of the disputed estate, Mr Youngman treated it
to be an offer and not an acceptance of any counter-offers made by the
plaintiff.
• Any offer to be made by the plaintiff was subject to acceptance by the first
defendant. On these grounds, the court held that the first defendant had
made no counteroffer and was merely inviting offers.

Conclusion:
Some facts that come to light through the correspondence between the parties
support the conclusion we have reached. The real question is whether the first
defendant had made a counteroffer in his cable of the 5th of August or he was
merely inviting offers. The plaintiff repeated his verbal offer of Rs 10,000 for the
bungalow in a letter sent to Youngman, but he did not explicitly specify that he
accepted the first defendant's "counter-offer." Similar to this, Youngman did not
indicate that the first defendant's offer had been accepted in the cable he sent to
him on August 28. Instead, he said that he had been offered Rs 10,000 for the
bungalow. Neither party thus treated the first defendant's cable as containing a
counteroffer. Both Youngman and White, with whom the first defendant was in
contact, believed, correctly, that no transaction could be completed without first
receiving the first defendant's express consent.
Case: Tripower Enterprises v. State Bank of
India, Civil Appeal No. 2373, Supreme Court of
India, 2020

Facts:
1. The State Bank of India had granted a financial credit to Respondent No.
3, i.e. M/S Rukmini Mills Ltd. (the borrower) and for that purpose
Respondent No. 2, i.e. M/S Associated Trading Corporation Pvt. Ltd. had
offered its immovable property as mortgage to the bank and becomes the
guarantor.
2. The borrower, that is, M/S Rukmini Mills Ltd. committed a default, and as
a result, the bank declared the borrower as a non-performing asset and then
filed it before the DRT at Madurai.
3. On 13th May 2008 bank also issued a notice for taking symbolic possession
of the mortgaged property.
4. On 15th October 2008, after considering the reply of the guarantor, took
symbolic possession of the secured asset.
5. M/S Associated Trading Corporation Pvt. Ltd. (the guarantor) filed a
petition before DRT Madurai against the possession notice of the bank.
The guarantor filed an appeal against the decision of the DRT.
6. On 8th February 2013, the appeal filed was rejected on the mere ground of
non-payment of the pre-deposit amount.
7. The bank put the secured asset on public auction to recover the outstanding
sum of Rs. 350.12 lacs. The E-Auction conducted by the bank and the
appellant of the present case was the highest bidder and purchased that
property.
8. On 29th April 2017, the Bank issued a sale certificate in respect of the
purchase of the secured asset by the appellant. The bank had already
applied before DRT to get original documents related to the concerned
property.
9. On 9th November 2018, the DRT rejected the application of the bank.
10. The guarantor filed a petition before High Court after being aggrieved by
the decision of the DRAT. The High Court after taking all facts and
circumstances into consideration restored the decision of the DRT.
11. Feeling aggrieved by the decision of the High Court the auction purchaser
(the present appellant) filed the present appeal by way of a special leave
petition.
Case analysis:
The borrower had received financial credit from the State Bank of India. In this
transaction, a guarantor provided the bank with its immovable property through
a mortgage as a Secured Asset. The guarantor appealed the notice of this
possession to the Debt Recovery Tribunal (DRT) and then to the Debt Recovery
Appellate Tribunal (DRAT), but it was denied both times because the pre-deposit
payment had not been paid. To recoup its unpaid debts, the Bank also offered the
Secured Asset for public auction. The Sale Certificate was given to Tripower
Enterprises Pvt. Ltd. (appellant). However, the DRT declined the Bank's request
to release the original documents so that they may be given to the appellant. When
an appeal was made against this to the DRAT, it reversed the decision of DRT
and directed the documents to be handed over to the Bank. Aggrieved by this, the
guarantor filed a writ petition in the High Court of Madras. This Court restored
the order passed by the DRT and ordered the documents to be retained till the
disposal of the original application, in the interest of justice. The appellant
(auction buyer), not happy with this ruling, filed an appeal with the Supreme
Court. The DRAT's decision to give the bank the original documents back was
affirmed by the court. The High Court's decision was overturned after the appeal
was accepted.

The decision of the court:

• The Supreme Court observed that they cannot ignore the direct interest of
the appellant to get relief, which was earlier claimed by the bank to fulfil
its obligation of handing over the original documents of the property to the
appellant, just because the Bank did not challenge the decision of the High
Court.
• The Court pointed out that the guarantor cannot be allowed to raise the
same plea repeatedly in every proceeding. It held that since the sale
certificate has been issued to the appellant, the Bank now is under
obligation to hand over the title deed to the appellant, for absolute
completion of the sale.
• In light of the aforementioned reasons, the Court reversed and partly
modified the order passed by the High Court and remarked that it should
not have entertained the writ petition filed by the guarantor. Thereby, it
upheld the decision of the DRAT to return the original documents to the
 bank. The appeal was allowed and the High Court’s judgement was set
aside.

Conclusion:
The court determined that the fact that the sale certificate was also granted to the
auction purchaser means that the respondent bank is now required to give the
document to the buyer in response to the application it made to get the original
papers about the disputed property. The Hon'ble Supreme Court then overturned
the impugned judgement of the High Court and implemented the DRAT's order
by stating that the bank's application is partially approved by returning the
original documents to the respondent bank.