Wakilii

Adam v Bhagwanji and Company (Civil Appeal No. 24 of 1949)

East African Court of Appeal · [1949] EACA 13 · 1949 Appeal Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Appeal from decision of H.M. Supreme Court of Kenya
Decision
Judgment of the lower court affirmed; respondent's counterclaim for agency services and expenses upheld

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

The Court held that the written agreement between the parties established a relationship of principal and agent, not vendor and purchaser. The respondents lawfully obtained an import licence to import goods on behalf of the appellant, and this arrangement did not breach import control regulations. As agents, the respondents were entitled to reimbursement for their outlays and to exercise a lien under the Indian Contract Act. The appeal was dismissed.

Outcome

Judgment of the lower court affirmed; respondent's counterclaim for agency services and expenses upheld

Facts

The appellant saw an advertisement by Quilliam Products for bivouac tents and agreed to purchase them. Unable to obtain an import licence himself, the appellant approached the respondents, who held import licences for such goods. By written agreement dated 16 January 1948, the respondents agreed to obtain an import licence and open a letter of credit in favour of the appellant's suppliers in exchange for 5% commission on landed costs and a 25% cash deposit. The goods were shipped to the respondents, who cleared them at Mombasa and railed them to Nairobi. When the respondents offered delivery in May 1948, the appellant refused to take the goods, claiming a shortage and asserting there was a contract of sale. The respondents counterclaimed for their agency expenses and commission.

Issues

  1. Whether the relationship between the parties was one of principal and agent or vendor and purchaser.
  2. Whether the respondents breached the Control of Imports Order 1941 by obtaining an import licence to serve the appellant.
  3. Whether the respondents were entitled to reimbursement and lien as agents under the Indian Contract Act.

Orders

  • Appeal dismissed.
  • Costs awarded to the respondent.

Rules and key headnotes

Contract Law — Agency — Construction of Agency Agreement
Where a written agreement recites that one party obtained an import licence on instructions of another, refers to suppliers as belonging to that other party, and provides for commission on landed costs, the relationship is one of principal and agent, not vendor and purchaser.
Administrative Law — Import Control — Use of Import Licences
There is nothing in import control regulations to prevent an importer from applying for an import licence to serve a principal or oblige another person who is unable to obtain a licence, provided the licence is not transferred and the goods are lawfully imported by the licence holder.
Contract Law — Agency — Rights of Agent to Reimbursement and Lien
An agent who has performed services and incurred expenses on behalf of a principal is entitled to reimbursement and to exercise a lien over goods in the agent's possession under the Indian Contract Act, notwithstanding the principal's repudiation of the contract.

Legislation cited (3)

  • Indian Contract Act
  • Control of Imports Order 1941 paragraph 4
  • Defence (Control of Prices) Regulations

Cases cited (2)

  • Ireland v Livingston (1872) 27 LT 79
  • Jefferson v Querner (1874) 30 LT 867

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

Adam v Bhagwanji and Company (Civil Appeal No. 24 of 1949) [1949] EACA 13 (1 January 1949)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.