Appellant: Osman Jamal and Sons Limited
Respondent: Gopal Purshottam
Decided on: July 19, 1928
Jurisdiction: Calcutta High Court
Hon’ble Judge: J. Lord Williams
Area of law: Section 124 and 125 of Indian Contract Act, 1872; (Indemnity)
Facts- A company was acting as the commission agent of the defendant firm and in that capacity bought certain goods for the defendants which they failed to take. The supplier became entitled to recover from the company certain sum of money as damages for breach. The company went into liquidation before paying the claim.
Issues- Whether the defendant was liable to indemnify the plaintiff even though the latter had not actually paid the vendor?
Judgement- It was held that the Official Liquidator could recover the amount even though the company had not actually paid the vendor. The court, however, directed that the amount, should be set apart so that it is used in full payment of the vendor in respect of whose contract the company had incurred liability.
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