Friday, January 11, 2008

Contract Act_Practicle Problems_69

A woman by falsely misrepresenting her to be wife of a well-known Baron (a millionaire), obtained two pearl necklaces from a firm of jewellers on the pre­text of showing them to her husband before buying. She pledged them with a broker, who in good faith paid her Rs 1,00,000. A suit was filed by the jeweller against the broker. Discuss the legal position.

4 comments:

Simardeep Singh said...

well, according to me, the suit filed by the jeweller is perfectly valid as the lady can't transfer a title which she does not have.
However, please correct me if I am wrong.. my email add is simardeep88@gmail.com

harish said...

According to me a suit cannot be filed by the jeweller against broker as it is his mistake by trusting unknown person and giving her credit.Another point is that she shown her husband, atleast then jeweller might have seen her husband.So, the suit by the jeweller is not valid.

If Iam wrong please correct me by sending mail to sharishkumar89@rediff.com

comaony said...
This comment has been removed by the author.
...... said...

If the unilateral mistake is caused by fraud or misrepresentation on the part of the other party the contract is void-ab initio and can be avoided by injured party. Further in case of Lake vs. Simmons wherein a woman by falsely representing to be wife of a Baron obtained two pearl necklaces on pretext of showing it to the husband before buying and then pledge it to broker who in good fiath paid Rs. 1,00,000, then it was held that the broker cannot retain such goods as the jeweler never intended to contract with her and as such the broker did not get title to goods and thus the suit filed by jeweller against the broker is correct.