3RD INTER SEMESTER MOOT COURT COMPETETION- 2014 | 20

3RD INTER SEMESTER MOOT COURT COMPETETION- 2014 Before THE HONBLE HIGH COURT OF BOMBAY, BOMBAY IN ACCORDANCE WITH THE ORIGINAL CIVIL SUIT (C.S No. /2007) Reliance Constructions Company (RCC) (Plaintiff)VsNew Sahara Consultancy Company (NSCC) (Defendant) Most respectfully submitted to the Honble Chief Justice and other Judges of High Court of Judicature of Bombay MEMORIAL ON BEHALF OF:THE PLAINTIFFCOUNSEL APPEARING ON BEHALF OF:3RD INTER SEMESTER MOOT COURT COMPETETION-2014THE PLAINTIFF

TABLE OF CONTENTSTable of Contents.(i)Index of Authorities(ii-iii) Acts(ii) Books & Articles (ii-iii) Cases.(iii) Websites............(iv) Abbreviations(iv)Statement of Jurisdiction................(1)Statement of Facts...(2)Issues Involved.(3)Summary of Arguments..(4-5)Arguments Advanced(6-19) Issue 1(6-7) Issue 2..........(8-10) Issue 3(11-12) Issue 4(13-15) Issue 5(16-17) Issue 6(18-19)Prayer.(20)

INDEX OF AUTHORITIES

Acts:

1. Indian Contract Act, 18722. Code of Civil Procedure,19083. Law of Tort

Books:

1. Pollock & Mullas revised and edited by Nilima Bhadbhade, 14th Edition: Indian Contract Act, 18722. Dr. R.K Bangias: Indian Contract Act3. Avtar Singhs: Contract and Specific Relief Act4. M.C Bhandaris: Laws of Contract5. Universals: Concise Commentary The Indian Contract Act, 1872 (9 of 1872) With Exhaustive Case Law6. M.C. Kuchhals: Mercantile Law7. Dutt, revised by H.K Saharay: Dutt on Contract-The Indian Contract Act, 18728. Dr. R.K Bangias: Law of Tort9. Ratanlal and Dhirajlals: The Law of Torts

Articles:

1. Fordham Law Review, Volume 62|Issue 12. Construction Articles: Nathan Chapman, Lee C. Davis and W. Henry Parkman3. Force Majeure and the Performance Excuse: Babatunde Osadare4. Impact of Force Majeure on Contracts: P.C Markanda

Cases:

1. Associated Cinemas of America Inc. v. World Amusement Company2. Supreme Court of Minnesota, (1937) 201 minn. 943. K & G Construction v. Harris 164 A.2d 451(md.1960)4. M & W Masonry Constr, Inc. v. head 562 P.2d 957, 961-62(Okla. Ct. app. 1976)5. Morgan v. Singley 560 S.W. 2D 746 (ex. Civ. App. 1977)6. Crest Communication Ltd v. State Bank of India 1.2003 3 Mh LJ 1637. V.V. Gupta v. New Delhi mc AIR 2006 DEL 1035(NOC)8. Hindustan Construction Co. Ltd v. State of Bihar (1999) 8 SCC 436 : AIR 1999 SC 31709. AT Brij Paul Singh v. State of Gujarat(1984) 4 SCC 59 : AIR 1984 SC 1703 10. Pannalal Jankidas v. Mohanlal AIR 1951 SC 144, 153: 1950 SCR 979: 53 BOM LR 472 (1951) 21comp cas 111. Hadley v. Baxendale (1854) 9 Ex 34012. New York Times Co. v. Sullivan(1964)13. D.P Choudhary v. Manjulata AIR 1997 Raj. 17014. S.N.M Abdi v. Prafulla Kumar Mohanta AIR 2002 Gawahati 75.15. Toepfer V. Cremer (1975) LLOYDS REP 11816. Bhagwan Das Metals Ltd v. M/S Raghvendra Agencies17. Ganga Saran v. Ram Chandra Ram Gopal AIR (1952) SCC 918. A.P V. Associated Engg. Enterprises AIR 1990 AP 294

Websites:

1. www.lexisnexis.com2. www.indiankanoon.com3. www.advocatekhoj.com4. www.vakilno1.com5. www.manupatra.com6. www.outlaw.com7. www.wikipedia.org8. www.law-dictionary.com9. www.mondaq.com10. www.legalmatch.com

Abbreviations:

1. NSCC: New Sahara Consultancy Company2. RCC: Reliance Constructions Company3. CPC: Civil Procedure Code4. ICA: Indian Contract Act5. AIR: All India Reporter6. SCC: Supreme Court Cases7. Co.: Company8. Inc.: Incorporation9. Ltd.: Limited10. SC: Supreme Court11. Sec.: Section3RD INTER SEMESTER MOOT COURT COMPETETION-2014 | i

MEMORIAL ON BEHALF OF THE PLAINTIFF

STATEMENT OF JURISDICTION

The Honble High Court of Bombay has jurisdiction in the instant case under Section 6, Section 9, Section 15 and Section 20(a) of the Code of Civil Procedure, 1908.Section 6 of the CPC, 1908Pecuniary Jurisdiction Same in so far as is otherwise expressly provided, nothing herein contained shall operate to give any court jurisdiction over suits, the amount or value of the subject matter of which exceeds the pecuniary limits(if any) of its ordinary jurisdiction.Section 9 of the CPC, 1908The court shall (subject to the provisions herein contained) have jurisdiction to try all suits of civil nature excepting suits of which their cognizance is either expressly or impliedly barred.Section 15 of the CPC, 1908Every suit shall be instituted in the court of lowest grade competent to try it.Section 20(a) of the CPC, 1908Subject to the limitations aforesaid, every suit shall be instituted in court within the local limits of whose jurisdiction:-a- the defendant or each of the defendants where there are more than one, at the time of the commencement of the suits, actually or voluntarily resides, or carries on business, or personally work for gain.

STATEMENT OF FACTS1. NSCC is a growing private equity firm with an annual turnover of Rs. 200 crore for the fiscal year 2005-2006. It is an Indian Company with its base in Mumbai. RCC, also an Indian Company is a reputed name in the real estate industry. Several building contracts for top corporate houses have been executed by it for years.2. NSCC & RCC entered into a contract to build a corporate house for NSCC by December 2006 with the total cost of the project Rs. 60 crore, payable in four equal tranches. A bank guarantee, which was 50% of the value of contract or Rs. 30 crore was also required to be furnished by RCC in favour of NSCC to cover any breach on their part.3. The construction work was started as per the schedule in Oct, 2005 and on 10th June 2006 a fire broke out & caused severe damage to building and thereby delaying the work. A committee setup found that reason of fire was the position of machinery kept by RCC, but it was not concluding whether RCC was at fault or not. It also stated that there would be at least 20% increase in cost of completion of contract and who would bear the extra cost was to be decided in a meeting which was never held. 4. After completion of project in March 2007, RCC claimed last tranche of payment and Rs 5 crore as additional cost for delay and asked NSCC to refer to clause 11 & 12 which stated RCC will not be liable for any delay or damaged and further RCC can levy charges in case where delay occurred due to circumstances outside of the control of RCC 5. NSCC stated, RCC has failed to perform his side of contractual obligations and the delay has caused loss to then and thats why they claimed Rs 50 lakhs and invoked the bank guarantee on 30th Mar, 2007 and collected Rs 50 lakhs from the bank.6. On 20th may 2007 RCC filed a Civil Suit in the Bombay HC, claiming Rs15 crore pending of final tranche of payment, Rs 5 crore for additional cost arose as consequence of accident, Rs50 lakh amount collected by NSCC under bank guarantee, interest on all these amount and Rs 5 crore as compensation of loss arising from libelous statement made by CEO of NSCC alleging RCC to have performed in bad faith. The matter is fixed for final hearing in the Bombay HC.

ISSUES INVOLVED

1- Whether there is a breach of contract?2- Whether withholding of final tranche of payment by NSCC justified?3- Whether NSCC had right to invoke bank guarantee?4- Whether RCC is entitled to damages caused due to delay in construction and breach of contract?5- Whether RCC is entitled to compensation for libelous statement?6- Whether RCC is liable for consequential loss that arose due to delay in completion of construction?

SUMMARY OF ARGUMENTS

ISSUE 1- Whether there is a breach of contract?There is a breach of contract on part of NSCC, as it failed in performing its part of contractual obligation promised under the contract. It had materially breached the contract by withholding final tranche of payment, because terms of contract mentioned that payment would be made to RCC as soon as construction of corporate house was completed.

ISSUE 2- Whether withholding of final tranche of payment by NSCC is justified?The withholding of final tranche of payment by NSCC was not justified because reasons for withholding were not reasonable and just. Withholding was in contravention of terms of the contract, as terms mentioned the time of payment to be made. And as per terms of contract RCC had completed the project.

ISSUE 3- Whether NSCC had right to invoke the bank guarantee?NSCC had no right to invoke bank guarantee as bank guarantee was furnished by RCC to cover breach of contract on their part. There was no fault and breach of contract on part of RCC rather RCC had performed its part of contractual obligation promised under the contract, thus the invoking of bank guarantee was wrong as per terms of the contract.

ISSUE 4- Whether RCC is entitled to damages caused due to delay in construction and breach of contract?

RCC is entitled to damages caused due to delay in construction and breach of contract because there was a breach of contract on part of NSCC and RCC had performed its part of contractual obligation promised under the contract, the non payment for which had put RCC at complete loss and also suffered loss due to withholding.

ISSUE 5- Whether RCC is entitled to compensation for libelous statements?RCC is entitled to compensation for libelous statement because it is a reputed company in the real estate industry and the defamatory against it was published in a popular magazine under an article containing interview of CEO of NSCC. The libelous statement was false and defamatory and was made in bad faith. This proved to be injurious for RCC

ISSUE 6- Whether RCC is liable for consequential loss that arose due to delay in completion of construction?RCC is not liable for any consequential loss fire broke out by reason of force majeure and RCC was not at fault for delay and fire. There was no breach on part of RCC thus not liable for any actual or consequential losses and NSCC had knowledge of fire and delay.

ARGUMENTS ADVANCED

1. Whether there is a breach of contract?It is humbly submitted before honble High court that there is a breach of contract by NSCC as it failed to perform his part of promise under the contract. The terns of the contract mentioned that NSCC is required to make final settlement as soon as the project was completed.On 15th September 2005 NSCC and RCC signed the contract that provided:NSCC will make payment in four equal tranches of Rs 15 crore each, in October-2005, February-2006, june-2006. The final settlement was to be made in December-2006, when the project was completed and was handed over to NSCC.The construction was finally completed in march-2007, three months behind the schedule. The final tranche of payment (15 crore) was withheld by NSCC till the construction was complete on march 1,2007, RCC sent a letter to NSCC claiming the last tranche of payment ,but in reply to this letter NSCC refused to make final tranche of payment to RCC, though the construction was completed.Section 37 of Indian Contract Act, 1872: Obligation of parties to contract.-the parties to a contract must either perform, or offer to perform their respective promises, unless such performance is dispensed with or excused under the provision of this act, or of any other law. Therefore there is breach of contract on part of NSCC. The breach of contract is defined as follows in case of Associated Cinemas of America Inc. v. World Amusement Company1:

1 Supreme court of Minnesota, (1937) 201 minn. 94

A breach of contract occurs when a party thereto renounces his liability under it, or by his own act makes it impossible that he should perform his obligation under it or totally or partially fails to perform such obligation.1.1 Renounciation of liability by NSCCAs per the contract agreement NSCC was liable to make final settlement to RCC on completion of construction of corporate house. But in violation of terms and condition of contract, NSCC refused to make final tranche of payment, on completion of construction on non-justifiable grounds.1.2 Partial failure to perform obligation imposed under the contractAs per definition of breach of contract, the failure in performing obligation may be total or partial under the contact. Thus NSCC partially failed to perform its part of obligation imposed under the contract by non-payment of final settlement to RCC. Thus resulting in breach of contract.1.3 Refutation made upon contentions of RCC was based upon non-justifiable groundsNSCC refuted the contentions made by RCC by stating that construction had not been completed as per schedule agreed under contract and due to delay in construction it had suffered loss of 50 lakhs as a rental charges of leased office premise. But these reasons for non-performing of his part of promise were absolutely non-justifiable due to following reasons:A. NSCC was acquainted with fire in the building and the delay that was supposed to be caused.B. NSCC showed his negligence towards deciding the fault of RCC for fire in building.C. NSCC had knowledge of delay, and the contract was voidable at his option, but he did not take any action at that time and allowed the continuing of contract.

2. Whether withholding of final tranche of payment by NSCC is justified?It is humbly submitted before the honble high court that the withholding of final tranche of payment by NSCC was not at all justified. The terms and condition of contract were worded as below:On 15th September 2005 NSCC and RCC signed the contract that provided:NSCC will make payment in four equal tranches of Rs 15 crore each, in October-2005, February-2006, june-2006. The final settlement was to be made in December-2006, when the project was completed and was handed over to NSCC.As per the terms of the contract NSCC was required to make final tranche of payment as soon as the construction of corporate house was completed.The construction of corporate house was completed by RCC in March 2007 three months behind the schedule. Where RCC was not responsible for delay as its fault was not proved by the investigating committee. Therefore on completion of construction RCC is entitled to final tranche of payment as per terms of the contract. Thus withholding of final tranche of payment by NSCC where substantial performance of promise has taken place , is totally non-justifiable.According to Fordham law review2, article 5 it has stated:Sometimes the withholding of payment will be considered to be a breach of the contract .the terminology will remain the same, however even though the withholding party is also technically a breaching party. In a limited number of situations the withholding party will withhold payment without any breach or justification by the other party. Under the above article court examined issues of withholding by applying Doctrine of Constructive condition and Material breach.

2 Volume 62 issue 1. The problem of withholding in response to breach: a proposal to minimize risk in continuing contract. William J. Geller

Court examine issue of withholding usually do so by applying the doctrine of constructive condition, under which each contracting partys duty to perform a contractual obligation is constructively conditioned on the other partys substantial performance of the prior obligation. Under the contract if a party fails to substantially perform the contract when its performance is due the party has materially breached the contract. In event of a material breach the constructive condition of performance has not occurred. The injured party then has a right to cancel the contract and terminate the remaining executory obligation of each side. The injured party may then also sue the breaching party to recover damage incurred as a result of total breach of contract. An example of the operation of this doctrine is provided by K & G Construction v. Harris3As per this doctrine of constructive condition and material breach following deductions can be made:1 There is no failure of substantial performance of contract by RCC.2 The delay that occurred due to accidental fire was an excusable delay, as it was not in control of RCC to avoid such accidental fire such delay cannot be termed as failure of substantial performance of contract.3 No fault of RCC could be concluded by the committee set up to investigate fire.4 Therefore there is no material breach by RCC in this case.5 Thus when there is no material breach and the performance of contractual obligation has been substantially rendered by RCC. Now it is the duty of NSCC to perform his part of contractual obligation.Thus it can be concluded on the basis of above doctrine that withholding of final tranche of payment by NSCC is not justified. In case of M & W Masonery Constr, Inc. v. Head4:The contractor improperly withheld payment of sub-contractor that had substantially performed. Therefore it was held if a material breach does not precede a withholding; 3 164 A.2d 451(md.1960)4 562 P.2d 957, 961-62(Okla. Ct. app. 1976

the withholding itself is considered a breach.The Fordham law review, article 5 had also made a certain conclusion regarding withholding when justified. This is a second standard used by court allows withholding when the finder of facts determines that the withholding is justified. Court applying this have approved jury instruction that treat the determination of whether a party was justified in withholding payment as entirely question of facts. In case of Morgan v. Singley5 , according to facts of case the contractor was justified in withholding payment of subcontractor.Considering the facts of the case the withholding of payment by NSCC was not justified for the following reasons:1. The substantial delay in the completion of construction of corporate house was due to fire that broke out in the incomplete structure was accidental and was out of control of RCC to avoid it.2. No fault of RCC could be concluded by the committee of officers of NSCC & RCC set up to investigate fire.3. NSCC had knowledge of fire and substantial delay but no action was taken by NSCC for recovery of losses and for further performance of contract at that moment.4. NSCC did not take any initiative in deciding fault of RCC which was recommended by investigating committee neither it hold a meeting in which it was to be decided as to who is to bear extra cost.5. NSCC allowed the further performance of contractual obligation on part of RCC without any objection and further condition.6. As per the promise made under the RCC performed its contractual obligation and the construction was finally completed in March 2007.5 560 S.W. 2D 746 (ex. Civ. App. 1977)

3. Whether NSCC had right to invoke bank guarantee?It is humbly submitted before honble high court that NSCC had no right to invoke bank guarantee except only in case of breach of contract on part RCC, a per the terms of contract agreement. There was no breach of contract by RCC, thus the invoking of bank guarantee by NSCC in the instant case is wrong and RCC is entitled to compensation.The terms of contract stated that:RCC was required to furnish bank guarantee6 in favor of NSCC to cover breach of contract on their part, which was 50% of the value of contract or Rs. 5 crore.As per terms of contract NSCC was entitled to invoke bank guarantee only in case of breach of contract on part of RCC. There was no breach of contract by RCC, thus NSCC had no right to invoke bank guarantee furnished in favor of NSCC to cover breach.In Syndicate Bank v. Vijay Kumar7 , it is well settled that: Bank guarantee is an autonomous contract. It is in common parlance that the issuance of guarantee is what a guarantor creates to discharge liability when the principal debtor fails in his duty and guarantee is in the nature of collateral agreement to answer for the debt, Taking into consideration the facts of the case, the invoking of bank guarantee by NSCC was non-justified for following reasons:3.1 Bank guarantee was furnished by RCC in favor of NSCC to cover breach, if occursThe bank guarantee was furnished by RCC in favor of NSCC to cover breach on part of RCC thus the breach was condition attached to guarantee. NSCC was entitled to invoke bank guarantee only in case of any breach on part of RCC. There was no breach of contract by RCC, therefore invoking of bank guarantee was non-justifiable.

6Guarantee-Section 126 of ICA, 1872, states that a contract of guarantee is a contract to perform the promise or discharge the liability of third person in case of his default.7AIR 1992 SC 1066.

In Crest Communication Ltd v. State Bank of India8:The contract was performed and accepted to the extent of 100% satisfaction and full payment made, an attempt to encash the bank guarantee was stayed.V.V. Gupta v. New Delhi MC9, the plaintiff was allowed relief of injunction where no breach of contract or loss could be proved, where terms of guarantee required such condition.Hindustan Construction Co. Ltd v. State of Bihar10, since a bank guarantee represents an independent contract between bank and beneficiary both of them are bound by its term and they are extremely material.3.2 RCC performed its part of contractual obligation promised under the contract RCC performed its part of contractual obligation promised under the contract. Thus there was no breach of contract on part of RCC. Therefore invoking of bank guarantee by NSCC was absolutely wrong which was furnished for the mere purpose of covering loss from breach of contract.3.3 Delay due to fire was by reason of force majeure cannot amount to breach of contractDelay that occurred due to fire in completion of construction of corporate house was caused by reason of force majeure11, the unforeseeable circumstances which were not under the control of contractor to avoid. Therefore such delay cannot amount to breach of contract and invoking of bank guarantee for such reason is non justifiable by NSCC.8 1.2003 3 Mh LJ 1639 AIR 2006 DEL 1035(NOC)10 (1999) 8 SCC 436: AIR 1999 SC 317011 Force Majeure- Standard clause found inconstruction andsupplycontracts, itexemptsthecontracting parties from fulfilling their contractualobligations forcauses that could not be anticipated and/or are beyond theircontrol. It essentially frees both parties fromliabilityor obligation when an extraordinary event or circumstance beyond the control of the parties, such as awar,strike,riot, crime, or an event described by the legal termact of God (such as hurricane,flooding,earthquake,volcanic eruption, etc.), prevents one or both parties from fulfilling their obligations under the contract. In practice, most force majeure clauses do not excuse a party's non-performance entirely, but only suspends it for the duration of the force majeure.

4. Whether RCC is entitled for damages caused due to delay in construction and breach of contract?It is humbly submitted before honble high court that RCC is entitled to additional charges of Rs. 5 crore for delay in construction for the following reasons:1. The delay in construction was by reason of force majeure, the fault of RCC was not concluded by investigation committee.2. The meeting was supposed to be held for deciding that who shall bear the extra cost of completion which would increase by atleast 20% due to loss by fire but the meeting was never convened by NSCC.3. The contract clause 11 & 12 states the following:11.0 RCC will not be liable for any loss or damage arising out of the work carried out under this contract.12.0 further more RCC is entitled to levy additional charges (I) extra work is required to prepare project before handing over the finished project.(II) increase in costs arising from delay in completion of project, where delay occurs from cause outside the contract of RCC.Therefore in absence of any fault and any meeting for deciding that who shall bear the extra cost the clause 11 & 12 of contract will be referred here. Thus in light of clause 11 & 12 RCC is entitled to additional cost caused due to delay in construction. As clause 12 mentions that RCC is entitled to levy additional charges for increase in cost arising from delay in completion of project where delay occurred from causes outside the contract of RCC.4.1 RCC is entitled to damages caused due to breach of contractRCC is entitled to damages claimed in suit filed, as there is a breach of contract on part of NSCC. The Indian Contract Act, 1872 provides for specific provision relating to relief which can be claimed by injured party from breaching party who had failed in performing its contractual obligation or a promise made under the contract. Such provision can be read as follow:

Section 73- Compensation for loss of damages caused by breach of contract:When a contract has been broken, the party who suffers by such breach is entitled to receive from the party who has broken the contract, compensation for loss or damages caused to him thereby, which naturally arose in usual course of things from such breach or which parties knew, when they made the contract , to be likely to result from breach of it.

In a case of AT Brij Paul Singh v. State of Gujarat12, the Supreme Court came to the conclusion that: Since works and building contracts are undertaken only with a view of earning profits, the party committing the breach would be liable for contractors loss in terms of expected profits.

PATANJALI SASTRI J of Supreme Court observed in Pannalal Jankidas v. Mohanlal13:That the party in breach must make compensation in respect of the direct consequences flowing from breach and not in respect of loss or damage indirectly or remotely caused.

Section 73 incorporates two rules of Hadley v. Baxendale14:

This section clearly lays down two rules related to whether compensation is recoverable for any loss or damage:1. Arising naturally in usual course of things from breach, or2. Which the parties knew at the time of contract as likely to result from breach.On basis of section referred above and various court decision quoted, it can be said that RCC is entitled to damages caused by breach of contract. For the following reasons:

12(1984) 4 SCC 59: AIR 1984 SC 170313AIR 1951 SC 144, 153: 1950 SCR 979: 53 BOM LR 472 (1951) 21comp case 114(1854) 9 Ex 340

4.2 Failure of NSCC in making final tranche of payment to RCC, after completion of project (breach of contract)

The contract terms mentioned that NSCC will make final settlement when the project was completed. But when project was completed and RCC claimed for its final payment the NSCC refused to make payment and withheld the final tranche of payment for non justifiable reasons. Therefore resulting in breach of contract by not fulfilling the contractual obligation imposed under the contract and failed in performing the promise made under the contract.

4.3 RCC performed his part of contractual obligation and any non-payment by NSCC would bring RCC in loss

The building contract undertook by RCC in completion of its construction RCC the contractor had incurred many costs in construction such as labour cost , material cost , machinery cost, equipment cost etc. apart from it lots of effort and time on project and had also borne extra cost which occurred due to the fire which was force majeure. In case of non-payment of final settlement to be paid on completion of project promised as per contract by NSCC would put RCC to a great loss and would upset many a settled expectation of RCC. Therefore RCC is entitled to all compensation and damages due to breach of contract including interest on all amount for wrongly withholding its payment.

5. Whether RCC is entitled to compensation for libelous statement?It is humbly submitted before the Honble court that RCC is entitled to compensation for libelous statement made by NSCCS CEO in an interview published in a popular business magazine. RCC is an Indian company, a real estate contractor and a reputed name in the real estate industry. The publication of an article containing an interview with CEO of NSCC in a popular business magazine as to how the contract entered with RCC was performed in a bad faith, resulted in defamation of RCC, which is a libel and caused a great harm to reputation and name of RCC in the business world. Therefore RCC is entitled to compensation for loss due to defamation caused by NSCC.

5.1 Defamatory statement was published in a popular business magazine

The defamatory statement against RCC was published in a popular business magazine under an article containing an interview with CEO of NSCC. Such a defamatory statement had a vast adverse impact on the reputation and name of RCC established in real estate industryRCC is a reputed name in the real estate industry15 and has executed several prestigious building contracts for top corporate houses over the years. Such a defamatory statement against RCC resulted in lowering the reputation and name of RCC, for which it took years for establishing such name and reputation by the hard work and efforts.In case of New York Times Co. v. Sullivan16, the U.S Supreme court found: The New York times guilty of libel for printing an advertisement that criticized Alabana officials.In D.P Choudhary v. Manjulata17,It was that all defamatory words are actionable per se and in such a case general damages will be presumed.

15Moot Proposition (2)16 (1964)17 AIR 1997 Raj. 170

In S.N.M Abdi v. Prafulla Kumar Mohanta18, it was held that: It is not necessary that the statement need not show a tendency of imputation to prejudice the plaintiff in the eye of everyone in the community or all of his associates.

5.2 Statement was false and defamatory

The statement made by CEO in his interview about the performance of contract of RCC was a false statement because no where it was found that RCC performed his contract in a bad faith. RCC completed its project as per promise made under the contract and the delay which occurred due to fire was by reason of force majeure for which RCC was not at fault. Thus the statement was false and defamatory lowering its reputation and name.

5.3 The statement was injurious

The statement made by CEO of NSCC in his interview was injurious to the reputation and name of RCC in the real estate industry as RCC was a reputed name in the real estate industries and has executed various prestigious building contracts. Any such statement made in respect of RCC will result in a fall of its business and its overall reputation in the real estate industry.

18 AIR 2002 Gauhati 75.

6. Whether RCC is liable for consequential loss that arose due to delay in completion of contract?It is humbly submitted before the Honble court that RCC is not liable for any consequential loss that arose due to delay in completion of construction because the delay was not deliberately caused. The fire that broke out in the incomplete structure was by reason of force majeure i.e., due to unforeseen circumstances which could not have been avoided after due care and caution and such circumstances were out of control of RCC. Thus when there was no breach and fault on part of RCC, it cannot be made liable for any loss.The Indian contract act, 1872 provides for specific provision for relief in form of compensation and damages enshrined under section 73.but such relief can only be sought only in case of breach of contract and no other circumstances.Considering the facts of the instant case, it can be said RCC is not liable for any consequential loss for the following reasons:6.1 RCC was not responsible for fire and subsequent delay in completion of constructionRCC was not responsible for fire that broke in an incomplete building because it was by reason of force majeure; the unforeseen circumstances could not have been avoided anticipated by RCC. It was not under control to avoid such circumstances. Thus the delay in completion of construction of corporate house was not deliberately caused by RCC. Thus it cannot be made liable for consequential loss considering it breach of contract.In Toepfer V. Cremer19: fire broke out, it was held that: Contactor was not responsible for extra cost, presence of force majeure.

19 (1975) Lloyds Rep 118

In Bhagwan Das Metals Ltd v. M/S Raghvendra Agencies20 ,held:Non- availability of relays was force majeure hence no special damage could be awarded.In another case Ganga Saran v. Ram Chandra Ram Gopal21: Plaintiff not entitled for any special damages on non supply of relays on promised time because reason of delay was force majeure.6.2 NSCC had knowledge of fire and subsequent delay to be resulting due to fire, but no step was taken immediatelyNSCC had knowledge of fire and delay, it knew that by reason of fire the work would be substantially delayed, but at that time no step and action was taken by NSCC which amounted to its acquiescence for delay. So, he could not claim any consequential loss which arose due to delay, as he waived his right at time when the incident took place.In State of A.P V. Associated Engg. Enterprises22: Accepted site for construction out of time without giving notice of intention to sue for consequences of delay no compensation was recoverable.6.3 No fault, no breach of contract, thus no actual or special damages could be claimed by NSCC.No fault and breach of contract on part of RCC was there thus NSCC is not entitled to any kind of damages.

20 C.S No., 392 OF 199821 AIR (1952) SCC 922AIR 1990 AP 294

PRAYER

In the light of the issues raised, arguments advanced and authorities cited, may this Honble Court be pleased to:

1. Pass an order against NSCC to pay the sum of Rs. 15crores, the amount of final tranche of payment, Rs 5crores for the extra cost that was caused due to delay in construction, Rs 50lakhs being the amount collected as bank guarantee and interest on these amounts.

2. Pass an order asking NSCC to compensate RCC for making libelous statements against its reputation.

3. Declare that RCC was not at fault and NSCC made default in relation to abiding with the terms of the contract.ANDPass any other order that it deems fit in the interest of Justice, Equity, and Good Conscience.And for this, the Plaintiff, as in duty bound, shall humbly pray. COUNSELS ON BEHALF OF THEPLAINTIFF