Category Archives: Civil Law

Sign Only What You Mean

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When was the last time you signed a contract without reading it?

If you think you’ve never done that, have you ever read the terms and conditions which are in a little scrolly box before you’ve signed up for an eMail account? Do you know what Orkuts terms of service are? Or for that matter Facebook’s or Twitter’s are?

Whether or not one thinks of it, they are legally binding contracts. One recent example where such a contract was used against someone was in Megan Meier’s suicide case. Megan killed herself at the age of thirteen after being rejected online by a person she thought was a sixteen year old boy. That person, however, turned out to be Lori Drew, the mother of one of her friends.

Strangely enough, there were no laws which could readily be applied to prosecute the woman so she was ultimately charged with violating MySpace’s terms of use which, among other things, do not allow ‘promoting information users know to be false or misleading, or soliciting personal information from anyone under the age of 18 or using information gathered from the Web site to ‘harass, abuse or harm other people’.’

Presumably Ms Drew had no idea of what the terms of service were although in all probability, knowing them would not have stopped her from acting in the way she did.

The point, though, is not merely that she didn’t know what she signed up for but that the contract was treated as being binding on her and was given the ‘force of law’.

This is, by no stretch of the imagination, the only case in which a contract has been given such force. In the recent case of the overweight air hostesses the single judge bench of the Delhi High Court described the employment contract the air hostesses has signed as their nemesis. And in that case, it appears that the air hostesses did in fact know what they had signed.

Nonetheless, despite knowing what the pitfalls of signing agreements without knowing what their contents are or signing agreements without wanting to be bound by them, it’s something most people do without thinking twice.

Think of all the times people have signed loan agreements which say that they will repay money at 20% interest just because their money lender says, “But I’ll charge you only 14%, just let this be there on paper.”

The problem with just letting things be on paper is that if you sign them, they will bind you. It doesn’t matter if you have a separate oral agreement with different terms. It doesn’t matter if the other party claims that he won’t enforce the terms on paper.

The law of evidence very clearly says that oral evidence is excluded by the existence of documentary evidence. There are a few exceptions and provisos but they apply so rarely that it’s hardly worth taking them into consideration at all. For example, if you do not write your whole agreement down, while interpreting it and deciding whether or not you can give oral evidence about a supplementary oral agreement which you have not written down and which does not go against anything you have written down, the court will take into consideration ‘the degree of formality’ of the contract i.e. basically, who drafted it. And the contract will be interpreted differently depending on whether it was drafted by two laymen over coffee or by two dozen overpaid lawyers.

As a general rule, the only thing which a court will take into consideration is your written contract.

The moral of the story: sign what you mean, and mean what you sign.

Nasty Comments on Your Blog

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What do you do if someone leaves distasteful comments on your blog?

The law regarding comments is actually a bit dicey: if a blog owner’s Terms of Service clearly say that they allow unmoderated comments, that they bear no responsibility, and if they remove nasty comments once they’re brought to their notice, they generally won’t be held liable for nasty comments made by other people. The picture changes, however, if the comments on a blog are moderated: if a blog’s owner chooses to take on the responsibility of not allowing nasty comments, then they will be liable if any appear. The result is that absurdly enough, the less care you take, the less liable you are. This is, however, drawn from case law in non-Indian jurisdictions; the Indian position is unclear.

The Law Applicable

In the case of a blog, there are two different agreements.

One between the owner of the blog and and WordPress / Blogger / Blogware / whichever service used i.e. the fascinating Terms of Service which hardly anyone ever reads.

In the case of blogs hosted by WordPress / Automattic, that agreement is governed by US law. As far as the choice of forum is concerned, there seem to be three aspects, briefly: (a) that disputes regarding the access to / use of the site are to be settled at a San Francisco court, (b) that disputes regarding the terms of the ToS themselves are to be settled by specified arbitrators and (c) that injunctions can be obtained and IP claims settled at any competent court.

The Automattic ToS does not speak of which law applies to the IP claims and one can only suspect that the issue is arguable since according to the agreement, all IP remains with authors and is not assigned to Automattic. So, the content of a blog may not automatically be treated as a part of the site to which the ToS applies.

However, the ToS is a boilerplate contract so presumably it could be challenged in an Indian Court which probably wouldn’t be too useful since in the absence of unconscionability etc., Indian Courts are not particularly enthusiastic about interfering with contractual choices of law or fora.

The second agreement would be between the owner of the blog and their visitors.

In such a case, the owner of the blog could be the one to impose a standard contract saying that the use of their blog is governed by so-and-so law. Or that all disputes in relation to it are to be settled at such-and-such place.

If the owner of a blog does not have such an agreement, if a case was to be filed, it could be done wherever the cause of action was to arise. Obviously. The country where it was filed would generally apply its own law. Any court could choose to override the ToS of the owner of the blog. The only thing the ToS would do is give them a much firmer ground to stand on while arguing their case.

The bottomline is that there’s nothing to stop anyone from filing anything anywhere. The best the owner of a blog can hope for if that happens is that the case gets thrown out in a hurry.

Consider a case where a third party were to sue for a nasty comment about him. Continuing with the same example, WordPress, if it could be sued, would probably have to be sued in the US because that’s what its ToS mandates. The owner of the blog could theoretically be sued in India. Or the blog service provider and the owner of the blog could be sued wherever the comments were viewed and the damage was done (although an Australian Court refused to allow a plaintiff to sue in such circumstances in Australia a while ago because of a ToS agreement which said that all disputes must exclusively be settled in the US).

In India, case law is still emerging and statutory law is woefully inadequate at the moment.

Defamation

Defamation in India is both a criminal offence and a civil wrong, and there is nothing to stop someone from suing the owner of a blog. And if he / she showed that the actions / inaction of the owner contributed to the defamation, presumably, that person would probably be awarded damages.

As far as defamation as a criminal offence is concerned, the position is somewhat different and only the person who actually makes a defamatory statement can be prosecuted. The Penal Code which was drafted in 1860 obviously has not taken the creation of the Internet into account.

The IT Act

Section 79 of the Information Technology Act, 2000 which deals with the liability of ‘webmasters’ says:

Network service providers not to be liable in certain cases
For the removal of doubts, it is hereby declared that no person providing any service as a network service provider shall be liable under this Act, rules or regulations made thereunder for any third party information or data made available by him if he proves that the offence or contravention was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence or contravention.

A ‘network service provider’ means an intermediary, and under Section 2(w) of the Act, an ‘intermediary’ with respect to any particular electronic message means any person who on behalf of another person receives, stores or transmits that message or provides any service with respect to that message.’Third party information’ means any information dealt with by a network service provider in his capacity as an intermediary.

IT Auction Sales Sacrosant

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In an appeal filed by Janatha Textiles, a partnership firm of Radhey Shyam Modi, Pawan Kumar Modi, Padmadevi Modi and Indira Chirmar, a firm that had been in tax arrears, the Supreme Court not only said that the IT department could attach the property of defaulters to recover the debt but also that if it sold the property, the sales were sacrosanct.

A Bench of the Supreme Court comprising Justices Ashok Bhan and Dalveer Bhandari held that auction sales by the Income Tax Department could not be interfered with unless there were grave irregularities in the process of sale. It said that it was necessary to extend such protection to such sales to ensure that auctioned property fetched the market value or fair price of the property.

Auctions are usually governed by Sections 64 and 20 of the Sales of Goods Act, and relevant case law. There are also provisions in the Port Trust Act and the Code of Civil Procedure which deal with certain kinds of auctions although the provisions in these two statues are not universally applicable.

In addition to statutory provisions, the terms of the auction concerned also play a role of vital importance. Auctions are merely a kind of sale, and the terms of the auction are a reflection of the intention or to parties. Although goods are usually sold by an auctioneer on behalf of the owner, there is nothing to stop a person from selling his own goods in an auction.

An auction is not in itself an offer, it is merely an invitation to treat. In other words, each bid made at an auction is an offer and it is open to the auctioneer to accept or reject that offer provided that he acts in accordance with the terms of the auction. The general principle of the auction is, however, that every higher bid supersedes the previous bid.

The concept of an auction Section 64 of the Sale of Goods Act is a guiding factor on the principles of an auction. It says:

In the case of sale by auction–

(1) where goods are put up for sale in lots, each lot is prima facie deemed to be the subject of a separate contract of sale;

(2) the sale is complete when the auctioneer announces its completion by the fall of the hammer or in other customary manner; and, until such announcement is made, any bidder may retract his bid;

(3) a right to bid may be reserved expressly by or on behalf of the seller and, where such right is expressly so reserved, but not otherwise, the seller or any one person on his behalf may, subject to the provisions hereinafter contained, bid at the auction;

(4) where the sale is not notified to be subject to a right to bid on behalf of the seller, it shall not be lawful for the seller to bid himself or to employ any person to bid at such sale, or for the auctioneer knowingly to take any bid from the seller or any such person; and any sale contravening this rule may be treated as fraudulent by the buyer;

(5) the sale may be notified to be subject to a reserved or upset price;

(6) if the seller makes use of pretended bidding to raise the price, the sale is voidable at the option of the buyer.

The section similar to Section 58 of the English Act, and can therefore be construed in similar terms. It is however important to bear in mind that the statutory provisions contained in Section 64 may be subject to a contract to the contrary. This effectively means that it would be the terms of the auction concerned which would prevail.

Reference materials and relevant cases:

  1. Pollock and Mulla, The Sale of Goods Act 
  2. (1869) LR 9 Eq 60
  3. [1895] All. E.R (Rep) 829
  4. [1907] 2 K.B. 1
  5. AIR 1961 Cal 54
  6. AIR 1961 MP 274
  7. [1963] Suppl. 2 S.C.R. 608
  8. Ouchterloney Valley Estates Ltd. v. State of Kerala (23.10.1964 – SC)
  9. AIR 1980 SC 1468
  10. AIR 1989 All 64
  11. AIR 1992 MP 250
  12. 2005(190)ELT161(Cal) 

The Case of the Overweight Air Hostesses

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Four air hostesses, Sheela Joshi, Shivani Mathur, Anne Patricia Dyook and Kiran Chaudhary filed writ petitions against Indian Airlines Ltd. which had grounded them for being overweight and told them that they would be treated on leave if there is any to their credit or otherwise on ‘leave without pay’ till they reduced their body weight so that it was within limits prescribed by the airline.

The airhostesses said that this order was unreasonable, unfair, without sanction of law and contrary to the Indian Airlines Employees Service Regulations. They also viewed it as an affront to their dignity, honour and womanhood.

The airline didn’t agree.

The appointment letters of the airhostesses inter alia said:

8. While undergoing Training in the Indian Airlines and the appointment as Air-Hostesses, you will be governed by the Indian Airlines Service Regulations applicable to the Flying Crew and Standing Orders concerning discipline and appeals as framed/ amended by Indian Airlines from time to time.
9. During the training period and on appointment as Air Hostesses, your services are liable to be terminated under the following circumstances
I) in the event of your getting married before the specified period
II) If you (a) fail to maintain vision without Glasses
(b) do not maintain weight within the prescribed limits
(c) develop air sickness.

On May 31, 2007, Justice Rekha Sharma of the High Court of Delhi held that they had no case. She said that their appointment letters were their nemesis; they agreed to the terms contained in them.

She also observed, “[I]t is not without rationale that the flying Crew has been subjected to certain standards of height and weight. Their job profile demands it. The aircrafts fly at a very high altitude. Quite often emergency situations arise because of air turbulence or on account of aircraft developing snag. The Cabin Crew including the Air Hostess are expected to handle the situation deftly, with alacrity and presence of mind. All this will be possible only if the Cabin Crew possesses the highest order of physical and mental fitness. And let us not forget that in this era of cut throat competition no Airlines can afford to remain lax in any department whatsoever, be it the personality of its crew members, their physical fitness in all respects or the air worthiness of the air craft or in relation to other facilities such as catering etc. If keeping in view this kind of job performance the Air Hostesses are asked to battle their bulge, control their girth and keep at desired level the affluence of their body weight as per the norms, it is not understood how it is in any way unfair, unreasonable and insulting to their womanhood. It is not the Air Hostesses alone which are put to these rigours. The other Members of the flying crew are also required to maintain a particular weight standard. If by perseverance the snails could reach the ark, why can’t these worthy ladies stand on and turn the scale.”

In 2008, a Division Bench of the High Court of Delhi comprising Justices A.K. Sikri and J.R. Midha affirmed her decision.

Compensation for Railway Accident

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On June 6, 2008, Justice S S Shinde of the Bombay High Court held that Premchand Jakharia and Laxmiben Jakharia whose son died after he fell off a train are entitled to compensation of 400000 INR with interest at the rate of 12 % from the Central Railway as had been awarded by the Tribunal.

Central Railway had opposed their claim before the Tribunal saying that there was contributory negligence on the victim’s part. In its appeal before the High Court, it then contended that the compensation too high and that the victim was not a bonafide passenger.

Interpleader Suits

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An interpleader suit is essentially a suit which is filed by a person who has no direct interest in the subject-matter of the suit. The classic classroom example is:

‘If you find a diamond ring which two people claim, you – the plaintiff – can file an interpleader suit to ask the Court to decide who among the claimant-defendants the owner of the ring is (and thus absolve yourself of responsibility).’

Such suits are governed by Order 35 of the Code of Civil Procedure.

In addition to all the usual requirements of a plaint, a plaint in an interpleader suit must state that the plaintiff claims no interest in the subject-matter of the suit other than for costs or charges. It must also state that there is no collusion between the plaintiff and any of the defendants.

If the thing being claimed is capable of either being paid into the court or being placed in the custody of the court, the plaintiff may be required to pay the amount or place it in the custody of the court to be entitled to an order in the suit.

It may so happen that the plaintiff in an interpleader suit is already being sued by a defendant in another proceeding for the subject-matter or the interpleader suit. In such a case, the court in which the plaintiff in the interpleader suit is being sued stays proceedings against the plaintiff and may provide for his costs. If it does not provide for his costs, the costs of the plaintiff in that suit may be added on to his costs in the interpleader suit.

The court hearing the interpleader suit may declare that the plaintiff’s liability to the defendants is discharged in respect of the subject-matter of the suit, award him his costs and dismiss him from the suit at the first hearing of the interpleader suit itself. However, the court may retain all the parties till the final disposal of the suit in the interest of justice or convenience.

Further, if the admissions of the parties or other evidence allow, the court may adjudicate the title of the subject-matter of the suit. If this is not possible, the question of title may be framed as an issue and tried as it would be tried in an ordinary suit either with or without making one of the defendant-claimants a plaintiff whether instead of or in addition to the original plaintiff in the interpleader suit.

Interpleader suits cannot be filed by tenants or by agents so as to make their landlords or principals interplead with persons who have not claimed through such landlords or principals.

Govt. Officer Not Paid Extra for Extra Duties

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In the case of C N Vasudevan v. Union of India decided on May 7, 2008, a Bench of the Supreme Court comprising Justices Sema and Katju denied a Government Officer any honorarium or remuneration for taking on additional duties which could be performed within his normal working hours.

The issue in this case was whether C N Vasudevan, a Regional Passport Officer was entitled to the grant of honorarium/remuneration for the period he worked as Protector of Emigrants over and above his salary as Regional Passport Officer, Ahmedabad.

He had prayed to the Central Administrative Tribunal an honorarium for working as the Protector of Emigrants since the responsibilities of the Regional Passport Officer and are quite different. His prayer was allowed by the Tribunal. The High Court, by its impugned order, affirmed the order of the tribunal.

Hence, this appeal was made by special leave to the Supreme Court.

The counter affidavit filed on behalf of the Regional Passport Officer, Ahmedabad before the Tribunal states that in all 14 Passport Officers were authorised to perform the functions of Protector of Emigrants so as to decide whether a person intending to depart from India is an emigrant or not for the purpose of Emigration Act, 1983. The duties of Protector of Emigrant were part of the normal duty of the Regional Passport Officer and were to be performed by the Regional Passport Officer during the normal office hours on working days only.

The Supreme Court agreed with this contention. It then gave an analogous example: the District Magistrate/Collector of a district is often also the prescribed authority under various State and Central Acts for discharging functions under the said Acts. This does not entitle the District Magistrate/Collector to any extra remuneration over and above his normal salary.

(This post is an edited extract of the judgment.)