III NOVICE INTRA MOOT COURT COMPETITION, 2020

Participant Code - 2

MAHARASHTRA NATIONAL LAW UNIVERSITY, MUMBAI

III NOVICE INTRA MOOT COURT COMPETITION, 2020

IN THE HON’BLE CITY CIVIL COURT OF MEDITARRANEO

ORIGINAL JURISDICTION

UNDER SECTION 9 OF CODE OF CIVIL PROCEDURE, 1908.

IN THE MATTER OF

VERITAS CORPORATION ...................

Plaintiffs

V.
SOMEL ....................
Defendants

To,

Hon’ble Lordship and His Lordship’s Companion Justices of the City Civil
Court of Meditarraneo

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MEMORIAL SUBMITTED ON BEHALF OF PLAINTIFFS

TABLE OF CONTENTS

LIST OF ABBREVIATIONS .................................................................................

INDEX OF AUTHORITIES.....................................................................................

STATEMENT OF JURISDICTION.........................................................................

STATEMENT OF FACTS ........................................................................................

ISSUES RAISED .......................................................................................................

SUMMARY OF ARGUMENTS ................................................................................

BODY OF ARGUMENTS .........................................................................................

1. THAT A BINDING CONTRACT FOR THE SALE OF GOODS HAS BEEN

VALIDLY FORMED BETWEEN THE PARTIES TO DISPUTE?
a) That there was a valid offer followed by a counter offer and a valid
acceptance to that counter offer.
b) That there was a valid consideration to the promise made by the parties at
dispute.
c) That there was a consensus ad idem (meeting of minds) between the parties
thus constituting a valid contract between the parties at dispute.

2. VERITAS CORPORATION IS RIGHT IN ASSERTING THAT THE

CHANGE IN LABOUR COST IS A RESULT OF AN UNFORESEEN EVENT
OUT OF THE CONTROL OF VERITAS CORPORATION.

PRAYER FOR RELIEF…………………………………………………………...

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LIST OF ABBREVIATIONS:

ABBREVIATION FULL FORM

AIR All India Reporter

Hon’ble Honourable

Ltd. Limited

Mr. Mister

Mah LJ Maharashtra law Journal

Ors Others

S. Section

SCC Supreme Court Cases

V. versus

& And

SCR Supreme Court Reporter

Ed. Edition

Pvt. Private

INDEX OF AUTHORITIES:

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 STATUES
 The Indian Contract Act, 1872
 Code of Civil Procedure, 1908

 CASES CITED
 Romesh Thappar vs The State of Madras (1950) SCR 594
 Haridwar Singh vs Bagun Sumbrui And Ors (1973) 3 SCC 889
 ITC Limited vs. George Joseph Fernandes and Anr (1989) 2 SCC 1
 Ramnath International Construction (P) Ltd vs Union of India
(2007) 2 SCC 453
 Esjay International Pvt. Ltd. vs Union of India (2011) 6 Mah LJ
750

 BOOKS REFERRED
 Law of Contract- Micheal Furmston
 Contract 1- K Vesava Rao

 LEXICANS AND DICTIONARY REFERRED

 Black's Law Dictionary (6th Ed. 1891) 
 Oxford English Dictionary, (2nd Ed. 2009)

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STATEMENT OF JURISDICTION:

The Appellant most humbly submits this memorandum for the appeal filed before the City
Civil Court of Meditarraneo by invoking jurisdiction under Section 9 of the Civil Procedure
Code, 1908.

Section 9 of the Civil Procedure Code, 1908 reads as-

The Courts shall (subject to the provisions herein contained) have jurisdiction to try all suits
of a civil nature excepting suits of which their cognizance is either expressly or impliedly
barred.

All of which is urged in detail in the written submission and is submitted most

respectfully.

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STATEMENT OF FACTS:

1. The dispute involves two parties: Veritas Corporation and Mr. Somel. Veritas
Corporation is a company in Vinonia which produces wine. It owns multiple
vineyards in Vinonia and Mr. Somel is a merchant of wines.

2. On 31 January, 2019, Mr. Somel sent an email to the CEO of Veritas Corporation
offering to purchase wine from Veritas Corporation. The specifics of the offer were
that: i) Mr. Somel would purchase 10 barrels each of 3 different types of wines, that
is,  30 barrels in total; ii) the price of each barrel would be 50 Vins, that is, 1500 Vins
in total; iii) delivery was expected by 1 April, 2019; iv) if Veritas Corporation was to
accept the offer it was required to write back confirming the quantity and the time
within which the shipment would take place.

3. On 15 February, 2019, Veritas Corporation replied to Mr. Somel asking him to

provide an address for the delivery of the barrels within the next two weeks. Along
with that, Veritas Corporation added a condition to the original offer that half of the
payment by should be made via online transfer within the next two weeks and the
other half at the time of receipt of delivery. Another specific was added to the original
offer stating that Veritas Corporation would not be liable for any damage caused to
the good or any delay caused in delivery of the goods or the inability to deliver goods
on the account of an unforeseen event beyond its reasonable control. In essence,
Veritas Corporation would be safeguarded from the consequences of an unforeseeable
event beyond the reasonable control of Veritas Corporation. The abovementioned
condition and specific were merely an extension to the original offer and thus it was
in turn a counter offer to the original offer.

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4. On 21 February, 2019, Mr. Somel replied to Veritas Corporation providing the

address for the delivery and a digital copy of the receipt of the online transfer of 750
Vins.

5. A month passed away but Veritas Corporation did not respond to Mr. Somel. On 21
March, 2019, Mr. Somel sent another email to Veritas Corporation asking whether
everything was on track for the delivery of his order.

6. Veritas Corporation replied to Mr. Somel on the next day saying that due to the
nationwide labour strike and consequent labour shortage in the vineyards, there was a
severe shortage in the number of barrels produced and thus the price per barrel had
increased to 75 Vins.

7. Veritas Corporation offered Mr. Somel a choice to either accept a lower quantity of
barrels for his payment of 1500 Vins or pay the additional amount required for his
original order of 30 barrels so that the contract could still be executed.

8. On 23 March, 2019, Mr. Somel rejected the proposal and demanded the repayment of
his 750 Vins stating that there was no formal acceptance by Veritas Corporation and
thus there was no valid contract. On the same day, Veritas Corporation replied to Mr.
Somel refusing the refund as there was a valid contract and the national labour strike
and the consequent increase in the price were an unforeseen event beyond the control
of Veritas Corporation.

9. As the delivery was expected by 1 April, 2019, and Mr. Somel sent response to the
email sent by Veritas Corporation, Veritas Corporation had to go ahead with the
shipping of the 30 barrels at the enhanced price. The barrels were duly sent and the
remainder of the payment was demanded by Veritas Corporation. The barrels were
not accepted and the payment was rejected. The non-payment and the non-
performance by Mr. Somel caused Veritas Corporation to come before this Hon’ble
Court. 

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STATEMENT OF ISSUES:

1. WHETHER A BINDING CONTRACT FOR THE SALE OF GOODS HAS

BEEN VALIDLY FORMED BETWEEN THE PARTIES TO DISPUTE?

2. WHETHER VERITAS CORPORATION IS RIGHT IN ASSERTING THAT

THE CHANGE IN LABOUR COST IS A RESULT OF AN UNFORESEEN
EVENT OUT OF THE CONTROL OF VERITAS CORPORATION?

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SUMMARY OF ARGUMENTS:

 ISSUE 1: A BINDING CONTRACT FOR THE SALE OF GOODS HAS BEEN

VALIDLY FORMED BETWEEN THE PARTIES TO DISPUTE.

1. It is humbly submitted before the Hon’ble court that the present case is maintainable
before the City Civil Court of Meditarraneo as the aforesaid case has been filed by a
corporation who in its view has faced tremendous problems in the enforcement of this
specific contract or has unjustifiably been deprived of its basic rights provided by The
Indian Contract Act, 1872. In light with the sections cited below the counsel proves that
there was a valid offer, an acceptance to that offer and a consideration for that agreement,
thus constituting a valid legal contract between the parties at dispute.

2. The counsel further submits that there was consensus ad idem between the two parties
and thus agreement by the parties was on the same thing with the same specifications in
their mind. The council for the plaintiff thus humbly submits that there was a valid legal
contract between the two parties. The council also humbly proves that the parties fulfilled
all the conditions there are to constituting a valid legal contract. The council thus humbly
concludes the first argument by pleading that a binding contract has been formed
between the two parties for the sale of goods.

 ISSUE 2: VERITAS CORPORATION IS RIGHT IN ASSERTING THAT THE

CHANGE IN LABOUR COST IS A RESULT OF AN UNFORESEEN EVENT
OUT OF THE CONTROL OF VERITAS CORPORATION.

1. The council humbly pleads before the court that “The nationwide labour strike and
consequent labour shortage in the vineyards due to which there was a severe shortage in
the number of barrels of each of the wines that were produced” as mentioned in 4 th Email

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by Veritas Corporation dated 22 March 2020 constitutes force majeure and is thus comes
under the scope of “unforeseeable circumstance”. . Force Majeure occurs when the law
recognizes that without default of either party, a contractual obligation has become
incapable of being performed because the circumstances in which the performance is
called for, has rendered the performance impossible. In accordance with the cases cited
below the council thus humbly submits before the court that the national labour strike and
increased price was an “unforeseen event beyond the control” of Veritas Corporation and
thus comes under the scope of force majeure.

2. The doctrine of hardship also applies in the present case where the court then as it deems
fit should allow Veritas Corporation to restore equilibrium by getting the remaining
amount of Vins. The counsel thus pleads before the Hon’ble court that the national strike
by the workmen was an “unforeseeable circumstance” out of the control of Veritas
Corporation and thus Veritas Corporation is right in asserting that the change in labour
cost is a result of an unforeseen event out of the control of Veritas Corporation.

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ARGUMENTS ADVANCED:

1. A BINDING CONTRACT FOR THE SALE OF GOODS HAS BEEN

VALIDLY FORMED BETWEEN THE PARTIES TO DISPUTE.

It is humbly submitted before the Hon’ble court that the present case is maintainable before
the City Civil Court of Meditarraneo as the aforesaid case has been filed by a corporation
who in its view has faced tremendous problems in the enforcement of this specific contract or
has unjustifiably been deprived of its basic rights provided by The Indian Contract Act, 1872.
Therefore, it is only fair that the court acting as the “sole protector and guarantor of the
Contractual rights may duly protect the infringement of one’s rights”1.

According to Pollock- “Every agreement and promise enforceable by law is a contract”. It is

also stated in Section 2(h) of The Indian Contract Act that “An agreement enforceable by law
is a contract.”

1. THAT THERE WAS A VALID OFFER FOLLOWED BY A COUNTER OFFER

AND AN UNCONDITIONAL AND QUALIFIED ACCEPTANCE TO THAT
OFFER.
 Section 2(a) of The Indian Contract Act 1872 says that “When one person
signifies to another his willingness to do or to abstain from doing anything,
with a view to obtaining the assent of that other to such act or abstinence, he
is said to make a proposal”. On 31 January 2020 Somel addressed the CEO of
Veritas in an email and offered to purchase barrels of Veritas’s Wines. Thus,
signifying his willingness to buy those barrels with a view to obtaining the
assent of this offer to this act.

1
Romesh Thappar vs The State of Madras (1950) SCR 594

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 It has been held in past cases in the apex court that “ In a counter offer there
is a rejection of the original offer and a new offer is made that needs
acceptance by the original promisor before a contract can be made...”2.The
judicious use of the said case is necessary to prove what a counter offer is and
acceptance to that counter offer. Veritas Corporation CEO addressed in an
email to Somel dated 15 February 2020 the conditions for the payment and the
conditions that would come under the scope of force majeure. Thus,
constituting a conditional acceptance to the offer made by Somel in the first
email which would then constitute a counter offer to the offer made by Mr.
Somel.
 It is stated in Section 2(b) of The Indian Contract Act 1872 that “When the
person to whom the proposal is made signifies his assent thereto, the proposal
is said to be accepted. A proposal, when accepted, becomes a promise.”
Somel replies by his email dated 21 February 2020 the address of the
warehouse where the delivery was scheduled to be. Somel also thanked
Veritas for a prompt response thus signifying his assent thereto the proposal
and accepting the counter offer given by Veritas Corporation in the second
email, thus constituting a valid promise.

2. THAT THERE WAS A VALID CONSIDERATION TO THE PROMISE MADE BY

BOTH THE PARTIES AT DISPUTE.

 Section 2(d) of the Indian Contract Act says that “When, at the desire of the
promisor, the promisee or any other person has done or abstained from doing,
or does or abstains from doing, or promises to do or to abstain from doing,
something, such act or abstinence or promise is called a consideration for the
promise.” Somel purchased 10 barrels each of Veri Red, Veri White and Veri
Gold i.e. 30 barrels total, 10 of each type. Somel offered to pay 50 Vins a
barrel for total payment of 1500 Vins. In response Veritas Corporation found
Somel’s offer reasonable and thus promised to deliver the products in a
stipulated time period except if any unforeseen circumstance arouses during
this duration. Thus, constituting a valid lawful consideration for the promise
made by Veritas Corporation before.
2
Haridwar Singh vs Bagun Sumbrui And Ors (1973) 3 SCC 889

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3. THAT THERE WAS MEETING OF MINDS (CONSENSUS AD IDEM) THUS

CONSTITUTING A VALID LEGAL CONTRACT BETWEEN THE PARTIES AT
DISPUTE.

 An agreement to form a contract must be in Consensus ad idem (the intentions

of the parties forming the contract sense). According to Black's Law
Dictionary (6th Edition) consensus ad idem means “a meeting of minds”.
 The Hon'ble Supreme Court in the case of ITC Limited vs. George Joseph
Fernandes and Anr3, while emphasizing on the concept
of consensus ad idem, observed as follows: - “…..Neither party can rely upon
his own mistake to say that it was a nullity from the beginning , no matter that
it was a mistake which to his mind was fundamental, and no matter that the
other party knew that he was under a mistake but a mistake to an essential
and integral element in the subject of contracts will avoid the contract”.Somel
replied to the second email sent by Veritas Corporation constituting
acceptance to the counter offer sent by Veritas Corporation. In this case Somel
and Veritas Corporation both agreed on the delivery of a specific number of
barrels for a specific amount at a specific interval of time thus constituting
consensus ad idem.
 An agreement is defined in Section 2(e) of The Indian Contract Act “as every
promise and every set of promises forming the consideration for each other, is
an agreement”. As proven above there was a valid promise made and a valid
consideration between the two parties thus constituting a valid legal agreement
between the two parties.
 It is stated in Section 2(h) of The Indian Contract Act that “An agreement
enforceable by law is a contract.” In other words, we can say that a contract is
anything that is an agreement and enforceable by the law of the land. Both
these conditions were fulfilled by the parties as proved above, thus a
constituting a valid legal contract between the parties.

3
(1989) 2 SCC 1

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The council for the plaintiff thus humbly submits that there was a valid legal contract
between the two parties. The council also humbly proves that the parties fulfilled all
the conditions there are to constituting a valid legal contract. There was a valid offer,
a valid acceptance of that offer, thus constituting a valid agreement. The council then
proves that there was a valid consideration for that agreement thus constituting a
contract which is legally enforceable between the two parties. The council thus
humbly concludes the first argument by pleading that a binding contract has been
formed between the two parties for the sale of goods.

2. VERITAS CORPORATION IS RIGHT IN ASSERTING THAT THE CHANGE

IN LABOUR COST IS A RESULT OF AN UNFORESEEN EVENT OUT OF
THE CONTROL OF VERITAS CORPORATION.

The council humbly pleads before the court that “The nationwide labour strike and
consequent labour shortage in the vineyards due to which there was a severe shortage
in the number of barrels of each of the wines that were produced” as mentioned in 4th
Email by Veritas Corporation dated 22 March 2020 constitutes force majeure and is
thus comes under the scope of “unforeseeable circumstance”.
 According to Black’s Law Dictionary (6th Edition), force majeure is defined as
“An event or effect that can be neither anticipated nor controlled.” Force
majeure clauses allocate risk between the contracting parties if performance
becomes impossible or impracticable because of an unforeseen event. Force
Majeure occurs when the law recognizes that without default of either party, a
contractual obligation has become incapable of being performed because the
circumstances in which the performance is called for, has rendered the
performance impossible.
 In Ramnath International Construction (P) Ltd vs Union of India4 the court
observed that “If the work be delayed : (i) by force majeure, or (ii) by reason
of abnormally bad weather, or (iii) by reason of serious loss or damage by
fire, or (iv) by reason of civil commotion, local combination of workmen,
strike or lockout, affecting any of the trades employed on the work. Then in
any such case the officer herein after mentioned may make fair and
4
(2007) 2 SCC 453

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reasonable extension in the completion dates of individual items or groups of

items of works for which separate periods of completion are mentioned in the
contract documents or works order, as applicable.”
 Veritas Corporation was not able to deliver the goods on the scheduled date of
April 1, 2020 as mentioned in Email 1 and thus subsequently delivered the
barrels later due to a nationwide labour strike and with an increased price. The
council thus humbly submits before the court that the national labour strike
and increased price was an “unforeseen event beyond the control” of Veritas
Corporation and thus comes under the scope of force majeure. Which is thus a
valid legal reason for the delay in the delivery of barrels to Mr. Somel. Also,
there was shortage of labour due to the national strike, by applying simple
economics we can deduct that this would result in the increased cost of labour
as supply was less and demand for the barrels was more. The counsel thus
humbly submits that the increase in labour costs was also beyond the control
of Veritas Corporation and thus comes under the scope of “unforeseeable
event”.

 In Esjay International Pvt. Ltd. vs Union of India 5 the High Court said that “a
force majeure condition is said to be something which is unforeseen,
unexpected and which happens suddenly and over which a person has no
control. Things which immediately come to mind is the sudden failure of the
power grid on account of which there is no electricity or a flash strike by the
workmen.” The counsel thus pleads before the Hon’ble court that the national
strike by the workmen was an “unforeseeable circumstance” out of the control
of Veritas Corporation and thus Veritas Corporation is right in asserting that
the change in labour cost is a result of an unforeseen event out of the control
of Veritas Corporation.
 The Doctrine of Hardship is a principle by the International Institute for the
Unification of Private Law (UNIDROIT), which is an independent inter-
governmental organisation in Rome, offers a feasible alternative approach to
‘hardship’ via its Principles on International Commercial Contracts (the
UPICC). These principles are based on the maxim pacta sunt survananda and
stress on the fact that when if a performance of a contract becomes more

5
(2011) 6 Mah LJ 750

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onerous it does not resolve the party of its liability to perform6. Hardship
entitles the disadvantageous party to request the other party to enter into
renegotiations. The request for renegotiations and the conduct of both the
parties is based on the principle of good faith and the duty of co-operation. In
the above given facts Somel did not show either of these principles and knew
about the disadvantageous position of Veritas Corporation who was on the
brink of bankruptcy. The doctrine provides that if the parties fail to reach an
agreement on the adaption of the contract, the court may either:
a) order the termination of the contract or
b) adapt the contract with the view to restore equilibrium.
The council thus requests the court to restore the equilibrium of the contract with
respect to the force majeure argument placed above. As mentioned above the
force majeure allows the contract to be restored back to its equilibrium stage and
thus the counsel pleads before the court that in accordance with the doctrine of
hardship and force majeure the court allows Veritas Corporation to maintain the
contract and thus restore equilibrium by getting the remaining amount of Vins.

PRAYER FOR RELIEF

6
The UNIDROIT Principles, Articles 6.2.1

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Wherefore in the light of arguments advanced, authorities cited and facts

mentioned the Hon’ble Court may be pleased to adjudicate by issuing an
appropriate direction or order that:

a) Decide the order in favour of the Plaintiff Veritas Corporation in accordance

with the Indian Contract Act, 1872.
b) Somel to pay the remaining amount of payment to Veritas Corporation for
the sale of the said barrels.
OR

The court may also pass any other or further order(s) as this Hon’ble Court may
deem fit,
just and proper in the facts and circumstances of the case, in the light of justice,
equity
and good conscience.

All of which is humbly submitted before the Hon’ble court.

Sd/-
Counsel for the Plaintiff -Veritas Corporation.

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