Decided on April 03,1925

WELD AND CO Respondents


- (1.) The appellants in this case are general merchants carrying on business at Kasauli, and the respondents are cotton brokers and merchants at Liverpool with a branch office at Bombay.
(2.) The business transactions between the two firms, carried out by the respondents through their Bombay house, commenced in the month of September, 1915, and had the appearance, at all events, of a succession of contracts for the purchase or sale of cotton for future delivery made by the respondents on the in-structions and for the account of the appellants. These purchases and sales on the appellants side look, it must be confessed, very like gambling transactions, not intended to be completed, and never, in fact, completed either by the taking or the making or delivery of any cotton, Genuine contracts by the respondents were apparently in no way necessary to secure for the appellants all that they desired from their enterprise, and it was at one stage of the case strongly contended by them-it was, indeed, so found by the trial Judge-that a set of contracts tinder discussion in these proceedings-the three contracts, that is to say, which their Lordships will later on refer to as the disputed contracts-were not shown by the respondents to have been entered into with any reference at all to the appellants.
(3.) It has, however, all through been the case of the respondents, and their Lordships for the purposes of their judgment freely accept it that the transactions in cotton futures between the appellants and themselves were in every case translated into real contracts af purchase or of sale involving them in serious liabilities to third parties. All of these contracts had to be made by the respondents in their own name; upon each of them they became personally liable either as buyers or sellers; their relation to the appellants under them was the relation of brokers only, their expected profit being derived exclusively from the commission charged by them on the contracts entered into for behoof of their clients.;

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