Essay About Pubali Bank Ltd. And Following Issues

Legal Environment of Business Term Paper on Contract Law
L501: Legal Environment of BusinessTerm Paper on Contract LawCase Analysis“Pubali Bank Ltd. vs. Sultana Oil Mills and Soap Factory and others, 1998, 17 CLC (HCD) [5615]”Submitted to:Dr. Mohammad Towhidul IslamAssociate ProfessorSubmitted by:Laboni Akter TaranaBatch: 52D, Roll: 14Date of Submission: 15th December, 2014Institute of Business Administration (IBA)University of DhakaIntroductionPubali Bank Ltd. and Sultana Oil Mills and Soap Factory and others were the two parties of this case. Involved Lawyers were Abdur Razzak with Mamun Ali Quadri, Advocates for the Appellant and Khan Saifur Rahman with Mostafa Kamal Pasha, Advocates for respondent No.5. FactThe Eastern Mercantile Bank, the predecessor of Pubali Bank, granted cash credit facilities of taka 5 lac to the defendant no. 1 namely the partnership firm Sultana Oil Mills and Soap Factory against the pledge of oil seed and other stock-in-trade in 1963. The defendant no. 2 to 4, the partners of the defendant no. 1 also executed collateral security against the loan. Defendant no. 3 mortgaged his property as further security for the loan. The defendant No.5 came as partner later. The charge documents were executed on 27-5-1963 and fresh charge documents were executed in the year 1965 and also in subsequent years. The limit was extended up to 1974. But the defendants having failed to repay the loan on several requests, the plaintiff-bank served legal notice Exhibit (E) dated 9-5-1972 and ultimately filed the suit on 30-9-1974 being Mortgage Suit No.91 of 1974 renumbered as Mortgage Suit No.73 of 1984. The plaintiff served the legal notice Exhibit (E) to defendant No. 1 only for payment of loan money. The legal notice Exhibit (E) clearly stated that, unless the defendant No. 1 clears its outstanding liabilities in terms of the legal notice, the bank would be obliged to dispose of the pledged goods at best available price that is, by sale of the pledged goods. It clearly spells out that, the pledged stock-in-trade was still under the custody of the bank. But the plaintiff had no pledged goods of the defendants with them when Exhibit (E) was issued for their redemption as the pledged goods were lost and looted away during war of liberation in 1971. Issue The trial court had to settle the following issues: Whether the suit is maintainable in the present form? Whether the suit is barred by limitation? Whether the suit is barred by principle of waiver, estoppel and acquiescence? Whether the suit is false and fabricated? Whether the suit is liable to be dismissed? The appellate division had to settle the following issues: Whether the suit, can be proceeded with against the surviving defendant-respondents although the deceased defendant-respondent Nos. 2 to 4 and 6 have not been substituted? Whether the defendant-respondent Nos.1 and 5 can be held liable to repay the loan having the defendant-respondent Nos. 2 to 4 and 6 been dead? Whether the suit has been dismissed illegally? Whether the suit is maintainable given the pledged goods have not been accounted for by the plaintiff-Bank? Whether the plaintiff-Bank can get a decree of the unpaid loan when the Bank is unable to return the goods and stock-in-trade kept in pledge to the bank?Whether the appeal filed against and in the name of the dead persons is maintainable? Rule of Law Laws regarding the case are as follows – The Contract Act, 1872, Section 42: “Devolution of joint Liabilities – When two or more persons have made a joint promise, then unless a contrary intention appears by the contract, all such persons during their joint lives, and after the death of any of them, his representative jointly with the survivor or survivors, and after the death of the last survivor, the representatives of all jointly, must fulfill the promise.”