P L D 1987 Karachi 112
Before Ibadat Yar Khan, J
ZUBAIR AHMED-Plaintiff
versus
PAKISTAN STATE OIL Co. LTD. AND ANOTHER--Defendants
Suit No. 391 of 1985 and Civil Miscellaneous Application No. 1937 of 1985, decided on
November; 1986.
(a) Civil Procedure Code (V of 1908)-
--- O. XXXIX, Rr. 1 & 2-General rule that Courts in certain situation could not d
performance, held, not unexceptionable Cases which could be exceptions to this genera
"illustrated".
(b) Civil Procedure Code (V of 1908)-
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O. XXXIX, Rr. 1 & 2-Contract Act (IX of 1872), S. 202-Application for injunction a
termination of dealership (Petrol Pump)-Prima facie case existing in favour of plaintiff to in
that his agency was coupled with interest-Plaintiff incurring expenses and putting in labo
establishing and running agency and creating a good-will among customers-Throwing plaintif
of agency without affording an opportunity to prove his case would be nothing but a hard blo
his established business and popularity in business-Defendants on other hand had been reg
receiving their share and charges from plaintiffs and did not show that irreparable injury wou
caused to them if they were not put in possession of land forthwith and plaintiff allowed to r
there subject to regularly paying all commissions and Government duesInterim injun
confirmed in circumstances.
PLD1965SC 83; 1985 CLC 1522; 1985 CLC 2891;.PLD 1965 (W. P.) Kar. 202 and P L D
Kar. 234 ref.
Egypt Air's case 1980 S C M R 588 rel.
Abbas Zia for Plaintiff.
Muhammad Anis for Defendants.
ORDER
This application for interim injunction has been filed by plaintiff in a suit for declaratio
injunction.
The plaintiff and defendants, by an agreement dated Nil Annexure "B" to the plaint agreed to
petrol pump on a plot situated in Sajawal.
By this agreement the defendants have appointed plaintiff as their agent/dealer to sell petro
lubricants produced by the defendants, on the plot, plaintiff was also authorised to sell Bat
tyres and automobile parts on the premi-ses. The plaintiff had also built an automobile s
station and equipped it with machinery and other facilities for servicing motor vehicles
claimed in the plaint that with consent and authority of the defendants the plaintiff has constr
renovated building and structures, and built an underground tank, and bas built a Pucca drive
It is further alleged in the plaint that in all this construction renovation and face lifting of th
the plaintiff has spent sums exceeding Rupees two lacs. These investments and efforts have
duly acknowledged by the defendants. The volume of business has increased and sale o
defendants' products have touched high peaks that these efforts have earned good will and p
for the defendant Company. Details of investments have been given in para.7 and para. 10
plaint and certificate of appreciation and acknowledgement by the Defendants Inspector have
filed as Annexures `C' and 'D' to the plaint. The plaintiff has been running the business of
pump since 1982 fulfilling all the obligations and conditions of the agreement. It is comp
that, the defendant without any reason or justification decided to abruptly terminate the deal
and asked the plaintiff to vacate and surrender the possession and the running business
defendants or their nominee. This threatened injury, the learned counsel for the plaintiff ca
irreparable injury.
The plaintiff has prayed for several reliefs but the relief germane for purposes of disposal o
application under Order XXXIX, rules 1 and 2 of C. P. C. is as follows :-
"(17) That the plaintiff prays for the following reliefs :--.
(a) for a decree of declaration that the plaintiff has himself an interest in the subject-mat
Dealership agency of service filling station of Petrol Pump Station at Sujawal, District Thatt
the agreement of dealership cannot be terminated by the defendants to the prejudice of
interest."
Mr. Abbas Zia, learned counsel for the plaintiff has submitted that it is not a case of li
simplicitor which could be terminated leaving the injured party to claim damages
compensation. The learned counsel reads in the situation of this case an agency coupled
interest and a licence coupled with grant and vehemently argues that the relationship betwee
parties was a contract governed by section 202 of the Contract Act which is as follows :-
"202., Where the agent has himself an interest in the property which forms, the subject-mat
the agency, the agency cannot, in the absence of an express contract, be terminated to the prej
of such interest."
The learned counsel for the defendant No. 1 Mr. Muhammad Anis disagrees with the conten
raised by the plaintiff's counsel. He has read the different clauses of the dealership agree
particularly clause 12 (a) which provides for termination of the agreement by either side by g
one month's notice to the other. Learned counsel argues that after the termination of li
consequences provided in clause 13 would begin to flow and in the language of the agreem
this clause :-
"Upon termination of the licence for any cause whatsoever, Licensee shall cease to have any
or interest whatsoever to enter or remain on the said premises, or to use the said facilities
interfere in the management of Service Filling Station. Upon the termination of the licenc
Licensee shall forthwith deliver the said premises and facilities to the company or to its
authorized agent."
Mr, Abbas Zia, learned counsel for the plaintiff has argued that clause 13 cannot be torn out
context. The learned counsel adds that the penal consequences visualised in clause 13 cann
operative against the plaintiff until the obligations detailed in the preceding para. 12 (a) are vi
by the plaintiff and until the plaintiff commits reach of any of the conditions of the agreement
In the present case the record of the plaintiff has remained satisfactory. There is every thing
favour and nothing against him. The certificates issued by the Inspector of the defendants and
mark of sale of defendants' products hit during the period of agency/dealership are the
testimony of performance by the plaintiff. In any case the threatened termination is not on ac
of any such breach. On the face of it is arbitrary and dishonest inspired by selfish and questio
motives. So, the learned counsel contended.
Both counsels have quoted earlier decisions and tried to apply them on the facts of the ca
hand. Mr. Pishori had relied on P L D 1965 S C 83 ; 1985 C L C 1522 ; 1985 C L C 2891 ;
1965 (W. P.) Kar. 202 and P L D 1973 Kar. 234.
There is no controversy on the proposition that there are certain situations in which Courts c
decree performance. For instances no unwilling employer can be forced not to prema
terminate the terms of employment of an employee whom he does not want. For unl
termination, the employee would have his remedy in damages and not in an injunctio
remaining in service. Similarly a contractor entering on premises to execute works with licen
permission of the owner cannot be provided a relief to hold on to the permissive possession
licence has been cancelled or permission withdrawn. No agent or attorney can be authoris
continue to represent and deal with third parties for and on behalf of the principal after the aut
A has been withdrawn or power has been terminated by grantor. Had it no been so the results w
have been disastrous. But there are cases which are exceptions to this general rule. In situ
where the stakes of licensees and agents are higher and they have been allured to commit
capital on the assurances and guarantees of the licensor and principal then such a licensee or
cannot be chucked off on the whims of their counterparts. These are cases of agency coupled
interest and licence coupled with grant. To appraise such issue in a case is always difficu
surely the crux of the matter. Until this crucial issue is investigated after evidence from both
any decision would be premature and may result in miscarriage of justice.
In the present case the suit itself is for a declaration and injunction. What were the assur
offered to the plaintiff and what promises were held out to him which induced the plaintiff to
such an extent as to put in his own money in the adventure remains to be seen. It is not a
where the plaintiff was installed on the driving wheel of a car to press the button and relea
clutch to start off. According to statement in the plaint, he was asked to pick up bits and piece
them together manufacture the car at his own expense and then take a ride. An investment of
of Rs. 2 lacs with consent and at the request of the defendants is something different from
operating the filling machine installed on a petrol pump. For purposes of disposal o
application and till the evidence is offered by the parties there is a prima facie case in favour
plaintiff to indicate that this was a case of agency coupled with interest.
The plaintiff have been running this business and have earned a good will among their custo
If they are thrown out before they have the opportunity to prove their case they would be upr
from an established business which would mean a hard blow on their established busines
popularity in the oil business. The defendants on the other hand have been regularly receiving
share and charges from the plaintiff.
Balance of convenience or comparative inconvenience to each party is also to be considered
the plaintiff requests for an injunction. The defendants have not shown what irreparable
would be caused to them if they are not put in possession forthwith and the plaintiff i allow
remain on the land subject to his regularly paying all the; commissions earned and also payin
Government dues and taxes regularly.
Mr. Abbas Zia, learned counsel for the plaintiff has relied on the case of Egypt Air (1980 S C
588). The plaintiff was appointed the sole selling agent by the Egypt Air Co. to sell their tick
passengers and also book the cargo. The Air Company then cancelled the agency and tr
resume and appoint someone else as their selling agent. There were charges of non-paymen
misappropriation also against the agency by Egypt Air.
The agent filed suit for declaration and injunction and also prayed for an interim injunction
learned Single Judge dismissed the injunction application and the agent filed an appeal befo
Supreme Court.
The learned Judges while granting the plaintiff leave to appeal observed that the case inv
substantial questions of law and fact. There seems to be a close resemblance between the two
Their Lordships formulated the points that could be raised in the following manner;
"(iii) Whether the plaintiff/petitioner is entitled to continue the agency and or claim damages
the principal on the pleadings as, made by him in his plaint and if so to what ultimate relief h
be entitled on the facts and in the overall circumstances of the case.'"(i) Under what circumst
a contract of agency of the kind involved in this case could be cancelled or revoked by a princ
A close look on the plaint would show that exactly the same question arises in the present case
The first relief claimed by the plaintiff is :---
"(17) That the plaintiff prays for the following reliefs :---
(a) for a decree of declaration that the plaintiff has himself an interest in the subject-mat
dealership agency of service /filling station of Petrol Pump Station at Sujawal, District Thatt
the agreement of Dealership cannot be terminated by the defendants to the prejudice of
interests;'
Respectfully following the Egypt Air's case quoted above I would allow this applicatio
confirm the interim injunction which was granted to E the plaintiff in chambers by order date
6-1985. It may be clarified that no arguments were addressed on behalf of defendant No. 2 an
order is without prejudice to the rights of the defendant No. 2 and to any remedies available t
defendant.
M. Y. H. Petition allowed.
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