Adjustment Archives - understand-culture

Force Majeure

On February 19, 2020, the Ministry of Finance ruled that “disruption of supply chains due to spread of Coronavirus will be covered” under the force majeure clause of government contracts. On May 13 it went further. For contractors not already in default, dates for obligations falling due from February 20 “shall stand extended for a period not less than three months and not more than six months,” without “any cost or penalty on the contractor/concessionaire.”

The same day, the Ministry of Housing and Urban Affairs asked the states to “treat the pandemic COVID-19 as ‘force majeure'” under the real estate law and to “automatically extend registration of all real estate projects registered under RERA by 6 months.”

Impossible

Section 56 of the Indian Contract Act releases the parties when performance becomes impossible. In Satyabrata Ghose v. Mugneeram Bangur of 1954, the Supreme Court explained the word. “This much is clear that the word ‘impossible’ has not been used here in the sense of physical or literal impossibility.”

Performance can also become impossible, the Court said, when it is “impracticable and useless from the point of view of the object and purpose which the parties had in view.”

Reasonable Compensation

Many Indian contracts name a sum that one side must pay if it breaks the contract. Under Section 74 of the Contract Act, a court does not simply award that sum. In Fateh Chand v. Balkishan Dass, decided in 1963, the Supreme Court said the court “will award to the party aggrieved only reasonable compensation not exceeding the amount named or penalty stipulated.”

The figure in the contract is a ceiling, not a price.

The Moratorium

On March 27, 2020, the Reserve Bank of India permitted lenders “to grant a moratorium of three months on payment of all instalments” falling due between March 1 and May 31. In May it extended the moratorium “by another three months, i.e., from 1 June 2020 to 31 August 2020,” as Business Standard reported.

The Works Contract

Indian contracts for public works often expect prices and dates to move. In a contract of the Delhi Development Authority, quoted by the Delhi High Court in 1998, clause 10CC provides that if the prices of materials “and/or wages of labour required for execution of the work increase the contractor shall be compensated for such increase.” The clause applies to longer contracts.

In the General Conditions of Contract that IIT Hyderabad uses for its works, clause 5 covers delays from force majeure, bad weather, strikes or “any other cause like above, which, in the reasoned opinion of the Engineer-in-Charge is beyond the Contractor’s control.” In such cases the authority “shall, if justified, give a fair and reasonable extension of time.”

Half a Berth

On Indian Railways, a passenger may hold an RAC ticket, Reservation Against Cancellation. “At the time of booking, RAC passengers are assigned a side lower berth, which is shared with another RAC traveller,” Zee Business explains.

Time Is Not of the Essence

Under Section 55 of the Indian Contract Act of 1872, a missed date makes a contract voidable only if the parties intended time to be essential. Otherwise the other side can only claim compensation.

In Chand Rani v. Kamal Rani, decided in December 1992, the Supreme Court applied this to the sale of immovable property. In such sales “there is no presumption as to time being the essence of the contract.” Elsewhere the judgment puts it more strongly: “there is presumption against time being the essence of the contract.”

Bell Recalled

On July 31, 2011, during the Test between England and India at Trent Bridge, Ian Bell was run out on the last ball before tea. He had left his crease, and “wandered up the pitch to congratulate his team-mate and head off for tea,” Wisden reported. Under the Laws of cricket, he was out.

During the interval England’s captain, Andrew Strauss, and coach, Andy Flower, visited India’s dressing room. India’s captain, M.S. Dhoni, withdrew the appeal. “When play restarted after tea, a few minutes late, it was Bell who jogged down the steps.” The ICC later gave Dhoni its Spirit of Cricket award.

Jugaad

In rural Punjab, a jugaad is a vehicle built from what is at hand. One kind bolts a farm trailer to a diesel engine of the kind that drives water pumps. Another, in Moga, fixes a 10 horsepower irrigation pump engine to the front of a wooden cart. It carries about 40 people.

The word means a workaround. In 2017 the Oxford English Dictionary added it: “A flexible approach to problem-solving that uses limited resources in an innovative way.”

The Vocabulary of Making Do

Chalta hai. It goes. It will do. Said of a half-baked solution that is accepted anyway.

Chaltaa kaam. A makeshift or temporary arrangement, according to the Rekhta dictionary.

Zara add-just karo. Adjust a little. A columnist in The Week described the habit of adjusting as “our accommodative spirit towards a less-than-perfect solution.”