Name : M Salman Majeed

Registration no / Roll no :
L1F18LLBH0029

Section : A

Subject : Law of contract (2)

Topic: Indemnity bond

Submitted to : Maam Freeha khaled

 Indemnity Bond

This deed of indemnity bond is made by Muhammad Ali

(indemnifier) in favour of Haroon & sons Co.(indemnified).

1. That, I Muhammad Ali (indemnifier) son of Ali Hamza, is

resident of House # 74 Block G , DHA , Lahore.

2. That, I Muhammad Ali (indemnifier) is an employee of the

Haroon & sons Co.
3. That, I am being dispatched to Malaysia for a technical
training session that extends over a period of 2 months,
commencing at April 01,2015 and terminating at june
01,2016 by my employer Haroon and sons Co, who
certainly will be bearing the cost of the training session
and my subsistence.
4. That, I Muhammad Ali (indemnifier) hereby agree that on
the completion of the period of this training in Malaysia, I
will immediately return to Pakistan as directed by the
company; and on my return will continue to serve the
company faithfully and diligently for a period of three
years in a grace of service, which in the discretion of
company shall be appropriate to my knowledge and
efficacy acquired during the training under the usual
conditions of service of the company, if so required by the
company. During this period any increment in my salary
 will be in accordance to both, company and my
performance.
5. That, I agree and undertake to indemnify Haroon and
sons Co. fully in respect of my failure to comply with the
stipulation stated in Clause IV, with specified sum of
money the company has disbursed on my technical
training session and sustenance in Malaysia.

I WITNESS WHEREOF I, Muhammad Ali (indemnifier) as an

employee to the company has signed this bond on Janurary
20,2015 .

Indemnifier: Indemnified
Muhammad Ali Haroon & sons
Co.
CNIC: 31104 -2059-107-8

Witnesses:-
1.
Signature
Name: Waleed tariq
CNIC No. 31104-2040-106-7
(Copy attached)
Address:
House#22, Bahria Town, Lahore

2.
Signature
Name: Usama iqbal
CNIC No. 31104-2040-101-8
(Copy attached)
 Address:
House#32, Bahria Town, Lahore

Haroon & sons co. v. Muhammad Ali

Arguments

Like any promise , contract , or any agreement there include 2 parties .

similarly in this there are two parties included haroon & sons and
Muhammed ali . In this M Ali is indemnifier and haroon & sons is the
indemnity holder .

1. Presence of Contract of Indemnity and its imperatives

The parties to the litigation delivered the issue of an understanding

between them. The understanding was in real a Contract of Indemnity.
Haroon and sons Co. – the offended party in the suit laid the cases to the
break of agreement by the respondent Mr. Muhammad Ali and in this way
look to be repaid for the misfortune they persevered. Then again
Muhammad Ali has perpetually denied the claims in wake of the way that
he has served the organization for a long while now with his redesigned
aptitude from preparing and doesn't wish to serve organization any further.
The situation rotate around the ideas of the basics of an agreement of
repayment. Before this that we set up the obligation for the situation it must
be altogether recognized that the source from where this agreement of
reimbursement starts, satisfies all the imperatives of repayment which may
thus decide whether the respondent should reimburse the offended party.
The Contract of Indemnity has been defined in Contract Act 1872 in Section 124 in
following words:
A contract by which one party promises to save the other from loss caused to him by the
conduct of the promisor himself, or by the conduct of any other person, is called a
"contract of indemnity".
So it is clearly seen that Muhammad ali broke the indemnity bond hence he
also broke the clause wriitn in the bond that after the training he will work
for the company for three years but he left the things in the half way hence
he broke the bond and also cause a much damage to the company
named Haroon & sons who exclusively endured the expense of the training
and subsistence of the defendant while in Malaysia, as the defendant was
in the servitude of the plaintiff as a paid employee. Quid pro quo to this
action of the plaintiff the defendant had agreed to serve the company for
three years upon his return from training session in Malaysia, while being
paid monthly. However upon his return the defendant has served the
plaintiff for only eight months and resigned. This fact of the series of
circumstances of the case is an explicit yet substantial evidence to the
conduct that has been stipulated to give rise to a loss in the contract of
indemnity, between the plaintiff and defendant. Thus he can be liable to
pay for the expenses as he written in the indemninty bond also the article
124 & 125 are also applicable in it .

The contract of indemnity hereby originates from the indemnity bond

written by Muhammad Ali in favour of Haroon & sons Co. and the conduct
of Mr. Muhammad Ali accounts to the behavioural phenomenon that the
Section 124 has indicated towards which has further entailed loss to
Haroon & sons Co. in form of losing an employee for whose expertise and
training they have financed.

2. DAMGES :
Subsequently Section 125 of the Contract Act of 1872 maintains
the rights of the indemnity-holder as follows:
The promisee in a contract of indemnity, acting within the scope of his
authority, is entitled to recover from the promisor-
(1) all damages which he may be compelled to pay in any suit in
respect of any matter to which the promise to indemnify applies;
(2) all costs which he may be compelled to pay in any such suit if, in
bringing or defending it, he did not contravene the orders of the
promisor, and acted as it would have been prudent for him to act in
 the absence of any contract of indemnity, or if the promisor
authorized him to bring or defend the suit;
(3) all sums which he may have paid under the terms of any
compromise of any such suit, if the compromise was not contrary to
the orders of the promisor, and was one which it would have been
prudent for the promisee to make in the absence of any contract of
indemnity, or if the promisor authorized him to compromise the suit.
As per the directives laid in Clause 3 of the Section 125 of the Contract Act 1872,
Haroon and children Co. are qualified for recuperate the whole of cash they have put
resources into financing the preparation and subsistence of Mr. Muhammad Ali in
Malaysia. The reimbursement bond made in support of them incorporates a comparable
cure in Clause V which peruses:

That, I agree and undertake to indemnify Haroon and sons Co.

fully in respect of my failure to comply with the stipulation stated
in Clause IV, with specified sum of money the company has
disbursed on my technical training session and sustenance in
Malaysia.

JUDEMENT :
As we have seen above that when M ali made a indemnity bond
and promise to fulfil all the things and the condition which are
made up by haroon & sons as u have promised that u will work
for 3 years after coming back from Malaysia , but as M ali is
unable to fulfil the condition and break the promise and the
condition of the indemnity bond he made now under clause 5 so
now he is liable to pay 500,000 for the recovery and the expenses
done on his training in Malaysia as the breaking of bond cause
damge to the company . Hense Haroon & sons win the case .