Controlled rate under supply contract includes a notified maximum price, entitling payment at the regulated rate.

A supply contract provided that if any article became controlled during the contract period, payment would be made at the controlled rate. The Supreme Court held that a notification fixing the maximum price of milk under the Hoarding and Profiteering Prevention Ordinance amounted to price control for this purpose. Control of the commodity in the agreement was read as control of its price, and the fact that milk could still be sold below the maximum did not negate price regulation. The contractor was therefore entitled to payment at the notified controlled rate, not the original contract rate.

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Issues: Whether a notification fixing only the maximum price of milk amounted to a controlled rate for the purposes of the supply contract, entitling the contractor to payment at the notified price rather than the contract rate.

Analysis: The agreement expressly provided that if any article became controlled during the period of the contract, payment would be made at the controlled rate. The notification issued under the Hoarding and Profiteering Prevention Ordinance fixed the maximum price of milk. The Court held that in the context of the agreement, control of the commodity meant control of its price, and a government fixation of maximum price was sufficient to constitute a controlled rate. The fact that milk might still be sold below the maximum did not negate the existence of price control.

Conclusion: The contractor was entitled to be paid at the notified controlled rate and not merely at the original contract rate.

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