Power purchase allocation clause required proportionate declaration of capacity, and compensation for diverted power could not be denied.

The Power Purchase Agreement was construed as a whole, and Article 3.1 with Schedule VI required the generator to declare available capacity and allocate it between the two beneficiaries on a proportionate basis. The parties' correspondence, including earlier acceptance of a 58:42 allocation, supported that construction, and the later settlement did not extinguish the claim for the period in dispute. Compensation for diversion of power could not be refused merely because actual loss had not yet been separately quantified, where the Commission had left loss assessment for later determination. The generator was therefore bound to follow the 58:42 allocation, and compensation for diversion was payable.

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Issues: Whether the Power Purchase Agreement required the generator to declare and allocate available capacity between the two beneficiaries in the proportion of 300:215, and whether the purchaser was entitled to compensation for diversion of power to the sister concern.

Analysis: The agreement had to be read as a whole. Article 3.1 expressly allocated capacity between the two beneficiaries, and Schedule VI required the company to submit weekly schedules of the capacity available from the generating station, after which dispatch instructions were to be issued. On that construction, the obligation to declare availability could not be treated as unrelated to the proportionate allocation. The correspondence between the parties also supported the proportionate basis. The earlier letters accepting 58:42 allocation showed acknowledgment of that basis, and the later settlement did not wipe out the claim for the period in issue. The Court further held that compensation could not be denied merely on the ground that actual loss was not separately quantified at that stage, since the Commission had left working out of the loss for separate determination.

Conclusion: The generator was bound to declare availability and allocate power on the proportionate basis of 58:42. The appellant was entitled to compensation for diversion of power, and the contrary view of the Tribunal was set aside.

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