Skip to content

Jairam Narronji Vs. Kuverbai and ors. - Court Judgment

LegalCrystal Citation
Decided On
Reported in(1885)ILR9Bom491
AppellantJairam Narronji
RespondentKuverbai and ors.
will - construction--vested orcontingent estate--fund set apart by will for payment of monthly allowances proving insucient--right to supply deficiency from the general estate--interest chargeable on property of a testator deposited with a firm. - - telang one of the counsel who appeared for the defendant kuverbai that the latter portion of the above claim did not clearly represen the words in the original, the court's interpreter, mr. therefore, that where a testator left the residue of his estate to a for life, with, subsequent void limitations-as for 'instance, in favour of persons unborn at the death of the testator,-and limitations describing an inheritance in tail male, and where at the same time it appeared that no estate of inheritance, other than' the void state in tail male,.....bayley, j.1. this suit is brought by jairam narronji, the survivor of three trustees appointed by the will of a hindu named chattoorbhooj mowji, dated the 29th june, 1874, executed at yarvara, near dwarka in kathiawar, on the 4th july, 1874, in the presence of captain jackson, acting assistant resident in charge at okhimandal, and other witnesses. chottoorbhooj mowji died on the following day, 5th july, 1874.2. the plaintiff by ms plaint, which was filed on the 2nd august, 1883, prays (1) that the will of the testator may be construed by the court; (2) that his estate may be administered under its direction; (3) that new trustees may be appointed in conjunction with the plaintiff to carry out the trusts of the said will; (4) that it may be ascertained and declared, who is or are the.....

Bayley, J.

1. This suit is brought by Jairam Narronji, the survivor of three trustees appointed by the will of a Hindu named Chattoorbhooj Mowji, dated the 29th June, 1874, executed at Yarvara, near Dwarka in Kathiawar, on the 4th July, 1874, in the presence of Captain Jackson, Acting Assistant Resident in charge at Okhimandal, and other witnesses. Chottoorbhooj Mowji died on the following day, 5th July, 1874.

2. The plaintiff by Ms plaint, which was filed on the 2nd August, 1883, prays (1) that the will of the testator may be construed by the Court; (2) that his estate may be administered under its direction; (3) that new trustees may be appointed in conjunction with the plaintiff to carry out the trusts of the said will; (4) that it may be ascertained and declared, who is or are the person or persons entitled to the residuary estate of the testator after the death of his two widows, Kuverbal and Kesserbai, the first and second defendants; (5) that all proper orders may be made, accounts taken, and directions given; (6) that the plaintiff may have such further or other relief as the circumstances of his case may require; and (7) that the costs of the suit may be provided for. The testator by his will appointed his brother, Visram Mowji, Sunderdas Mulji, and the plaintiff, a cousin of the testator, trustees of his will. He directed that Visram Mowji should carry out his religious and charitable bequests contained in the will; and directed that he alone should obtain probate. Visram Mowji duly proved the will in this Court on the 17th July, 1875.

3. The testator left him surviving his two widows, the defendants (N03. land 2), Kuverbai and Kesserbai, and a daughter, the defendant (No. 5), Jiva (by the defendant Kuverbai), now about sixteen and married, but no male issue. He also left him surviving his brother Visram Mowji and his two nephews, Vullubdass and Morarji, sons of his brother Visram, The testator was separate in estate from his brother and nephews, but owned some property in common with them. The property dealt with by the will was admitted to have been self-acquired.

4. Sunderdas Mulji died on or about the 12th January 1875. One of the testator's nephews, Morarji Visram, died unmarried, at the age of four or five, soon after the death of the testator. The other nephew, Vullubdass, died in 1877 at the age of fifteen or sixteen, intestate, and without issue, leaving his widow, the defendant Vulivahu, him surviving. The testator's brother and executor, Visram Mowji, died on the 9th June, 1882, leaving him surviving a son, the defendant Purshotam Visram, who was borne in 1878. He also left a widow and two daughters.

5. In 1880 Mowji Mulji, the father of at the testator and of Visram Mowji, died. He was not in the firm of Visram Mowji. He was left a legacy of Rs. 10,000 by the testator's will, which was paid to him before his death, and no question arises as to that.

6. The immoveable property of the testator consisted of a half share in a house in the Kalbadevi road in this city, the ground floor of which is occupied by the shop of Messrs. Thompson and Taylor, Chemists, and a half share in a house at Varvara, in Kathiawar, which houses the two brothers had purchased out of their private funds, and of which houses they were tenants in common. The moveable property left by the testator was, according to the plaintiff's account, of the value of about rupees one and a-half lakhs, and was all situated in Bombay. The defendants, the testator's widows, contended that it was of very much greater value.

7. The testator was a member of the firm carried under the name of Visram Mowji, and had a five-annas' share therein. The members of the firm were the testator and his brother Visram; and they were general and piece-goods merchants. The firm is still going under the name of Visram Mowji.

8. The plaintiff's son, Lilladhur Jairam, who was the only witness called in the case, stated that he (Lilladhur) is the eldest eon, and has four brothers; and that he, his father, and his four brothers are now the partners in the firm, he himself baying become' a partner in 1937 (1880-81). He also stated that the house in the Kaibadevi road, i.e. the whole of it; according to the present rates prevailing, is worth from Rs. 60,000 to Rs. 70,000. The house of Varvara he had never, seen.

9. The first question arises on the construction of the limitations in the will regarding the testator's half share in the two houses already referred to. Those limitations are contained in Clause 2 and in a portion of Clause 16. The will is in Gujarati, and the official translation of such portions of the will made by Mr. Flynn, the probate of which was put in and marked as exhibit A, is as follows:

Article 2.-' There are my dwelling-houses in Bombay and Varvara. Bhai Visram Mowji has a half share therein, and a half share is mine. My two wives may reside in the same as long as they may live; and in the event of the decease of my two wives, Bhai Visram Mowji's son, Vullubda's (the same of the living Visram is (shall be) subsequently the owner of my half share; and should the decead Vullubdass take place, then whoever may be the son of Bhai Visram Mowji is (shall be) the owner, and no one has any claim in respect thereof.

10. It having been suggested during the hearing by Mr. Telang one of the counsel who appeared for the defendant Kuverbai that the latter portion of the above claim did not clearly represen the words in the original, the Court's interpreter, Mr. Surrottam Sucearam, was asked to translate it orally, and he stated that the proper translation was as follows:

In the event of the death of Vullubdass, then the children (' chokra') of Bhai Visramji, whoever they may be, shall become owners ('malak'), and no one else shall have any right or title thereto.

11. Towards the end of Clause 16 is the following passage as officially translated by Mr. Flynn:

And by the operation of destiny should the decease of my two wives take place, then as to my immoveable property and moveable property whatever there may be belonging to me, Bhai Vurlubdass and Morarji, two persons, the sons of my brother Visrarn. Mowji, are the owners of the whole thereof. No one else has any claim to the same.

12. During the argument, and in answer to a question from one of the learned Counsel, Mr. Surrottam, the Court's interpreter staled that the literal translation of the latter part of that passag was this ':

I have made my brother Visram Mowji's sons, Bhai Vullubdass and Morarji, two persons, owners. In the same no one else has any right.

13. By Clauses 15 and 16 the testator leaves to his wives, Kuver bai and Kessarbai, monthly allowances, respectively, of Rs. 150 and 200 for their expenses, subject to cesser, in case they conduct themselves improperly in any way, and not in accordance with the respectability of the testator's house. 'Each is to act agree-ably to the directions of his brother Visram.

14. By Clause 8 the testator directs Rs. 20,000 to be credited and kept in the shop of Bhai Visram Mowji for the benefit of certain trusts he proceeds to create in favour of his daughter, Jiva, till betrothal and marriage; and, in the event of her having no son, in favour of the testator's religious and charitable account, for which account, in Clause 3, he directs that the sum of Rs. 50,000 be credited and kept at the place of business of Bhai Visram Mowji.

15. As this will was made by a Hindu after the 1st September 1870, and related in part to immoveable property situated within the local limits of the ordinary original civil jurisdiction of the High Court of Bombay, certain portions of the Indian Succession Act, X of 1865, are, by Section 2 of the Hindu Wills Act, XXI of 1870, made applicable to such will, so far as relates to the testator's half share of the house in the Kalbadevi road.

16. The portions of the Indian Succession Act, X of 1865, applicable to the construction of the limitations of the half share of that house, are mainly founded on decisions in the Courts of Equity in England, and embody the results of the earnest endeavours of a long series of very eminent judicial authorities to give effect to the wishes of testators as expressed in their testamentary documents, which have often been drawn in ambiguous and imper. fectly expressed language.

17. Two years after the passing of the Hindu Wills Act, XXI of 1870, viz., in July, 1876, the Tagore Case L.R. Ind. A p., Sup.47 was decided in the Privy Council. It was there held that by Hindu law, as a general principle, a person capable of taking under gift or will must either in fact, or in contemplation of law, be is existence at the time when the gift takes effect, i.e., in the case of a will at the death of the testator; therefore, that where a testator left the residue of his estate to A for life, with, subsequent void limitations-as for 'instance, in favour of persons unborn at the death of the testator,--and limitations describing an inheritance in tail male, and where at the same time it appeared that no estate of inheritance, other than' the void state in tail male, could be, read or deduced from the will, it was held that the estates of inheritance and estates or interests, subsequent to A's life interest failed. At page 83 the Lords of the Judicial Committee say:' He (the plaintiff) takes nothing under the will. As heir-at-law he is entitled to so much of the inheritance in the real and personal property as is not exhausted by the valid provisions of the will,' In Lallubhai Bupubhai v. Mankuvarbai I.L.R. 2 Bom. 388 : 7 Ind. App. 212 (affirmed in the Privy Council) it was held (in 1876) by the Court of Appeal of the High Court of Bombay, that, 'in the exercise of the testamentary power among Hindus, the intention to disinherit must be clear and unambiguous; and that mere bequests of special portions of the testator's estate to the heir, without language of disherison, do not exclude him from the undisposed of residue,'

18. In the judgment in the Tagore Case L.R. Ind. App., Sup. 47 is a passage which may be usefully cited with reference to the will now under consideration. 'Another general principle applicable to transfers by gift (more lit orally applied in the law of England to wills than to gifts infer vivos)is that a benignant construction is to be used, and that, if the real meaning of the document can be reasonably ascertained from the language used, though that language be ungrammatical or untechnical, or mistaken as to name, or description, or in any other manner incorrect, provided it sufficiently indicate what was meant, that meaning shall be enforced to the extent and in the form which the law allows,

Accordingly, if the gift confers an estate upon a man with words imperfectly- describing the kind of inheritance, but showing that it was intended that he should have an estate, of inheritance, the language would be read as conferring an estate inheritable as the law directs.

' If an estate were given to a man simply without express words of inheritance, it would, in the absence of conflicting context, carry by Hindu law (as under the present state of law it does by will in England) an estate of inheritance. If there were added to such a gift an imperfect description of it, as a gift of inheritance, not excluding the inheritance imposed by the law,' an estate of inheritance would pass.' page 65.

19. I do not consider that the law as laid down in the Tagore Cam L.R. Ind. App., Snp. 47 is affected by the Hindu Wills Act, XXI of 1870, although Mr. Justice Wilson thought it was- Alangamonjori Dabee v. Sona' mom Dabee I.L.R. 8 Cal. 157. His decision was expressly overruled, in May 1882 by Sir Richard Garth, C.J., and Mr. Justice White, who decided that a gift by will to persons unborn at the time of the death of the testator, whether made prior or subsequently to the passing of the Hindu Wills Act, is void--Ahngamonjori Dabee v. Sonamoni- Dabee I.L.R. 8 Cal. 637.

20. The testator in the present case does what we so frequently find in the wills of Hindu testators. He does not make those nearest, and one might presume, dearest to him-his wives and his only child, Jiva-the largest recipients of his bounty. H gives to his wives a right of residence in the half share in the two houses which belonged to him, and makes a money provision for them and for his daughter Jiva. On the death of his wives, he gives his property, subject to the charitable and other bequests to his nephew Vullubdass; and after Vullubdass,, death he makes a bequest 'which is unquestionably void under the principles laid down in the Tagore Case L.R. Ind. App., Sup 47. Then by Clause 16 all the residue of his immoveable and moveable property is, after the death of his two wives, to become the property of his nephews, Vullubdass and Morarji.

21. After carefully considering the will and its various provisions, the able arguments of counsel, and the authorities cited by them, have arrived at the following conclusions:1 am of opinion hat, as regards the immoveab'e property, the two widows take no mote than a right of residence in the two houses. To hold, as contended for by the learned Counsel for Kuverbai, that there was as intestacy as to the half of the Kalbi-devi house, and that the widows took on the testator's death a life estate, and on the death of Vullubda'ss a widow's estate in the remainder, would, I think be contrary to the express provisions of the will. He clearly intended, in Clause 2, to make his nephew, 'Vullubdess, and after him Yullubdass' unborn brother, or brothers, the owner or owners of his half share in the two houses. I think it is quite clear, as well under the Indian Succession Act and Hindu Wills Act as under the principles of construction which I ought to apply in construing these 'limitations, that, under Clause 2 of the will, 'Vullubdass took, on the death of, the testator, not a contingent, but a vested, estate in perpetuity in all that was devised to him.

22. Section 106 of the Indian Succession Act, X of 1865, which is adopted by the Hindu Wills Act, XXI of 1870, is as follows: (His lordship read the section.) Illustration (c) is applicable here. 'A fund is bequeathed to A for life, and after his death to B. On the testator's death the legacy to B becomes vested in interest to B.' If that section be, as probably it is, applicable to the devise of the half share of the house at Varvara in Kathiawdr, the English authorities-which I should, in the absence of any Indian ones, follow-point to the same result.

23. In Benyon v. Maddison 2 Bro C.C. 73 decided by Sir Lloyd Kenyon, M.R., in 1786, there was a bequest of all the testator's estates to A, to pay the income to testator's mother for life, and after her decease, I then give to A, etc., and the residue to B, with power to dispose of it by will. It was held that the legacy to A vested immediately and having died in the lifetime of the mother, was transmissible to the plaintiff as A's representative. The Master of the Rolls said:' I take it the word then in the present case is not to be construed as an adverb of time, and I thought the question had been settled by the decisions,' In the will of Chattoorbhooj Mowji the, word appears in the translation as ' subsequently' which means, at the death of the widows, and is equivalent to the word ' then' in the case just cited.

24. The case of Barnes v. Alkn 1 BroC.C. 180 was decided by Lord Chancellor Thurlow in 1782. There was a devise of the residue of personal estate to the wife, and if she died without issue living at her death, to the testator's two brothers, or, if one of them should be dead, to the survivor. They both died in the lifetime of the wife. The legacy was held to be Vested in both the brothers as joint tenants, and, therefore, went to the representative of the survivor.

25. The necessity that exists for looking at the whole provisions of 'a will in considering whether an estate is vested or contingent, is shown in a decision of the Privy Council in 1882 in a case on appeal from the Supreme Court at New Zealand. There a testator, after making certain dispositions in favour of his wife and others, directed that, from and after the decease of his wife without leaving issue of his marriage, his trustees should stand possessed of all the undisposed of residue of his real and personal estate intrust for his natural daughter for the term of her natural life, with further provision in case of her death or marriage. It appeared that there was no issue of the marriage; that the testator's widow was still living; and that the natural daughter was still unmarried. It was' held, from an examination of the whole will, that, according to the intention therein appearing., the vesting in possession of the natural daughter's estate was not postponed till after the death of the widow-Rhodes v. Rhodes 7 App. Cas H.L. 192.

26. Then the devise in Clause 2, after the death of Vullubdass, is clearly void for remoteness. The defendant, Purshotam Visram, son of the testator's brother, Visram Mowji, was not born till 1878, four years after the testator's death. The Tagore Case L.R. Ind. App., Sup. 47 shows that he could not take under the concluding part of Clause 2. No son of Visram, who was not born until after the testator's death, can take under the limitations in that clause, and accepting Mr. Surrottam's translation as correct, viz., that, 'in the event of the death of Vullubdass, then the children (chokra) of Visram, whoever they may be, shall become the owners (malak),' such children cannot take. As was said by Norman, J., in Srimati Bramamji Desa v. Joges Chandra Dutt 8 B L.R. 41: 'It is a well-settled rule in constructing wills formed upon excellent reasons, and which haw been adopted in the 102nd section of the Indian Succession-Act, X of 1865, that where there is a gift to a class and some persons constituting such class cannot take in consequence of the remoteness of the gift, or otherwise, the whole bequest must fail.' Section 102 of the Indian Succession Act, X of 1865, which is extended to the wills of Hindus by the Hindu Villa Act, XXI of 1870, and which applies to the devise of the half share of the house in the Kalia devi road, enacts that, 'if a bequest is made to a class of persons with regard to some of whom it is inoperative by reason of the rules contained in the two last preceding sections, or either of them, such bequest shall be wholly void.' Soudaminey Dossee v. Jogesh Chunder Dutt I.L.R. 2 Cal 262 decided by Pontifex, J. in 1877, it was held that 'the rule that where there is a gift to a class, and some persons constituting that class cannot take in consequence of remoteness, the whole bequest must fail, as well as the principle of the English Courts in deciding questions of remoteness, that regard is to be had to possible and not to actual events, is applicable to the interpretation of the wills of Hindus.'

27. Next, as to the devise to the two nephews in Clause 18. In my opinion the devise was a devise to them jointly. It created a joint tenancy in the whole of the residuary estate; and, on the death of Morarji in 1875, the survivor, Yullubdass, took the whole absolutely; and on his death, in 1877, his interest was transmitted to his widow, the defendant, Yulivahu.

28. Section 93 of the Indian Succession Act, X of 1865, which applies here, enacts that 'if a legacy be given to two persons jointly, and one of them die before the testator, the other legatee takes the whole. Illustration-'The legacy is simply to 'A and B.' A dies before the testator. B takes the legacy.'

29. As was laid down in the Tagore Case L.R. Ind. App., Sup.47 'if an estate were given to a man. simply, without express words of inheritance, it would in the absence of a conflicting context carry by Hindu law an estate of inheritance' (p. 65).

30. Here there is no conflicting context. The contention that the nephews took as tenants in common is, in my opinion, untenable; the language of the whole will and also that of the particular decree in. question leading to no inference that the testator intended to, or that he did, confer an estate on his nephews as tenants in common.

31. In Lakshmibai v. Ganpat Morobd 4 Bom. H.C. R 161 O.C.J Sir Joseph Arnold said, 'The very reasons assigned by Mr. Jarnian for the technical construction put by English judges on such expressions as 'share and share alike' in English wills show that the rule of construction contended for is one that should not be adopted by Indian tribunals in suits between Hindus * * *. For these reasons it appears to me that in a suit, like the present, in which all the parties are Hindus, ought not to construe the words, 'share and share alike,' occurring in the will, as necessarily constituting a tenancy in common, with all the incidents attached thereto in English law.' See also the remarks of the Court of Appeal on that case in Lahshmibai v. Ganpat Moroba 5 Bom. H.C. R. 138O.C.J.

32. In the present will there are no such words, and no indication of an intention that the nephews should take as tenants in common. The result, therefore, is that Vullubdass by the combined operation of Sections 2 and 16 took at the testator's death a vested estate in perpetuity in the half shore of both houses from his brother's death; and a similar estate in the residuary immoveable and moveable property subject to the right of the widows to reside in the houses, and to have their monthly allowances paid out of the moveable estate; and is subject to the bequests, charitable and otherwise, contained in the will. His interest is now vested in the defendant, Vulivahu, as his widow. Who will be entitled to succeed on her death, it is premature now to consider. There is, in my opinion, no intestacy as to any portion of the testator's property.

33. Then if the particular sourcess of income, out of which the testator directed that his widows' monthly allowances should be paid, be not sufficient, the rest of the moveable property, or rather the income derived from it, as well as the rents derived from the immoveable property, must contribute. It will be noticed that the testator in the concluding clause of his will, directs that an outlay of Rs. 5,000 is to be made after the death of each of his widows according to the custom of his caste. He does not indicate out of what portion of his estate such sums are to come. He probably considered that his moveable property by its investment, and by the accumulation of interest arising thereupon, and the income derived from the rents of so much of the house in the Kallbadevi road as would not be occupied by the widows, would suffice for the purpose. By his directions in Clauses 15 and 16, that both of his widows are to act agreeably to the directions of his brother Visram, he seems to have contemplated that his brother would live as long as the widows. He made no provision for the contingency, which has happened, of Visram dying in the lifetime of those ladies. The will was made evidently without proper legal assistance. What this Court has to do is to endeavour to construe it, and give effect to the expressed wishes of the testator, so far as it legally can; and not to make a new will, or supplement any provisions which the Court might think ought to be found in it, but which are not.

34. Next, as to the rate of interest to be allowed on the moneys set apart in the firm of Visram Mowji in accordance with the directions in the will.

35. From the evidence of the plaintiff's son, Juilladbur Jairam, it appears that the firm cannot be considered as a banking firm. It had and has no deposits of strangers, but had small deposits of female relations of the partners. To them the firm allowed 6 per cent,, as the amounts deposited were small, and they lived on the interest. The firm had no need to borrow money from others. It depended, he said, on circumstances what rate of: interest firms allow on moneys. If there is a running account, 9 per cent, is usually charged, On a running account between his firm and European houses it was usual to charge 5 per cent, on both sides of the account. He had looked over the firm's books for many yean?, and had never come across a higher rate than 6 per cent. The balance struck in Chattoorbhooj's account in the firm's books on the 1st Kartak Sudh 1930 (22nd October, 1873), the last Divali before his death, was Rs. 1,64,754-7-5 in his favour. On that sure, interest was allowed at 6 per cent. After the testator's death Rs. 90,800 were carried to different accounts according to the directions in his will; and on the let day of 1931 the' balance to credit, after such new accounts had been opened, was Rs. 25,546-2-1, Rs. 50,000 out of the Rs. 90,800' 'were credited to the testator's charity account, and interest at 6 per cent, was allowed on that and on the other accounts opened, in pursuance of the directions in the will. Interest at 6 per cent, has up to recently been allowed on the Rs. 50,000 charity account.

36. With reference to the other accounts, an alteration took place in the rate of interest allowed under the following circumstances.

37. Lilladhur Jairam stated that in Jet 1937 (28th May to 26th June, 1881) the partners had a talk with. Visram Mowji and said they were required to pay a very heavy rate of interest on the moneys lying in their firm, and they proposed to him that the moneys belonging to Chattoorbhooj's estate should be invested in Government promissory notes, or in some other way, or in some other place. That it was resolved that, from Asad following, 6 per cent, should be allowed on the charity account, and 41/2 per cent, on the other accounts. Lilladhur said that on those terms his father (the plaintiff) and he himself and the other partners agreed to keep the moneys in the firm; and those rates were credited in the account up to Visram's death in June 1882; and that his father who on Visram's death succeeded to the management of the firm, has credited the interest in the same way.

38. He admitted, however, that the accounts of the partners are allowed 6 per cent, in the firm's books. That in 1987 or 1928 (1870-71, it 71-72) the firm first became 'agents to a mill, and afterwards to two or three mills, and as such agents lent moneys to the mills, when the mills were in want of money, first at 9 per cent., but for the last five or six years at 6 per cent.

39. Chattoorbhooj, the testator, died on the 5th July, 1874, and as a partner in the firm of Visram Mowji with a five annas share in it must, of course, have known that he and his partners were getting 9 per cent, for the moneys lent by the firm to the mills. The reduction of the rate paid by the mills to 6 per cent, did not occur till after his death. He must also have known that his firm never allowed to any one interest at a higher rate than 6 per cent. Although he directed the sums mentioned in his will to be set apart, and entered to credit in the firm's books, he could not compel the partners to continue to hold money, unless they chose to retain the moneys belonging to his estate. He does no contemplate his share in the partnership continuing after his death.

40. In Clause 16 he says: 'Should my decease take place, then as to my business which is carried on in Bhai Visram Mowji's shop, in which I have (a share) of five annas, it is to be made to cease.' He nowhere states the rate of interest, which he wishes, or assumes that the firm wil1 continue to pay after his decease.

41. Lilladhur said that his father recently purchased 4 per cent. Government promissory notes for Rs. 60,000 with the money standing to the credit of the charity account; and that, in addition thereto, Government promissory notes for Rs. 65,000 have been purchased, of which notes the firm has now the possession. All such notes must at once be endorsed over to the Accountant-General of this Court, who will retain them until the final decree is made in this suit, or until further order.

42. Now was the reduction from 6 per cent, to 41/2 per cent. on some of the moneys held by the firm made in May or June, one which those interested in the estate of the testator have a right to complain of? I may here remark, that I cannot collect from the evidence whether the interest at the rate of 6 per cent. or that at the rate of 41/2 per cent, allowed by the firm was made up with or without annual rests. In Fergmson v. Fyffe 8 Cl. & Fin., 121, which was a case regarding an account opened with a banking agency house in Calcutta by a Scotchman in 1786, who became insane in 1793 and died there in 1810, it was held by the House of Lords that there cannot be a title to compound interest without a contract, express or implied, or custom; and that by the law of England a contract for compound interest is not valid, except in mercantile accounts current for mutual transactions.

43. It Boddam v. Byley 1 B C.C. 234 S.C. 2 B C.C. 2 S.C. 4 Brown's Pari cases 561 decided by Lord Chancellor Thurlow in 1783 and by the House of Lordsi n 1787, which affirmed his decree, the question was as to what interest should be allowed on certain accounts between Samuel Hough and John Spencer, who when residing in Bombay in 1755 entered into partnership as marchants there, and afterwards became involved in pecuniary 'difficulties. Lord Thurlow said: 'The question now is merely upon the interest. Spencer's representative claims 9 per cent. interest from year to year, upon the ground that the books were so made up. But think no such interest can be allowed; for, although, where there are cross accounts, interest is as fair to one as the other, yet it is not fair after closing the trade. Then, whether he shall have Indian interest? If accounts are regularly made up upon Indian transactions, they ought to carry such interest as obtained there at the time when the transactions passed.'

44. The early portion of the above-quoted passage was cited in the House of Lords by Lord Cottenham, L. C., in Fgrgusson v. Fyffe 1 B C.C. 239 as conclusive upon the point.

45. Lilladhur Jairman admitted, in cross-examination by Mr. Jardine, that his firm does not allow interest at 4 1/4 Per cent, in its accounts with other firms. His firm did not borrow at 41/2 per cent. Indeed, it had no need, he said, to borrow money from others.

46. Except from the reason of its being the half of 9 per cent., which is and long has been the current rate amonst native merchants in Bombay, I do not understand why that rate was fixed upon by the partner in Jet 1937 (28th May to 26th June 1881).

47. As the accounts of the partners in the firm were allowed? 6 per cent, interest, and that the rate allowed on the balance of Rs. 1,64,754-7-5 standing to Chattoorbhooj's credit in the firm's books at the Dwatt preceding his death, as well as on the moneys of the testator's estate in the hands of the firm from his death in 1874 to May or June 1881, I think that such rate may be accepted as a fair one upon all the moneys of the estate in the firm's hands up to the time when the investments of Rs. 60,000 and 65,000 were respectively made in Government 4 per cent, promissory notes; after which it would be unfair to charge the members of the firm, or rather Visram Mowji and the plaintiff with a higher rate than that which the notes produced. Lilladhu stated that the. Government notes are not used for the purposes of the firm, and that he and his partners do' not wish to keep them in the firm. Whether the accounts from the testator's death should be made up with annual rests or not, I must to the Commissioner, as I have no materials at present for forming an opinion on the point.

48. The other questions raised in paragraph 5 of the plaint (sub-clauses 2, 3, and 4) can be better answered when the Court has the Commissioner's report before it, and when it knows exactly what the real value of the estate is.

49. The question raised in Sub-clause 5 of the above-quoted paragraph as to making up the income of the widows, I have already answered. Lilladhur said that the monthly allowances to the widows are debited in the firm's books to the general account of the testator's estate, and in my opinion correctly so.

50. The Court, therefore, passes a decree in favour of the plaintiff, and directs, as prayed, that the estate of the testator be administered under the direction of this Court. The usual administration accounts must be taken. The Commissioner must report what charitable and other bequests have been made by the will of the testator, and what moneys have been or are necessary to be set apart for the purpose of carrying out the same. Let him also report whether or not annual rests ought to be allowed, and, if so, from and to what dates, on ail or any of the moneys of the estate during the time they have been in the custody of the firm of Visram Mowji. Let the plaintiff forthwith assign over and endorse, or cause to be assigned over and endorsed, to the Accountant-General of this Court the Government 4 per cent, promissory notes for Rs. 60,000 and Rs. 65,000 purchased with the moneys of the testator's estate; and let the Accountant-General open separate accounts in the name of this suit in respect of such several amounts, and hold the same respectively subject to the further order of this Court, or of the sitting Judge in chambers. Let the Commissioner inquire and report who would be proper trustees to be appointed, and whether alone or in conjunction with the plaintiff, in carrying out the 'charities and bequests to charity in the testator's will; and let the Commissioner frame a scheme for the future management of such charitable bequests and charities as' have been duly made and established according to, the law and usage in force in relation to the same.

51. As the testator has made a Will, the provisions of which require the assistance of this Court to construe and determine the meaning of it, the costs of all the parties to this suit of and incidental thereto, as well as the costs reserved by the order of the 28th July, 1884, must come out of the estate; the same to be taxed as between attorney and client. Leave to apply as advised. Further costs and further directions reserved.

Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //