1. This is a second appeal against a decree of the learned Assistant Judge of Belgaum. The suit was instituted to enforce specific performance of an agreement of sale dated November 23, 1935, whereunder defendant No. 1, who was the only executant of the document, had agreed to sell the entire survey Nos. 19 and 20 of Yellimanoli in the Hukeri taluka to the plaintiff for Rs. 2,000. The agreement referred to certain transactions between the vendor and other persons which compelled him and his co-sharer; to file a suit in 1928 (suit No. 521) against those opposing their peaceful possession of the property, and recited that the object of the sale was to provide the vendor with the means of meeting the cost of the litigation against the supposed trespassers. Those trespassers were defendants Nos. 3 to 20. The co-sharer of the vendor was defendant No. 2. The agreement further recited that the latter had agreed to transfer his interests in the lands to the vendor and therefore he was in a position to convey the entire survey numbers to the plaintiff. The plaintiff not only made the vendor, who had contracted to sell the property to the plaintiff, as a party-defendant, but he also made defendants Nos. 2 to 20, who were strangers to the contract, as parties because defendant No. 2 was interested in a portion of the property and the other defendants were in actual possession, although the latter by a decree passed in the suit referred to of 1928, which was confirmed in the High Court on August 27, 1936, were ordered to deliver possession of the property to the vendor defendant No. 1 and his co-sharer defendant No. 2 The plaintiff, when he saw that defendant No. 1 was unwilling to execute the sale-deed in terms of the agreement although he had received half of the consideration as earnest at the time of the contract filed this suit to enforce the agreement.
2. The plaint was presented to the Court on September 2, 1936, and with the leave of the Court the plaintiff paid the deficit Court-fee thereon on September 28, 1936. At the time of the presentation of the plaint only defendants Nos. 1 to 20 were made parties. It was discovered upon the statement of defendant No. 1 that one of his creditors had instituted a suit against him (suit No. 260 of 1936) and had effected an attachment before judgment on September 22, 1936, of the property comprised in the agreement for sale. Therefore by an application on March 22, 1937, the plaintiff stated that such an attachment was not effective under Section 64 of the Civil Procedure Code to defeat his rights under a subsisting contract at the date of the attachment, and he consequently asked the Court on that ground to implead the attaching creditor of his vendor as a party-defendant. The Court granted that application and allowed the amendment of the plaint and made the attaching creditor as an additional party, defendant No. 21. The newly added defendant No. 21 contended that the agreement of sale was intended to defeat his claim and that his attachment was good. Ultimately the trial Court, after hearing the evidence and the arguments of defendant No. 21, who did not claim any specific issue of fraud nor went into the witness-box to support his plea, held that his attachment was not effective, and that the plaintiff was entitled to the specific performance of the agreement of sale by defendant No. 1 to the extent of the latter's half share in the property comprised in the agreement, and directed him to execute the sale-deed of that share. By mistake it appears that in the judgment instead of defendant No. 21's attachment it was referred to as 'the attachment of defendant No. 1.' The decree further directed that the plaintiff was entitled to get possession of his half share by executing the decree in suit No. 521 of 1928 which his vendor, defendant No. 1, and defendant No. 2 had obtained against the trespassers defendants Nos. 3 to 20 and which, as I have said, was confirmed in the High Court on August 27, 1936. Defendant No. 2 acquiesced in that decree and so also defendant No. 1.
3. Against that decree an appeal was taken to the District Court by the other defendants with the exception of some of them who were not interested. The only questions that were argued in that appeal were that the appellants were not necessary parties to the suit for specific performance, that the declaration that the attachment of defendant No. 21 was not binding on the plaintiff was improperly granted, and that the plaintiff was not entitled to recover possession of half the suit property by executing the decree in suit No. 521 of 1928 against defendants Nos. 3 to 20. AH those contentions were upheld by the learned Assistant Judge principally on the ground that defendants Nos. 3 to 20 were not necessary parties. He thought that the declaration against defendant No. 21 was wrongly given on the following grounds: that no declaration was specifically claimed upon amendment of the plaint that the attachment was binding on the plaintiff, that no leave to join the special cause of action was taken under Order II, Rule 4, of the Civil Procedure Code, and that no proper issues arising from the written defence of defendant No. 21 were raised and evidence heard. Accordingly the trial Court's decree was confirmed in so far as it affected defendants Nos. 1 and 2, but in so far as it affected the other defendants it was set aside. Against that decree the plaintiff has filed this second appeal.
4. On the question of misjoinder of the defendants it seems to me that the learned Assistant Judge has not properly appreciated the circumstances under which the suit was instituted. The rule as to joinder of defendants is contained in Order I, Rule 3, of the Civil Procedure Code. It says:--
All persons may be joined as defendants against whom any right to relief in respect of or arising out of the same act or transaction or series of acts or transactions is alleged to exist, whether jointly, severally or in the alternative, where, if separate suits were brought against such persons, any common question of law or fact would arise.
5. Undoubtedly the agreement, which was the foundation of the cause of action, expressly refers to a series of transactions between the vendor and defendants Nos. 2 to 20 and the common question of fact involved in the suit was whether defendant No. 1 had the sole title to sell the property to the plaintiff and whether the contract of sale affected the interests of defendants Nos. 2 to 21. It is indeed true that in a suit for specific performance the general rule is that a stranger to the contract cannot be sued upon it. Only the parties to the contract are, according to that rule, necessary and sufficient parties. But the general rule is subject to certain modifications (see Halsbury's Laws of England, 2nd edn. Vol. XXXI, para. 497, page 417, and the foot-notes thereunder. See also Fry's Specific Performance of Contracts, 6th edn., page 90, para. 205). For instance, strangers are made parties as an exception to the rule in cases of novatio; in cases of an interest arising under a prior contract; and in cases where it is desirable to avoid multiplicity of suits. That is exactly what Order I, Rule 1, of the Civil Procedure Code, contemplates. According to Fry (paras. 208 and 209):--. a stranger to the contract may so mix himself up with it by setting up a claim to some benefit resulting from it, as to render himself liable to be made a party to proceedings for the enforcement of the contract.... In some cases where a. portion of the relief claimed might affect the person in actual possession of the property, that person may properly be made a party to an action for the specific performance of the contract....
6. The rule as to joinder of defendants was thus expressed by Stuart V.C. in Bishop of Winchester v. Mid-Hants Railway Co. (1867) L.R. 5 Eq. 17
Ordinarily, a person not being a party to the contract ought not to be brought before the Court. But it is otherwise where possession is sought by the bill, and' the person in possession will be affected by the decree.
7. It has been held in several cases in England that persons claiming adversely might be made defendants, and the case of defendants Nos. 3 to 20 is exactly on the same footing for they had claimed adversely to the vendor. It may be noted that they are still in possession and their possession is likely to defeat the claim of the plaintiff to possession. If the plaintiff succeeds upon his title, the decision is bound to affect those defendants. In that connection it is necessary to refer to Section 27, Clause (c), of the Specific Relief Act, which deals with the class of persons who may be parties to a suit for specific performance. That clause is as follows:--
Any person claiming under a title which, though prior to the contract and known to the plaintiff, might have been displaced by the defendant.
8. The general rule is obviously the sensible rule in practice. But the recognized exceptions which are in conformity with the practice of the Court of Chancery cannot be overlooked [see also Rangayya Reddy v. Subramania Ayyar (1917) I.L.R. 40 Mad. 365. It seems to me that the learned Assistant Judge was wrong in holding that defendants Nos. 3 to 20 were not necessary parties.
9. Then there is the case of defendant No. 21. He claims under an attachment before judgment, and he says that that attachment should be upheld because by reason of Section 64 of the Civil Procedure Code the prior agreement of sale, which according to him was collusive and fraudulent, is not effective to displace the rights under the attachment. It was certainly up to him to prove collusion and fraud or at least ask the trial Court to frame a proper issue and lead evidence upon it because the burden was on him. The trial Court in that connection has remarked as follows:--
The defendant No. 21 contended that the alleged agreement of sale is bogus and fraudulent. But he has not even entered the witness-box to prove these things.
10. It is true that no specific issue was framed, but that was the fault of defendant No. 21. He did not direct the attention of the Court to the plea on that point and did not offer to lead any evidence. When he appealed he made no grievance in his memorandum of appeal of that omission or that his evidence was shut out and that he was prejudiced by the omission to frame an issue. All that he contended in ground No. 10 was that the attachment of the interest of defendant No. 1 was not binding on the plaintiff. It would be binding if the plaintiff's prior agreement was fraudulent, for, as, observed in Basappa v. Honmappa : AIR1939Bom492 'Section 64 and Order XXXVIII, Rule 10, of the Civil Procedure Code, have to be read together and Section 64 applies to an effective attachment and an attachment ordered under Order XXXVIII, Rule 10, before judgment is not effective as against rights subsisting at the date of the attachment.' Unless therefore defendant No. 21 proved that no rights subsisted under the plaintiff's agreement of sale, because that agreement was collusive and fraudulent, his plea cannot succeed. I have already indicated that in the circumstances defendant No. 21 was a necessary party and that by permitting the plaintiff to amend the plaint and implead him the Court by necessary implication granted the plaintiff upon his claim for possession leave to add a cause of action arising upon the subsequent attachment in the suit of defendant No. 21.
11. There is also another ground upon which in my opinion that attachment cannot succeed. The plaint in the present suit was presented to the Court on September 2, 1936, and the attachment was made on September 22, 1936, that is during the pendency of the suit. It has been pointed out that although the plaint was presented on September 2, 1936, the Court had granted leave to affix the deficit Court-fee later and that therefore the plaint could not be regarded as presented till September 28, 1936, when the deficit Court-fee was made good. That argument is not well founded in view of the explanation to Section 52 of the Transfer of Property Act. The suit, in my opinion, was pending from the time of the first presentation. If instead of rejecting the plaint on account of insufficiency of stamp the Court received the deficit fee and granted time to the plaintiff to make good the deficiency, the plaint must be deemed to have been presented when it was first received by the Court. Therefore the principle of lis pendens will affect the defendant's attachment. It does not matter, in my opinion, that the alienation or attachment was not voluntary. The principle of lis pendens embodied in Section 52 of the Transfer of Property Act will apply to such alienations also [see Moti Lal v. Karrabul-din. Consequently this appeal must be allowed, the decree of the lower appellate Court set aside and that of the trial Court restored with costs throughout.