1. This appeal raises an important question of law. Plaintiff sued to recover Rs. 5,000 odd in the following circumstances. Plaintiff is the granddaughter of Laxmanrao Mutalik, whose widow Gangabai adopted the defendant on April 22, 1911. On the same day that the adoption deed was executed, the defendant passed an agreement to Gangabai that out of the estate of the adoptive father he would pay Rs. 5,000 to the plaintiff, Gangabai's daughter's daughter. The defendant was a major at the date of the agreement. The plaintiff was a minor at that date, and the agreement was that the money was to be paid on her attaining majority. The plaintiff, therefore, sued to recover it, and the First Class Subordinate Judge of Satara has awarded her claim. Defendant appeals.
2. The learned Subordinate Judge has held that defendant constituted himself a trustee for the payment to plaintiff. Under the same agreement and by the same clause of the agreement, which is Exh. 18, p. 27, at p. 30, the defendant also agreed to pay Rs. 1,000 to Vinayak, the minor son of Gangabai's brother Krishnarao. He also failed to pay that, and Vinayak sued him in 1915. The first Court dismissed his claim. On appeal the District Court granted it, but in Second Appeal No. 983 of 1917, the High Court dismissed the suit. The judgment is at p. 16 of the record. The High Court here were considering the same clause of the same document with which we are now concerned. There is no apparent distinction between the two cases, and the finding of the High Court that the defendant did not mean to constitute himself a trustee for the purpose of carrying out what was agreed in the document is diametrically opposite to the finding of the learned Subordinate Judge in the present case. It has been contended by the learned Counsel for the appellant that adoption is not a contract. He refers to Mulla's Hindu Law, 7th Edition, paragraph 492, in which it is stated that an adoption is not invalid merely because the person giving in adoption receives a consideration for the adoption from the person taking in adoption, though the promise to pay cannot be enforced in law, and refers to Krishnamurthi Ayyar v. Krishnamurthi Ayyar where the Privy Council held that with the single exception of an arrangement regulating the right of the widow as against the adopted son, any limitation on the estate of the adopted son is invalid. He also refers to Shri Sitaram Pandit v. Shri Harihar Pandit I.L.R. (1910) Bom. 169 : 12 Bom. L.R. 910 Various cases decided by the High Courts have been referred to in Krishnamurthi Ayyar v. Krishnamurthi Ayyar, and in referring to the Bombay cases it is stated that while the Courts have always upheld the grant to the widow of her interest for life, when the gift is to outsiders it has been held invalid, and that whether made by the widow or the adopting father himself. But that was the case of a minor, and there is a recent case of this Court, Pandurang v. Narmadabai : AIR1932Bom571 , in which the adopted son was of full age at the time of the adoption, as in the present case, and it was held that he was bound by an agreement made at the time of the adoption with the adoptive father as regards the extent of his interest in the property of the adoptive father, and the learned Chief Justice, after referring to the case of Krishnamurthi Ayyar v. Krishnamurthi Ayyar, distinguishes it on the ground that the adopted son in Krishnamurthi's case was a minor, and says (p. 1212):
If he agrees to be given in adoption and at the same time agrees that on that event happening he will carry out certain agreements as to the property which he will acquire on adoption, I cannot see why he should be at liberty to accept the adoption and disregard the agreement. I know of no principle in Hindu or English law which enables that to be done and I do not think that their Lordships of the Privy Council intended to hold that such a thing was legal.
3. Then the learned Chief Justice goes on to refer to Ramasawmi Aiyan v. Vencataramaiyan as an authority in favour of the view that a major is bound by the agreement which he makes on adoption. I am, therefore, of opinion that the defendant would be bound by the agreement made by him on adoption, he being a major at the time, and if the suit had been brought by the person with whom the agreement has been made, the suit would succeed.
4. But unfortunately there is another difficulty in this case. The agreement was made not by the plaintiff but by her grandmother, and as a general rule of law a person who is not a party to a contract cannot sue on it unless a trust is created in favour of a person suing. The learned Subordinate Judge has been at pains to show that there is a trust in the present case, but, as I have already said, this very document has been construed in a suit by the other beneficiary under the same Clause 4, and it was held that there was no trust, and the plaintiff's suit was, therefore, dismissed. The judgment of the High Court is at p. 16 of the record, Exh. 13, and it was held by Macleod C.J. and Heaton J. that unless the plaintiff could show that that document constituted a trust in his favour he could not succeed, for a third party cannot sue on an agreement between two persons unless he can show that that document effected a trust in his favour, and then, after considering the terms of the document, their Lordships came to the conclusion that the document could not be read as constituting a trust and that there was nothing in it that would lead them to suppose that the defendant intended to constitute himself a trustee to the extent of Rs. 1,000 for the plaintiff. Now although this is not res judicata, I do not think we ought, except for very strong reasons, to adopt a view contrary to that which has already been taken by this Court of this very same document and of the very same clause of the document, and I think the learned Subordinate Judge would have been better advised to follow the opinion of the High Court.
5. The only remaining ground on which the plaintiff could succeed is that this was a family arrangement, and reference is made to Khwaja Muhammad Khan v. Husaini Begam But in Khwaja Muhammad Khan's case the circumstances were peculiar. The amount payable to the plaintiff was a personal allowance to a wife fixed before her marriage, recognised by Muhammadan law, and the agreement executed by the defendant specifically charged certain immoveable property for the allowance which he bound himself to pay to the plaintiff, who was the only person beneficially entitled under it. In Kashibai v. Tatya I.L.R. (1916) Bom. 668 : 18 Bom. L.R. 740 there was an adoption deed and a will, which constituted a single family arrangement. The will was in favour of the predeceased son's daughter, and it was held that the adopted son, who was of full age, having deliberately accepted the family arrangement and its advantages, must be held to it. In the present case the plaintiff is not the son's daughter, but the daughter's daughter, and she has no right in the family property, not even a right of maintenance. In order that there should be a family arrangement the parties to the arrangement must have an interest in the family property. In Kashibai v. Tatya the son's daughter had a claim. In the present case the plaintiff has no claim on the family estate.
6. In these circumstances, although the result is to be regretted, the decree of the lower Court cannot be supported, and the appeal must be allowed, and the plaintiff's suit dismissed with costs throughout.
7. This is a defendant's appeal in a suit by the plaintiff to recover Rs. 5,894 with interest. The plaintiff is the daughter's daughter of one Laxmanrao Balwantrao Mutalik who died leaving behind him his widow Gangabai and the plaintiff. On April 22, 1911, Gangabai took the defendant in adoption and on that date two documents were passed between the widow and the defendant who was himself a major at the time. Exhibit 18 is the deed of agreement passed by the defendant to the widow whereby he agrees that the latter should enjoy all her husband's property during her lifetime, that there was a temple of Sree Datta which the widow was then building, that the widow had appointed certain trustees for that temple, and that the defendant undertook to complete that temple at a cost of Rs. 1,000 in consultation with the trustees and to spend Rs. 400 every year towards the worship in that temple. Then follows the material clause:
I will pay Rs. 1,000 (one thousand), to Vinayak aged nine, the minor son of your brother Krishnarao Deshpande, in consultation with the above mentioned trustees. I shall also arrange, in consultation with the said trustees, so that Yamubai, your granddaughter, i.e., of your son-in-law Krishnarao Vasudevrao Deshpande, should get Rs. 5,000 (five thousand) when she attains majority.
8. The other document of the same date is the deed of adoption, Exh. 32, passed by the widow to the defendant in which it is stated, inter alia :
You have separately executed an agreement that you would act as a son towards me and would carry out the wishes of my husband. You should act in accordance with the same.
9. Five days after these deeds were passed, the widow died. The plaintiff became major on March 8, 1924, after which she made a demand of the amount of Rs. 5,000 from the defendant who did not comply with it and hence this suit to recover the amount under the said agreement.
10. The defence, among other things, was that the plaintiff was not a party to the agreement, that the agreement created neither a trust nor a family arrangement and hence the plaintiff could not sue upon it.
11. Before I go to discuss the merits of this case, it is relevant to note that in 1915 the guardian of the minor Vinayak Krishnarao Deshpande, the brother's son of the widow who was to be paid Rs. 1,000 under the clause of the agreement quoted above, had filed a suit against the present defendant to recover that amount. The Subordinate Judge held that the said agreement was not illegal or against public policy but that the plaintiff was not entitled to sue on that agreement as he was not a party to it, that it did not also create a trust in the plaintiff's favour but that it was only a promise to pay and as the plaintiff was not the promisee, he had no right to sue under the agreement. On appeal the Assistant Judge was of opinion that the agreement created a trust as well as a family arrangement and therefore decreed the claim. On second appeal, Sir Norman Macleod C.J. and Heaton J. held with regard to the agreement that 'there is nothing in it that would lead us to suppose that the defendant intended to constitute himself a trustee to the extent of Rs. 1,000 for the plaintiff,' and that the plaintiff's suit must fail inasmuch as he, a third party, cannot sue on an agreement between two persons which did not create any trust in his favour.
12. This decision as to the construction of the clause of the agreement quoted is material because in the present case also it is the same clause of the agreement that is to be construed in deciding the question as to whether the present plaintiff, who was not a party to it, has a right to sue upon it.
13. The First Class Subordinate Judge of Satara, who heard the present suit, decreed the claim. His findings were that the agreement in suit created a trust if the entire transaction was considered, that even if the defendant did not constitute himself a trustee as such, the agreement embodied a family arrangement and the plaintiff can successfully base her claim on such an arrangement from which the defendant cannot back out. He, therefore, decreed the suit as prayed for.
14. The defendant has now appealed and the first point that is urged by his learned Counsel is that the clause in the agreement relating to the payment of Rs. 5,000 to the plaintiff is illegal and against the principles of Hindu Law. His argument is that the case of adoption is different from contract, and the promise to pay by a person in expectation of being adopted cannot be enforced and is illegal : see Shri Sitaram Pandit v. Shri Harihar Pandit I.L.R. (1910) Bom. 169 : 12 Bom. L.R. 960 It is further urged, relying upon the recent decision of the Privy Council in Krishnamurthi Ayyar v. Krishnamurthi Ayyar that in an adoption deed where the agreement is to pay money to an outsider, that agreement is invalid and cannot be enforced. Now, no doubt, in that case the Privy Council has definitely laid down that except in the case of a widow adopting making certain conditions with the son going to be adopted, any other conditions in favour of a stranger would not be binding on the adopted son. There, the agreement was between the widow and the natural father of the minor boy going to be adopted, and in those circumstances it was held that the minor son would not be bound by any such agreement entered into on his behalf by his natural father, and that the doctrine of approbate and reprobate would not apply to him. In the present case, however, the adopted son was not a minor but a major at the time when he entered into the agreement, and in such a case the principle laid down in a recent case of our High Court, Pandurang v. Narmadabai : AIR1932Bom571 , would apply. In this latter case, the adopted son was a major and the Privy Council case of Krishnamurthi Ayyar v. Krishnamurthi Ayyar has been distinguished and it is held that the remarks of the Privy Council as to approbate and reprobate are consistent only with the case of a minor boy being adopted and not in the case of an adult person who enters into the contract with his eyes open. I think the present case is, therefore, governed by the principle of this case and not by the principle laid down in the Privy Council case. Therefore, the adoption would not be invalid or against the provisions of Hindu Law in this case.
15. A further argument is urged that even if the agreement is valid, the present plaintiff, who is not a party to the agreement, cannot base any claim on that agreement. It is true that the present plaintiff is not a party to the agreement which was between the adoptive mother and the adoptive son, and it is also true that under the law a person, not a party to a contract, cannot file any suit on the contract unless the contract creates a charge in his favour on some property or unless a valid trust is created in favour of that person, or unless the agreement is a part of a family arrangement. Here, no charge whatever has been created on any property in favour of the plaintiff, and as to a trust being created, we have the former decision of our High Court in the appeal filed by the present appellant against Vinayak, Second Appeal No. 983 of 1917, in which, as I have stated above, this very clause has been construed, and it has been held that it does not create any trust in favour of the person to whom a cash amount is to be paid. I agree that the defendant has not constituted himself a trustee under this clause, and it cannot be said that all the requirements for the creation of a valid trust could be spelt out in this agreement. Therefore, following the decision in that second appeal, I think that no trust is created in favour of the present plaintiff, and she would not be entitled to sue on this agreement, considering it as a trust deed.
16. Then the only ground left on which the present plaintiff can successfully base her claim is that this agreement should be construed as a family arrangement. It has been contended by the learned Counsel for the appellant that this agreement does not amount to a family arrangement inasmuch as a family arrangement involves a compromise of doubtful rights between the members of the same family, and here the plaintiff, who is the daughter's daughter of the person to whom the property belonged, had no claim either doubtful or real on any property, because she belongs to another family altogether, i.e., the family of her father. I think, this contention ought to prevail. Even though it may not be strictly necessary that a family arrangement should involve a compromise of doubtful claims or doubtful right, it is necessary that a family arrangement should comprise some arrangement which is brought about to preserve the peace and the property of the family, and it cannot be said in this case that the present plaintiff had any sort of claim on her maternal grandfather's property. Reliance has been placed by the learned advocate for the respondent on the case of Kashibai v. Tatya I.L.R. (1916) Bom. 668 : 18 Bom. L.R. 740 It is true that this case is not overruled in the Privy Council case of Krishnamurthi Ayyar v. Krishnamurthi Ayyar, as observed in Pandurang v. Narmadabai, but I think this case does not apply here because in that case the person who was to get the benefit under the arrangement was the son's daughter and not the daughter's daughter. A son's daughter is, no doubt, only a bandhu under the Hindu Law but she does belong to the family of her father and grandfather and she has also certain claims as a family member for her maintenance and her marriage expenses. But a daughter's daughter has no claim for maintenance or marriage expenses from her maternal grandfather, and therefore, any arrangement under which any benefit is given to her cannot be considered to be a family arrangement.
17. There is one case, Mittar Sain v. Data Rama : AIR1926All194 which is very similar to the present case except that there the person benefited under the agreement of adoption was the brother of the adopting widow, while here it is the case of her daughter's daughter. But both these cases are similar on this point that the person benefited did not belong to the family of the person to whom the property belonged. In the Allahabad case originally two Judges had differed. One Judge was of opinion that it would be a good family settlement even though the person taking benefit under the agreement did not belong to the adopting family. The other Judge was of opinion that it cannot amount to a family arrangement at all because in order to take benefit under the agreement he must strictly belong to the same family. There was an appeal under the Letters Patent against that decision, and it was held that the agreement did not amount either to a trust or to a family arrangement. It did not amount to a trust because, as here, it was only a promise to pay and nothing more, and it did not amount to a family arrangement because the person taking the benefit did not belong to the same family. I think that decision is correct, and therefore, it must be held that the agreement in suit does not amount to a family arrangement on which the present plaintiff can found her claim.
18. The conclusion, therefore, is that although the agreement in suit is a valid document, still the plaintiff herself cannot sue on it. At the most if she were a defendant in possession of the property, she can take her stand as a defendant and rely on the agreement as was the case in Pandurang v. Narmadabai. But this is a suit not by the adopted son but by the granddaughter and that makes a real difference in the legal position.
19. I am, therefore, of opinion that the appeal should be allowed and the plaintiff's suit be dismissed with costs throughout.