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Pandurang Jaswant Vs. Sakharchand Malji - Court Judgment

LegalCrystal Citation
SubjectCivil;Property
CourtMumbai
Decided On
Case NumberSecond Appeal No. 575 of 1905
Judge
Reported in(1906)8BOMLR861
AppellantPandurang Jaswant
RespondentSakharchand Malji
DispositionAppeal dismissed
Excerpt:
mortgage-prior mortgage-puisne mortgage-suit by prior mortgagee in which puisne mortgagee not a party-decree-execution-sale in execution-bights of the puisne mortgagee.;where a prior mortgagee sues his mortgagor for sale of the mortgaged property without making a puisne mortgagee a party to the suit, the latter is in no way effected by the suit or its results. thus if the property is brought to sale in execution of the decree, and is bought by a third person, the puisne mortgagee has against him precisely the same rights as he had collectively against his mortgagor and the prior mortgagee. that is to say, he may sue to redeem the purchaser as mortgagee, or thereafter as mortgagor to foreclose, or suffer himself to be redeemed by him. - - out of the proceeds of the sales of the house and..........he mortgaged the chawl only to pandurang. sundrabai sued on the mortgage, and got a decree for sale. pandurang was not made a party to that decree. one day, before the day fixed for making that decree absolute, pandurang filed a suit against sakharam and sundrabai praying as against sundrabai for marshalling, and as against sakharam for sale of his equity of redemption. the court on this decreed that sakharam should pay to pandurang the full amount found due on his puisne mortgage, and as to sundrabai the court decreed that in execution of her mortgage decree she should sell first the house, and if the proceeds were insufficient to satisfy her claim, then the chawl. accordingly the house was sold first, and as it did not realize enough to pay off sundrabai, the chawl was next sold to.....
Judgment:

Beaman, J.

1. This is a second appeal arising out of execution proceedings in the following circumstances. Sakharam was the original owner of a house and a Chawl. He mortgaged both to Sundrabai. Subsequently he mortgaged the Chawl only to Pandurang. Sundrabai sued on the mortgage, and got a decree for sale. Pandurang was not made a party to that decree. One day, before the day fixed for making that decree absolute, Pandurang filed a suit against Sakharam and Sundrabai praying as against Sundrabai for marshalling, and as against Sakharam for sale of his equity of redemption. The Court on this decreed that Sakharam should pay to Pandurang the full amount found due on his puisne mortgage, and as to Sundrabai the Court decreed that in execution of her mortgage decree she should sell first the house, and if the proceeds were insufficient to satisfy her claim, then the Chawl. Accordingly the house was sold first, and as it did not realize enough to pay off Sundrabai, the Chawl was next sold to Sakharchand. That sale was set aside, and the Chawl was re sold to one Krishna-nath at a higher figure.Out of the proceeds of the sales of the house and the Chawl Sundrabai's decree was satisfied, and the balance amounting to Rs. 167 odd was paid over to Pandurang, who appears to have accepted it without protest; and there all might have ended satisfactorily but for the fact that on appeal the order setting aside the sale to Sakharchand was reversed and that sale was duly confirmed. Thereupon Pandurang repaid the money he had received as surplus after paying off Sundrabai, into Court, and put in the Darkhast with which we are now concerned, to have his decree against Sakharam and Sundrabai executed. The lower Court admitted the Darkhast and ordered that the Chawl should be sold, Sakharchand being repaid what he had paid for it in the first instance, out of the sale-proceeds. Against that order he appealed, and the District Judge held that Pandurang had exhausted whatever remedies he might have had as a puisne mortgagee, who had not been a party to the prior mortgagee's suit, by his own subsequent suit against Sundrabai and his mortgagor Sakharam ; that therefore Sakharchand had taken; an absolute title to the Chawl in the Court-sale, and that that property could not be sold again at the instance of Pandurang.

2. We think that but for the rather peculiar facts of this case the law generaly applicable presents no difficulty. But as we have head an elaborate agrument upon it, and have been referred to namerous cases, we think it as well briefly to state what we believe the correct law to be. Where a prior mortgagee suis his mortgagor for sale as in the present case, without making puisne mortgagees parties, the latter are in no way affected by the suit or its results. Thus, if the property is brought to sale in execution of the decree, and is bought by a third person, the puisne mortgagee has against him. precisely the same rights as he had collectively against his mortgagor and the prior mortgagee. That is to say, he may sue to redeem the purchaser as mortgagee or thereafter as mortgagor to foreclose, or suffer himself to be redeemed by him. That we take to be clear, and it is the same whether the prior mortgagee or a stranger buys at the sale. Had there then been no other transactions we should have found no difficulty in holding that Pandurang was entitled to redeem Sakharchand. as occupying the position and character of prior mortgagee, or again of foreclosing him or insisting upon being redeemed by him, in his character of the original mortgagor. Both these characters have now merged in him, and he is entitled to avail himself of either or both. But we have to deal with the facts of this case, and those facts do occasion us much doubt and difficulty. For, in the first place there is a question of Us pendens. The sale in execution of Sundrabai's decree was not effected till after the institution and progress of Pandurang's suit against her and the original mortgagor. Thus it appears that on general principle the purchaser in execution of that decree would be affected by the doctrine ofis pendens and would be deemed to have bought subject to the decree in Pandurang's suit. That decree, as we understand it. forecloses the mortgagor while merely marshalling as far as the mesne mortgagee is concerned; and the result is anomalous; for it works out to this, that without having made any attempt to redeem the prior mortgagee, the puisne mortgagee has obtained for himself the equity of redemption: nor, as far as we can see did he by this circuituos mode of procedure afford the prior mortgagee the opportunity of foreclosing him. Be that as it may it is plain that the equity of redemption can neither have altogether been annihilated, nor can it be in two persons, Pandurang and Sakarchand. In this complication we are inclined to think that it really is in Pandurang or would be, were it not for other considerations. But his conduct has to be considered. He appears to have assented completely to the execution proceedings which were being carried out by Sundrabai, once it was understood that she was to sell the house first and only in the event of that sale not having realised enough to pay her off, theChaw next. This is precisely what was done. And thereafter, as we have said, Pandurang, when at the second attempt the Chawl brought in a fair price, accepted what was over after paying off Sundrabai, and evidently regarded the whole matter as being at an end. Suppose, instead of the first sale having been finally confirmed, the second sale had stood, could it be argued that in these circumstances Pandurang could have afterwards demanded execution of his decree against the purchaser, while retaining the balance of the purchase-money? We think not. And we regard what subsequently happened as a mere accident, in no way affecting the principle which would have shut Pandurang out, had that accident not occurred. In this view, though for altogether different reasons, we think that the decision of the Court below was right, and we would dismiss this appeal with costs. But we must add a direction that Pandurang is entitled to have back out of Court, where he deposited it, the sum of 112-2-6, being the surplus on the first sale, and the remainder of the money deposited in Court to be paid back to Krishnanath.

3. The balance of the total deposits by Sakharchand and Pandurang likewise to be paid to Krishnanath.


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