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Nagamma and ors. Vs. ChIn Basappa and ors. - Court Judgment

LegalCrystal Citation
SubjectFamily;Commercial
CourtAndhra Pradesh High Court
Decided On
Case NumberLetters Patent No. 8 of 1957
Judge
Reported inAIR1961AP257
ActsCode of Civil Procedure (CPC) , 1908 - Order 1, Rule 10
AppellantNagamma and ors.
RespondentChIn Basappa and ors.
Appellant AdvocateHari Narayanlal, Adv.
Respondent AdvocateVinayak Rao Vaidya and ;L.P. Sahgal, Advs.
Disposition Appeal dismissed
Excerpt:
.....maintainability of suit - held, suit filed by promises in there own name without impleading third parties is maintainable. - - in support of this theory, strong reliance is placed on seshan pattar v. the question posed by their lordships was whether there was any principle of law or any custom applicable to a case like that according to which the managing members of a hindu joint family entrusted with the management of business must be held incompetent to enforce at law the ordinary business contracts they were entitled to make or discharge in their own names. the same principle emerges from these observations as well: the learned judges expressed the opinion that ilr 32 mad 284 was no longer good law, having regard to the privy council ruling in ilr 33 all 272 (pc). there it..........their lordship.', the original plaintiffs in this case were entitled, as the sole managers of the family business, to make in their own names, the contracts which gave rise to the claim, and that they properly sued on such contracts without joining the other members of the family,' their lordships said that ilr 18 mad 33 did not in any way support the contention of the defendants that all the members of the family should join the suit based on a contract. 14. in ilr 18 mad 33 one of the defendants was engaged by the plaintiff to carry on business in burma for a particular period. the defendant, in discharge of his duties as the agent of the plaintiff, acted in contravention of the plaintiffs orders and also refused to render an account when called upon to do so. this led the plaintiff.....
Judgment:

P. Chandra Reddy, C.J.

1. This appeal is against the judgment of Ansari J. (as he then was) with his leave under Clause 15 of the Letters Patent,

2. The material facts leading to this appeal may be briefly narrated. One Basi Reddy executed a document on 24th April 1941 to evidence a loan of Rs. 1425/- in favour of two persons, Rarcanna and Chinna Basappa. A suit was brought by the two promisees for recovery of the money due, under the document against the heirs of the executant, who died in the meantime. Pending the suit, Ramanna died and another Basappa was brought on record as his legal representative.

3. The suit was inter alia resisted on the objection that it was not competent for two of the promisees alone to raise the action as they were only two of the three members of the joint family and that by the lime the third member was impleaded its a party the period of limitation had already expired.

4. The defence prevailed with the trial court with the result that the suit was dismissed.

5. This was confirmed on appeal by the Subordinate Judge.

6. The aggrieved plaintiffs brought a second appeal which was heard by a Bench of the erstwhile Hyderabad High Court of which Ansari J. was a member. The appeal was allowed and it was remanded to the lower appellate court for decision on merits. When this judgment was delivered, the defendant and his advocate were absent. Sometime later, an application was filed to set aside the ex parte judgment,

The application was allowed and the appeal was heard by Ansari J. The learned Judge took the same view as the Bench of the erstwhile Hyderabad High Court took, namely, that the non-joinder of the third member of the joint family who was not one of the promisees, was not fatal to the suit. It is this view that is canvassed in this letters patent appeal.

7. In support of the appeal, it is urged by Sri Harinarayanlal for the appellants that two only of the three members of the joint family were not entitled to file the suit. In support of this theory, strong reliance is placed on Seshan Pattar v. Veeraraghava Pattar, ILR 32 Mad 284. In that case, White G. J. and Miller J. expressed the opinion that where the benefit of a contract belonged to an undivided family and a fresh contract by which the original contract was discharged was entered into in the name of one only of the members of such family, all the members of the family were necessary parties to the suit on the fresh contract and an action by the member in whose name the contract was made was incompetent.

8. In Support of their decision, the learned Judges, White C. J. and Miller J. cited Alagappa Chettiar v. Vellian Chetti, ILR 18 Mad 33 and Angamuthu Pilfai v. Kolandavelu Pillai, ILR 23 Mad 190. They dissented from Ramanujachariar v. Srinivasachariar, 9 Mad LJ 103 and Adaikkalam Chetty v. Marimuthu, ILR 22 Mad 326.

9. In ILR 22 Mad 326 it was ruled by a Bench of the same Court that a promisee was entitled to sue without impleading the other members of the family, when the contract did not purport to have been on behalf of others. To the same effect is the judgment in 9 Mad LJ 103.

10. There is no doubt that ILR 23 Mad 190 and Shamrathi Singh v. Kishan Prasad, ILR 29 All 311 are in consonance with the principle underlying in ILR 32 Mad 284. But we are not convinced that ILR 18 Mad 33 lends much assistance to that view. In our judgment, the view expressed in ILR 22 Mad 328 is the correct one and is in accord with the authoritative pronouncement of the Privy Council in Kishan Prasad v. Harnarain Singh.

ILR 33 All 272 (PC) which reversed ILR 29 All 611 one of the rulings followed in ILR 32 Mad 284.

11. The question that fell to be decided in the Privy Council case was whether the managing members of the family, who made contracts in the course of their business in their own names, could maintain a suit to recover the amount found due on settlement of accounts. An objection was raised that the suit was not properly constituted, the other members not having been joined as plaintiffs.

To get over this, the other members were sought to be impleaderl but by that time the statutory period had expired. The High Court, reversing the judgment of the Subordinate Judge gave effect to the defence as regards limitation, in the view that the other members of the family ought to have been added as parties to the suit. On appeal their Lordships of the Privy Council, in disagreement with the conciusion of the High Court allowed the claim of the plaintiffs and restored the judgment and decree of the Subordinate Judge.

The question posed by their Lordships was whether there was any principle of law or any custom applicable to a case like that according to which the managing members of a Hindu joint family entrusted with the management of business must be held incompetent to enforce at law the ordinary business contracts they were entitled to make or discharge in their own names. It was answered in the following words:--

'The defendant is, of course, entitled to insist on all the persons with whom he expressly contracted being made parties to the suit, and thai was done in the action as originally framed in this case. There were no other parties to the contract of the 9th August 1901, than the respondents and the first three plaintiffs......'

12. It is clear from these observations that the decision of their Lordships rested on the principle that if the contract on which the suit is based is in the name of an individual and it does not purport to have been entered into on behalf of others, he is entitled to sue without impleading the other members. That this is so is made clear by their Lordships distinguishing Ramscbuk v. Ramlall Koondoo, ILR 6 Cal 815 in which the suit brought by two only of the four partners was dismissed. Their Lordships referred with approval to the following observations of Garth C.J.

'If in this case it had been found in the Court below as a fact that the contract was made between the defendant and the two original plaintiffs only there would be no difficulty in deciding in their favour, because the joinder of the Other two plaintiffs would only have been a misjoinder which, by sec, 31 of the Code of Civil Procedure, is never now fatal to a suit.'' Again, the learned Chief Justice says:

'The lower court has found in this case that all the four plaintiffs were partners in the concern, and that the defendants contracted with all jointly.' After extracting this passage, it was remarked by the Judicial Committee.-

'It is to be observed that there were other members of the family who had an equal family interest in the profits of the business, but it wasnot suggested that they should be joined as plaintiffs or that they were to be treated as partners in the firm of managing members.'

13. This makes it explicit that some of the members of the family who have obtained the contract in their own names could enforce it without joining the other members of the family to the action. The same principle emerges from these observations as well:--

'In the opinion of their Lordship.', the original plaintiffs in this case were entitled, as the sole managers of the family business, to make in their own names, the contracts which gave rise to the claim, and that they properly sued on such contracts without joining the other members of the family,'

Their Lordships said that ILR 18 Mad 33 did not in any way support the contention of the defendants that all the members of the family should join the suit based on a contract.

14. In ILR 18 Mad 33 one of the defendants was engaged by the plaintiff to carry on business in Burma for a particular period. The defendant, in discharge of his duties as the agent of the plaintiff, acted in contravention of the plaintiffs orders and also refused to render an account when called upon to do so. This led the plaintiff to file a suit for certain reliefs. The defendants pleaded inter alia that the plaintiff being only one member of the family trading in partnership could not maintain the suit in his own name. This defence-was accepted by the High Court. Dealing with the objection as to joinder of parties. Muttusami Ayyar and Shephard JJ. obervcd.

'There can be no doubt that as a general rule all the members of a partnership firm ought to be joined as plaintiffs in a suit brought in. respect ot transactions with the partnership. It makes no difference that the persons carrying on business together, were also members of a Hindu family.'

* * * * 'There can be no doubt, in the present case, that the employment of Vellian as agent was an employment in the business of the firm and that the contract was made by Alagappa on behalf of the firm.' It is to be noted that this was a case of the members of a joint Hindu family trading in partnership. Therefore, no exception could be taken to the proposition contained in that case as on principle some of the several partners of a firm could not maintain a suit. So the doctrine enunciated in ILR 18 Mad 33 does not support the principle laid down in ILR 32 Mad 284

15. In a later decision rendered by Wallis (Offg. C.J.) and Kumarasami Sastri J. in Adai-kulam Chctti v. SubWi Chctti, 27 Mad LJ 621: (AIR 1915 Mad 387) this point was discussed at some length. The learned Judges expressed the opinion that ILR 32 Mad 284 was no longer good law, having regard to the Privy Council ruling in ILR 33 All 272 (PC).

There it was laid down that where a mortgage was taken by a member of a joint Hindu family in Ms own name out of the funds belonging to the family without disclosing that he was acting as an agent of the family, he could sue on the mortgage without impleading the other members. Their Lordships followed the principle laid down in Adaikkalam Chetty V. Marimuthu, ILR 22 Mad 326 as it accorded with the pronouncement of the Privy Council referred to. In Mulla's Hindu law, there is a note to the effect that the decisions in ILR 32 Mad 284 and ILR 29 All 311are no longer good law.

16. In our considered judgment, the law as stated in ILR 22 Mad 326 and that line of cases is sound and ILR 32 Mad 284 does not hold the field in view of the above mentioned ruling of the Privy Council.

17. On this decision, it follows that the suit as originally filed was properly constituted and that the non-joinder of the other members of the family did not in any way affect the maintainability of the suit.

18. In the result, the judgment under appeal is affirmed and the appeal is dismissed with costs.


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