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Chiranji Lal Vs. Naraini and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Judge
Reported in(1919)ILR61All395; 51Ind.Cas.158
AppellantChiranji Lal
RespondentNaraini and ors.
Excerpt:
indemnity bond - suit to recover money payable under an indemnity bond--decree passed against plaintiff, but money not actually paid--suit maintainable. - - in that bond kanhaia ram covenanted that if anyone else put forward a claim to the money secured by the deed of mortgage and if he failed to prove his power to give a discharge and if the plaintiff should be obliged to pay any one else, then he would indemnify the plaintiff against such payment......he executed for the full amount and the bond which is the basis of the present suit. in that bond kanhaia ram covenanted that if anyone else put forward a claim to the money secured by the deed of mortgage and if he failed to prove his power to give a discharge and if the plaintiff should be obliged to pay any one else, then he would indemnify the plaintiff against such payment. certain property was hypothecated to secure this covenant. in course of time a rival claimant brought a suit against the plaintiff and kanhaia ram based on the original mortgage, alleging that the then plaintiffs were entitled to half the property in possession of which musammat maharani had been and that the receipt and discharge by kanhaia ram was only effectual to the extent of half of the mortgage debt......
Judgment:

Henry Richards, Kt., C.J. and Pramada Charan Banerji, J.

1. This appeal arises out of a suit brought on foot of a bond, which has been called, not inappropriately, an indemnity bond. It appears that there was a mortgage executed by the plaintiff in favour of one Musammat Maharani. On her death there were two sets of persons claiming to be entitled to the property held by her. One claimant was a man of the name of Kanhaia Ram. He alleged that he had received payment of the entire mortgage money from the plaintiff, and there was given in evidence a receipt he executed for the full amount and the bond which is the basis of the present suit. In that bond Kanhaia Ram covenanted that if anyone else put forward a claim to the money secured by the deed of mortgage and if he failed to prove his power to give a discharge and if the plaintiff should be obliged to pay any one else, then he would indemnify the plaintiff against such payment. Certain property was hypothecated to secure this covenant. In course of time a rival claimant brought a suit against the plaintiff and Kanhaia Ram based on the original mortgage, alleging that the then plaintiffs were entitled to half the property in possession of which Musammat Maharani had been and that the receipt and discharge by Kanhaia Ram was only effectual to the extent of half of the mortgage debt. This suit was successful and a decree for sale of the mortgaged property was made, and, as already stated, the plaintiff and Kanhaia Ram were defendants to that suit. The court of first instance decreed the plaintiff's claim, but put a proviso to the decree that it could not be executed unless and until the plaintiff was obliged to discharge the decree which had been made against him. The court of first appeal confirmed this decree. A learned Judge of this Court set aside the decrees of the courts below and dismissed the plaintiff's suit as premature. It seems to us that the view taken by the learned Judge of this Court was not correct. It is true that at the time the suit was brought the decree had not actually been discharged; but it was a mortgage-decree against the plaintiff's property, and it seems to us that it was highly technical to hold that the suit was therefore premature. Furthermore, the proviso which the courts below had put upon the decree prevented the possibility of any injustice being done to the respondent. On behalf of the appellant the case of the British Union and National Insurance Co. v. Rawson (1916) 2 Ch. D., 476 has been cited as an authority that the suit could not be dismissed as being premature. We think also the case of Tota Das v. Babu Ganesh Prasad (1910) Civil Revision No. 79 of 1909, decided on January 31st, 1910, (unreported) is an authority in the plaintiff's favour. Dr. Sulaiman, on behalf of the respondent, has tried to support the decision of the learned Judge of this Court upon the ground that the plaintiff may not have paid the full amount stated in the receipt to Kanhaia Ram. It appears that there was a finding in the previous litigation in which the plaintiff and Kanhaia Ram were co-defendants, that the plaintiff had not paid the full amount due upon the mortgage. As pointed out by the lower appellate court, this decision was certainly not necessary for the purposes of that suit, and furthermore, the plaintiff and Kanhaia Ram were arrayed on the same side. Admittedly, there was some consideration for the bond sued upon in the present suit, and the terms of the bond were that if a claim should be put forward and the discharge which Kanhaia Ram was purporting to give should prove not sufficient, then Kanhaia Ram would indemnify the plaintiff from any further money he had to pay. We have already held that under the circumstances of the present case the granting of a mortgage-decree against the plaintiff was equivalent to payment. We may mention here that the appellant has produced before us a certified copy of the certificate recording payment of the amount of the mortgage-decree. We allow the appeal, set aside the decree of the learned Judge of this Court and restore the decree of the lower appellate court. The appellant will have his costs of both hearings in this Court.


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