1. This was a suit by two brothers for a declaration that the defendant was liable to pay them Rs. 15,000 within 15 years from the 14th of December 1918 in accordance with the terms of two documents of 12th of December 1918 and 14th of December 1918 respectively. There was a difference of opinion between Lindsay, J., and Lal Gopal Mukerji, J.,with the result that this case has come before us for decision. About the year 1912 one Dalip Singh died childless, leaving a widow, Mt. Manohri. Ha was a Vaish Jain Agarwal. The case, as put by the plaintiffs, is that Mt. Manohri had been given an express authority to adopt, and shortly before or on 27th of October 1918, that is some six years after her husband's death, she agreed to adopt the plaintiff, a man of full age, provided he would consent to pay according to her directions sums inter alia amounting to Rs. 20,000 and an annuity of Rs. 360 a year to a certain person. The defendant was a penniless man, and these sums of money were to be paid out of the estate which would come to him on adoption; in particular the Rs. 15,000, which is the subject matter of this suit, was a sum which the defendant had to agree to pay to Mt. Manohri's brother as a condition of being adopted. On 12th of December 1918 the lady executed a document, which has been termed a Will, and a deed of adoption and on the 14th of December the defendant executed a document, which in effect promised to carry out the conditions that she had imposed. The action has been brought now, because it is said that the defendant is making away with what undoubtedly was the ancestral property of Dalip Singh; and the plaint contains a prayer also for relief against the property on the ground of an alleged charge contained in the document of the 14th of December.
2. The defendant attacks the validity of the transaction on a number of grounds. His principal contention is that he is entitled to the benefit of the adoption freed from any conditions. He says that the conditions were not such as a Hindu widow could legally impose. It has been conceded by the defendant that a Hindu widow, when making an adoption can impose stipulations which are reasonable and proper for her own protection, and that agreements of this character for maintenance, and at times, management of the property have been upheld. But it is urged that there is no case in which a widow has been permitted to benefit her own relatives and friends and has bargained for money or property to be made over to them as a condition of the adoption. The plaintiff contended that as regards a Vaish Jain Agarwal, there is a custom by which the widow could impose any conditions she liked. But custom was not pleaded nor was any evidence given of it. I think that the case must be governed by the general principles of law applicable to Hindu widows, and that this Court would be setting up a dangerous precedent if it accepted the view that Mt. Manohri had power to make any bargain which was pleasing to her, advantageous to her relatives, and detrimental to the ancestral estate. The ancestral property left by Dalip Singh is probably in the neighbourhood of two lakhs in value. The defendant contends that the lady had unlimited and unfettered power and could have made such an agreement as would have given a few thousand or a few hundred rupees only to the man whom she was adopting to her husband, and that she could have required in return for the adoption the payment over by the son of practically the whole balance of the estate to her nominees.
3. I am of opinion that a Hindu widow be she a Jain or of any other caste, possesses no such power, and that though she was negotiating with a man of full age, she was not entitled in law to propose any arrangement which could diminish the value of the ancestral estate in favour of her relatives. Lindsay, J. has referred to the case of Venkappa v. Fakir gowda : (1906)8BOMLR346 , and I am in agreement with his view that this was an unlawful bargain for the widow to make. I am also in complete agreement with him on the other matters of argument which arose during the hearing of the case. The objection as to the legality of the conditions sought to be imposed in the adoption is, in my opinion, fatal to the claim of the plaintiffs. I would therefore allow the appeal with costs and fees on the higher scale.
4. I agree that the suit should be dismissed. The case put forward by the plaintiffs in the plaint was that Mt. Manohri was the full owner in possession of considerable estate; that on 12th of December 1918 she executed a deed of adoption stating that she was adopting the defendant as her son and bequeathed to him all her property with certain conditions; that on 14th of December 1918, the defendant executed a deed of agreement by which he accepted and adopted all the conditions and provisions laid down in the deed of adoption; that among the conditions there was a provision that the defendant would pay Rs. 15,000 to the plaintiffs; that although since Mt. Manohri's death the defendant is in possession of all the property and is bound by all the conditions he is denying his liability to pay the said amount. The plaintiffs asked for a declaration: (1) that the defendant was liable to pay them the aforesaid sum and (3) that the payment of that amount was a charge on the entire estate of the deceased lady. In the plaint there was no suggestion that at anytime prior to 14th of December 1918 the defendant had agreed to abide by the conditions sought to be imposed by Mt. Manohri.
5. The defendant in his written statement denied that Mt. Manohri was the absolute owner of the estate and inter alia pleaded that the adoption having taken place some time before 12th of December 1918, the agreement was not binding upon him; in fact he pleaded that it had been obtained under unlawful pressure. As the application of 14th of June 1921 shows, the plaintiffs were fully aware of the fact that the defendant was denying that any condition was agreed upon prior to or at the time of the adoption. The parties, however, understood that the issues framed by the Court were comprehensive enough to include this dispute. The plaintiffs in the first instance led no oral evidence whatsoever to show that there was any agreement by the defendant at or before his adoption. The defendant, on the other hand, went into the witness-box and deposed that when he was adopted it was not settled between Mt. Manohri and him that any money, etc., should be paid to the plaintiffs. His own brother Bano Mal also deposed that Mt. Manohri bad not laid down any condition up to the time of the adoption. Two more witnesses, Jia Lal and Puna Mal, were also produced by the defendant to prove that there had been no settlement at the time of the adoption. After the defendant's evidence was closed the plaintiffs' vakil made a statement that he would produce no evidence to the effect that at the time of adoption or prior it, it had been settled that the plaintiffs would be paid Rs. 15,000, but would only rely on the recital in the deed; but that by way of rebutting evidence he would produce evidence to show that the deed of agreement was not executed under unlawful pressure. He accordingly led further evidence on this last-mentioned point.
6. The learned Subordinate Judge found that the deed of agreement had not been executed under unlawful pressure. He preferred the recitals in the agreement to the defendant's oral evidence and concluded that the terms must have been agreed upon before the adoption. He accordingly held that the agreement was for consideration and the defendant was liable to pay the amount, but he considered that no charge was created on the property received by the defendant. The suit was accordingly decreed in part.
7. Both the parties appealed to this Court. The appeal first came up before Mukerji and Dalai, JJ., who sent down issues to ascertain whether, the property left by Mt. Manohri was her absolute property or not. The findings that have been returned make it quite clear that although Mt. Manohri was a Jain widow she had only a Hindu widow's estate in the property because this was the ancestral property of her husband and not his self-acquired property. No objections were filed to this finding and this position is now accepted.
8. The appeal came up for final disposal before Lindsay and Mukerji, JJ., and the two learned Judges differed, hence this appeal under the Letters Patent.
9. On the question of fact as to whether the conditions had been offered and accepted at or before the time of the adoption Mukerji, J., in view of the recitals contained in the defendant's agreement and the probabilities of the case was satisfied that the condition must have bean arrived at before the adoption. Lindsay, J., although thinking that the matter was not so clear to him did not feel prepared to differ as regards this matter. In the Will executed by Mt. Manohri there is no reference to any condition having been agreed to at the time of the adoption. In fact she purports to impose this condition as if she were an absolute owner of the property entitled to lay down this condition. In the agreement the relative words are my adoption is (or more favourable to the plaintiffs, has been) held conditional to my accepting the stipulation aforesaid.' There is no clear recital in the deed that the adoption was held conditional before the adoption took place. This ambiguous recital is the solitary piece of evidence in favour of the plaintiffs and is supposed to outweigh the oral evidence of the defendant. I must say that I share the reluctance of Lindsay, J., as the matter is not so clear to me also. I am, however, loath to take a different view of the interpretation at this stage and must assume that the condition was agreed upon by the defendant before his adoption took place.
10. was of opinion that the agreement to pay Rs. 15,000 to the brothers of the adoptive mother was contrary to Hindu Law and illegal and unenforceable, He further held that this agreement did not amount to a family arrangement; nor under the agreement any trust was created in favour of the plaintiffs, nor was any charge created on the property. He accordingly held that the plaintiffs not being parties to the contract were not entitled to enforce it. On the other hand Mukerji, J., did not consider that such as agreement was contrary to Hindu Law and, therefore, illegal or unenforceable, but held that the arrangement amounted to a family settlement, that it created a trust in favour of the plaintiffs and also a charge on the property and was accordingly binding on the defendant.
11. It has not been contended before us that apart from any prohibitions of Hindu. Law the objection to the validity of the agreement can be founded on the ground that it is opposed to public policy. It is very difficult to extend the doctrine of public policy beyond the classes of cases already covered by it. Courts are reluctant to invent new heads. It is, however, contended that stipulations made by the widow before adoption are in the nature of a bargaining which is contrary to Hindu Law. It is pointed out that if such an arrangement were to be accepted by Courts, agreements would be encouraged which would be detrimental to her husband's estate. On the other hand, if a widow cannot be allowed to make any arrangement, she may very often refuse to make an adoption and thus fail to carry out the desire of her husband. No doubt the adopted son does not claim through the widow, but in his own right which comes into existence as soon as he is adopted. It is, therefore, quite reasonable to assume prima facie that a Hindu widow can have no power to impose conditions on the estate which is going to vest in the adopted son. It is not disputed that a Hindu father can impose conditions before the adoption, but the position of a Hindu widow with limited powers is certainly quite different as she does not possess a full disposing power over the estate.
12. In cases where a minor son is given in adoption by his natural guardian and the latter enters into an agreement with the widow curtailing the estate, it is a vexed question of law how far that agreement would be binding on the minor son. The general opinion seems to be that an agreement, so far as it can be considered to be reasonable, would be binding on the son because it was entered into by his natural guardian for his benefit and considered necessary by the guardian at the time. In the present case the defendant was admittedly of age when he himself entered into the agreement. He must be deemed to have been in the best position to know his own interest and his benefit. He entered into the agreement with open eyes apparently knowing full well that but for such an agreement he would not be adopted and would not inherit this valuable estate. Under such circumstances the question whether it was or was not reasonable, does not arise. Unless the agreement can be said to be void either for want of consideration or as being opposed to Hindu law, it would be binding on him in its entirety. The question whether it can be enforced by third parties will be considered hereafter.
13. To my mind the question whether a widow can impose conditions on the boy to be adopted or the estate is entirely different from the question whether the adopted son can or cannot himself undertake a liability in lieu of consideration. I am prepared to concede that a Hindu widow, as a general rule, has no power to impose conditions. At the same time it has been held in several cases that an agreement with the natural guardian of the boy before adoption for allowing the widow to remain in possession of the entire estate for her lifetime is binding on him. Similarly other reasonable agreements under which the adopted son's powers were curtailed have also been upheld. Cases where such agreements have not been upheld are based not on a supposed ground that such agreements are illegal and opposed to Hindu Law, but rather on the ground of want of authority in the widow to impose conditions on a minor son which are not for his benefit. I would, therefore, feel great difficulty in holding that agreements of this kind are prohibited by the Hindu Law so as to make them absolutely illegal and void.
14. Even if, therefore, the widow has no power to impose conditions on her would be adopted son, I see no good ground for holding that the adopted son, if of age, is prevented from undertaking a liability on himself for consideration. The adopted son would be bound by his agreement not because the widow had power to impose such condition on him before adopting him, but because he himself entered into an agreement in lieu of consideration. The defendant is bound not by the authority of the widow but by his own agreement.
15. It is now well settled by the Full Bench case of Fateh Singh v. Thakur Rukmini Ramanji Maharaj AIR 1923 All 387 that a reversioner, if he gives his consent to an alienation by a Hindu widow, would be estopped from challenging it if he himself succeeds to the estate on her death. The position of the adopted son is somewhat analogous and I fail to see why he also should not be estopped from challenging his own agreement after the property becomes vested in him.
16. The widow, though directed by her husband to adopt, cannot be legally compelled to adopt a boy. The adoption to some extent is a matter of her discretion and this is specially so when the boy to be adopted has not been named. In the case of Jain widows they can adopt even without an express authority of the husband: vide the case of Manahar Lal v. Banarsi Das (1907) 29 All 495. Her agreeing to adopt the defendants is certainly an act which was a good consideration for the agreement. Under Section 2, sub-Cl. (d), Contract Act, when at the desire of the promisor the promisee or any other person has done or abstained from doing or does or abstains from doing or promises to do or to abstain from doing something, such act or abstinence or promise is called a consideration for the promise. It would be difficult to deny that the act of the widow in selecting the defendant and not selecting any other person to be adopter and adopting him did not amount to a consideration within the meaning of the section. It might have been her moral or even religious duty (which is doubtful in the case of a Jain widow) to adopt a boy, but it was certainly not her legal duty to adopt one and much less to adopt the defendant. Her agreement to adopt him was therefore a good consideration, and it is not possible to hold that the deed of agreement executed by the defendant was void for want of consideration.
17. That agreements entered into at the time of adoption are neither absolutely illegal nor without consideration has been assumed in several decided cases: vide the cases of Visalakshi Ammal v. Sivaramien (1904) 27 Mad 577 and Kashibai Ramchandra Ghatge v. Tatya Genu Pawar AIR 1916 Bom 312. The Privy Council case of Ramasami v. Venkata Ramaiyan (1878) 2 Mad 91 is, in my opinion, a clear authority that agreements curtailing the rights of the adopted son are not absolutely void, but in the case of a minor merely voidable and capable of ratification on his attaining majority. In that case the natural father of the boy had entered into an agreement with the adoptive mother that the boy would have no concern with certain properties previously sold and disposed away by the widow and that the would inherit only certain properties described by name which were in the possession of the widow. There was a clear covenant that whether or not there are more properties, neither the natural guardian nor his begotten son, who is the adopted son, would have any sort of claim or title to the same or to their enjoyment. When the boy attained majority he ratified this agreement but subsequently went back upon it and sued to set aside all the alienations and to claim all the properties. On the facts their Lordships felt themselves bound to assume that the father consented to give his son in adoption on the understanding that he would inherit only about one-third of the late husband's property being aware, or not caring to inquire, how the remaining two-thirds had been disposed of. The High Court had held that the agreement was void in law in so far as it relinquished on behalf of the plaintiff his right to any part of the property which had been his adoptive father's. Their Lordships of the Privy Council remarked: 'How far the natural father can by agreement before the adoption renounce all or part of his son's rights, so as to bind that son when he becomes of age, is also question not altogether unattended with difficulty; although the case of Chitko Raghunath Raja Diskh v. Janaki (1874) 11 BHC 199 certainly decides that an agreement on the part of the father that his son's interest shall be postponed to the life-interest of the widow is valid and binding. In this case their Lordships think it enough to decide that the agreement of the natural father, which has been set out, was not void, but was, at the least capable of ratification when his son became of age. The main question in the case when his son became of age is therefore reduced to this whether the son did or did not validly ratify it.' Accordingly when their Lordships found that the plaintiff had on attaining majority ratified the agreement they held that he was bound by it. This, in my opinion, is a clear pronouncement in support of the view of Mukerji, J., that agreements of this nature are neither prohibited by Hindu Law nor are without consideration. If a minor is to be bound by an agreement entered into by his natural father and subsequently ratified by him when he comes of age, there is no good ground for holding that an adult adopted son cannot be bound by an agreement into which he enters with open eyes. I would therefore hold that the agreement executed by the defendant was neither illegal nor without consideration.
18. Although under the Indian Contract Act it is not necessary that the consideration should move from the promisee himself, it is nevertheless necessary under Section 2 that the proposal should be made to the promisee and the latter should signify his assent thereto. It would therefore follow that a stranger cannot enforce a contract to which he was himself no party. This point is completely covered by the case of Jamma Das v. Ram Autar Pande (1912) 34 All 63 affirming a decision of this Court where a person for whose payment money was left in the hands of a transferee was held not entitled to maintain a suit against the transferee. Mukherji, J., has conceded that a stranger cannot enforce an agreement to which he was not a party unless the agreement amounted to a family arrangement or created a trust or created a charge.
19. In support of his view that this transaction amounts to family arrangement he has relied on the case of Kashibai Ramchandra Ghatge v. Tatya Genu Powar AIR 1916 Bom 312. That case is certainly an authority for that view. The facts of the present case also are very similar to the facts of that case. In both cases the adopted son was of age at the time of the agreement. But with great respect I am unable to agree that the correct basis of decision was the existence of a family settlement. Lindsay, J., has correctly pointed out that a family arrangement is one arrived at by members of the same family in settlement of doubtful claims, cases in which there being uncertainty as to the rights of the various claimants, the dispute being composed by a settlement based upon the acknowledgment of pre-existing title in the parties concerned. There must be a bona fide dispute which has to be settled by a private family settlement without having recourse to law. In the present case there could be no dispute whatsoever. The widow particularly as she was a Jain widow, had a full discretion both in the matter of adoption and in the choice of the boy. The brothers of the widow had no claim to the estate and no right to be paid an amount. There was therefore no dispute which required a settlement and in fact none was settled. The mere fact that an agreement is entered into by persons who are relations of each other does not make such an agreement a family settlement so as to be binding on persons who are not even parties thereto. Section 23, sub-C1. (c) under which a compromise of doubtful rights between the members of the same family can be specifically enforced by any persons beneficially entitled thereunder cannot therefore be applicable.
20. I also agree with Lindsay, J., that the compromise to pay Rs. 15,000 to the widow's brother did not amount to a trust. The defendant merely declared that he should abide by all the conditions laid down in the Will of Mt. Manohri. His agreement at best amounted to a promise to pay Rs. 15,000 to the brothers within 15 years. There was no money belonging to the widow over which she had created a trust, nor was the possession of the defendant that of a trustee holding trust property for the benefit of the plaintiffs. It was merely an agreement to pay them the said amount and by this agreement he constituted himself a promisor liable to pay them that amount. In the case of Jamna Das v. Ram Autar Pande (1912) 34 All 63, the money which had been left in the hands of the transferee was money actually belonging to the mortgagor and had been expressly left in the hands of the transferee for payment to a named creditor. Even then their Lordships did not consider that such a transaction created a trust in favour of the person to whom it was to be paid. In the present case there was not even any money in existence at the time of the agreement and such money certainly did not belong to the widow who can be said to have created a trust in favour of the plaintiffs. Mukerji, J., has considered that it falls within the definition of a trust as given in Section 3, Trusts Act (Act 2 of 1882) which says that a trust is an obligation annexed to the ownership of property and arising out of a confidence reposed in and accepted by the owner or declared and accepted by him, for the benefit of another, or of another and the owner. But here before the adoption the widow was not the absolute owner of the property capable of creating any trust, nor had the property then vested in the defendant. If Rs. 15,000 are to be treated as trust money,.. is the obligation annexed to the ownership of it or the estate? If the widow had no power to impose an obligation on the adopted son she could not annex an obligation to the ownersip of the property which was to vest in Data Ram. It is, therefore, very difficult to hold either that the money was a trust money or that Data Ram was a trustee or that the plaintiffs were beneficiaries of the trust.
21. Lindsay, J. has agreed with the Subordinate Judge that the agreement does not create a charge on the immovable property which vested in the defendant. The deed does not purport to create any such charge expressly. It specifies no property by name. It is called an ikrarnama (agreement) and is written on a stamp paper of the value of eight annas. Had it been intended to create a charge on some property it would under Section 2, sub-Cl. (17) of the Indian Stamp Act have bean treated as a mortgage-deed and a stamp paper of much larger value would have been used. It merely records the agreement of the defendant that he would abide by all the conditions specified in the deed dated the 12th of December 1918, as well as in the Will dated the 13th of December 1918. The last document has not been produced by either party. As the first document is merely a Will the last one was necessarily the more important one if it in any way purported to modify the provisions of the former. In the agreement there is no express mention that the persons to whom the money is to be paid would have a right to enforce a charge or realize their money by sale of any specified property. All that it says is that they may have the terms enforced by the Court. It is true that in the Will to which the dead refers there is a provision that in the case of non-payment the payees will have power to realize the amount through a competent Court by causing the property of the executant (Mt. Manohri Bibi) to be sold at auction or by any other way they like. I have already mentioned that Mt. Manhori was not the owner of the property capable of creating a charge which would enure for the benefit of the charge-holder beyond her lifetime. It was she who purported to create a charge but in view of her inability to do so her doing so could not be efficacious. Data Ram accepted the conditions but did not himself purport to create any charge on his estate. Furthermore, it is the plaintiffs' case that the oral agreement was completed before the adoption was made. If that is so then at that time the property had not even vested in Data Ram. As to the document executed by Mt. Manhori it was in the nature of a Will which did not come into effect on the date of the agreement by Data Ram but would be operative after Mt. Manohri's death. A charge is defined in Section 100 of the Transfer of Property Act as being created on immovable property of one person when that property is by act of parties or operation of law made security for the payment of money to another and the transaction does not amount to a mortgage. It is very difficult to say that the defendant created a charge on his estate and made it security for the payment of the promised amount.
22. In this view of the matter it is unnecessary for me to express any definite opinion whether, when a charge is created on property in favour of a third person and the contract is not even a settlement on marriage or a compromise of doubtful rights between the members of the same family as referred to in Section 23 of the Specific Relief Act, the beneficiary even though a stranger to agreement, can enforce the contract.
23. I accordingly hold the plaintiffs not being a party to the contract, are not entitled to enforce the agreement and their suit is liable to be dismissed with costs in all Courts.
24. The decree of the Court below is set aside and the plaintiffs' suit is dismissed. The result is that Letters Patent Appeal No. 39 of 1925 preferred by the defendant would be allowed and the Letters Patent Appeal No. 30 of 1925, filed by the plaintiffs dismissed. The plaintiffs will have to pay the costs of the defendant in all Courts including in this Court fees on the higher scale.