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Atmaram Rachhodbhai Vs. GulamhuseIn Gulam MohiyaddIn and anr. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtGujarat High Court
Decided On
Case NumberSpecial Civil Appln No. 762 of 1965
Judge
Reported inAIR1973Guj113; (1972)GLR828
ActsTrust Act, 1882 - Sections 47
AppellantAtmaram Rachhodbhai
RespondentGulamhuseIn Gulam MohiyaddIn and anr.
Appellant Advocate N.V. Karlckar, Adv.
Respondent Advocate I.C. Bhatt, Adv.
Cases ReferredIshwardas v. Maharashtra Revenue Tribunal
Excerpt:
.....trust is a private trust governed by the indian trust act or is a public charitable or religion trust, a trustee cannot delegate any of his duties, function and powers to a co-trustee or to any other person unless the instrument of trust so provides or the delegation is necessary or the beneficiaries competent to contract consent to the delegation or the delegation in the regular course business. there are the only four exceptional case sin which delegation is permissible and save in these exceptional cases, the trustees cannot even by a unanimous resolutions, authorise one of themselves to act as managing trustees for executing the duties, function and powers relating to the trust and every one of them must join in the execution of such duties, function and powers. and the other of..........or any of the function except in some specific cases. the rules against renunciation of the trust by trustee and against delegation of his function by a trustee are embodied in respect of trusts to which the indian trust act applies, in section 46 and 47 of that act............ it is true that section 1 of the india trusts act makes provision of the act inapplicable to public or private religious or charitable endowments; and so, these section may not in terms apply to the trust now in question. these sections however embody nothing more or less then the principles which have been applied to all trusts in all counties. the principles of the rule against delegation with which we are concerned in the present case, is clear: a fiduciary relationship having been created, it is against.....
Judgment:

Bhagwati, C.J.

1. This is Special Civil Application under Article 227 of the Constitution of has been placed before us on a reference made by the J. B. Mehta, J. two question have been referred to us. One is, whether some only out of several co-trustees can effectively determine a tenancy by giving notice to quire and the other is, whether a suit to evict a tenant can be filed by one of the more co-trustees without joining other co-trusted in the suit. Both questions are of frequent occurrence in the cases arising under the Rent Act and even under the general law of landlord and tenant and it is, therefore, necessary that they be properly considered and the law on the subject should be finally settled by a Full Bench decision of this Court.

2. The determination of the two question must depend on the true nature and character of the office of co-trustees. The classic statement of the law describing what is the true mater and character of the office or co-trustees is to be found in the following passage from Lewin on Trusts, (Sixteenth Edition,), page 181:--

'In the case of co-trustees of a private trust, the officer is a joint one. Where the administration of the trust is vested in co-trustees, they all form as to the were but one collective trustee and therefor must execute the duties of the officer in their joint capacity. Sometime, one of several trustees is spoken of as the action trustees, all but the Court knows of no such distinction: all who accept the officer are in the eyes of the law acting trustees. If any one refuses or in incapable to joint, is it not competent of the other to proceed without him, and, if for nay reason they are unable to appoint a new thrustee in the place under Section 36(1) of the Act, the administration of the trust must devolve upon the Court. However, the act of one trustee done with the sanction and approval of a co-trustee may be regarded as the act to the both, though such action or approval must be strictly proved'.

The Judicial Committee of the Privy Council pointed out in Man Mohan Das v. Janki Prasad , that this was a correct statement of law applicable in England and that the same doctrine applies in India also. The trustees must act jointly in executing the duties of their office unless the instrument of trust otherwise provides. The instrument of the trust may proved that one or more trustees shall be managing trustees entitled to act on behalf of the trust and where such provision is made, those who are empowered to act as managing trustees would be entitled to execute the duties of the office without the concurrence of the other co-trustees. But in the absence of such provision, all co-trustees must join in the execution of the duties of the office.

3. It follows as a necessary corollary form the above proposition that save in certain exceptional cases to which we shall presently refer, a trustee cannot delegate any of the duties, function and power of his officer to his co-trustee or the any one else, as that the would be contrary to his obligation under the trust. This position of law is now well settled and there is high authority in support of it, namely the decision of the Supreme Court in Abdul Kayum v. Alighai : [1963]3SCR623 . The following observation form the judgment of the Supreme Court in this case are very important and material in this determining the controversy between the parties land they may be reproduce as following:--

'.............. trustee cannot be transfer their duties, function and power to some other body of men and create them trustees in their own place unless this is clearly permitted by the trust deed, or agreed to by the entire body of beneficiaries. A person who is appointed a trustee is not bound to accept the trust; but having once entered upon the trust he cannot renounce the duties and liabilities expect with the permission of the Court or with the consent of the beneficiaries or by the authority of the trust deed itself. Nor can a trustee delegate his officer or any of the function except in some specific cases. The rules against renunciation of the trust by trustee and against delegation of his function by a trustee are embodied in respect of trusts to which the Indian Trust Act applies, in Section 46 and 47 of that Act............ It is true that Section 1 of the India Trusts Act makes provision of the Act inapplicable to public or private religious or charitable endowments; and so, these section may not in terms apply to the trust now in question. These sections however embody nothing more or less then the principles which have been applied to all trusts in all counties. The principles of the rule against delegation with which we are concerned in the present case, is clear: a fiduciary relationship having been created, it is against by the interests of society in general that such relationship should be allowed to the terminated unilaterally. That is why the way does not permit delegation by trustee of the his functions, except in cases of necessity or with the consent of the beneficiary or the authority of the trust deed itself; apart form the delegation in the regular course of business', that is, all such function which a prudent man of business would ordinarily delegate in connection with his own affairs'.

These observation clearly show that whether trust is a private trust governed by the Indian Trust Act or is a public charitable or religion trust, a trustee cannot delegate any of his duties, function and powers to a co-trustee or to any other person unless the instrument of trust so provides or the delegation is necessary or the beneficiaries competent to contract consent to the delegation or the delegation in the regular course business. There are the only four exceptional case sin which delegation is permissible and save in these exceptional cases, the trustees cannot even by a unanimous resolutions, authorise one of themselves to act as managing trustees for executing the duties, function and powers relating to the trust and every one of them must join in the execution of such duties, function and powers.

4. The first question which arises for decision is, whether one co-trustee can determine a tenancy by giving notice to quit to the tenant, or whether it is necessary that all co-trustees must join in giving such notice. Now there can be no doubt that unless the power and function to determine a tenancy by giving notice to quire is delegated by all co-trustees to a particular co-trustee, the notice to quite given by such co-trustee alone would be insufficient to determine the tenant and even if such delegation is made, it would be ineffective unless it falls within one of the excepts categories of permitted delegation. If the instrument of trust provides, or all beneficiaries, being competent to contract, consent that any one particular co-trustee may given notice determining a tenancy, the delegation of the power and function to the given notice determining a tenancy, the delegation of the power and function to the notice to quire would be valid and the notice to would given by the particular co-trustee would be effective be determine the tenancy. But even if the instrument of trust does not so proved and the beneficiaries, being competent to contract do the so consent,. the question would still remain whether the delegation of the power and function to given notice to quire determining the tenancy can be said to be necessary or in the regular course of business. There may be conceivable cases where the delegation of the power and function to given notice to the quire determining a tenancy may be considered necessary for the execution of the trust be such cases would be very rare rate and ordinarily but it would be very such rare and ordinarily to would be difficult to regard such delegation as necessary, though of the course this question would always depend in the last analysis on the facts and circumstances of each case. But whatever might the position in regard to the question whether such delegation is necessary or not it is clear that such delegation cannot be business said to be in the regular course of business. There are at least two decision, one of the Privy Council. and the other of the Calcutta High Court, which clearly show inferentially that such delegation cannot be sustained as a delegation in the right course of the business.

5. The first decision is the decision of the Privy Council in K. S. Bannmerji v. Sitanath Das, AIR 1922 PC 209. This was a case where a lease granted by a power-of-attorney holder of a trustee was challenged. The Judicial Committee of the Privy Council held that the lease was execution by a person without authority and was, therefore, void. Lord Buckmaster, delivering the opinion of the Judicial Committee, gave the following reason for taking this view:--

'It was said that he was not in the strictest language a trustee; but be it so, his position was nonetheless a representative one, and it being plain that he never negotiate nor considered, nor knew of the lease until after it had been executed, if the what was done, was done by virtue of a power of attorney, it would only have been because of the power had delegated the representative authority that he possessed to a third party. The duties of Protap, however they mar be defined, were their nature fiduciary and fiduciary duties cannot be made the subject of delegation. If, therefore, the document had been before their Lordship it would have been impossible to have supported the contention that it conferred the power of the negotiate and execute for the document upon when the whole of the defendants' case rests'.

It would seem from this decision the power of the grant a lease of trust property cannot be delegated by the trustee to any-one else. It is a power coupled with a fiduciary duty and fiduciary duty cannot be made the subject of delegation. Any attempted delegation would be ineffective be invalid.

6. This decision of the Privy Council was followed by the Calcutta High Court in Gopal Sridhar Mahdev , Sashi Bhusan Sarkar : AIR1933Cal109 . There a contract for giving for lease of certain debutter property was entered into which the plaintiffs by defendants No. 3 acting on behalf of defendant No. 2 who was the shebait. Defendant No. 2 on coming to known of the contract of lease repudiated it and that led to the filing of the specific relief by the plaintiffs. The suit 'was resisted by defendant No. 2 and one of the defence raised by her was that even if defendant No. 3. had authority to enter into the contract of the lease on behalf of defendant No. 2, such authority was ineffectual since grating of lease was matter of fiduciary obligation an it could not be delegated by defendant No. 2 to defendant No. 3. This defence was upheld by Division Bench of the Calcutta High Court consisting of Mukerji and Bartley, JJ. The learned Judges Council in AIR 1922 PC 209 (supra) and applying of the ratio of that decision on the facts of the case before them observed:

'It is open to the trustee or a shebait to appoint a sub-agent, but such appointment must only be as means of carrying out his own duties himself and not for the purpose for delegation those duties by means of the such appointment. It cannot be denied that the granting of a lease of this character was a matter with the regard to which defendant 2 as shebait was bound to exercise her judgment, and when it is found that defendant 3, under a support authority which must have purposed to delegate that exercise of judgment to him, made the contract and when defendant 2 repudiate the contract at the earlier opportunity available to her it is impossible to uphold this delegation which is a good deal more than the mere employment of a machinery for carrying out the duties which attached to defendant 2 in the fiduciary character she occupies.......'

This decision also, therefore, shows that granting of a lease is not a matter which granting of a lease is not a matter which can be delegated by a trustee to nay other person 'in the regular course of business'.

7. Now if the granting of lease is a matter which cannot be delegated by the trustee, it must follow as a necessary corollary that the determination of a lease of the cannot be regarded as a matter which can be delegated by the co-trustee to another co-trustee to determine a lease is of the same nature and as the power and function to grant a least and if one cannot be . Both function are affected with a fiduciary duty with respect to which all co-trustee are bound to exercise there judgment and no one co-trustee can abdicate the exercise of this judgment by delegating these function to his co-trustee or to any other person.

8. It is, therefore, clear that one co-trustee cannot given notice to quire determining the tenancy. The decision to determine the tenancy by giving notice to quire must be taken by all co-trustees unless, of course, the instrument of trust otherwise provides, or the benefaction being competent to the contract consent, or it any particular case is established that on the peculiar facts obtaining in that case, the delegation of the power to determine the tenancy was necessary. But when he way that the tenancy must be determined by all co-trustee, we must make it clear that what we means is that the decision to terminate the tenancy must be taken by all the co-trustees. The formal act of the giving notice to quire pursuant to the decision taken all by the co-trustees may be performed by one co-trustee on behalf of the rest. The notice to quire given in such a case would be a notice given when the sanction and approval of all the co-trustees and would be clearly a notice given by all co-trustees.

9. Turning now to the second question which arises for considerations, it is clear that all co-trustees must joint on the filing a suit to recover possession of the property from the tenant after determination of the lease. That must follow as necessary and logical consequence from the nature and character of the officer of co-trustees to which we have referred in the opening part of the Judgment-Section 48 of the co-trustees to which we have referred in the opening par of the Indian Trusts Act provides that when the are more trustees than one, all must join the execution of the trust, except where the instrument of trust otherwise provides. The principle embodied in this section must apply equally to a public religious or charitable trust as pointed out by the Supreme Court in : [1962]46ITR640(SC) (supra) . Since all co-trustee must join on the execution of the trust, and recovery of possession of the property from the tenant after determination of the lease would be a duty arising in the execution of the trust, all the co-trustees must join in filing a suit to recover possession of the property from the tenant. The only exception to this rule would be where the instrument of trust provides that one co-trustees may institute a suit to recover possession of the property from the tenant, he would be competent to institute such a suit and it would be no answer on the part of the tenant to say that the other co-trustees must joint to the officer in the suit to recover possession of the property from the tenant for the officer is a joint officer and they all form as it were but one collective trustee. This position in law is now well settled and there is complete unanimity of opinion amongst the High Court about it. We may mention only a few of the decision which have taken this view: Vedkannu v. Annadan Chatram, AIR 1938 Mad 982 and Ramesh Chandra v. Hemendra Kumar, AIR 1949 Cal 519.

10. There was, however, one decision cited on the behalf of the landlord to which we must refer before we part with this question. That was the decision of the Supreme Court in Ishwardas v. Maharashtra Revenue Tribunal : [1968]3SCR441 . This case arose out of an application made by the managing trustee of a public charitable trust for possession of a certain portion of the land leased out to a tenant, under the provisions of the Bombay Tenancy and Agricultural Lands (Vidarbha Region) Act, 1958. The ground on which possession was sought was that the managing trustee bona fide required the land for cultivation it personally. Section 2(12) defined the expression 'to cultivate personally' to mean to cultivate on one's own account. The tenant resisted the application on a two fold ground. One ground was that the managing trustee was not a landlord entitled to obtain possession of the land since the land was not vested in him and the other was that the meaning trustee could cultivate the land only on account of the beneficiaries and not on his own account and it could not, therefore, be said that he bona fide required the land for cultivating it personally. Both these grounds were negatived by the Supreme Court. The Supreme Court held that in view of Section 2(18) of the Bombay Public Trusts Act, 1950, the properties of the trust which included the land in question vested in the managing trustee was, therefore, a landlord within the meaning of that expression as used in the Act and since the land vested in the managing trustee cultivation by him in the manner set out in Section 2(12) could be considered to be cultivation 'on one's own account' and the managing trustee, was therefore, entitled to obtain possession of the land form the tenant. We fail to see how this decision can be of any assistance to the plaintiff so far as the present contention is concerned. It is apparent from the decision that no contention was advanced before the Supreme Court that the managing trustee alone was not entitled to maintain the application for obtaining possession of the land from the tenant and that the other trustees were necessary parties to the application. It is quite possible that such a contention was not advanced because under the instrument of trust the managing trustee was empowered to maintain suits and applications on behalf of the trust without joining other co-trustees. But, whatever be the reason, it is clear that no question as to the competency of the managing trustee alone to maintain the application was raised before the Supreme Court nor did the Supreme Court have occasion to consider any such question and the decision of the Supreme Court cannot, therefore, be regarded as an authority on the point that a managing trustee can maintain an action on behalf of the trust without joining the other trustees.

11. We are, therefore, of the view that unless the instrument of trust otherwise provides, all co-trustees must join infiling a suit to recover possession of the property from the tenant after determination of the lease. No one single co-trustee, even he be a managing trustee unanimously chosen by the co-trustees, can maintain such a suit against the tenant without joining the other co-trustees. All co-trustees must be joined in the suit and if any one or more of them are unwilling to be joined in the suit as plaintiffs or for some reason or the other it is not possible to join them as plaintiffs, they must be impleaded as defendants so that all co-trustees are before the Court.

12. We, therefore, answer the questions accordingly and send the Special Civil Application for hearing and final disposal by a single Judge of the High Court in the light of the answers given and the observations made in this judgment.

13. Order accordingly.


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