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Dodla Rami Reddi and ors. Vs. Devireddi Pattabhirami Reddi (Deceased) and anr. - Court Judgment

LegalCrystal Citation
SubjectContract;Property
CourtChennai
Decided On
Reported in(1936)71MLJ599
AppellantDodla Rami Reddi and ors.
RespondentDevireddi Pattabhirami Reddi (Deceased) and anr.
Excerpt:
- - it is contended that it is such an oral agreement and therefore comes under proviso (3) to section 92. in our view, that contention must fail. 6,000 by the said date 31st march, 1925, you should grant me further time till 31st march, 1926, for the payment of the balance and if i should fail to pay it as aforesaid, you shall be entitled to recover on the liability of the mortgaged properties the whole of the amount of principal and interest without reference to the amount waived by you, and i shall raise no objection to it. , release the properties from the mortgage as and when sold, the plaintiff thinks it fair and that he should be released from what in our view clearly was an obligation undertaken by him, i......in the suit was to compel the defendant to execute and register at his (the plaintiff's) cost a release deed in respect of the suit lands releasing the same from a mortgage in the defendant's favour dated 14th september, 1920. this mortgage was executed by one kali chetty narayana reddi. the lands comprised in this mortgage and other properties were sold in court auction on 3rd december, 1924 and were purchased by the plaintiff subject to the defendant's mortgage. the plaintiff's case was that he entered into agreements of sale with third parties with respect to some of the lands to the knowledge and with the consent of the defendant who agreed that the plaintiff should pay him the prices stipulated under the agreements of sale and to release from his mortgage the lands agreed to be,.....
Judgment:

Horace Owen Compton Beasley, Kt., C.J.

1. This is an appeal by the plaintiff against the judgment of the principal Subordinate Judge of Nellore dismissing his suit. His claim in the suit was to compel the defendant to execute and register at his (the plaintiff's) cost a release deed in respect of the suit lands releasing the same from a mortgage in the defendant's favour dated 14th September, 1920. This mortgage was executed by one Kali Chetty Narayana Reddi. The lands comprised in this mortgage and other properties were sold in Court auction on 3rd December, 1924 and were purchased by the plaintiff subject to the defendant's mortgage. The plaintiff's case was that he entered into agreements of sale with third parties with respect to some of the lands to the knowledge and with the consent of the defendant who agreed that the plaintiff should pay him the prices stipulated under the agreements of sale and to release from his mortgage the lands agreed to be, sold. Accordingly amounts paid by purchasers were duly paid to the defendant on 17th February, 1926, 15th November, 1926 and 14th February, 1927 and at the same time under Exs. A-1, A-2 and A-3 he acknowledged the receipt of the money and agreed to execute a release deed in respect of the properties sold whenever the plaintiff required. By the date of Ex. A-3, i.e., 14th February, 1927, sums aggregating to Rs. 6,000of which Rs. 1,500 was by a promissory note the remainder being cash, had been paid. The plaintiff, however, did not call upon the defendant to execute the release deed in respect of the properties sold for nearly three years. Then he filed the suit under appeal.

2. The defendant set up the defence that there was an oral agreement that the release deed was only to be given when the entire mortgage debt had been discharged and that whenever thereafter the plaintiff called upon him to execute the release deed he was under an obligation to do so but not before. It is clear that Exs. A-1 and A-2 which are unregistered cannot be admitted in evidence at all and that only Ex. A-3 is admissible. That document, however, refers to the previous transactions of 17th February, 1926 (Ex. A-1) and 15th November, 1926 (Ex. A-2). In Ex. A-3 which acknowledges the receipt of Rs. 600 for the sale of certain property comprised in the mortgage, it is stated by the defendant:

I shall execute at your cost a deed of relinquishment of right in your favour whenever desired by you and get the same registered.

3. And after referring to Exs. A-1 and A-2, he states:

Therefore I shall whenever desired by you and at your cost execute in the same manner a deed of relinquishment of right in your favour, even in respect of those lands mentioned in that document and get it registered.

4. If is clear that the oral arrangement set up by the defendant cannot be admitted under Section 92 of the Evidence Act unless it is a separate oral agreement constituting a condition precedent to the attaching of any obligation under the contract. It is contended that it is such an oral agreement and therefore comes under proviso (3) to Section 92. In our view, that contention must fail. The contract is to execute a deed of release 'whenever desired by you' and not 'whenever desired by you after the mortgage has been discharged'. The oral agreement pleaded is directly contradictory to the terms of the contract itself. Had the case rested there, then the plaintiff would have been entitled to succeed; but under Section 22 of the Specific Relief Act the Court may exercise its discretion and not decree specific performance where the circumstances under which the contract is made are such as to give the plaintiff an unfair advantage over the defendant. The learned Subordinate Judge was of the opinion that the discretionary relief should be refused to the plaintiff on that ground and also because of the delay by the plaintiff in enforcing his claim. Mere delay itself is no ground for refusing relief but when it raises the presumption of an abandonment of the plaintiff's claim or has caused a hardship to the opposite party or something to his prejudice, Courts are entitled to exercise their discretion and refuse the relief prayed for. In this case we are not concerned merely with the question of delay though on this point it is worthy of remark that the alleged purchasers of the property apparently took no steps to get from the plaintiff releases of the properties they had purchased from the mortgage until according to the plaintiff himself just before he filed the suit which he says was filed owing to the pressure of his vendees. It is strange also that, if the plaintiff believed that he had the right to call upon the defendant to execute release deeds in respect of the properties sold piecemeal, he took no steps until just before the expiration of the period of limitation to enforce his right. There is something else, this is an unusual contract and the mortgagee agrees to the sale of the security, the mortgaged property, piecemeal instead of at one time; and the reason for this is, we think, quite apparent from an important exhibit in the case, namely, Ex. I, and the plaintiff's own evidence at the trial. Ex. I is dated 4th December, 1924, and is written by the plaintiff to the defendant. It states the purchase by the plaintiff of the mortgaged properties in Court auction and fixes the amount of principal and interest due to the defendant on that date from the mortgagor Narayana Reddi at Rs. 12,100 and says that Rs. 1,100 had already been whole-heartedly waived by the defendant leaving Rs. 11,000 due by Narayana Reddi to him. The plaintiff says that he purchased the properties in auction subject to this debt and says:

If I should pay to you in full the said amount of principal and interest by 31st March, 1925, either in instalments from this date or in one lump sum, you should forthwith cancel that document duly and hand it over to me. If I should pay you a sum of Rs. 6,000 by the said date 31st March, 1925, you should grant me further time till 31st March, 1926, for the payment of the balance and if I should fail to pay it as aforesaid, you shall be entitled to recover on the liability of the mortgaged properties the whole of the amount of principal and interest without reference to the amount waived by you, and I shall raise no objection to it.

5. The plaintiff therefore undertook personally to discharge the mortgage and was given a remission of Rs. 1,100 provided he paid the money by 31st March, 1925, or if he paid an instalment of Rs. 6,000 he was to have another year's time in which to pay. It is common ground that he did not pay; and therefore Ex. I was no longer operative in his favour. It is clear instead that an arrangement was come to between the plaintiff and the defendant whereby the plaintiff undertook to discharge the mortgage amount by instalments. The plaintiff himself sets up an oral arrangement and since in our view this does not contradict the contract set out in Ex. A-3, and is quite consistent with the plaintiff's case in the plaint, it is admissible in evidence. Speaking of Ex. I he says in his evidence:

So the document stood cancelled and the right to claim remission was lost. I sold some of the hypotheca subsequently and I paid Rs. 4,000 (Rs. 2,500 cash and Rs. 1,500 by pro-note). The promise by defendant at that time was that he should release the properties sold from mortgage. Somewhere about September, 1925, i.e., 6 months after the breach of the agreement Ex. I, I and defendant entered into an agreement that I should go on selling the hypotheca in parts and pay the defendant the price fetched and he should receive such amounts and execute release for the property sold. It was in pursuance of that agreement I sold in 1926 for Rs. 4,000.

6. It seems reasonably plain to us that the agreement was that the entire mortgaged property should be sold in parts as soon as possible and the defendant paid the price fetched with the object of discharging the mortgage-debt. Time had already been given to the plaintiff for payment and it is obvious that within that time the whole of the mortgage amount was to be paid. It is likely that in the circumstances the defendant would be willing that these piecemeal sales should be spread over a long interval? We think it is obvious that this cannot be so. The plaintiff sold only three of the mortgaged properties and did nothing thereafter and when he filed the suit nearly three years after Ex. A-3, no other properties at all had been sold. Whilst asking the Court to bind down the defendant to his part of the contract, i.e., release the properties from the mortgage as and when sold, the plaintiff thinks it fair and that he should be released from what in our view clearly was an obligation undertaken by him, i.e., speedy discharge of the mortgage by this method. We do not agree and think that it would be wholly inequitable under the circumstances to grant the relief claimed in the suit. The appeal will accordingly be dismissed with costs.


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