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Thattan Kontner's son Kunhan of thekkumangalam Desam Vs. Mangalath Manakal Narayanan Nambudripad's son Moorthi alias Ashtamoorthi Nambudripad and Ors. (20.07.1910 - MADHC) - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtChennai
Decided On
Reported in(1910)20MLJ951
AppellantThattan Kontner's son Kunhan of thekkumangalam Desam
RespondentMangalath Manakal Narayanan Nambudripad's son Moorthi alias Ashtamoorthi Nambudripad and Ors.
Cases ReferredIn Luke v. South Kensington Hotel Company
Excerpt:
.....upon us, we are not satisfied that a suit by one uralan in which co-uralars are impleaded as defendants for redemption from mortgagees or for recovery of devaswom property from trespassers is liable to be necessarily dismissed for the reason that the co-uralars were not joined as co-plaintiffs or even consulted before the institution of the suit. 'in the old chancery practice there was this difficulty, that the misjoinder of plaintiffs was fatal and that if you had any one person among the plaintiff's who had done anything which might have amounted in equity to a release of his rights the whole suit failed and there was no remedy for it and therefore as a general rule you selected, if you could, one person as plaintiff whom you knew to be free from any charge or imputation of..........296 that some of the trustees of a devaswom cannot institute a suit on its behalf making the other trustees defendants without having asked them to join as plaintiffs. an exception was made in other cases where the other trustees perversely declined to cooperate and the suit was for the benefit of the institution. the last of these cases was doubted in mariyel raman nair v. narayanan nambudripad i. l. r. (1902) m. 461 but it was unnecessary to decide the question of the necessity for previous request to join as co-plaintiffs as in that case the plaintiff impeached the renewal which the co-trustee defendant granted and it was impossible to get one to impeach his own deed. the question, however, was referred to a full bench in karattole edamana v. unnikanam i. l. r. (1903) m. 649. but as.....
Judgment:

1. This is a suit for redemption. The plaintiff is one of the Uralars of the Killikurishi Devaswom. The kanom sought to be redeemed is of the year 1884. It was granted to the family of the defendants Nos. 1 to 3. Defendants Nos. 5 to 10 are impleaded as the remaining Uralars of the temple. The defendants set up a renewal in 1905 to which the plaintiff was no party. The 11th defendant is the assignee of the rights of the kanomdars. The Courts below have held the renewal to be invalid and given a decree to the plaintiff for redemption. The nth defendant has preferred the second appeal.

2. A preliminary objection was taken that the nth defendant had no right to prefer the second appeal in as much as the plaintiff's co-uralars did not contest the decree of the lower appellate Court. We see no force in this objection. The 11th defendant as assignee of the mortgage interest is entitled to question the right of one of the co-mortgagors to redemption, whether or not the remaining co-mortgagors acquiesce in the claim of the plaintiff.

3. It is argued in second appeal that the plaintiff was a consenting party to the renewal and that his name appears in Exhibit XXIV as one of the persons present when the resolutions therein set out were adopted. It appears there that ' it is resolved that the Uralan that manages the affairs of the respective years should grant renewals with the greatest possible number of Uralars, receiving the renewal fees, signing fees at the rates now settled from tenants whose term of lease has expired.' The actual renewal now impeached is Exhibit I. The plaintiff was no party to its execution, nor was he consulted about it. We do not understand Exhibit XX to dispense with the necessity for all the Uralars being consulted before the execution of the renewal. ' The greatest possible number of Uralars receiving the renewal fees ' does not mean that it is left to the option of a majority to set at nought a minority and to carry on the business of the Devaswom in the matter of renewals without any reference to that minority or without inviting its cooperation. We must, therefore, hold that the plaintiff, not having been consulted in respect of the renewal in question, is not precluded from impeaching it.

4. It is next contended that the majority of the trustees of the Devaswom were parties to the renewals and that in the case of a charitable trust the consent of the majority is sufficient to validate the transaction. 'In the due administration of all trusts of a private nature the vote or act of the majority of the trustees cannot, in the absence of an express or implied power, bind dissenting minority'--see Luke v. South Kensington Hotel. Co (1879) 11 Ch. D. 121. But it has long been held, owing probably to the validity of perpetuities in charities and the consequent perpetual succession of trustees which would produce a dead-lock in the administration if unanimity were insisted on, that a majority of trustees has powers to bind the minority. See TUDOR'S Charitable Trusts, p.259. It does not appear to us to follow, from the exception of the validity of the acts of the majority in public and charitable trusts that they may transact the affairs of the trust without any reference to the minority. On the other hand it seems to us that the very principle of recognising the validity of the acts of the majority involves the necessity of the decision of the majority being arrived at after mutual discussion among all the members. A minority before mutual consultation may be converted into a majority after it. Unanimity on all occasions may be impossible. A majority after consultation and discussion is the nearest approach to it. Reliance was placed on The Attorney-General v. Shearman (1839) 48 E. R. 1119 in support of the view that a majority is sufficient even though the minority had no opportunity to express their views. In this case there were II trustees. There was an original lease by them to one last. There was a renewed lease to the original lessee and another by six out of the eleven trustees, the rest having refused to join. When the second lease was impeached it was held to be valid. This case is no authority for the position that a majority of the trustees can act in respect of a public or charitable trust without giving an opportunity to the minority to state their dissent. In Teramath v. Lakshmi I. L. R. (1883) M. 270 it was held that the decision of the majority was binding upon a dissentient minority where the majority of the Uralars of a Devaswom agreed to renew a kanom on terms beneficial to the Devaswom after the question of the renewal had been fairly considered by all the Uralars. It was pointed out that in such a case each had the opportunity to let his views be known before a decision is passed. The High Court remitted an issue for trial whether the renewal was the result of consultation by all the Uralars though a majority had actually concurred in signing the deed. Section 16 of the Charitable Trusts Act 1860 (23 & 24 Victoria, Chapter 136) provided: ' A majority of two-thirds of the trustees of any charity assembled at a meeting of their body duly constituted and having power to determine, etc., shall also have a legal power on behalf of themselves and their co-trustees, &c;, to do, enter into, and execute all such acts, deeds, contracts and assurances as shall be requisite for carrying any such sale, exchange, partition, mortgage, lease or disposition into legal effect, and all such acts, deeds, contracts or assurances shall have the same legal effect as if the same were respectively done, entered into or executed by all the acting trustees for the time being, &c.;, &c.;'

5. This section was repealed by Section 17 of the Charitable Trusts Act 1869 (32 & 33, Victoria, Chapter no). Section 12 of this later Act repealed the earlier provision thus: ' Where the trustees or persons acting in the administration of any charity have power to determine on any sale, exchange, partition, mortgage, lease or other disposition of any property of the charity, a majority of those trustees or persons who are present at a meeting of their body duly constituted and vote on the question shall have and be deemed to have always had full power to execute and do all such assurances, &c.;, for carrying any such sale, &c;, into effect and all such assurances, &c.;, shall have the Same effect as if they were respectively executed and done by all such trustees or persons, &c.;' See 4 HALSBURY'S Laws of England, Section 416. This, no doubt, is a statutory provision. But the same rule obtained as regards mutual consultation and opportunity for the statement of each person's views before these statutes. In Wilkinson v. Malin (1832) 3 Try whit 544 a school-master was appointed by a majority of the trustees assembled for the purpose. He was dismissed by five out of the trustees without a meeting and there was no opportunity for the remaining trustees to participate in the business. Dealing with the dismissal Lord Lyndhurst, C.B., who delivered the judgment of the Court of Exchequer, observed as follows:--'The next question that arises for consideration arises on the ninth and last issue, being whether the master was duly and properly dismissed. Now the dismissal was in this form : there was no public meeting nor any declaration of a majority assembled at a public meeting that the school-master should cease to act in that situation: but five out of the trustees not assembled in that formal manner gave notice that the school-master should, within a certain time, retire from his office. In the first place, at the time when the notice was given, there were ten trustees so that the persons who gave notice did not even constitute a majority of the whole body. In the next place, even if they did constitute a majority of the whole body it is the whole body that is to dismiss and not a majority of it. So that if there is a meeting and a majority are for dismissal, then the declaration of the majority is not merely the declaration of the majority but of the whole body ; which whole body does in fact dismiss. Therefore, in a case of this description, where there was no meeting and where five individuals gave their opinion, or said, that the dismissal should take place in a short time or that the party should cease to act as school-master, we are of opinion that that is not a valid dismissal within the meaning of this trust.' Without deciding that in every case of a transaction entered into by the majority of the trustees of a public and charitable trust there should have been a meeting of all to validate it, we may safely hold that all the trustees should have had an opportunity of stating their opinion. As the plaintiff in the present case was never consulted about the particular renewal, we must hold that it was invalid.

6. It was urged that as regards the mortgagee he had nothing to do with the meeting or consultation amongst the trustees but that he was justified in accepting the renewal granted by the majority as they must be deemed to have had authority to represent the whole body. The argument was rested on the principle of estoppel. The Attorney-General v. Shearman (1839) 48 E.R. 1119 and LINDLEY on Companies, p. 128, were relied on. As regards the case cited, we have already pointed out that it was not a case of a majority of the trustees having acted without reference to the minority. In holding that the acts of the majority, in the circumstances of that case, are binding, the Master of the Rolls further pointed out that the lessee had no notice from the dissenting minority; that they objected to the lease, and that there was no pretence of fraud or concealment on the part of the majority. These observations do not carry the matter as far as the appellant wants. They do not amount to saying that so far as the validity of the transaction as regards the party dealing with the majority of the trustees is concerned it is established by the majority of the trustees concurring in it. As regards the rule laid down in LINDLEY on Companies that there is no necessity on the part of persons dealing with Companies to see that de facto directors are properly appointed nor to see that the directors exercise the powers they possess in the precise manner prescribed in the regulations of the Company, it is to be observed that the principle underlying it is different from what we have to apply to a case where a majority has no power to act for the whole body unless the whole body had been consulted about it. If prima facie the majority had power to act and it is a mere informality or a piece of irregularity in their not having consulted about the transaction the position of the lessee or mortgagee would be different. This is not a case where the minority has permitted the majority to act for them subject to certain conditions assuming it would be competent to trustees to confer such a power upon their fellows. The rule of estoppel, by holding out certain persons as clothed with authority, has no application where the majority has only a limited authority within the limits of which a stranger dealing with it has to find the power to enter into the transaction. Another contention of a formal nature was raised. It was said that the 6th defendant had surrendered his right in favour of his son Sankaran and likewise the 10th in favour of his nephew Parameswaran, and that they were Uralars of the temple and should have been impleaded. This contention has been negatived by the Courts below. It is unnecessary to discuss it as the nth defendant who is the only appellant before us did not raise any such plea in his written statement.

7. The appellant has then an alternative argument that if the 6th and 10th defendants are the Uralars they have not been consulted by the plaintiffs as regards the institution of the suit. It is urged with much force that if a majority of trustees cannot enter into any transaction without consulting the minority the institution of a suit by a single trustee without taking the opinion of the other trustees is bad and the suit is on this ground liable to be dismissed. There has been considerable conflict of opinion on the question of joinder of co-trustees in this Court. It was held in Parameshwaran v. Shangaran I. L. R. (1891) M.. 489 Paramathan Somayajipad v. Shankara Menon I. L. R. (1899) M. 82 and Savitri Antarjanam v. Raman Nambudri I. L. R. (1900) M. 296 that some of the trustees of a Devaswom cannot institute a suit on its behalf making the other trustees defendants without having asked them to join as plaintiffs. An exception was made in other cases where the other trustees perversely declined to cooperate and the suit was for the benefit of the institution. The last of these cases was doubted in Mariyel Raman Nair v. Narayanan Nambudripad I. L. R. (1902) M. 461 but it was unnecessary to decide the question of the necessity for previous request to join as co-plaintiffs as in that case the plaintiff impeached the renewal which the co-trustee defendant granted and it was impossible to get one to impeach his own deed. The question, however, was referred to a Full Bench in Karattole Edamana v. Unnikanam I. L. R. (1903) M. 649. But as that was a suit for a redemption by one trustee it was held that Section 91 of the Transfer of Property Act enabled any person having an interest in the mortgage property to institute a suit for redemption and that one of several Uralars was a person having such interest and could therefore bring a suit for redemption. Savitri Antarjanam v. Ramnan Nambudri I. L. R. (1900) 24 M. 296 was practically overruled. But the Court expressed no opinion about the correctness of the decisions in Parameswaran v. Shangaran I. L. R. (1891) M. 489 and Paramathan Somayajipad v. Sankara Menon I. L. R. (1899) M. 282 which were suits in ejectment. The present case being one for redemption would apparently fall within the scope of the rule in the Full Bench case. But it is pointed out by Mr. Sundara Aiyar that joint trustees have not a several interest in the property of the Devaswom or any personal interest in it and that Section 91 does not contemplate the interest of one of several co-trustees or entitle him to institute a suit for redemption. It may be, as pointed out by him, that the question of majority voting for redemption is different from that of the joinder of all as plaintiffs and that this view was not presented to the Court. It certainly does not appear to have been considered. But we cannot, on that account, whittle away the authority of that decision. However, apart from the authority of that case which is binding upon us, we are not satisfied that a suit by one Uralan in which co-uralars are impleaded as defendants for redemption from mortgagees or for recovery of devaswom property from trespassers is liable to be necessarily dismissed for the reason that the co-uralars were not joined as co-plaintiffs or even consulted before the institution of the suit. It has been held in case of joint owners or joint contractors that some of them may sue persons who infringe their rights impleading co owners and co-contractors as party defendants and with-out consulting them before the institution of the suit. See Periakaruppan v. Velayuthan Chetti I. L. R. (1906) M. 302; Pyare Mohun Bose v. Kedar Nath Roy I. L. R. (1899) C. 409 and Biri Singh v. Nawal Singh I. L. R. (1898) A. 226. Does it make any difference that the joint owners are trustees There is a distinction that their interest is one and indivisible, while in the other cases there is a separable beneficial interest. In cases where no remedial right accrues to the trustees until a majority after a mutual consultation have signified their will, it cannot be competent to some of the trustees or even the majority to institute an action without such consultation. It may also be that if the decision in such a case of the majority is adverse the minority cannot institute an action as the remedial right has not come into existence. Take the case of a suit for the removal of an employee of a Devaswom by some of the trustees making them remainder defendants. Then the employee was liable to be removed by the vote of the majority. If no such majority had concurred in dismissing the employee from office a suit by some of them would be ineffectual and would be liable to be dismissed on the ground that the trustees who desired the removal had not acted. It may also be where the removal of such employee is in the interests of the Devaswom essential and the conduct of the majority of the trustees in upholding the misbehaving servant is open to exception, the minority is not without its remedy. But where the right to the relief claimed has accrued to the joint trustees, the institution of a suit by some only without their having consulted the remaining trustees, even where they have not perversely refused to join, cannot, it appears to us, be a sufficient ground for dismissing the suit. Although the interests of the co-trustees is joint and indivisible, it is fully represented where they are all on the record on the one side or the other. Whatever question of costs may arise, misjoinder is not fatal to the suit. In Kokilasari Dasi v. Mohunt Rudranand Goswbmi (1907) 5 Cri.L.J. 527 while laying down the rule that all trustees should ordinarily be co-plaintiffs and that they must exercise the powers of their office in their joint capacity, the Court pointed out that it was unable to follow the Full Bench Ruling in Pyari Mohan Bose v. Kedarnath Roy I. L. R. (1899) C. 429 in the particular circumstances of the case by transferring the co-trustees to the rank of the plaintiffs as the original plaintiff set up sole right in himself. In Luke v. South Kensington Hotel Company (1879) II Ch. D. 121 where there were three trustees of a private trust and the renewal mortgage in favor of two of them was impeached by the third in a suit to foreclose the mortgage the Master of the Rolls after disposing of the misjoinder as not made out in the circumstances of the case, proceeded to deal with an objection similar to that now raised in the following words:--'There it is said that some of the mortgagees might not wish to foreclose and others might. We will deal with that case when it arises, as to whether one without the consent or against the wish of the other can foreclose. That is not the case here. The other two defendants do not oppose the foreclosure. They were not willing to be plaintiffs but they do not refuse to foreclose. If two out of three trustees decline to foreclose or to agree to any other remedy it might be a reason for removing them from being trustees; but that is not the case here, and we have not therefore to consider that case which may be dealt with when it arises.' The Master of the Rolls did not think that the unwillingness of the trustee-defendants to foreclose would be ground for dismissing the plaintiff's suit for foreclosure. Lord Justice James added: ' In the old Chancery Practice there was this difficulty, that the misjoinder of plaintiffs was fatal and that if you had any one person among the plaintiff's who had done anything which might have amounted in equity to a release of his rights the whole suit failed and there was no remedy for it and therefore as a general rule you selected, if you could, one person as plaintiff whom you knew to be free from any charge or imputation of misconduct and made all the others defendants. There never was any objection to that in practice Now that is rendered unnecessary by the fact that the Courts may deal with misjoinder of plaintiffs according to the justice and equity of the case.' In the present case the right to redeem has long accrued. The plaintiff, as one of the joint trustees, is right in enforcing the claim of the Devaswom to redeem. If defendants Nos. 5 to 10 are unwilling to join in the redemption there may arise a question as to how they are to be dealt with. We see no objection to one trustee suing for redemption without consulting the others or making them co-plaintiffs. But Mr. Sundara Aiyar urged that the decree should have been one for redemption in favour of the plaintiff and defendants Nos. 5 to 10, They were not represented before us. The proper course in such cases, as pointed out by the Master of the Rolls in the case already referred to, is to order the trust property to be restored to all for the benefit of the cestui que trust. But the trustee-defendants have not asked for it. The decrees of the Courts below are in plaintiff's favor on behalf of the Devaswom. There is no need to vary them. The second appeal is dismissed with costs. The time for redemption is extended to two months from this date.


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