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Abdul Shaker Sahib Vs. Abdul Rahiman Sahib and anr. - Court Judgment

LegalCrystal Citation
SubjectContract
CourtChennai
Decided On
Reported inAIR1923Mad284; (1923)44MLJ107
AppellantAbdul Shaker Sahib
RespondentAbdul Rahiman Sahib and anr.
Cases ReferredIn Ramaswami Kone v. Sundara Kone I.L.R.
Excerpt:
.....seem to be absurd to hold that the mere fact that a date of completion is fixed in the original decree put an end to the action and that the control of the original court expires on the expiration of that date-and thus substitute in effect for all the known remedies stated above the simple expedient of treating the action and the decree as dead for all purposes and leaving the vendor in undisturbed possession of property which is not his and may as in the present case, be of a greater value than the contract purchase money, which, perhaps by some accident purchaser has failed to produce on the date fixed. it is a well established principle that persons who desire the assistance of the court in obtaining equitable relief must come quickly. it is perfectly clear that the contract is not.....1. the respondents, plaintiffs, obtained a decree for specific performance of a contract for the sale of certain lands and superstructures thereon to them by the first defendant. coutts trotter j. gave judgment in the following words: 'i must therefore find for the plaintiffs and give them decree for specific performance on payment of rs. 4,000. time for payment two months.' in pursuance of this judgment a decree was passed providing (1) that, upon payment by the plaintiffs on or before the 19th day of december 1921 of a sum of rupees four thousand only, the first defendant do execute and register a proper deed of conveyance of the properties in the schedule (2) that upon payment the first defendant do put the plaintiffs in possession of the properties together with all documents and.....
Judgment:

1. The respondents, plaintiffs, obtained a decree for specific performance of a contract for the sale of certain lands and superstructures thereon to them by the first defendant. Coutts Trotter J. gave judgment in the following words: 'I must therefore find for the plaintiffs and give them decree for specific performance on payment of Rs. 4,000. Time for payment two months.' In pursuance of this judgment a decree was passed providing (1) that, upon payment by the plaintiffs on or before the 19th day of December 1921 of a sum of Rupees Four Thousand only, the first defendant do execute and register a proper deed of conveyance of the properties in the schedule (2) that upon payment the first defendant do put the plaintiffs in possession of the properties together with all documents and title-deeds. Before the expiry of the two months that is before December 19th, the first defendant had given notice of appeal. Before the expiry of the two months but after the notice of appeal, the plaintiffs had issued an application before the Judge in charge of the Original side for extention of the time for paying the money and this application was heard in January 1922, that is, after the expiration of the two months and was ordered to stand over until the hearing of this appeal. The appeal coming on, a preliminary point is taken, namely, that the two months having now elapsed neither the Original Court nor this Court has any power to extend the time and that therefore the plaintiffs have lost irrevocably all their rights under the decree except the costs, and that it is therefore useless to occupy the time of this Court in considering the merits of the case. I do not think that this is strictly a preliminary point, because the question of the costs of the suit would still remain. If the decree was right, the plaintiffs would be entitled to costs from the first defendant and if wrong the plaintiff would be liable for costs. But the point has been fully argued on both sides and raises important points on which we shall express our opinion.

2. The decree as drawn up, I am told, is the ordinary form of decree in use here in cases of specific performance. It may be that it is a convenient form in certain cases, though I have been unable to discover its history and how it came to be adopted. No form for a decree for specific performance is provided by statute or rule here, and it has been left to the courts to devise a suitable and appropriate form. Specific performance is an equitable remedy which has been known and used by the Courts of Chancery in England for centuries and appropriate forms of judgment have been approved by learned Equity Judges in England and have now become almost stereotyped: and those at present in use will be found set out in Seton on Judgments under the title Specific Performance. On a perusal of them the first thing to be observed is that not one of those forms contained in the first instance limit of time for payment of the purchase money and not one attempts to make payment of the purchase money by a certain date a condition of the continuance of the rights under the judgment. After the original judgment for specific performance it is the definite practice in England that all consequential relief by reason of any party failing to comply with the terms of the judgment must be sought by application to the Court by which the judgment was passed. Such applications are made by motion in the action showing that in England, after the original judgment the action is by no means ended but remains under the control of the same court. If the default is made by the purchaser in paying the purchase money there are several remedies open to the vendor. (I) He may on motion in the action obtain an order fixing a definite time and place for payment and delivery over of the conveyance and title deed and can, after the expiration of that time, levy execution for the amount if not paid. (2) He may apply by motion in the action for an order rescinding, not the judgment but the contract, and in order to succeed in such a motion he has to satisfy the Court that there has been a positive refusal to complete, which it may be observed in the present case, the respondent has certainly not proved. A similar right is given by Section 35 of the Specific Relief Act of 1877. (3) He can enforce his unpaid vendor's lien for the purchase-money and costs: (4) He can by motion in the action obtain an order for sale by the Court of the property when he will be at liberty to bid. The proceeds of the sale are paid into court and the vendor gets his contract price, interest and costs and the purchaser the balance if any. Where the vendor is in default, the remedies are even more varied.

3. It would seem to be absurd to hold that the mere fact that a date of completion is fixed in the Original Decree put an end to the action and that the control of the Original Court expires on the expiration of that date-and thus substitute in effect for all the known remedies stated above the simple expedient of treating the action and the decree as dead for all purposes and leaving the vendor in undisturbed possession of property which is not his and may as in the present case, be of a greater value than the contract purchase money, which, perhaps by some accident purchaser has failed to produce on the date fixed. In this particular case it is worth observing that there is no evidence that the first defendant was ready to execute a conveyance or hand over the title deeds in exchange for the money and in fact, so far from intending to complete he was appealing on the ground that the decree was wrong.

4. In my judgment it was intended by this decree that the payment of the Rs. 4,000 by the date named should be a condition, failing to comply with which would deprive the successful plaintiff of all his rights under the decree. In my judgment this decree is in the nature of a preliminary decree, the Original Court keeping control over the action and having full power to make any just and necessary orders therein, including in appropriate cases the extension of the time. If I am wrong in this and the proper interpretation of this decree is as contended for by the appellant, then, in my judgment, this decree is wrong, and I should, if necessary, order that it be set right by eliminating the condition which ought not to have been imposed upon the successful plaintiff except at a much later date and upon definite refusal by him to complete. Even in that case such condition could only be imposed at the request of the defendant who as I have pointed out has other various remedies. As long as this form of decree is understood to be of a preliminary nature and the Court still retains full power over the action, 1 do not see any particular harm in the continuance of its use. Some words such as 'further consideration reserved' shall be added. But, personally, I should be prepared to say that the appropriate forms are those set out in Seton.

5. It is however contended that this form having been used, we are precluded by authority from holding that the time fixed is not a condition and, as I understand also from holding that either the Original Court or this Court has power to extend the time. I do not so interpret this decree but as I have said, if that is the correct interpretation of it, in my judgment, it must be varied. Therefore, the question whether we are bound by authorities which so interpret it is not of great importance. The cases relied on are Ramaswami Kone v. Sundara Kone I.L.R. (1907) Mad. 28. Moideen Kuppai v. Ponnuswami Pillai (1909) 10 C.L.J. 120 and Gopala Ayyar v. Sannasi (1915) 3 L.W. 29. In Ramaswami Kone v. Sundara Kone I.L.R. (1907) Mad. 28 the decision of the District Munsif was that on plaintiffs paying into Court the balance of consideration within a month the defendant should execute a sale deed. The money was not paid into Court within the month, and after the expiration of the month, the defendant appealed. On appeal the Subordinate Judge confirmed the District Munsiff's order. The plaintiff then applied to execute this decree and the District Munsiff held that the original one month granted by his decree having expired and the plaintiff not having complied with its terms, the plaintiff could not have execution. The plaintiff then applied to the Subordinate Judge to modify the appellate decree by introducing into it a fresh time limit. This having been refused, the plaintiff appealed against the District Munsiff's order dismissing his application for execution. That appeal was dismissed by the Subordinate Judge. The case came on appeal before a Bench of this Court which held that on the proper construction of the first appellate decree of the Subordinate Judge, the time was not extended and that therefore execution could not be granted. The Court, however, did lay down that the Subordinate Judge could extend the time for performing conditions precedent granted by the original decree on appeal from that decree. It is however to be observed that no application was at any time made to the District Munsiff to extend the time allowed by the decree, and this case does not therefore touch the point in question here.

6. In Moideen Kuppai v. Ponnuswami Pillai (1909) 10 C.L.J. 120 this Court on Second Appeal, directed that on payment of Rs. 50 within three months by the plaintiff to the defendant a moiety of the suit property should be delivered to the plaintiffs. Subsequently, the plaintiffs applied to the lower Court to extend the time. That was refused by the lower Court, and on appeal, by this Court on the ground that the lower Court had no power to extend the time fixed by the Appellate Court. The plaintiffs then petitioned this Court to extend the time and this Court held that it had no power to modify its own order except on a proper application for review which that application was not. The Court held that the time fixed by its order in that case was an essential term and that the non-complfance with it could result in plaintiff's losing their rights unless they could put the matter right by review. But, in that case, the question was not under consideration whether the Original Court, if it directed that specific performance should be performed within a certain time, could extent that time.

7. In Gopala 'Ayyar v. Sannasi (1915) 3 L.W. 29, the Court of First Instance gave a decree for specific performance giving the plaintiff, one month's time to pay the price, which decree was, on appeal to the Subordinate Judge, confirmed by him. More than one month after the date of the appellate decree the plaintiff applied to the Subordinate Judge to extend the time fixed by the original decree. The application was granted but on a revision petition it Was held by Srinivasa Aiyangar, J., that the appellate Court had no jurisdiction to extend the time fixed by the Original Court. This may be right: but the learned Judge said that it had been decided by this Court in Ramaswami Kone v. Sundara Kone I.L.R. (1907) Mad. 28 that the Court which passed the decree had no power to extend the time, much less any appellate Court. As I have pointed out Ramaswami Kone v. Sundara Kone I.L.R. (1907) Mad. 28 did not say so, and with that part of the judgment of Srinivasa Aiyangar, J. I do not agree.

8. I therefore do not feel in this matter in any way hampered by authority and this preliminary point fails.

9. Turning to the merits, the main question is a pure question of fact. The learned trial Judge has, I think, correctly stated, different judges or different juries might take different views of the facts. But there was ample evidence to support his finding that the contention alleged was made and I see no reason for differing from it.

10. Further the contract alleged is to reconvey the property when the Rs. 4,000 is tendered within one year. There is no evidence of an actual tender but there is evidence that the first plaintiff attended upon the first defendant with P.W. 6 who had the money with him and on the first plaintiff asking the first defendant to take it, the first defendant said he would not. This, in my judgment, was a waiver of and dispensed with any actual tender, see Polglass v. Oliver (1914) 1 L.W. 882 and many subsequent cases.

11. A further point was taken that, as certain persons entitled to the' benefit of the contract refused to join the plaintiffs in the suit and have been joined by them as defendants, the decree for specific performance could not be granted. I do not agree with this contention and I have nothing to add to the judgment of Coutts Trotter, J. on the point.

12. Lastly it was contended and this is a more difficult point that as two years had elapsed from the date of the original offer of the money, the plaintiffs were too late in bringing this suit. It is a well established principle that persons who desire the assistance of the Court in obtaining equitable relief must come quickly. In each case it is a question to be decided on the facts whether the delay on the part of the plaintiff is such that the Court ought not to exercise its powers. In this case on the facts I think that the delay should be excused, for on the evidence, the plaintiffs were put off for some time by the first defendant himself. The case has however been brought very late but in my judgment not late enough to compel us to refuse relief at not being shown that the defendant has been prejudiced.

13. The appeal will therefore be dismissed with costs. The time for the completion will be extended by this decree for a period of two months. It must be understood that the Original Court still has jurisdiction in this matter and has full powers to deal with any point that may arise including, if necessary, an application for further time.

Wallace, J.

14. I agree. On the first point of law taken, I wish to say this: No special form for drafting a decree for specific performance is supplied by the Civil Procedure Code, as is supplied by it in the case of a decree in a pre-emption suit by Order 20 Rule 14, which directs that, if the purchase money is not paid as stipulated in the decree, the suit shall be dismissed with costs. Hence the analogy of decree etc., in preemption suits and reported rulings thereon are not of assistance in this case. The form of decree drawn up in the trying Court is the general form adopted in this Presidency for such decrees. But that it is in the nature of a preliminary and not a final decree is, I think placed beyond doubt by Section 35 of the Specific Relief Act. As I read that section, it lays down that when a decree for specific performance of a contract of sale has been passed and the purchaser makes default in payment of the sum which the Court has ordered him to pay the vendor may either file a fresh suit for rescission of the contract or may, in the specific performance suit itself, apply to the Court to rescind the contract. It is perfectly clear that the contract is not determinable or determined by the mere failure to comply with the terms of the decree. It is not determined until the Court orders that it is determined. By the decree for specific performance the Court sets out what it finds the real contract between the parties was, and declares that such a contract exists and gives what it considers a reasonable time within which the contract shall be carried out. Regarding the decree from this point of view, as a contract, it is clear in this case, as in most others of the same kind, that time is not of the essence of the contract, and that, until the contract is rescinded by formal order or decree such time for performance, not being an essential part of the contract, may be varied by the Court which has declared what the essential terms of the contract are. It is clear as the learned Chief Justice has shown, that it must be within the power of the Court to vary the time within which the contract shall be performed, as difficulties might arise through no fault whatever of the parties preventing performance within the time specified in the decree; e.g., when a third party has within that period set up a bona fide claim of title to the property, it may even be necessary to direct specific performance to stand over for a reasonable but indefinite period, until that claim has been adjudicated.

15. I take it then that where specific performance of sale has not been effected within the period laid down by the decree, it is open (a) to the purchaser to apply to the Court for an extension of time for payment of the purchase money, and (b) to the vendor to apply either for a final and peremptory order for specific performance or for an order rescinding the contract either immediately or to follow automatically on the expiry of the period peremptorily granted. The original action is thus open until a final decree or order of such a nature and scope is passed, and the original Court has until then ample power to extend the time for specific performance. The case reported in Moideen Kuppai v. Ponnuswami Pillai (1914) 1 L.W. 882 is not a case in point. It was apparently not a case of a decree for specific performance since no reference was made to Section 35 of the Specific Relief Act. In the 3 L.W. case also no reference is made to that section, and in any case the application to extend the time was made after the time granted by the decree had expired. In Ramaswami Kone v. Sundara Kone I.L.R. (1907) Mad. 28 case there was no application for extension of time at all, and the decision turned on the propriety of interpreting the appellate decree in terms of the original decree. In the present case an application to extend the time was put in by plaintiffs to the Court which passed the decree and no final order has yet been passed on that. I am therefore quite clear that the original Court has in this case full power to extend on proper application made to it the time fixed by its decree for specific performance, and equally so has the appellate Court in an appeal which is of the nature of an appe, al from a preliminary decree. The argument that plaintiffs should not be allowed to get a fresh extension of time because defendant has appealed against the decree does not impress me. His appeal was tantamount to declaration that he would not receive the money and carry out his part of the contract, and thus made it useless for plaintiffs to attempt to carry out their part of it. On the other points of the case I have nothing to add to the judgment of the learned Chief Justice.


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