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In Re: Muthammal and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported in(1938)1MLJ310
AppellantIn Re: Muthammal and anr.
Cases ReferredThanmul Sowcar v. Ramadoss Reddiar
Excerpt:
- - in these circumstances, i fail to see how the doctrine of marshalling can be invoked by the appellants......of marshalling. the appellants are subsequent mortgagees of what may be described as the first schedule properties; they obtained a decree on the strength of their mortgage and have become the purchasers thereof. the other property included in the suit mortgage, namely, the second schedule property, is no longer subject to that mortgage because it was released by the mortgagee before the suit was instituted for a cash consideration of rs. 50. the suit was therefore only for recovery of the balance amount from the first schedule property which alone according to the plaintiff is liable to be sold in satisfaction of the amount claimed in the suit. in these circumstances, i fail to see how the doctrine of marshalling can be invoked by the appellants. marshalling implies the existence of.....
Judgment:

Pandrang Row, J.

1. This second appeal raises two questions, one a question of fact and the other a question of law. On the question of fact, namely, whether Ex. D is a benami transaction, the finding of both the Courts below is to the effect that it is not benami and this concurrent finding is not open to attack in second appeal. The question of law which is the only one that has been argued before me relates to the doctrine of marshalling. The appellants are subsequent mortgagees of what may be described as the first schedule properties; they obtained a decree on the strength of their mortgage and have become the purchasers thereof. The other property included in the suit mortgage, namely, the second schedule property, is no longer subject to that mortgage because it was released by the mortgagee before the suit was instituted for a cash consideration of Rs. 50. The suit was therefore only for recovery of the balance amount from the first schedule property which alone according to the plaintiff is liable to be sold in satisfaction of the amount claimed in the suit. In these circumstances, I fail to see how the doctrine of marshalling can be invoked by the appellants. Marshalling implies the existence of two sets of properties one of which is subject to both the mortgages and the other is subject only to the earlier mort gage. At the time when the doctrine was sought to be invoked in the present suit, there were no two items of properties liable to be sold but only one item, that is to say, the first schedule property. It is impossible for the plaintiff in. the present suit to ask for sale of the second schedule properties, and it follows therefore that it is not open to the appellants to ask that they should be sold before the first schedule properties are sold. It may be that certain observations found in Thanmul Sowcar v. Ramadoss Reddiar (1927) 55 M.L.J. 358 : I.L.R. 51 Mad. 648 are not tenable in view of the omission of the words as against the seller' which appear in the old Section 56 as suggested in Mulla's Commentary at p. 445 of the 1933 edition. This, however, does not affect the present question. In this case, the question is not whether the plaintiff's, that is, the first mortgagee's, rights are going to be prejudiced by the application of the doctrine of marshalling, but whether the doctrine of marshalling can be invoked when there are no properties to be marshalled, the only properties liable to be sold being subject to both the mortgages. This point is, in my opinion, sufficient to dispose of this second appeal. As observed by the lower appellate Court, this does not mean that the appellants' right of contribution is negatived. That right, as observed by the lower appellate Court, has to be worked out in a separate suit as between the appellants and respondents two and three. So far as marshalling is concerned, in the present suit there can be none for the reason given by me. It is impossible to accept the contention that the undoubted right of the first mortgagee to release any part of the security is lost or is made subject to the right of marshalling given by Section 81 of the Transfer of Property Act. In the lower appellate Court, the appellants' advocate did not controvert this position, namely, that the mortgagee could release any part of the hypotheca and throw the whole burden upon the remaining portion of the hypotheca. The words found in Section 81 of the Transfer of Property Act, namely, 'but not so as to prejudice the rights of the prior mortgagee' certainly include the right of the mortgagee to release any portion of the hypotheca. Such right cannot be deemed subject to the right of marshalling given in Section 81 which makes it expressly subject to the condition that there should be no prejudice to the -rights of the first mortgagee.

2. I am therefore of opinion that there is no substance in the contention on the question of law raised in this second appeal. The second appeal is therefore dismissed.


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