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(Palavalasa) Suramma Nayuralu Vs. (Savirigana) Surayya and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1934Mad585; 152Ind.Cas.612
Appellant(Palavalasa) Suramma Nayuralu
Respondent(Savirigana) Surayya and ors.
Cases ReferredChinnaswami Padayachi v. Darmalinga Paiayachi
Excerpt:
- .....mortgagee) and defendants 3 to 5, who claim under the later purchase in the earlier action (by the prior mortgagees). the plaintiff was in possession on the date of the suit, and the learned district munsif, holding that he was entitled to remain in possession, has granted an injunction restraining defendant 3 to 5 from interfering with the plaintiff's possession. that decree of the trial court has been reversed by the subordinate judge, bud in my opinion the district munsif's view is correct and that of the lower appellate court is wrong.3. where each of several simple mortgagees files a separate suit, impleading his mortgagor alone and not other mortgagees, and in execution sales different persons become purchasers, it must now be taken as settled, that priority of date of purchase.....
Judgment:

Venkatasubba Rao, J.

1. This appeal raises the vexed question of priority in regard to the right to possession, when the competing claimants are purchasers at execution sales under different mortgage decrees against the same mortgagor. The facts in their chronological order may be briefly set out:

24-1-1920 Defendants 1 and 2 executed a

promissory note in favour of

defendant 6.

9-5-1922 The same persona executed a

mortgage to defendants 3 to 5,

Exact date Subsequent to that mortgage,

not known. defendant 6 filed O.S. No.724

of 1922 against defendants 1

and 2 to enforce his right

under the promissory note.

24-11-1923 Defendant 6 obtained a consent

decree in O.S. No, 724 of

1922 which by Its terms

created a mortgage

(not a mere charge) in

his favour, over the

properties already

mortgaged to defendants 3 to 5.

23-4-1924 Defendants 3 to 5 instituted

O.S. No. 303 of 1924

against defendants 1 and 2

to enforce their mortgage

(without 1m-pleadlng defendant 6).

8-10-1924 Defendant 6 in execution of his

decree in O.S. No. 724 of 1922

brought the properties to sale.

(Defendants 3 to 5 were

not parties to this proceeding).

20-11-1924 Defendant 6, having himself

purchased the property, obtained

delivery.

24-11-1924 A mortgage was passed in O.S. No.

303 of 1924.

19-1-1925 Defendant 6 sold the properties

to the plaintiff.

24-12-1926 Defendants 3 to 5, having purchased

the properties in execution of

their mortgaged decree,

obtained symbolical delivery.

2. I find no difficulty in holding that the position of defendant 6 is that of a puisne mortgagee and I am further prepared to hold that his execution petition must for the present purpose be treated as a suit to enforce his mortgage. That being so, the; salient facts are these : (1) The suit by the first mortgagees was earlier in date. (2) The earliar purchase was that made in the suit of the puisne mortgagee. (3) That purchase was made during the pendency of the first mortgagees' action. The contest is between the plaintiff, who traces his right to the earlier sale in the later suit (by the puisne mortgagee) and defendants 3 to 5, who claim under the later purchase in the earlier action (by the prior mortgagees). The plaintiff was in possession on the date of the suit, and the learned District Munsif, holding that he was entitled to remain in possession, has granted an injunction restraining defendant 3 to 5 from interfering with the plaintiff's possession. That decree of the trial Court has been reversed by the Subordinate Judge, bud in my opinion the District Munsif's view is correct and that of the lower appellate Court is wrong.

3. Where each of several simple mortgagees files a separate suit, impleading his mortgagor alone and not other mortgagees, and in execution sales different persons become purchasers, it must now be taken as settled, that priority of date of purchase gives priority of title to possession; the fact that a particular mortgage was earlier in date or that a particular suit was filed earlier, being immaterial. Such conflict as there was on the point, must now be taken to have been set at rest by the recent decision of the Full Bench in Nagendraa Chettiar v. Lakshmi Ammal 1933 Mad. 583. This rule, I think, rests on sound principle. The mortgages being simple, possession remains with the mortgagor and he is the person in law entitled to it. It follows therefore that a sale of his interest in a suit either by a prior or a puisne mortgagee must convey to the purchaser the mortgagor's right to possession, the only question being in which suit was the earlier sale made. On the date of that sale the mortgagor having the right to possession, that right becomes transferred to the vendee. The plaintiff on the facts stated above must therefore be held to have a preferential right to possession. The question next arises, is that right affected by the doctrine of lis pendens, as the purchase under which the claim, was made during the pendency of the suit brought by the prior mortgagees? I think not. The rights of the second mortgagee are unaffected by the first mortgagees' suit his right to redeem the prior mortgage remains, so also is his right to sell the equity of redemption preserved. The argument was at one time put forward that the subsequent) mortgagee could only claim to redeem the prior mortgage and only after such redemption, could sue for sale, but the Courts have repelled this contention : Mulla Vittil Seethi v. Achuthan Nair (1911) 9 I.C. 513 and Chinnu Pillai v. Venkatasamy Chettiat 1917 Mad. 751. I may quote the following passage from the judgment in the first mentioned case:

These observations are not confined to the mere preservation of the subsequent mortgagee's right to redeem the previous mortgage. If the eights of the puisne encumbrancer, who was not made a party to the suit of the prior mortgagee, are preserved in every respect the right to sue for the sale of the equity of redemption, which existed previous to the suit by the first mortgagee, must continue to remain after it.

4. If, notwithstanding the pendency of the prior mortgagee's suit, the decisions have held that the puisne mortgagee's right to sue for sale is preserved intact, the conclusion, I think, is inevitable that the transfer resulting from such a sale cannot be affected by the rule of lis pendens. There is yet another reason for holding that the prior mortgagees' action does not operate as a lis pendens. The principle of lis pendens is based on 'the maxim ut lite pendente nihil innovatur, which means, 'during a litigation nothing new should be introduced.'. In the words of the Lord Chancellor in Bellamy v. Sabine 1 De G & J 566:

The law does not allow litigant parties to give to others pending the litigation rights to the property in dispute, so as to prejudice the opposite party.

5. 'The necessities of mankind' continues the Lord Chancellor:

require that the decision of the Court in the suit shall be binding; not only on the litigant parties, but also on those who derive title under them by alienations made pending the suit.

6. The reason for the doctrine is that tout for it, 'interminable litigation might toe the consequence.' The alienations aimed against by the rule (as the passages extracted above show) are those made during the pendency of the suit and not those which have been effected .previously. If a certain right remains unaffected, the legal remedy to enforce that right must also continue. No suit 'therefore can operate as a lis pendens so as to affect the antecedent transfers which had come into existence prior to it; the transfers being unaffected, it follows that the legal proceedings brought to enforce those transfers are likewise immune from the operation of the rule. This is in conformity with the decision of Krishnan Pandalai, J., in Chinnaswami Padayachi v. Darmalinga Paiayachi 1982 Mad. 566.

7. I therefore hold that the District Munsif's view that the plaintiff has a preferential right to possession, is correct. It must be noted that the findings of the trial Court on issues 1 and 2 are binding upon him. Those findings are, (1) that the mortgage in favour of defendants 3 to 5 is not nominal and (2) that the decree in O.S. No. 303 of 1924 is not vitiated by fraud or collusion. AH that is now decided is that the plaintiff has a prior right to possession. The other rights which the parties possess, must be worked out in appropriate proceedings. In the result, the decree of the Subordinate Judge is set aside and that of the District Munsif is restored. But the plaintiff shall' not get his costs in this and the lower appellate Court some of the issues having been decided against him.


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