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Vaiyapuri Pandaram Vs. V. Seetharama Chettiar - Court Judgment

LegalCrystal Citation
SubjectBanking
CourtChennai
Decided On
Reported inAIR1934Mad639; 152Ind.Cas.464
AppellantVaiyapuri Pandaram
RespondentV. Seetharama Chettiar
Cases Referred and Lewin v. Wilson
Excerpt:
- beasley, c.j.1. this is an appeal from a judgment of jackson, j. the suit under appeal was upon a promissory note executed by defendant 1 on 23rd may 1920 for rs. 1,000. the suit was filed against defendant 1 and against the present appellant as defendant 2 on 14th march 1925. the appellant was impleaded in the suit as defendant 2 because he had executed a document, ex. b, on 31st july 1921 together with defendant 1. the document is as follows:both of us are conducting trading business jointly for the benefit of our family. in respect of the debts that have been borrowed (till now) and may be borrowed hereafter from you (the plaintiff) by us jointly and severally and also jointly along with others, we bind ourselves to be liable for them and pay them oft to you, jointly and severally.2......
Judgment:

Beasley, C.J.

1. This is an appeal from a judgment of Jackson, J. The suit under appeal was upon a promissory note executed by defendant 1 on 23rd May 1920 for Rs. 1,000. The suit was filed against defendant 1 and against the present appellant as defendant 2 on 14th March 1925. The appellant was impleaded in the suit as defendant 2 because he had executed a document, Ex. B, on 31st July 1921 together with defendant 1. The document is as follows:

Both of us are conducting trading business jointly for the benefit of our family. In respect of the debts that have been borrowed (till now) and may be borrowed hereafter from you (the plaintiff) by us jointly and severally and also jointly along with others, we bind ourselves to be liable for them and pay them oft to you, jointly and severally.

2. It is clear that as against the appellant the suit was barred by limitation, but it was contended that certain payments made by defendant 1 on 22nd March 1922 and 13th January 1923 saved limitation. But the trial Court and the first appellate Court held that as against the appellant the suit was barred by limitation. But in second appeal, Jackson, J., held that Ex. B was not a contract of guarantee or suretyship at all but was simply a contract of joint and several borrowing and that, as an account had not been rendered and a demand made and no refusal of that demand, there was no breach of contract and that time would not; run until there was such a breach. This point was not raised by the counsel in the course of his argument before Jackson, J., but was one taken by our learned brother himself. He felt that it was open to him to take the point because, in his view, it was not suggested in the plaint that Ex. B was a contract of suretyship. But, with respect, my understanding of para. 6 of the plaint is that such a plea was certainly intended; and the case was tried upon that footing. Issues 2 and 3 plainly show this and so does the evidence of the plaintiff which is as follows:

Later on I demanded the amount due under plaint pro-note. Then defendant 1 said he had then no money but he would give security. Accordingly the letter of guarantee, Ex. B, was given to me by defendants 1 and 2 on 31st July 1921.

3. The appellant's evidence also is important because he says that Ex. B was a guarantee. He says:

It was in 1917 that I executed the guarantee, Ex. B. I gave it to plaintiff without putting any date. Plaintiff later on dated it so as to file the present suit.

4. In the judgments of the District Munsif and the Subordinate Judge, the case is dealt with on this footing and, in my view, in second appeal an entirely new case, as I think this is, should not be the basis of a judgment reversing the lower Court's decision, though I agree that Jackson J's, view of Ex. B may be correct. This appeal must therefore be considered on the case presented in the trial Court and in the lower appellate Court. What then is the position? The payments referred to were not made by the appellant but by defendant 1, the principal debtor; and Brajendra Kiahore Roy v. Hindustan Cooperative Insurance Co. Ltd. 1918 Cal. 707 is clear authority in favour of the appellant's case. In that case it was held that the fresh period of limitation created under Section 20, Lim. Act, by the payment of interest by the principal debtor could be only in respect of the debt upon which the interest was paid, namely, the debt of the principal debtor, that the fact that the interest was paid with the knowledge and consent of the surety and even at his request made no difference unless the circumstances could be said to render the payment one on behalf of the surety and that there is nothing in the relation of principal and surety itself which makes payment by the principal binding as a payment by the surety. Domi Lal Sahu v. Roshan Dobay (1906) 33 Cal.1278 was distinguished on the facts. There, there was a mortgage deed and the mortgagor had made payments of interest to the mortgagee and it was held that such payments affected not only the mortgagor but the respondent, the purchaser of the equity of redemption, who of course claimed through the mortgagor. Another important case is Gopal Daji v. Gopal Sonu, (1901) 28 Bom. 218 a judgment of Jenkins, C.J. This case also strongly supports the appellant's contention. In this Court we have Govindaraja Mudali v. Samarapuri Chetty 1930 Mad. 112 a judgment of Wallace, J., Sami Ayyangar v. Laxmi (1911) 9 I.C. 8, Dwarkadoss Goverdhandoss v. C. Krishnaya (1911) 9 I.C. 204. Two English oases were referred to by the learned Counsel for the respondent, namely, Allison v. Frisby (1890) 43 Ch.D. 106 and Lewin v. Wilson (1886) 11 A.C. 639, but in the former case the surety had joined in the covenant in the mortgage thus bringing himself within the Real Property Limitation Act, 1874, Section 8 and in the latter case the question turned upon the Limitation Statute of New Brunswick called 'Limitation of Real Actions' and I do not think these cases can be regarded as any authority upon the Limitation Act. Certainly Allison v. Frisby (1890) 43 Ch.D. 106 and Lewin v. Wilson (1886) 11 A.C. 639 are not regarded by the learned author of 'Rowlatt on Principal and Surety' as in any way affecting the general rule that a payment made by the principal debtor to the creditor does not prevent time running in favour of the surety. For these reasons, in my view this appeal succeeds and must be allowed and the decree of the second appellate Court reversed and that of the first appellate Court restored. The appellant will have the costs here and in the second appellate Court.

Bardswell, J.

5. I agree.


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