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K.S. Sundaramayyar Vs. K. Jagadeesan and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberAppeal No. 318 of 1960
Judge
Reported inAIR1965Mad85; (1965)1MLJ362
ActsSpecific Relief Act - Sections 24
AppellantK.S. Sundaramayyar
RespondentK. Jagadeesan and anr.
Cases ReferredCalcutta Improvement Trust v. Surbarnabala Debi
Excerpt:
.....specified period--lawyer's notice to refund advance paid and for damages--later on demand for specific performance--maintainability--whether entitled to specific performance;the plaintiff agreed to purchase the suit property under an agreement, dated 31st january 1958, for rs. 23,750 and paid an advance of rupees four thousand; the transaction was to be completed on or before three months from the date of agreement and time was of essence of the contract. but is was not fulfilled in spite of the defendant issuing a telegram to the plaintiff, on 30th april 1958 to finish the sale-deed. later on the plaintiff also issued a reply lawyer's notice, dated 22nd may 1958, calling upon the defendant to refund the advance sum of rupees four thousand and to pay damages of rupees thousand since..........had not chosen his remedy and obtained satisfaction for the breach of the contract by the other party, specific performance could be granted. he relied, in this connection, on s. 24(c) of the specific relief act. but the question in the present case is not, whether, the appellant had not availed himself of one remedy or another, it is even more fundamental than that. the appellant had, as we said, put an end to the contract and demanded a return of the advance amount paid by him and made a further claim for damages. if the contract were to be held as subsisting, he would have no right to insist upon a return of the advance amount. we are unable to find any thing in the decision in calcutta improvement trust v. surbarnabala debi, 44 cal wn 541 to support the contention that,.....
Judgment:
(1) The suit, out of which this appeal arises, was filed by the appellant for specific performance of contract dated 31-1-1958 for the sale of a house, No. 17/25 Raja Street, Coimbatore, which belonged to the first respondent. The price settled was Rs. 23,750, of which Rs. 4000 was paid as advance on the date of the agreement. It was agreed that the sale was to be completed within a period of three months from the date of the agreement, the stipulation in that regard being:

"The party of the first part (first respondent) shall execute and have the sale deed registered within a period of three months from this day. The said period of three months cannot be extended for any reason whatsoever, save by the consent in writing by both the parties."

But nothing, however, happened within the period aforesaid. On 30-4-1958, the last day specified for the performance of the contract, the first respondent sent a telegram to the appellant 'House sale agreement date expires today. Finish sale deed today'. There was no response to this telegram from the appellant. Correspondence, to which we shall have occasion to refer later, followed, each party accusing the other of the breach of the terms of the agreement. On 24-12-1958 the appellant, by a notice sent through his advocate, called upon the first respondent to execute the sale deed and deliver possession of the property along with it title deeds. The first respondent declined to do so, on which the suit was instituted.

(2) The substantial defence to the action was two-fold: (1) Time was the essence of the contract and as the appellant did not perform his part of the contract within the time, stipulated by tendering the balance of the purchase money and giving the draft sale deed, there was no obligation on the part of the first respondent to abide by the terms of the contract. (2) The appellant not having been continuously ready and willing to perform the contract, he could not obtain relief by way of specific performance.

(3) The learned Subordinate Judge found that, notwithstanding the specific terms of the contract, time could not be considered as its essence, but that in as much the appellant had himself committed a breach of the contract, the first respondent having been at all times ready and willing to perform the same, his claim should fail.

(4) We are by no means satisfied that the view taken by the learned Subordinate Judge that time was not the essence of the contract was entirely correct. But it is unnecessary for us to go into that question, in the view we take of the other question.

(5) There can be very little doubt, on the evidence in the case, that the appellant, who claimed a remedy by way of specific performance, was not continuously ready and willing to perform his part of the contract. We shall presently refer to the evidence in the case.

(6) There is little controversy as to what happened subsequent to 30-4-1958, when the first respondent sent the telegram calling upon the appellant to complete the sale. On 17-5-1958, the first respondent, by his registered notice sent to the appellant, accused the latter of having failed to perform the contract and claimed that he would be entitled to forfeit the advance of Rs. 4000 paid to him and further stated that the appellant would be liable to recoup any loss he (first respondent) might sustain by sale of the property to a third party. Evidently, as a reply thereto, on 22-5-1958, the appellant, through his advocate, sent notice complaining that the first respondent had filed to deliver up the title deeds of the property and had further defaulted in delivering possession of the property in spite of demands. There is, however, no substance in either of these two complaints, as it has been proved that the only title deed which the first respondent had with him had been delivered to the appellant, who was himself a mortgagee of the property. As regards delivery of possession, a fair reading of the terms of the agreement would show that possession was to be delivered simultaneously with the completion of the sale. The learned Subordinate Judge found that the first respondent had vacated the house by the middle of February 1958, and he was ready to deliver possession of the same, but that it was purely on account of the default on the part of the appellant that possession could not be given. The evidence in the case supports this conclusion. But the most significant part of the appellant's notice, to which we have just now made reference, is its concluding portion where it is said:

"As there was no offer even in the telegram to deliver possession to my client of the property as per the terms of agreement, my client was not bound to finish the sale deed as stated in the telegram. You have thus committed default and broken the terms of the agreement. My client has been ever ready and willing to act upto the terms.....to the property by giving the title deeds for my client's inspection and by handing over possession to my client of the portion in your occupation, you are bound to return the sum of Rs. 4000 received by you as advance and also pay my client Rs. 4000 by way of damages.

Your are therefore hereby called upon to pay my client the sum of Rs. 4000 received as advance and also Rs. 4000 by way of damages, within 3 days of receipt of this notice. Take notice that on default of compliance with this demand, steps will be taken through Court for recovery of the said sums."

Even assuming that time was not the essence of the contract and that the first respondent was guilty of breach, it is clear from the above letter that the appellant had decided not to keep the contract subsisting but, on the other hand, had put an end to it and demanded damages for an alleged breach by the first respondent. Such a demand for return of the advance paid is quite inconsistent with the subsistence of the contract. It cannot be said, therefore, that the appellant was ready and willing to perform his part of the contract.

(7) The subsequent correspondence between the parties only confirms this view. Three days later, the first respondent wrote a long letter, Ex. B.7, to the appellant setting out his version of the case and reiterating his original decision for forfeiting the advance amount and claiming further damages. That elicited a reply from the appellant on 10-6-1958 Ex. B.8, which charged the first respondent with a breach of the terms of the contract and reiterating the stand taken by him in his notice dated 22-5-1958. He then called upon the first respondent to comply with the demands made in that notice.

(8) It was only more than is months thereafter that the appellant completely changed his case and issued a notice, Ex. A. 2, through his advocate claiming specific performance of the contract by the first respondent within three days therefrom after receiving the balance of the sale price. He claimed that as he was a rich man, the sale price must have been always ready with him and proceeded to state:

"My client hereby withdraws the notice he gave you for the refund of the advance and the compensation money as he is advised that he can obtain specific performance itself".

This statement itself amounts to an admission that by the previous notice the appellant had put an end to the contract by claiming a return of the advance amount paid by him. It will not be open to a party to a contract, who has once elected to accept the breach assuming there was a breach on the part of the other side to cancel that election and treat the contract as if it were subsisting. We regard the notice dated 22-5-1958 as amounting to a definite abandonment by the appellant of his right to obtain specific performance of the contract. As pointed out by the Privy Council in Ardeshir Mama v. Flora Sasson, ILR 52 Bom 597: (AIR 1928 PC 208) the plaintiff in a suit for specific performance should always treat the contract as still subsisting; he has to prove his continuous readiness and willingness, from the date of the contract to the time of the hearing of suit, to perform his part of the contract and a failure to make good that case would undoubtedly lead to a rejection of his claim for specific performance. Where, therefore, a party to a contract of sale made a claim for damages, on the footing of its breach by the other party it would amount to a definite election on his part to treat the contract as at an end and thereafter no suit for specific performance could be maintained by him, for, by such election, he had disabled himself from making the averment that he had always been ready and willing to perform his part of the contract.

(9) Learned counsel for the appellant, however, contended that, so long as the injured party had not chosen his remedy and obtained satisfaction for the breach of the contract by the other party, specific performance could be granted. He relied, in this connection, on S. 24(c) of the Specific Relief Act. But the question in the present case is not, whether, the appellant had not availed himself of one remedy or another, it is even more fundamental than that. The appellant had, as we said, put an end to the contract and demanded a return of the advance amount paid by him and made a further claim for damages. If the contract were to be held as subsisting, he would have no right to insist upon a return of the advance amount. We are unable to find any thing in the decision in Calcutta Improvement Trust v. Surbarnabala Debi, 44 Cal WN 541 to support the contention that, notwithstanding the election by a party to a contract to accept the breach by another he could still revive, at his choice, the contract and insist upon a specific performance thereof. We are, therefore, of opinion that the learned Subordinate Judge was correct in his view that the appellant was not entitled to relief by way of specific performance.

(10) The question whether the appellant will be entitled to a return of the advance amount paid, does not call for determination in this case, as the learned subordinate Judge has declined to grant him any relief in respect thereof, and no ground of appeal has been taken against the propriety of that conclusion

(11) The appeal, therefore, fails and is dismissed, but in the circumstances, without any order as to cost.

(12) Appeal dismissed.


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