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Abdulla Beary Vs. Mammali Beary and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Judge
Reported in5Ind.Cas.87
AppellantAbdulla Beary
RespondentMammali Beary and anr.
Cases ReferredRamakrishna Ayyar v. Subramania Ayyar
Excerpt:
.....act (iv of 1882), section 55, clause 4(b) - vendor and purchasers--vendor's lien for unpaid purchase money--agreement that purchase money should be paid by vendee to third parties--whether vendor can enforce the statutory charge. - - 935. but exclusion of such charge by contract express or implied, being contemplated, it is clearly open to us to negative, if we find, as in this case, a contract by necessary implication to the contrary. but when the vendor gets-in return for ,his conveyance a promise to pay the purchase money or a part thereof to a third person whom the vendor is under obligation to pay, it is perfectly safe to say that there is a contract to the contrary negativing a charge in the vendor's favour. if in england such a contract has been inferred, under like..........sue for damages for the breach of contract. the courts below have treated the suit as one for the purchase money. they have held the plaintiff to be entitled to a; charge upon the property in the hinds of the buyer under section 55 clause (b) of the transfer of property act. if this were correct, the plaintiff's suit would, of course, be in time under article 132 of the limitation act. but if the damages claimed by the plaintiff are not purchase money due to him and he is entitled to no charge it is clear that the suit is barred by lapse of time. has the plaintiff then a charge in this case? by the terms of the contract the purchase money is not payable to the plaintiff. he has no right of action to recover it. how then can he have a charge upon the property conveyed when no money is.....
Judgment:

1. The Courts below have given a decree to the plaintiff for the purchase money of certain property conveyed by him to the defendant on the liability of the properties conveyed. Exhibit A, dated the 22nd of January 1894, is the conveyance executed by the plaintiff. The price is fixed thereby at Rs. 1,650. It is stated to be kept with the purchaser in consideration of an agreement by him to discharge certain liabilities of the plaintiff. It is further stipulated that the money so reserved with the purchaser should be paid to the respective persons to whom the plaintiff was liable within eight days from the date of the sale and that the purchaser should, in default of payment, be liable for interest due to them from the date of sale and any damages resulting from such default. The defendant (the purchaser) having' made default in payment, the plaintiff is entitled to sue for damages for the breach of contract. The Courts below have treated the suit as one for the purchase money. They have held the plaintiff to be entitled to a; charge upon the property in the hinds of the buyer under Section 55 Clause (b) of the Transfer of Property Act. If this were correct, the plaintiff's suit would, of course, be in time under Article 132 of the Limitation Act. But if the damages claimed by the plaintiff are not purchase money due to him and he is entitled to no charge it is clear that the suit is barred by lapse of time. Has the plaintiff then a charge in this case? By the terms of the contract the purchase money is not payable to the plaintiff. He has no right of action to recover it. How then can he have a charge upon the property conveyed when no money is due to him (sic)der the conveyance? Section 55 says he (sic) the absence of a contract to the con(sic) the Judicial Committee of the Privy Council say in Webb v. Macpherson 30 I.A. 238 that to displace the satutory charge, 'it must be shown that there was a clear contract to the contrary between the parties.' It is true there is no express contract in this case against a charge, but is there not, to use the language of the Privy Council, at least something from which it is a necessary implication that such a contract exists'? When it is agreed that the purchase money, is to be paid to another, is that agreement consistent with the vendor retaining a charge? The purchaser, no doubt, is under a duty to the plaintiff to perform the covenant to pay the plaintiff's obliges. But he is under no obligation to pay the plaintiff any purchase money. The charge created by the statute in favour of the vendor is only security for purchase money payable to him. We are, therefore, inclined to hold that a contract to the contrary arises by implication, to negative the statutory charge. It is, no doubt, pointed out by the Privy Council that the statutory charge in India is different in origin and nature from the vendor's lien given by Courts of Equity to an unpaid vendor.' See also the notes to Mareth v. Symmons 2 White & Tudors Equity Cases. 935. But exclusion of such charge by contract express or implied, being contemplated, it is clearly open to us to negative, if we find, as in this case, a contract by necessary implication to the contrary. It is perhaps not easy to define what circumstances may give rise to, a necessary implication. The intention of the parties must be gathered from a variety of facts. But when the vendor gets-in return for , his conveyance a promise to pay the purchase money or a part thereof to a third person whom the vendor is under obligation to pay, it is perfectly safe to say that there is a contract to the contrary negativing a charge in the vendor's favour. If in England such a contract has been inferred, under like circumstances to exclude the equitable lien of the unpaid vendor, we shall not be acting wrongly in making use of English decisions for purposes of illustration. In Albert Life Assurance, Co. v. Western Life, Assurance, Society L.R. 11 Eq. 164 in consideration of the Albert, Company undertaking the liabilities, and, engagements of the Western. Society, the latter conveyed a lease, and mortgages belonging to it and when on failure of the former the society claimed a lien on the lease and mortgages conveyed, Sir James Bacon, Vice Chancellor, refused to allow it. In Webb v. Macpherson 30 I.A. 238 already cited, the Privy Council point out that conveyance or sale in consideration of a covenant to pay a sum of money in the future is different from sale in consideration of money which the purchaser covenants to pay. The distinction, they say, may seem fine but it is a real distinction and it is one which if made out might have had the effect which the High Court have given to it. In that case the price was fixed at Rs. 81000, Rs. 30,000 was paid down and the balance of Rs. 51,000 was agreed to be paid to the vendor in certain instalments. The sum of Rs. 51,000 was part of the purchase money payable to the vendor, though payment was deferred. It was, therefore, distinguishable from cases in which, to use the language of Vice-Chancellor Bacon, the engagement to do the thing was the consideration for the transfer and the vendor having accepted that engagement has the very thing he bargained for and cannot say the consideration has not passed to him. The English Courts do not-recognise alien in such a case. Lord St. Leonards states the distinction in these words: 'There is a marked distinction between conveyance as for money paid with a separate security for the price, whether by covenant, bond or note and a conveyance ex--pressed to be in consideration of covenants which the purchaser enters into by the deed itself.' Sugden's Vendors and Purchasers, page 554. Notwithstanding the decision of the Privy Council in Webb v. Macpherson 30 I.A. 238 we may, on, the authority of the English cases see also Earl of Jersy v. Briton Ferry Floating Dock Co. 7 Eq. 409 and In re Brentwood Brick and Coal Co. 4 Ch. D. 562 whose weight is still left unimpaired], hold that the conveyance was in consideration of 'covenants today in the future' and not for purchase money payable to the vendor in which latter case alone the charge created by the statute can attach. But however this may be, it is enough for the purpose of this case to say that a promise to pay a stranger is a mere covenant the breach of which must be compensated in damages and that there is no occasion for the statutory charge in favour of the unpaid vendor to arise. Stress was laid for the appellant on the provision in Exhibit A that the vendor and his descendants have no right to the property conveyed. But this, in our opinion, is nothing more than the common declaration in conveyances that the vendor does not reserve to himself and to his heirs any right in the property conveyed and has no reference to the unpaid vendor's lien or charge in the event of non-payment.

2. It was also contended that according to the instrument the receipt of the purchase money was acknowledged and no question of the right of the unpaid vendor could arise. But as pointed' out in Dart's Vendors' and Purchasers Volume 2, pp. 739 and 740, the vendor's' lien, (and we conceive the statutory charge in India as well), is not lost by such acknowledgment. See also Sections 54 and 55 of the Conveyencing Act 1881.

3. Upon the finding, however, that there was no purchase money payable to the vendor, the plaintiff had no charge. This view is riot in accordance with the actual decision in Ramakrishna Ayyar v. Subramania Ayyar 29 M.k 305,the facts of which are similar to those of the present. No question was' raised or considered in that case as to whether any purchase money was due to the plaintiff. The sole point decided was that there was a statutory charge as distinguished from a vendor's lien. The authority of that case, therefore, does not preclude us from holding that the plaintiff in this case is not entitled to a charge. The decrees' of the Courts below must be reversed and the suit dismissed with costs throughout.


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