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Veeraraghava Aiyar and ors. Vs. K. Lakshmana Aiyar and ors. - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported in18Ind.Cas.247
AppellantVeeraraghava Aiyar and ors.
RespondentK. Lakshmana Aiyar and ors.
Cases ReferredRaja of Vizianagaram v. Raja Setrucherla Somasekharaz
Excerpt:
mortgage - prior and subsequent mortgage--failure of prior mortgagee to discharge mortgagor's debt, which was part consideration for mortgage--debt discharged by mortgagee--second mortgagee's priority--contract act (ix of 1872), sections 69 and 70--transfer of property act (iv of 1882), section 101--salvage lien. - - he failed to do so and the property was sold. it seems to me that all these four grounds fail and that the appellant must be content to take, what he certainly in terms took, the mortgage as security for his payment, subsequent to that of the plaintiff......against whom his claim for reimbursement is made. here there is nothing to suggest that this mortgage money was advanced by the appellants in the interest of the plaintiff and, consequently, he is not entitled to claim on that account priority over the plaintiff though indirectly he may have benefited the plaintiff. then as to the third ground, there is no earlier security which the appellants would be entitled to retain as a shield. they are seeking rather to create a security where none was before. the further claim is as salvagor and the answer to that is again that the appellants have no interest in the property which they say they have saved. so far as i know, where charges of this kind have been allowed, the cases are those in which the person who has paid money had an.....
Judgment:

Miller, J.

1. While certain immoveable property was under attachment after a money decree and before it was sold by the Court, the plaintiff obtained a mortgage of the property and undertook, as part of the consideration thereof to discharge the amount of the decree. He failed to do so and the property was sold. The judgment-debtor then had recourse to the appellants and giving him a mortgage on the same properly obtained from him the payment required by Section 310A of the former Code of Civil Procedure and got the sale set aside. The appellants now claim that their mortgage should be given priority to that of the plaintiff. Mr. Ramachandra Iyer put his claim on four grounds. He claimed that under Section 69 of the Indian Contract Act, his client was entitled to a prior charge, that he was also entitled under Section 70 of that Act and, failing either of those two sections, claimed priority on the principle of Section 101 of the Transfer of Property Act and lastly be claimed a salvage lien on the ground that he had saved the property for the plaintiff by his payment. Now as regards Section 69 of the Indian Contract Act, the answer to his claim seems to me to be that he was not interested in the payment of the money. His only interest is that created by his mortgage. As I understand Section 69, the interest must be an existing interest, an interest which the payment is intended to protect; and not an interest which may be said to be created by the payment or as part of the transaction in which the payment was made or which is merely security for the payment. The appellants had no such existing interest when they undertook to lend some money to the judgment-debtor and took the mortgage as security therefor. There is no interest which this payment protected. They were in no way interested in the satisfaction of the decree. Consequently, the payment does not come within Section 69, and I do not think it is within Section 70 for the reason that the payers did not make the payment in any way for the plaintiff. It is suggested (but I do not propose to investigate the suggestion) that the plaintiff has been benefited by the payment, but, as I understand the decision in Yogambal Boyee Ammani Ammal v. Naina Pillai Marakayer 36 M.L.T. 162 Section 70 will not apply to cases where the person, who makes the payment, makes it for himself and not for the other person against whom his claim for reimbursement is made. Here there is nothing to suggest that this mortgage money was advanced by the appellants in the interest of the plaintiff and, consequently, he is not entitled to claim on that account priority over the plaintiff though indirectly he may have benefited the plaintiff. Then as to the third ground, there is no earlier security which the appellants would be entitled to retain as a shield. They are seeking rather to create a security where none was before. The further claim is as salvagor and the answer to that is again that the appellants have no interest in the property which they say they have saved. So far as I know, where charges of this kind have been allowed, the cases are those in which the person who has paid money had an interest to preserve and here, as I have said in discussing the question of Section 69 of the Contract Act, I think that the appellants had no interest which could support their claim to save the property at the plaintiff's expense on grounds such as those on which the decision of the Full Bench in Raja of Vizianagaram v. Raja Setrucherla Somasekharaz 26 M.k 686 was based. It seems to me that all these four grounds fail and that the appellant must be content to take, what he certainly in terms took, the mortgage as security for his payment, subsequent to that of the plaintiff. I would, therefore, dismiss the appeal with costs.

Abdur Rahim, J.

2. I agree.


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