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In Re: a Vakil of the High Court - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported in39Ind.Cas.289
AppellantIn Re: a Vakil of the High Court
Excerpt:
letters patent (madras), clause 10 - vakil--professional misconduct--conveyance of property to vakil benami--absolute title set up by vakil--perjury. - - 4,000 and after redemption, to sell the property at the best available price......1914 (in which they in 1911 sought his advice as his clients) that they should execute a nominal sale-deed to him, in order that be might litigate in his own name but on their behalf with the plaintiffs' mortgagee.3. he was guilty of improper conduct in obtaining a sale-deed (exhibit g, november 1911) accordingly in his own name.4. he took advantage of the ignorance and the needy position of his clients to obtain the conveyance (exhibit g) for much less than the value of the equity of redemption and he afterwards fraudulently executed a fresh mortgage-deed in favour of the plaintiffs' mortgagee in order to defraud his clients and to secure for himself the property, in fraud of the understanding between himself and his clients and in order to create evidence against his clients in the.....
Judgment:

1. This is a matter under Clause 10 of the Letters Patent in which a Vakil of this Court stands charged as follows:

2. He gave improper advice to the plaintiffs in Civil Suit No. 387 of 1914 (in which they in 1911 sought his advice as his clients) that they should execute a nominal sale-deed to him, in order that be might litigate in his own name but on their behalf with the plaintiffs' mortgagee.

3. He was guilty of improper conduct in obtaining a sale-deed (Exhibit G, November 1911) accordingly in his own name.

4. He took advantage of the ignorance and the needy position of his clients to obtain the conveyance (Exhibit G) for much less than the value of the equity of redemption and he afterwards fraudulently executed a fresh mortgage-deed in favour of the plaintiffs' mortgagee in order to defraud his clients and to secure for himself the property, in fraud of the understanding between himself and his clients and in order to create evidence against his clients in the matter of the said understanding.

5. He did not do his duty towards his clients even after they sent notice of suit through Mr. Govindaraghava Ayyar (Exhibit J), but exercised undue influence in obtaining Exhibits XI, XII and XVI from the second plaintiff.

6. He raised false defences as first defendant to the suit brought by his clients (the plaintiffs Nos. 1 and 2 in the suit of 1914), namely, in paragraphs 7 to 10 of his written statement, to the effect that the sale-deed to him was intended to be a real sale-deed, conveying the properties outright to him, and that Rs. 2,300 of the purchase money had been paid up before the registration of the sale-deed.

7. He gave perjured evidence in the suit, especially in the matter of the alleged payment of Rs. 2,300 out of the Rs. 5,000 mentioned in the sale-deed (Exhibit G) as purchase money and he suborned perjury by asking two of his friends (namely, the defence witnesses Nos. 2 and 3 in the suit) to give false evidence in respect of the said Rs. 2,300.

8. The facts which gave rise to these proceedings were disclosed in the course of trial of a suit on the Original Side of this Court (Civil Suit No. 387 of 1914) in which Mr.--was the first and principal defendant. The object of the suit was to obtain a declaration that a deed of sale executed by the plaintiffs and the third defendant in favour of Mr.--was nominal and procured by him by means of fraud and undue influence and to have it set aside, and also for a declaration that a deed of mortgage executed by the first defendant in favour of the second defendant was not binding on the plaintiffs and the third defendant., Mr. Justice Kumaraswami Sastriyar who tried the suit gave a decree to the plaintiffs as prayed for and neither the first defendant nor the second defendant appealed against his judgment. The learned Judge held that the conduct of the first defendant throughout the transactions in question with the plaintiffs, who were his clients, was grossly fraudulent. Mr.--through his Pleader Mr. Subrahmaniya Sastri has, however, challenged in these proceedings the learned Judge's findings, and we have heard his comments on the evidence that was adduced in the suit itself and canvassed once again at the preliminary enquiry before Mr. Justice Sadasiva Ayyar.

9. The second plaintiff, his son, the first plaintiff, and the third defendant are owners of certain properties, consisting of bungalows and gardens in the town of Madras, yielding a monthly income of about Rs. 600. In 1903 they mortgaged the property by way of conditional sale to one Shaik Adam for Rs. 35,000. In 1905 they paid off Shaik Adam by raising Rs. 40,000 on a usufructuary mortgage (Exhibit A) to the second defendant, who was to pay out of the rents and profits Rs. 50 a month to the mortgagors for their maintenance. The second defendant, whom Mr. Justice Kumaraswami Sastriar describes as an usurer, would not regularly pay the stipulated allowance to the mortgagors who were in extremely straitened circumstances, apparently in the hope of securing the property on easy terms. The value of the property is estimated at a lakh of rupees at the least, and this is the price which the owners wanted, but the second defendant would not pay more than Rs. 80,000. The plaintiffs on 19th July 1911 sent a notice through Mr. K. Ramachandra Ayyar, a High Court Vakil, to the second defendant asking for an account of the rents and profits, and the second defendant made out that Rs. 63,000 and odd were due to him and made a demand for the amount threatening legal proceedings in default of payment. Thereupon, with the aid of two brokers, Abdul Khadir and Khaja Mohideen who were examined in the case the plaintiffs came to an arrangement with one Padmanabhayya. The properties were to be transferred to Padmanabhayya and a memorandum of agreement was drawn up according to which he was to pay the owners of the property Rs. 1,000, take the necessary steps to redeem the mortgage incurring expenses for that purpose up to Rs. 4,000 and after redemption, to sell the property at the best available price. It was also a part of the arrangement that out of the sale proceeds Padmanabhayya would recoup himself the Rs. 5,000 which he had agreed to disburse, pay two-fifths of the balance to the owners, one-fifth to the brokers and take the remaining two-fifths as his own remuneration. The arrangement ultimately fell through as Padmanabhayya refused to agree to the disputes arising between the parties being settled by the sole arbitration of Mr. K. Ramachandra Ayyar.

10. It was in this position of affairs that the owners of the property sought the professional advice and help of Mr.--They were introduced to him by the same brokers and he was told the entire story. He wanted and was given a vakalat; he then sent a notice to the second defendant (Exhibit F) on 10th October 1911, demanding on behalf of his clients Rs. 200 on account of arrears of maintenance for four months. The case of the plaintiffs in the suit was that Mr.--told them that he had received no reply to his notice, but if they entered into an arrangement with himself similar to that with Padmanabhayya he would be able to settle the account with the mortgagee on favourable terms, otherwise the property could not be saved. His proposal was that they would execute a deed of absolute sale in his favour for Rs. 5,000, but that he would not execute a counter-agreement or pay any lump sum of money. He would file a suit for redemption, the cost of which was estimated at Rs. 3,500, and he agreed to pay Rs. 100 a month to the plaintiffs for two years, the time which the suit for redemption was likely to take Mr.--was not only to be recouped the expenses but was to get his fees as Vakil. At first the owners of the property were not willing to execute a deed of sale without an agreement to reconvey the property being executed by Mr.--The Vakil professed to be indignant that he could not be trusted and the brokers ultimately persuaded the owners to agree to his proposal. Thus a deed of sale (Exhibit G) was executed in favour of the Vakil on 23rd November 1911. It recites that the consideration for the sale was Rs. 5,000 which was paid to the plaintiffs, and that the mortgage amount due to the second defendant would be paid by the plaintiffs. On the strength of this document Mr.--negotiated with the mortgagee representing that he had purchased the property; and the amount due upon the mortgage on the taking of accounts being settled at Rs. 62,000, he executed a fresh usufructuary mortgage on the 5th January 1912 (Exhibit XXVII) to the second defendant for that amount. On the 19th February 1912 the plaintiffs having become apprehensive as to the real intentions of the first defendant sent a notice (Exhibit J) to him through Mr. L. A. Govindaraghava Ayyar demanding cancellation of the sale-deed (Exhibit G) and a reconveyance of the property. But far from complying with the demand, he got a letter written to himself on 19th March 1912 (Exhibit XI) by the second plaintiff, who is a feeble old man, assuring him that he need not worry about the notice and asking for Rs. 100. On the same day Mr.--paid the second plaintiff Rs. 67 and subsequently on the 3rd April 1912 he paid him Rs. 33 obtaining receipts (Exhibits XII and XVI).

11. It is admitted by Mr.--that the recital that Rs. 5,000 was paid in cash is not entirely correct. As for the statement in Exhibit G that the vendors themselves would pay off the mortgage, that, of course, was also not correct; it was evidently introduced for the purpose of evading a higher stamp duty and not with any intention of escaping liability for the mortgage of the second defendant. The case of Mr.--is that the sale under Exhibit G was real and bona fide and that the proper price of the equity of redemption was not more than Rs. 5,000. As regards the consideration, he says that he paid Rs. 2,300 in cash before registration and Rs. 300 on the date of registration and the balance, i.e., Rs. 2,400 is the total of what he agreed to pay for the plaintiff's maintenance at the rate of Rs. 100 a month for two years. Though it has been strenuously argued before us by Mr. Subrahmanya Sastri that Mr.--in fact paid Rs. 2,300 and Rs. 300 as alleged, there can be no doubt whatever, as found by the learned Judge who tried the original action, that the story is not true. It is not possible to believe that Mr.--could not have taken a receipt for Rs. 2,300 at the time of payment and his statement that the payment was recited in the receipt, which he says he took for Rs. 300 but which he subsequently lost, is hardly credible. He admitted having made an attempt long afterwards to secure an antedated receipt, and this he would hardly have done if he had originally obtained a receipt. Mr.--is not a man of any means and the evidence of his witnesses Gopala Ayyar and Krishnadoss Paramanandadoss, from whom he say she obtained the money for paying the plaintiffs is not at all trustworthy, Both are interested witnesses, the former is his cousin and the latter, a petty sowcar, is a client of his. There can be little doubt that Mr.--'s case, so far at least as the payment of Rs. 2,300 is concerned, is not true. We have no hesitation in holding that Exhibit G was never intended to operate as a sale. Having regard to the income of the property and its capabilities and the offers that were received at different dates, the estimate of its value at a lakh of rupees on the date of the alleged sale is by no means top high. It is not at all likely that the plaintiffs, who had refused the second defendant's offer of Rs. 80,000 sometime previously, should have agreed to sell the equity of redemption to the first defendant for Rs. 5,000. The amount due to the mortgagee was settled shortly afterwards by Mr.--himself at Rs. 62,000. Besides if it was a case of sale, it is difficult to understand why Rs. 2,400, part of the purchase money, should have been made payable in monthly instalments of Rs. 100 extending over a period of two years. The truth is undoubtedly on the side of the plaintiffs' case that Exhibit G was intended to be merely nominal and was executed for the purpose of enabling Mr. to secure a favourable settlement from the second defendant and, if necessary, to sue for redemption of the property in his own name. The cost of the suit for redemption and accounts was estimated at Rs. 2,500 and as it was expected that it might take two years for the matter to be finally settled, provision was made for the maintenance of the owners of the property in the meantime by fixing for them an allowance of Rs. 100 a month. This was also the nature of the arrangement with Padmanabhayya, which ultimately fell through but of which Mr.--was fully informed when the plaintiffs sought his professional advice and help.

12. Soon after the execution of Exhibit G, however, it became evident to the plaintiffs that Mr.--did not mean to abide by the real arrangement between the parties and was setting himself up as the owner of the property. It is abundantly clear that from the very beginning his intentions were anything but honest and he has persisted in carrying out his fraudulent design to the very last. It was boldly argued by his learned Pleader Mr. Subrahmaniya Sastri that, however culpable the conduct of his client might have been in setting up a false defence to the suit instituted by the plaintiffs and in supporting it by means of false evidence of himself and his friends, he has not been guilty of misconduct in the discharge of his profession so as to make him liable to be dealt with under Section 10 of the Letters Patent. But it was in his capacity as a Vakil that his advice was sought by the plaintiffs and he obtained all information about their property and their affairs generally. Intending all the time to cheat them he succeeded in inducing the plaintiffs, who were in an extremely helpless condition, to convey the property to him, relying on his word as a gentleman belonging to an honourable profession to carry out the real arrangement between them faithfully and honestly. Immediately after the document was executed, he deliberately and steadily set himself to defraud the clients who had reposed so much confidence in him. If acts such as Mr.--'s do not amount to misconduct in the discharge of a Pleader's profession, it is difficult to conceive what would. We bold that all the charges have been proved, except perhaps the fourth charge as to which the evidence of undue influence is not clear or adequate.

13. We direct that Mr.--be suspended from practice for a period of two years.


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