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Vaiyapuri Reddy and anr. Vs. Sivalinga Reddiar - Court Judgment

LegalCrystal Citation
SubjectContract
CourtChennai High Court
Decided On
Reported in(1970)1MLJ92
AppellantVaiyapuri Reddy and anr.
RespondentSivalinga Reddiar
Cases ReferredGomathinayagam Pillai v. Palaniswami Nadar
Excerpt:
..... palaniswami nadar [1967]1scr227 ,it has been pointed out that where a person claims a decree for specific performance, it is for him to establish-that he was, since the date of the contract, continuously ready and willing to perform his part of the contract and that if he failed to do so, his claim for specific performance must fail. failure to make good that averment brought with it the inevitable dismissal of his suit. clearly, in this case, after the date of the decree, the plaintiff has not been able to show that he was continuously ready and willing to perform his part of the contract-indeed it is doubtful, if he had the necessary money with him, considering the fact that from 27th june, 1966, the date of the decree, to april, 1967, when he seems to :have ultimately paid the..........in i.a. no. 784 of 1966 in o.s. no. 134 of 1965. this revision petition arises out of a suit for specific performance. defendants 1 and 2 in the suit are the petitioners. the plaintiff filed a suit for specific performance of a contract to reconvey certain properties, which had been sold on 5th september, 1969 by him and two others to defendants 1 and 2. the claim against the third defendant a purchaser from defendants 1 and 2 of one of the items was given up. defendants 1 and 2 submitted to a decree and therefore, the decree provided that they should execute a sale-deed and that in the event of default the plaintiff was to have the sale-deed executed by the court and registered. unfortunately, the decree did not provide the period within which the plaintiff was to pay the.....
Judgment:
ORDER

A. Alagiriswami, J.

1. This is a petition to revise the order of the learned Subordinate Judge of Vellore, in I.A. No. 784 of 1966 in O.S. No. 134 of 1965. This revision petition arises out of a suit for specific performance. Defendants 1 and 2 in the suit are the petitioners. The plaintiff filed a suit for specific performance of a contract to reconvey certain properties, which had been sold on 5th September, 1969 by him and two others to defendants 1 and 2. The claim against the third defendant a purchaser from defendants 1 and 2 of one of the items was given up. Defendants 1 and 2 submitted to a decree and therefore, the decree provided that they should execute a sale-deed and that in the event of default the plaintiff was to have the sale-deed executed by the Court and registered. Unfortunately, the decree did not provide the period within which the plaintiff was to pay the consideration for the sale-deed. The decree was on 27th June, 1966. The plaintiff did not either pay the amount to the defendants or deposit it into Court. Therefore, on 6th December, 1966 on behalf of the defendants, a notice was sent to the plaintiff stating that the money had not been paid to them nor the draft sale-deed submitted for their approval, and, enquiring whether the plaintiff had deposited the said amount to the credit of the defendants. Having received no reply to this notice, the defendants filed on 14th December, 1966 I.A. No. 784 of 1966, out of which the present revision petition arises, under Section 28 of the Specific Relief Act, 1963, for rescinding the contract and dismissing the suit. The plaintiff filed a counter saying that he had always been ready and willing and even now ready and willing to perform his part of the contract and pay the purchase-money and take a reconveyance. Even then the amount was not deposited. The interlocutory application was ordered on 7th March, 1967 giving 30 days time to deposit the amount and the amount has been deposited within 30 days provided in the order of the Court. The contention on behalf of the petitioners is that the Court below was not justified in granting time to the plaintiff and that in any case the Court could have dismissed their application, but should not have given anytime to the plaintiff on. the application made by them (defendants).

2. The facts which I have already mentioned would show that whatever might have been the position before the date of the consent decree the plaintiff does not seem to have been ready and willing to deposit the amount necessary for getting the reconveyance. The decree was as early as June, 1966. Till December, 1966, he did nothing. Even after he received the notice, he did. not send a reply offering; to pay the amount to the defendants. Even after the defendants had filed a petition under Section 29 of the Act, the plaintiff did not deposit the amount, nor did he deposit the amount till March, 1967, when the lower Court made its order, giving : him a further time of 30 days. It is, thus obvious that the plaintiff has not been ready and willing to deposit the amount due to the defendants.

3. In Gomathinayagam Pillai v. Palaniswami Nadar : [1967]1SCR227 , it has been pointed out that where a person claims a decree for specific performance, it is for him to establish-that he was, since the date of the contract, continuously ready and willing to perform his part of the contract and that if he failed to do so, his claim for specific performance must fail. Their Lordships referred to the observations of the Privy Council in Adeshir H. Mama v. Flora Sassoon (1928) 55 M.L.J. 523 : L.R. 55 IndAp 360 : A.I.R. 1928 P.C. 208, where the Privy Council pointed put as follows:

In a suit for specific performance, on the other hand, he treated and was; required by the Court to treat the contract as still subsisting. He had in that suit to allege, and if the fact was traversed, he was required to prove a continuous readiness and willingness from the date of the contract to the time of the hearing,. to perform the contract on his part. Failure to make good that averment brought with it the inevitable dismissal of his suit.

4. Then the Supreme Court went on to say:

The respondent must in a suit for specific performance of an agreement plead and prove that he was ready and willing to perform his part of the contract continuously between the date of the contract and the date of hearing of the suit.

Clearly, in this case, after the date of the decree, the plaintiff has not been able to show that he was continuously ready and willing to perform his part of the contract-Indeed it is doubtful, if he had the necessary money with him, considering the fact that from 27th June, 1966, the date of the decree, to April, 1967, when he seems to : have ultimately paid the amount after 10 long months. It may be that he has taken advantage of the unfortunate failure of the Court below to specify the period within which, he had to deposit the amount.

5. It is urged on behalf of the respondent, however, that while the principle laid down by the Supreme Court will apply for a decision of the suit itself, after the suit has been decreed, it is only the provisions of Sections 28 of the Specific Relief Act that apply and that section enables the Court to extend the period within which. the purchase-money should be paid even though it might not have been paid within the period fixed by the Court. The argument is that as Section 28 of the Act contemplates that the Court should specify a period within which the amount should be paid and as even in a case where the plaintiff has been ready and willing, it is. permissible for the Court to extend the period further, it would be all the more clear that the Court would have such a power to extend the period where in the first instance it does not fix the period within which the money ought to be paid. Speaking for myself if the question had been an open question I would have been prepared to hold that the failure of the plaintiff to pay the money or deposit it expeditiously after the decree in his favour showed that he was not ready and willing to perform his part of the contract and therefore, the defendants' application under Section 282 of the Act should be allowed. A Bench of this Court has held in Abdul Shaker v. Abdul Rahiman : AIR1923Mad284 , that a decree for specific performance is in the nature of a preliminary decree, the original Court keeping control over the action and having full power to make any just and necessary orders therein including, in appropriate cases, the extension of the time, and that the contract is not determined by mere failure of the plaintiff to pay the amount within the specified time. On this point Schwabe, C.J., discussing the legal position observed as follows:

Specific performance is an equitable remedy which has been known and used by the Courts of Chancery in England for centuries and appropriate forms of judgment have been approved by learned Equity Judges in England and have now become almost stereotyped : and those at present in use will be found set out in Seton on Judgments under the title Specific Performance. On a perusal of them the first thing to be observed is that not one of those forms contained in the first instance a limit of time for payment of the purchase-money and not one attempt to make payment of the purchase-money by a certain date a condition of the continuance of the rights under the judgment. After the original judgment for specific performance it is the definite practice in England that all consequential relief by reason of any party failing to comply with the terms of the judgment must be sought by application to the Court by which the, judgment was passed. Such applications are made by motion in the action showing that in England, after the original judgment the action is by no means ended but remains under the control of the same Court. If the default is made by the purchaser in paying the purchase-money there are several remedies open to the vendor. (1) He may on motion in the action obtain an order fixing a definite time and place for payment and delivery over of the conveyance and title deed and can, after the expiration of that time, levy execution for the amount, if not paid, (2) he may apply by motion in the action for an order rescinding, not the judgment but the contract, and in order to succeed in such a motion he has to satisfy the Court that there has been a positive refusal, to complete, which it may be observed in the present case, the respondent has certainly not proved. A similar right is given by Section 35 of the Specific Relief Act of 1877. (3) He can enforce his unpaid vendor's lien for the purchase-money and costs. (4) He can by motion in the action obtain an order for sale by the Court of the property when he will be at liberty to bid. The proceeds of the sale are paid into Court and the vendor gets his contract price, interest and costs and the purchaser the balance if any. Where the vendor is in default, the remedies are even more varied. It would seem to be absurd to hold that the mere fact that a date of completion is fixed in the original decree put an end to the action and that the control of the original Court expires on the expiration of that date--and thus substitute in effect for all the known remedies stated above the simple expedient of treating the action and the decree as dead for all purposes and leaving the vendor in undisturbed possession of property...

6. The other learned Judge pointed out as follows:

But that it is in the nature of a preliminary and not a final decree is, I think placed beyond doubt by Section 35 of the Specific Relief Act (section 28 of the present Act). As I read that section, it lays down that when a decree for specific performance of a contract of sale has been passed and the purchaser makes default in payment of the sum which the Court has ordered him to pay, the vendor may either file a fresh suit for decision of the contract or may, in the specific performance suit itself, apply to the Court to rescind the contract. It is perfectly clear that the contract is not determinable or determined by the mere failure to comply with the terms of the decree. It is not determined until the Court orders that it is determined. By the decree for specific performance the Court sets out what it finds the real contract between the parties was, and declares that such a contract exists and gives what it considers a reasonable time within which the contract shall be carried out.

Regarding the decree from this point of view, as a contract, it is clear in this, vase is in most others of the same kind, that time is not of the essence of the contract and that, until the contract is rescinded by formal order or decree such time for performances not being an essential part of the contract, may be varied by the Court which has declared what the essential terms of the contract are. It is clear as the learned Chief Justice has shown, that it must be within the power of the Court to vary the time within which the contract shall be performed, as difficulties might arise through no fault whatever of the parties preventing performance within the time specified in the decree; e.g., when a third party as within that period set up a bona fide claim of title to the property, it may even be necessary to direct specific performance to stand over for a reasonable but indefinite period, until that claim has been adjudicated.

I take it then that where specific performance of sale has not been effected within the period laid down by the decree, it is open (a) to the purchaser to apply to the Court for an extension of time for payment of the purchase-money and (b) to the vendor to apply either for a final and peremptory order for specific performance or for an order rescinding the contract either immediately or to follow automatically on the expiry of the period peremptorily granted. The original action is thus open until a final decree or order of such a nature and scope is passed, and the original Court has until then ample power to extend the time for specific performance.

Thus, it is obvious that after the decree has been passed even where the decree does not specify the time within which the plaintiff should deposit the amount, it is open to the Court to fix a fresh period or extend the period already fixed, though I cannot accept the argument on behalf of the respondent, that they should not be made to suffer for the failure of the Court to specify the period even in the first instance. But the principles above laid down have, some basis. As pointed out by the Supreme Court in Gomathinayagam Pillai v. Palaniswami Nadar : [1967]1SCR227 , if the contract relates to a sale of immoveable property, it would normally be presumed that time was hot the essence of the contract. Section 28 of the Act seems to really embody this principle. I, therefore, consider that as the Court has, under Section 28 of the Act, the power to extend the period even where it has already fixed a period within which the plaintiff should deposit the amount, it has the power to extend that period, it should be deemed to have the power to either fix a period or grant a fresh period for the plaintiff to deposit the purchase-money where by the decree it has not already fixed a period. If we apply this principle to the facts of this case, even though there had been laches on the part of the plaintiff, the order passed by the lower appellate Court is not one without jurisdiction or one passed in disregard of the principles of equity.

7. The Civil Revision Petition is, therefore, dismissed.


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