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Sannasi Chetti Vs. Arunachala Chetti and anr. - Court Judgment

LegalCrystal Citation
SubjectLimitation
CourtChennai
Decided On
Reported inAIR1927Mad1137
AppellantSannasi Chetti
RespondentArunachala Chetti and anr.
Cases ReferredNarayanamurthi Ayyar v. Marimuthu Pillai
Excerpt:
- .....laid down in section 145, indian contract act, relating to the indemnification of a surety by the principal debtor and it was added:it will be noted that the surety's right is to recover from the principal debtor whatever sum the former paid to the creditor which sum ought to have been paid by the principal debtor. the principal debtor being bound to indemnify the surety, it is obvious that the cause of action cannot be merely the procuring by the surety, of the principal debtor's exoneration from liability to the creditor, but also the surety being himself damnified.2. the same principle was adopted in duraiswami tevar v. lakshmanan chetty : (1904)14mlj285 which was a case between vendor and vendee. the vendee failed to pay the purchase-money to a creditor of the vendor in pursuance of.....
Judgment:

Curgenven, J.

1. This is a suit for contribution by one of two co-promisors under a promissory-note. The sole issue tried by the District Munsif was one of limitation. He has assumed that the payment which was made by the plaintiff under the decree in the suit brought by the holder of the note was on the 8th of March 1921, the date on which the decree was entered as satisfied. It appears from the plaintiff's evidence that satisfaction was effected by means of a promissorynote for Rs. 50, the balance being paid in cash. The question, therefore, arises whether the execution of a promissorynote is such a payment as would enable one of two creditors to sue the other for contribution. This question has been answered in the negative in Narayanamurthi Ayyar v. Marimuthu Pillai [1903] 26 Mad. 322 where a similar point came up for decision. It was pointed out that the principle of law applicable is that laid down in Section 145, Indian Contract Act, relating to the indemnification of a surety by the principal debtor and it was added:

It will be noted that the surety's right is to recover from the principal debtor whatever sum the former paid to the creditor which sum ought to have been paid by the principal debtor. The principal debtor being bound to indemnify the surety, it is obvious that the cause of action cannot be merely the procuring by the surety, of the principal debtor's exoneration from liability to the creditor, but also the surety being himself damnified.

2. The same principle was adopted in Duraiswami Tevar v. Lakshmanan Chetty : (1904)14MLJ285 which was a case between vendor and vendee. The vendee failed to pay the purchase-money to a creditor of the vendor in pursuance of a covenant, so that the vendor had to execute a promissorynote for the interest due to the creditor. It was held, following Narayanamurthi Ayyar v. Marimuthu Pillai [1903] 26 Mad. 322 cited above, that this did not amount to such damage as would entitle him to sue. I think accordingly that, before the suit is dismissed on the ground of limitation the question must be gone into as to the manner in which the decree was satisfied by the plaintiff, and if satisfaction was effected partly by the execution of a promissory-note, when if at all, the debt under that note was discharged as that would give the starting point for limitation to run.

3. The respondent's pleader has raised anobjection to this course that the plaintiff's case was that payment was actually made at the date of satisfaction of the decree. But, so far as I understand what he says, he does not assert that that payment was made in ca-h. He merely means that the decree was satisfied. I accordingly remand the suit for a fresh finding upon the issue whether the suit is barred by limitation and for disposal accordingly.

4. Costs will abide the result.


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