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M.V. Maya Nadan and Brothers Vs. Arunachallam Chettiar - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported in97Ind.Cas.981
AppellantM.V. Maya Nadan and Brothers
RespondentArunachallam Chettiar
Cases ReferredSee Sanyasi Charan Mandal v. Krishnadhan Banerji
Excerpt:
promissory-note - signature of firm--agent's signature, addition of--practice amongst nattukottai chetties--hindu, law--debts--discharge of insolvent father--pious obligation of son, whether subsists. - .....of those principles to so complicated a thing as the type of signature in vogue among nattukottai chetty firms or indeed at times among nattukottai chetty individuals.2. the suit is brought on a promissory note dated 20th february, 1911. the liability of the 1st defendant is sought to be enforced on two grounds; (1) that the signature to the note is on the face .of it an unqualified assumption by him of personal liability; (2) that in any event, if the signature be held to be merely that of a firm, he was in fact a partner in that firm or alternatively held himself out as being such. the 1st defendant's name is arunachallam chetty and he is the son of a man called a. ponsivalai chetty. there is no doubt that a. ponsivalai chetty entered into partnership with a firm trading under the.....
Judgment:

Victor Murray Coutts Trotter, C.J.

1. Whatever difficulty there may be in this case arises in my opinion, not from any doubt or uncertainty as to the legal principles applicable to it but in the application of those principles to so complicated a thing as the type of signature in vogue among Nattukottai Chetty firms or indeed at times among Nattukottai Chetty individuals.

2. The suit is brought on a promissory note dated 20th February, 1911. The liability of the 1st defendant is sought to be enforced on two grounds; (1) that the signature to the note is on the face .of it an unqualified assumption by him of personal liability; (2) that in any event, if the signature be held to be merely that of a firm, he was in fact a partner in that firm or alternatively held himself out as being such. The 1st defendant's name is Arunachallam Chetty and he is the son of a man called A. Ponsivalai Chetty. There is no doubt that A. Ponsivalai Chetty entered into partnership with a firm trading under the Vilasam of 'V.M.A.C. and Sons', and that partnership unquestionably traded under the style of 'V.M.A.C. and Sons and A.P.'--See for example, Ex. I. There is also no doubt that the partnership gave a power-of-attorney to Arunachallam to act as agent for the partnership, Ex. VI. If, therefore, he signed the promissory note with the partnership signature and merely added his own name, the inference would be irresistible that the operative signature was that of the firm and that he merely added his own name as agent. It is true that he added no qualificatory words such as 'agent' or 'by' or 'per pro' but documents in that form are executed by Nattukottai agents every day and are universally understood to be the firm's signature merely vouched as such by the agent' who adds his' own name. The learned Judge took that view and held that the signature should read as if it were written 'V.M.A.C. and Sons and A. P.', (firm's signature) 'Arunachallam Chetty' (agent's signature). The appellant's case is that the signature should be read entirely differently thus:

V.M.A.C. and Sons' (one signature) and 'A.P. Arunachallam Chetty' (another signature). In plain English, does the A. P. attach itself to what precedes or what follows? To my mind, the ''and' (which is . not written in Tamil, but in the ordinary English abbreviation '&'. clearly links up the A.P. with what precedes, and I, therefore, agree with the learned Judge that the signature on the face of it makes the partnership firm of 'V.M.A.C. and Sons and A. P.' liable, and excludes the personal liability of Arunachallam. I am not sure how far I am entitled to look outside the signature itself to construe it, but as both sides have invited us to do so, I will briefly state what conclusions I would be prepared to draw from the only two sources that appear to me to be in any conceivable way relevant. The first is the words used in the body of the promissory note sued upon itself. It is unfortunate that the Tamil has clearly been mistranslated, but that does not really affect the present question, because the promissory note cpntains the clearest possible recital that the debtors are the firm trading under the style of 'V.M.A. Chinnappa Chetty and Sons and A. Ponsivalai Chetty.' If I am at liberty to look at Ex. B the result is the same. That is dated the 11th February, 1918, and was the formal application for the very loan in respect of which the suit promissory note was executed. It is signed in practically the same way: 'V.M.A.C. and A.P. Arunachallam Chetti'. But the heading is unequivocal, 'V.M.A. Chinnappa Chettiar. A. Ponsivalai Chetty writes'--a clear intimation that the application for the loan was for a loan to the firm of 'V.M.A.C. and Sons and A P.

3. The whole difficulty has arisen from the fact that Arunachallam at times put his fathers' initials in front of his own name when he undoubtedly meant to be signing for himself and nobody else. See for example, his affidavit in the subsequent insolvency proceedings, Ex. IV. That, it seems to me, would at best found an estoppel against him, and in order to found that estoppel, it would have to be shown that such a signature existed which was (a) prior in date to the suit promissory note and (b) brought to the notice of the appellants. If I am right in my construction of Ex, B there is no document on the record which fulfils the first of these requirements let alone the second.

4. The next point taken was that the 1st defendant was a partner in fact or by estoppel. That he was not a partner in fact is conclusively shown by this. Whereas he was at first adjudicated an insolvent along with the other members of the firm of 'V.M.A.C. and Sons and A.P.;' on the true facts being brought to the knowledge of the High Court, his adjudication was annulled, and the decision was not appealed from. Indeed it never rested on anything more solid than the mere statement of the appellants. The estoppel can only be based on the very documents which we have held not to reveal him as other than an agent.

5. A fresh point was taken in appeal, seeking to rest the liability of all the defendants on the pious obligation of the sons to pay the father's debt. The remedies available against the father (which for this purpose must mean A. Ponsivalai Chetty) have been pursued against him and a considerable dividend realized and he has obtained his discharge. When the obligation of the father is ended that of the sons goes with it.

6. In the result the appeal is dismissed with costs.

Ramesam, J.

7. I agree with my Lord's judgment just delivered but on the second point raised I wish to add a few words. In the first place it is contended that Section 45(4) of the Presidency Insolvency Act applies, and, therefore, the order of discharge does not release the 1st defendant who continues to be liable. It is conceded that the 1st defendant is not a partner or a co-trustee with Ponsivalai Chetti nor was he jointly bound nor had he made any joint contract with him. It is also conceded he was not a surety but it is said that he was in the nature of a surety for Ponsivalai Chetty. On this point the decision in Narain Chettiar v. Veerappa Chettiar : (1916)31MLJ386 is against the appellant. It was held in that case that where the father is discharged under the Straits Settlements Bankrupts Ordinance by the Supreme Court at Singapore, the extinguishment of the debt operated as discharge everywhere and the creditor had no right to sue in India the debtor and his undivided sons for the balance of the debt as if it was still subsisting. I do not see any reason to differ from that decision. It would have been different if a decree had been obtained against the son or even against the father prior to the insolvency, in which case it may be possible for the creditor to seize the joint family property in the hands of the son in execution proceedings. [See Brij Narain Rai v. Mangla Prasad Rai : (1924)26BOMLR500 ]

8. But apart from this, there seem to be other difficulties in the way of the plaintiff. The plaint does not allege that the 1st defendant is liable on the ground that though the debt was contracted by the firm of 'V.M.A.C. & Sons and A.P.', the 1st defendant being the undivided son of Ponsivalai Chetty and being in possession of the joint family property is liable for the suit debt. Paragraph 9 of the plaint merely refers to the liability of defendants Nos. 2 to 6 as the undivided sons of the 1st defendant on the ground that defendant No. 1 and his sons 2 to 6 form an undivided family of which the 1st defendant is the manager. It has nothing to do with the liability of the 1st defendant on the ground of the larger joint family of which Ponsivalai Chetty is the manager. If the liability of the 1st''defendant is based on the ground that he is the son of Ponsivalai Chetty and the debt is not illegal and immoral and that he is liable along with his father even during his lifetime [Brij Narain Rai v. Mangla Prasad : (1924)26BOMLR500 ] the reply is that when the father is discharged the son cannot continue to be liable, the son's liability depending for its existence on that of the father. [See Mayne's Hindu Law, page 399, 9th Edition.] When this was pointed out, Mr. Srinivasa Gopalachari abandoned his contention and was content to rely not on the special ground that the 1st defendant is under a pious duty to discharge his father's debts but on the ground that he is a member of the joint family who had-the benefit of the partnership like other members such as the brothers of Ponsivalai Chetty. But if it is rested on this ground the whole plaint has to be re-cast. There are no allegations that the business carried on by Ponsivalai Chetty was an ancestral business 'and is, therefore, prima facie binding on all other members of the family. If it is not ancestral it must be shown that the business resulted in some benefit to the family and that the other members participated in such benefit. [See Sanyasi Charan Mandal v. Krishnadhan Banerji : (1922)24BOMLR700 .] Unless it is shown that other members were admitted to the benefits of the partnership they are not liable for the debts of the firm. The share of the other members of the family who were not directly partners is merely the right to participate in the property of the firm after the obligations have been discharged. There being no allegations in the plaint on these matters, to allow it to be amended at this stage will be to alter its character entirely and start a fresh trial de novo. We see no reason to allow this. The result is, the appeal is dismissed with costs.


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