Skip to content


Mothoormohun Roy Vs. Soorendro NaraIn Deb - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Judge
Reported in(1876)ILR1Cal109
AppellantMothoormohun Roy
RespondentSoorendro NaraIn Deb
Cases ReferredBarret v. Hartley L.R.
Excerpt:
hindu law - aye of majority of hindus--act xl of 1858--unconscionable agreement-usury. - .....one side, usury on the other, or extortion, or advantage taken of that weakness,' a presumption of fraud. fraud does not here mean deceit or circumvention; it means an unconscientious use of the power arising out of these circumstances and conditions; and when the relative position of the parties is such as prime facie to raise this presumption, the transaction cannot stand unless the person claiming the benefit of it is able to repel the presumption by contrary evidence, proving it to have been in point of fact fair, just, and reasonale. this is the rule applied to the analogous cases of voluntary donations obtained^ for themselves by the donees, and to all other cases where influence, however acquired, has resulted in gain to the person possessing at the expense of the person subject.....
Judgment:

Macpherson, J.

1. The plea of minority having been disposed of by the decision of the Bull Bench, it remains for us to consider what amount the plaintiff is entitled to recover. Phear, J., being of opinion that, even supposing the defedant to have attained the age of majority at sixteen, the bargain was most unconscionable and unfair, and one which no Court of Equity ought to enforce, declared that the plaintiff could in no event get a decree for more than the sum actually paid by him to the defendant, with interest at the rate of 6 per cent, per annum up to the date of filing the plaint. Disallowing the three sums of Rs. 450 retained for interest, Rs. 100 paid to Baboo Romanath Law, the Attorney, for having in his character of solicitor for the plaintiff, advised the plaintiff that the defendant was legally of age, and Rs. 60 for office or amlah expenses, Phear, J., declared that the balance (which would be Rs. 4,390) was the amount paid by the plaintiff to the defendant.

2. For the appellant it is contended, that if the defendant was legally of age when he signed the promissory note, he is bound by the terms of the note, and the plaintiff is entitled to a decree for the full amount claimed.

3. We agree with Phear, J., in the view which he has taken of the facts of this case: and we are of opinion that the plaintiff is entitled to a decree for what he actually advanced, with interest at the rate of six per cent, per annum, and to nothing more. It is an entire mistake to suppose, that because the law against usury has been repealed, a money-lender can, as a matter of course, enforce a contract such as this made with a young man who has only just attained the legal age of majority. Miller v. Cook L.R. 10 Eq. 641 and Earl of Aylesford v. Morris L.R. 8 Ch. App. 484 : See also Barret v. Hartley L.R. 2 Eq. 789 at p. 795. per V.C. Sttjart, are clear authorities that the jurisdiction of the Court over unconscionable bargains of this nature is not affected by the repeal of the usury laws. The remarks of the Lord Chancellor in the latter of these cases are very pertinent to the state of facts now before us. After referring to the old usury laws and arbitrary rule of equity as to sales of reversions, Lord Selborne says: 'Both have been abolished by the Legislature; but the abolition of the usury laws still leaves the nature of the bargain capable of being a note of fraud in the estimation of this Court; and the Act as to 'sales of reversions (31 Vict., c. 4) is carefully limited to 'purchases made bona fide and without fraud or unfair dealing,' and leaves under-value still a material element in cases in which it is not the sole equitable ground for relief. These changes of the law have in no degree whatever altered the onus probqndi in those cases, which, according to the language of Lord Habdwickb, 'raise from the circumstances or conditions of the parties contracting weakness on one side, usury on the other, or extortion, or advantage taken of that weakness,' a presumption of fraud. Fraud does not here mean deceit or circumvention; it means an unconscientious use of the power arising out of these circumstances and conditions; and when the relative position of the parties is such as prime facie to raise this presumption, the transaction cannot stand unless the person claiming the benefit of it is able to repel the presumption by contrary evidence, proving it to have been in point of fact fair, just, and reasonale. This is the rule applied to the analogous cases of voluntary donations obtained^ for themselves by the donees, and to all other cases where influence, however acquired, has resulted in gain to the person possessing at the expense of the person subject to it.'

4. Again he says: 'It is sufficient for the application of the principle, if the parties meet under such circumstances as, in the particular transaction, to give the stronger party dominion over the weaker; and such power and influence are generally possessed, in every transaction of this kind, by those who trade upon the follies and vices of unprotected youth, inexperience and moral imbecility. In the cases of catching bargains with expectant heirs, one peculiar feature has been almost universally present; indeed its presence was considered by Lord Bbougham to be an indispensable condition of equitable relief, though Lord St. Leonards, with good reason, dissents from that opinion. The victim comes to the snare (for this system of dealing does set snares, not, perhaps, for one prodigal more than another, but for prodigals generally as a class,) excluded, and known to be excluded, by the very motives and circumstances which attract him, from the help and advice of his natural guardians and protectors, and from that professional aid which would be accessible to him, if he did not feel commpelled to secrecy. He comes in the dark, and in fetters, without either the will or the power to take care of himself and with nobody else to take care of him. Great Judges have said that there is a principle of public policy in restraining this.'

5. Such being the law on the subject, and as we concur with Phbar, J., in his finding of the facts, and in his opinion as to the unconscionable nature of the transaction, we declare the plaintiff entitled to a decree for Rs. 5,000 less the two sums of Rs. 450 and Rs. 100, that is, for Rs. 4,450 with interest at six per cent, per annum from the date of the promissory note to the date of filing the plaint and no more.

6. As the defendant, at the time he borrowed the money, asserted that he was of full age, and as he was in law then of full age, and as the plea of minority has caused the chief contest in the suit, we think that the defendant ought to pay the costs of this appeal (including those of the reference to the Full Bench).


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //