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Brohmo Dutt Vs. Dharmo Das Ghose - Court Judgment

LegalCrystal Citation
SubjectProperty;Contract
CourtKolkata
Decided On
Judge
Reported in(1989)ILR26Cal381
AppellantBrohmo Dutt
RespondentDharmo Das Ghose
Cases ReferredBartlett v. Welles
Excerpt:
estoppel - minor--mortgage by minor--attorney for both mortgagor and mortgagee--notice of minority--evidence act (i of 1872), section 115--contract act (ix of 1872), sections 11, 64--avoiding contract--compensation--specific relief act (i of 1877), sections 38, 41. - .....now, let us consider the circumstances under which that document was obtained. one kedar nath mitter, an attorney of this court, was acting as solicitor both for the present appellant (the intending mortgagee) and for the plaintiff, the intending mortgagor. it appears that on the 15th of july this attorney received a letter from the solicitor of the mother and guardian of the infant, (she having been appointed guardian by an order of court) telling him in the clearest terms that the plaintiff was not of age. there was a dispute upon the evidence as to whether or not kedar nath mitter ever received that letter. i do not entertain the slightest doubt that he did receive it, and, notwithstanding his denial, i am satisfied that the letter is the letter which is spoken of as a.....
Judgment:

Francis W. Maclean, K.C.I.E., C.J.

1. This is an appeal from the decision of Mr. Justice Jenkins, in which he held that a certain alleged mortgage deed executed by the plaintiff on the 20th of July 1895, was void and inoperative, and ought to be cancelled.

2. The circumstances of the case are these: The suit is brought by a minor, suing by his mother as his next friend, to set aside a mortgage which the plaintiff had undoubtedly executed. I will take it for the purposes of this judgment that the contract was not a void one, but a voidable contract.

3. The defence was that, even if the plaintiff were a minor, he fraudulently represented that he was of age and that fraudulent representation was acted upon, and that consequently, by a well recognised principle of equity, the plaintiff was not entitled to succeed.

4. The first point for consideration is, whether or not the plaintiff, on the 20th of July 1895, was a minor or of full age. Upon that part of the case, we have heard but little argument from the appellant's Counsel. The learned Judge in the Court below has stated that he had no hesitation in holding that the plaintiff was not of the age of twenty-one years, on the 20th of July 1895; and substantially that issue has not been contested before us, although, during the course of the argument, it was rather feebly suggested that Mr. Justice Jenkins, in allowing the mother to refresh her memory from a certain document which was shown to her when giving evidence, had admitted evidence which was not admissible. That point, however, is not raised as one of the grounds of appeal, and under these circumstances we declined to allow the matter to be gone into. Upon the first issue then, I see no ground whatever to dissent from the view expressed by the Judge in the Court below that on the 20th July 1895 the present plaintiff was a minor.

5. The next question is, did the plaintiff fraudulently represent to the defendant that he was of age? This representation is alleged to have been made in a declaration, which he swore, and which is set out at page 132 of the Paper Book. It is a long document, but the pith of it lies in the last paragraph, in which the plaintiff says or is made to say that he came of age on the 17th of June then last past, that would be the 17th of June 1895. This is the alleged fraudulent representation.

6. Now, let us consider the circumstances under which that document was obtained. One Kedar Nath Mitter, an attorney of this Court, was acting as solicitor both for the present appellant (the intending mortgagee) and for the plaintiff, the intending mortgagor. It appears that on the 15th of July this attorney received a letter from the solicitor of the mother and guardian of the infant, (she having been appointed guardian by an order of Court) telling him in the clearest terms that the plaintiff was not of age. There was a dispute upon the evidence as to whether or not Kedar Nath Mitter ever received that letter. I do not entertain the slightest doubt that he did receive it, and, notwithstanding his denial, I am satisfied that the letter is the letter which is spoken of as a 'thundering letter' by his own witness, whose evidence will be found at page 100 of the Paper Book. In consequence of that letter what does Kedar Nath Mitter do? Although he is told in the most explicit terms by the attorney of the mother that the plaintiff is an infant, under the age of 21 years, and that any one lending money to him would do so at his own risk and peril, he thinks fit to proceed, and obtains a declaration on the 19th July from one Nanda Lal Ghose, and from another person, who is described as the family astrologer, and both these declarants say that the plaintiff was of age. But Kedar Nath Mitter does not rest there. Although he was acting as the solicitor of the plaintiff, and it was his clear duty, as such solicitor, to protect him, he thinks it right to obtain the declaration in question from him. That declaration is obviously prepared and drawn up by Kedar Nath Mitter himself. Its language is not the language of the plaintiff, it is the language of Kedar Nath Mitter, and to my mind it was a most reprehensible act on the part of Kedar Nath Mitter to have prepared, and allowed his client to have sworn, this declaration, when he had received the clearest notice from the mother that her son, as has proved to be the case, was a minor. The declaration was not prepared or sworn until after the mortgage had been prepared, and when it was ready for execution; and when according to the defendant's own story, negotiations had been going on regarding it, since the previous May. It was prepared and sworn, in fact, at the very last moment. These are the circumstances under which this declaration was taken.

7. Now taking that declaration to contain a fraudulent representation as to the plaintiff's age, was this attorney misled or defrauded by it. He had received the clearest notice, by the letter of the 15th of July, that the plaintiff was not then of age, he pays no heed to that notice, he obtains this declaration under the circumstances I have mentioned, and it is to my mind almost absurd to ask us to believe that he was deceived by any statement contained in it. I entirely agree with the conclusion arrived at by Mr. Justice Jenkins that Kedar Nath Mitter was not misled by it.

8. But then it is said that, although Kedar Nath Mitter may not have been misled by it, there is nothing to show that the defendant himself, who was advancing the money, was not misled by it. That is an argument to which I am quite unable to accede. The defendant thought fit to employ this attorney in the matter, and the knowledge acquired by the attorney in a case such as this must be taken to be the knowledge of the defendant himself, and the attorney must be taken in an ordinary mortgage transaction such as the present, to have communicated to his client the facts which were communicated to him. At any rate as between the plaintiff and defendant it does not lie in the defendant's mouth to say that he was not bound by the knowledge which his agent, whom he employed in this transaction, had acquired.

9. Then it is urged that Kedar Nath Mitter practised a fraud, not upon the infant plaintiff, but upon the defendant, and we are asked upon that footing to adopt the view laid down by Lord Chelmsford in the case of Espin v. Pemberton (1859) De G, and J., 547, where he says: 'I would rather say that the commission of the fraud broke off the relation of principal and agent, or was beyond the scope of the authority, and, therefore, it prevented the possibility of imputing the knowledge of the agent to his principal. I think that Pemberton was not the solicitor of Browne in the assignment, as there is not only no proof of consent that he should act in that capacity, but something approaching to proof of the contrary.'

10. We are invited upon that principle to hold that any knowledge acquired by Kedar Nath Mitter could not be fairly imputable as knowledge acquired by the defendant himself. This is a perfectly new case; no such case was ever suggested in the Court below, and there is no evidence to support such a case; on the contrary the evidence shows that Kedar Nath Mitter, so far from practising any fraud upon the defendant, took this declaration from the plaintiff, either with the object of holding it in terrorem over him, when he attained his majority, as a lever, possibly, for a threat of criminal proceedings, or, alternatively as a basis, for his present contention that the plaintiff, even though a minor, could not take advantage of his own fraud. It would appear, therefore, that Kedar Nath Mitter obtained the declaration, not with the view of defrauding the defendant, but of protecting the defendant's interest.

11. Then it is contended that under Section 115 of the Evidence Act, the plaintiff, though a minor at the time, is estopped from saying that he did not make the representation in question. In my opinion, this section has no application to the case of a minor. A minor cannot be estopped by a deed or by the recitals in a deed, and if he cannot be so estopped, it seems incongruous to say that he can be estopped by a parol declaration, for this is the contention. We must read the language of the Legislature if we can, so as to make it harmonize, and not conflict, with the general law, though remembering at the same time that the office of the Legislature by its legislative Acts is to define, and even alter, the law. The term 'person' in Section 115 is amply satisfied by holding it to apply to one who is of full age, and competent to enter into a contract, and I cannot bring myself to think that it could have been the intention of the Legislature, by such a general expression, to institute such a grave change in the law of estoppel in relation to minors.

12. Our attention has been directed to a case decided by the High Court at Bombay, which holds that Section 115 of the Evidence Act is applicable to the case of a minor. Speaking with every respect, I am unable to assent to that view, and I may point out that the cases upon which the learned Judges in that Court rely as substantiating their proposition when carefully examined appear to me not to warrant the conclusion arrived at. This has been pointed out by Mr. Justice Jenkins, and concurring as I do in his criticism I need not refer to what he has said. The case of Mills v. Fox (1888) L.R., 37 Ch. D., 153, is quite distinguishable. That was a case under the Infants' Settlement Act, which for the purposes of the settlement treats the infant pro tanto, as sui juris, and I am satisfied that Mr. Justice Sterling in that case did not intend to lay down any such proposition in relation to estoppel against a minor, as that for which the present appellant now contends

13. Now I pass on to the argument raised in relation to Section 64 of the Contract Act. Section 64 again speaks of a 'person' and the 'party,' and I think that the terms 'person' and 'party' must be regarded as interchangeable terms.

14. The observations I have made as to the meaning of the term 'person' in Section 115 of the Evidence Act apply with even greater force to that expression as used in Section 64 of the Contract Act.

15. In my opinion the term 'person' in Section 64 means such a person as is referred to in Section 11, that is to say, a person competent to contract who is of the age of majority according to the law to which he is subject, and it would be an extraordinary result to bold that this section applies to the case of a minor. Moreover, as was pointed out by Mr. Bannerjee, although it is unnecessary for us to decide the point, it is certainly open to argument that when Section 64 of the Contract Act speaks of 'voidable' contracts, it refers to such contracts as are spoken of as voidable in Section 19 of the same Act. But I express no final opinion on this point. If we were to accede to the appellant's argument as to the application of Section 64, the protection, which the law has so carefully thrown around minors in relation to matters of this nature, would be virtually destroyed, or I might almost say shifted to protect the very parties who prey upon the weakness and folly of the young.

16. Then, we are asked to exercise the discretionary powers vested in us under Sections 28 and 41 of the Specific Relief Act. That is a matter for the discretion of the Court; the learned Judge in the Court below has exercised his discretion adversely to the appellant, and I see no reason which would justify us in differing from that conclusion. On the contrary I do not think that in a case of this class where a man, who has been told that the person with whom he is dealing is a minor, still chooses to lend him money, 'justice requires' that it should be returned to him.

17. The last point was that the minor when he had attained majority ratified the bargain, but there really is no evidence to support this view, and I agree with Mr. Justice Jenkins upon the point. I have now dealt with the many points which have been urged for the appellant; in my opinion they all fail, and the appeal must be dismissed with costs.

Prinsep, J.

18. I agree in dismissing the appeal with costs for the reasons just given by my Lord, the Chief Justice.

Ameer Ali, J.

19. As the questions raised in this case are of some importance, I desire to add a few observations. It was urged in the first place that assuming the letter of the 15th of July 1895 was received by Kedar Nath Mitter, it did not amount to a notice such as would compel him to make any enquiry with reference to the statement contained therein. It was further urged that notice to Kedar Nath would not affect the defendant in the case; and that, as a matter of fact, Kedar Nath acted fraudulently towards Brahmo Dutt, the defendant.

20. In considering these questions it is necessary to bear in mind some of the salient facts of the case. It has been abundantly proved, amongst other things, that the defendant is a money-lender, who, at the time of the transaction under enquiry, was not in Calcutta, and that all his business here was managed by his monib gomasta Dudraj. This man admits in his deposition that the defendant's entire business was in his charge, and that throughout the transaction Kedar Nath acted on behalf of his master. He admits further that he had known Kedar Nath for about twelve years, and that during that period a considerable amount of business had been done for him by the latter. The evidence of Dudraj clearly shows that he was on intimate terms with Kedar Nath Mitter. Dudraj states that when the question of the plaintiff's minority was broached before him, he told Kedar 'to remove all doubts about the man's infancy,' whilst Kedar says that 'he obtained the declaration of the plaintiff concerning his age and the Exhibits 10 and 11 for the greater security of the interest of my client' meaning the defendant. Throughout the evidence of Kedar Nath or Dudraj there is not the faintest ground for the suggestion that the former was acting fraudulently towards the defendant or his gomasta. Not only is there no ground in support of that suggestion, but the evidence given in the case directly contradicts it.

21. As regards the contention that the letter of the 15th of July 1895 did not amount to a notice, according to my apprehension of the subject, any information which puts a person upon enquiry is a notice. Apart from what is admitted by Dudraj and Kedar Nath Mitter, namely, that the plaintiff himself stated to the latter, that there was a question about his majority, I entertain no doubt whatever, upon the evidence, that Kedar Nath did, on the 15th of July, receive the letter which was addressed to him by Babu Bhupendra Nath Bose on behalf of the mother and constituted guardian of the infant. I do not attach the smallest credence to Kedar Nath Mitter's denial of the fact; and, if he did receive that letter, it undoubtedly did put him upon enquiry. The information conveyed to him in that letter was as clear and explicit as it could well be. And what did Kedar Nath, who was the defendant's attorney, do upon receipt of that letter? If he had been acting as he ought to have done, he would have told the plaintiff that, if he had attained his majority he should go and get his guardian discharged. Instead of doing that, he goes and induces the plaintiff' to make a declaration of the character already described. Instead of going to the mother or the mother's brother for further information on the subject of the plaintiff's minority he obtain? some affidavits from two persons, one of whom cannot be regarded as otherwise than his creature. Nanda Lall Ghose is an attorney's clerk, who is or was in the habit of bringing work to Kedar Nath, as he says. We all know what that means. This Nanda Lall Ghose is said to be an uncle of the plaintiff, but it is in evidence that he was litigating with the plaintiff's mother, that he has lost all his property, and for a considerable number of years has held no communication with the plaintiff's family. It was upon these declarations that Kedar Nath proceeded, as he says, to get this money advanced to the plaintiff. There can, therefore, be no doubt that, so far as Kedar Nath was concerned, he was not misled by any statement made by the plaintiff regarding his age. The plaintiff himself stated to Kedar that there was a doubt about his age, and that his mother was questioning his majority. The mother's attorney wrote to Kedar Nath on the subject, so that when he advanced the money to the plaintiff he advanced it with his eyes open.

22. The contention that notice to the attorney is not notice to the defendant is, I must say, wholly unsupported by authority. There is a presumption that the solicitor or attorney does his duty. It was Kedar Nath's duty to convey to the defendants the information which was given to him in that letter of the 15th of July, and if he failed to do so, the defendant must take the consequences.

23. In Boursot v. Savage (1866) L.R. 2 Eq., 134, the same question that has been attempted to be raised in the case before us was presented for decision. In that case one Holmer, a solicitor, was one of the trustees under a certain indenture of trust. By an indenture in which he forged the names of his co-trustees Holmer assigned to the defendant Savage certain leasehold hereditaments covered by the trust. Upon the discovery of the fraud the beneficiary sued for the cancellation of the indenture of assignment. At the trial it was proved that Savage had no knowledge of the forgery or fraud committed by Holmer; but it was not disputed that he had acted in the transaction as the defendant's solicitor. On the question of notice to Savage in respect of the trust, it was contended by his Counsel that Holmer had acted as solicitor for both parties, and that when the fraud commenced the connection of solicitor and client was broken off. Dealing with this contention Kindersley, V.C., at pages 141 and 142 of the report, expressed himself as follows: 'Supposing, however, that actual knowledge of the existence of a trust cannot be imputed to the defendant Savage, still I think he is affected by constructive notice. He employed Holmer as his solicitor in the transaction of the purchase; and, according to the doctrine of Equity, a purchaser has constructive notice of that which his solicitor, in the transaction of the purchase, knows with respect to the existence of the rights which other persons have in the property.' He then goes on to say: 'It is a moot question upon what principle this doctrine rests. I confess my own impression is that the principle on which the doctrine rests is this: that my solicitor is alter ego; he is myself; I stand in precisely the same position as he does in the transaction, and therefore his knowledge is my knowledge; and it would be a monstrous injustice that I should have the advantage of what he knows without the disadvantage. But, whatever be the principle upon which the doctrine rests, the doctrine itself is unquestionable. It is insisted, however, that the doctrine cannot apply to this case because Holmer was committing a fraud, and the client is not to be affected with constructive notice of a fraud committed by his solicitor. But if the client would be affected with constructive notice of a trust, the existence of which is known to his solicitor, in the case where there is no fraud, the fact that the solicitor is committing a fraud in relation to that trust cannot afford any reason why the client should not be affected with constructive notice of the existence of the trust. It is the existence of the trust, and not the fraud, of which he is held to have constructive notice, and the constructive notice of the existence of the trust must be imputed to him, whether there is a fraud relating to it or not.'

24. I am not aware that case has been overruled or dissented from in any subsequent case. On the contrary in the case of Bradley v. Riches (1878) L.R., 9 Ch. D., 189, L.J. Fry gave expression to the same view, in other words that the knowledge of the solicitor was the imputed knowledge of the client.

25. But I go further and hold upon the evidence that the present case does not rest upon constructive notice. For Dudraj admits that a day or two before the execution of the deed he was informed that there was a question as to the plaintiff's age, and I regard that as sufficient information to put him upon enquiry. If the enquiry is not sufficient, if it turns out that he did not take proper steps to satisfy himself, and if, afterwards, it is established by judicial investigation that the fact of which he purported to be satisfied was not the true fact, he must take the consequences.

26. Then it was argued that the plaintiff was estopped under Section 115 of the Evidence Act by his representation in respect of his age. To hold that an infant may be estopped in regard to contracts by conductor misrepresentation would be practically to sweep away all the limitations the law has imposed on the capacity to contract; and a person labouring under a disability would be enabled to enlarge by his own act his legal capacity to contract. In the Liverpool Adelphi Loan Association, v. Fairhurst (1854)9 Exch., 422, it was held that a person under a disability to contract was not liable upon the contract, nor for a wrong arising out of or directly connected with the contract, and which is the means of effecting it and parcel of the same transaction. The same principle was followed in Bartlett v. Welles (1862) 1 B. & S., 836.

27. It follows, therefore, that when the present law declares that an infant shall not be liable upon a contract, or in respect of a fraud in connection with a contract, he cannot be made liable upon the same contract by means of an estoppel under Section 115. I, therefore, agree that there is no estoppel whatsoever in this case founded upon any representation or alleged representation on the part of the plaintiff.

28. As regards Section 64 of the Contract Act, I agree that the contracts there referred to are contracts by persons who have the capacity to contract or who are not labouring under any disability from contracting. As at present advised I agree with the decision of this Court holding that the contract of an infant is voidable at his option, but that must be understood as meaning that it is voidable to his advantage and not to his disadvantage. No reason has been shown in this case for the exercise of the equitable jurisdiction of this Court. Undoubtedly a Court of Equity has the power, if the minor has derived any benefit by means of a fraudulent representation--to order compensation, to use a common maxim--to compel a person seeking equity to do equity. In the present case I see absolutely no foundation whatever for the defendant's invoking the equitable jurisdiction of the Court. I agree, therefore, in dismissing this appeal.


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