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Mati Lal Pal Vs. Preo Nath Mitra and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Judge
Reported in3Ind.Cas.696
AppellantMati Lal Pal
RespondentPreo Nath Mitra and ors.
Cases ReferredJackson v. Warren
Excerpt:
lis pendons - specific performance, suit for--contract, of sale--compromuc decree--purchaser at execution sale--priority--amicable partial satisfaction of decree. - .....the plaintiff and he brought his suit (no. 2 of 1902) for a specific performance of contract. the suit was decreed upon a compromise which the parties entered into and the decree that was passed gave, in terms of the petition of compromise, three months time to the defendants nos. 3 and 4 to execute the conveyance. they failed to execute it, and the plaintiff executed his decree on 5th may 1903. on 14th aghran 1310, (30th november 1903). the defendant no. 4 only executed out of court a conveyance in plaintiff's favour for his one-third share. the defendant no. 3 took objections to the execution and an appeal in reference to his objections is pending in the hon'ble high court.3. the defendant no. 2, who is a co-sharer of the defendants nos. 3, 4 and 5, was obliged to pay rs. 317 for.....
Judgment:

Robert Rampini, A.C.J.

1. This is a Letters Patent appeal against the decision of Mr. Justice Woodroffe.

2. The suit out of, which the appeal arises is one for the possession of certain land with wasilat. The facts as found by the lower Court are as follows :--'The defendants Nos. 3 and 4 contracted to sell their aforesaid share along with other properties to the plaintiff for the sum of Rs. 8,501. They failed to execute a conveyance in favour of the plaintiff and he brought his suit (No. 2 of 1902) for a specific performance of contract. The suit was decreed upon a compromise which the parties entered into and the decree that was passed gave, in terms of the petition of compromise, three months time to the defendants Nos. 3 and 4 to execute the conveyance. They failed to execute it, and the plaintiff executed his decree on 5th May 1903. On 14th Aghran 1310, (30th November 1903). the defendant No. 4 only executed out of Court a conveyance in plaintiff's favour for his one-third share. The defendant No. 3 took objections to the execution and an appeal in reference to his objections is pending in the Hon'ble High Court.

3. The defendant No. 2, who is a co-sharer of the defendants Nos. 3, 4 and 5, was obliged to pay Rs. 317 for Road-cess arrears in respect of lot No. 14 and sued the defendants Nos. 3, 4 and 5 for contribution. His suit was No. 49 of 1P02. It was decreed ex parte, on the 2nd July 1902. It was executed and at auction, the defendant No. 2 purchased the right, title and interest of the defendants Nos. 3, 4 and 5 on the 16th September 1903 and is in possession of the property which the plaintiff seeks to recover possession of.'

4. Now the question for decision in this appeal is whether the defendant No. 4's conveyance in favour of the plaintiff, dated 30th November 1903, or the defendant No. 2's auction' purchase, dated the 16th September 1903, is to have priority.

5. The Munsif held that the plaintiff's deed of the 30th November 1903 was entitled to priority. The Subordinate Judge and Mr. justice Woodroffe have come to a contrary decision and have held that the defendant No. 2's purchase, being prior in time, is entitled to prevail over the plaintiff's deed.

6. The learned Advocate-General has, however, contended that the plaintiff's deed is entitled to preference, because, when the defendant No. 2 purchased, the plaintiff was prosecuting a suit which affected the property which the defendant No. 2 purchased on the 16th September 1903. This suit was instituted on the 4th May 1902 to compel the defendants Nos. 3 and 4 to fulfil their contract which they had entered into to sell their shares to the plaintiff. The plaintiff obtained a decree based on a compromise and the conveyance which the defendant No. 4 executed in favour of the plaintiff was executed in accordance with the terms of the compromise decree. Hence, it is argued and, I think rightly, that the, defendant No. 2's purchase took place at a time. when the property was the subject of a us pendens.

7. Mr. B. C. Mitter on the other hand admits that the defendant No. 2's purchase would be subject to a lis pendens, if it were not for two facts: (1) that the plaintiff's conveyance of the 30th November 1903 conveys other properties besides the defendant No. 4's share, and (2) that the plaintiff's decree has been split up, and that he has taken a conveyance from the defendant No. 4 in satisfaction of part of his decree and is executing his decree for the remaining interest against defendant No. 3. Neither of these facts, in my opinion, affects the matter. The whole of the defendant No. 4's share is conveyed by the deed in accordance with his previous compromise with the plaintiff. Then, a decree-holder is entitled to split up his decree and to enter up satisfaction against the judgment-debtor who satisfies him in respect of his liability under the decree, and to execute it as against the judgment-debtor who does not do so, provided there is nothing to make this arrangement inequitable. Moreover, we are told that this argument has been put forward unsuccessfully in this Court in the execution case against the defendant No. 3, and that the plaintiff has been successful in his execution case against him.

8. However this may be, I do not think that the facts relied on by Mr. Mitter disentitle the plaintiff's conveyance to priority over the defendant No. 2's purchase, and I would, therefore, decree this appeal with costs.

Doss, J.

9. The essential question involved in this appeal under Section 15 of the Letters Patent is whether defendant No. 2, who is the principal respondent in this appeal, is affected by the doctrine of Us pendens. The facts which raise this point are undisputed and may be briefly stated : On the 19th December 1898, defendants Nos. 3 and 4 executed a bainapatra, i.e., a contract in favour of the plaintiff agreeing thereby to convey the property in dispute to the latter for a sum of Rs. 8,501. The defendants Nos. 3 and 4 having failed to execute a conveyance of the property, the plaintiff brought a suit for specific performance of the contract on the 4th January 1902, and on the 29th September of the same year obtained against them a decree in terms of a compromise entered in to between them and the plaintiff. By that compromise decree it was ordered that in case the defendants Nos. 3 and 4 repaid to the plaintiff within 3 months from the date of the decree, the earnest-money received by them from the latter and also the costs of the suit, they would not be bound to execute the conveyance in his favour. But if they failed to do so within that period, then the plaintiff would be at liberty to have a conveyance executed either by the defendants or by the Court on their behalf, on payment to them amicably or on depositing in Court in their favour the balance of the consideration. The period of 3 months limited by the decree' for repayment of the earnest-money and costs having expired and the defendants Nos. 3 and 4 having failed to repay the amount, the plaintiff took out execution of the decree on the 4th February 1903, and asked for execution of a conveyance under Section 261 of the Civil Procedure Code and renewed his application again on the 6th May of the same year. On the 30th November 1903 defendant No. 4 alone executed a kobula in respect of his half share of the property in favour of the plaintiff; the defendant No. 3, however, preferred objections to the execution and those objections being overruled, the latter preferred an appeal to this Court which was pending at the time the present suit was brought. Meanwhile on the 16th September 1903, which was nearly a year after the date of the compromise decree, defendant No. 2 purchased the rights and interests of defendants Nos. 3, 4 and 5 (defendants Nos. 3 and 4 being owners of a two-third share and defendant No. 5 being owner of the remaining third share) in the property in suit at a sale held in execution of a money-decree which he had obtained against them in a suit for contribution in respect of a certain sum paid by him in satisfaction of arrears of Road-cess due from the property of which the defendants Nos. 2, 3, 4 and 5 were co-owners. The defendant No. 2 having taken possession of the property under his purchase, the plaintiff instituted the present suit on the 4th May 1904 to recover possession of the property and for mesne profits and for partition. The plaintiff in his plaint impugned the bona-fides of defendant No. 2's decree and charged the sale under it as collusive and fraudulent. Both the Courts below have decided against the plaintiff on those points, so it is unnecessary to notice them any further. The Courts below have also negatived the allegation of the plaintiff that defendant No. 2 was benamidar for the plaintiff in all these transactions. The main defence of the contesting defendant was that the ' bainapatra, the solenama, the compromise decree and the conveyance or kobala executed by defendant No. 4 were all collusive and fraudulent and that no consideration passed under the conveyance. The Munsif held that the plaintiff had fully established the bona fides of those transactions and this finding was not controverted before the Subordinate Judge. The Munsif further held that the kobala had been executed by defendant No. 4 in pursuance of the compromise decree, and that satisfaction of the decree in respect of the share of defendant No. 4 had been entered by the Court. Upon these findings, he gave a decree to the plaintiff for possession of the half share of defendant No. 4. On appeal by the defendant No. 2 the learned Subordinate Judge reversed that judgment and dismissed the suit on the ground that the compromise decree neither created a charge on the property, nor transferred the rights and interests of defendants Nos. 3 and 4 therein, and that such rights and interests could not pass until after the execution of the conveyance either by them or by the Court and the payment by the plaintiff of the balance of the consideration.

10. On second appeal by the plaintiff to this Court the learned Judge who heard it has agreed generally in the conclusion arrived at by the Subordinate Judge and has dismissed the appeal and the suit resting his judgment chiefly on the ground that the balance of the purchase-money was not paid by the plaintiff until after purchase by defendant No. 2 at the execution sale, and that, therefore, the plaintiff's kobala did not take precedence over the purchase by defendant No. 2.

11. Against this judgment the plaintiff has preferred this appeal under Section 15 of the Letters Patent. With every respect to the learned Judge, I regret, I am unable to assent to the view entertained by him, and but for his opinion I should have thought the point was a perfectly clear one. To hold that until the payment of the purchase-money by the vendee and the execution of the conveyance by the vendor in his favour he acquires no sort of right as against the vendor or a mesne purchaser from him during the pendency of a suit for specific performance is, in my opinion, to hold that the doctrine of lis pendens has no application to a suit for specific performance. This is clearly opposed to well-established rules deducible from the very nature and object of that doctrine. In Turner v. Wight (1841) 4 Beav. 40 an application by the plaintiff, vendee, in a suit for specific performance, for an injuction to restrain the vendor from selling or letting the estate pending the hearing of the suit, was refused by the Court solely on the ground that the lessee or the purchaser pendente lite would take subject to the plaintiff's rights. In Hadley v. London Bank of Scotland Limited (1865) 3 Do G.J. and S. 63 the Court refused a similar application for an injunction on the ground that in that case it seemed to it doubtful whether there was a clear undisputed contract for sale, but it distinctly affirmed the general principle that in a suit' for specific performance the purchaser pendente lite is bound by the result of the suit. Turner, L. J. thus observed in his judgment: I have always understood the rule of the Court to be that if there is a clear valid contract for sale, the Court will not permit the vendor afterwards to transfer the legal estate to a third person although such third person would be affected by lis pendens. I think this rule well-founded in principle, for the property is in equity transferred to the purchasers by the contract, the vendor then becomes a trustee for him and cannot be permitted to deal with the estate so as to inconvenience them? 'See also Fry on Specific Performance, fourth edition, Section 1159, page 498. In Eyster v. Gaff (1875) 91 U.S. 521 at p. 524, Mr. Justice Miller in delivering the unanimous opinion of the Supreme Court of the United States observed as follows:- In a suit against the vendor of a real estate for specific performance, his conveyance of the legal title after suit was brought would not suspend the proceeding or defeat the title under the decree of the Court. The obvious; reason for this is, that if, when the jurisdiction of the Court has once attached, it could be ousted by the transfer of the defendant's interests, there would be no end to litigation and justice would be defeated. Another reason is that when such a suit is ended by a final decree transferring the title, that title relates back to the date of the instrument on which the suit is based or to the commencement of the suit, and the Court will not permit its judgment or decree to be rendered nugatory by intermediate conveyances.' The essential object of the doctrine of lis pendens being the preservation of the status quo of the res pending the determination of the suit for the due and proper administration of justice, it follows that the doctrine ought to apply as much to a suit for specific performance, as to a suit for possession of immovable property or a suit on. a mortgage, foreclosure or sale. In this case the purchase by defendant No. 2 at the execution sale was made long after the compromise decree; he is, therefore, unquestionably bound by it. The question whether the purchaser pendente lite is bound by a decree which is not founded on an adjudication by the Court but is made by consent of parties or is passed on compromise, does not, therefore, arise in this case The case of Annamalal Chettiar v. Malayandi Appya 29 M. 426 : 1 M.L.T. 145 : 16 M.L.J. 372 lays down. that he would be so bound provided the compromise is not tainted by fraud or collusion. This was also distinctly held by the Supreme Court of California in Partridge v. Shepard 12 Pacific Reporter 480 where Searls, Chancellor, in delivering the judgment of the Court in the case which was for specific performance of a contract of sale, and in which a decree had been passed by consent, said-'We know of no good reason why a judgment entered by consent of parties, in a cause in which the Court has jurisdiction of the subject-matter and of the parties, is less efficacious than if entered after a trial of the suit. It may be impeached like any other judicial record by evidence of a want of jurisdiction in the Court rendering it, by showing collusion between the parties, or by proof of fraud on the part of the party offering the record. 'See also In re South American and Mexican Co., ex parte Bank of England (1895) 1 Chan. 37, Prattal Anni v. Lakshmi Anni 26 I.A. 101 : 22M. 508. The fact that defendant No. 2 derives his title under a purchase at an execution sale and not under a private transfer ' by the judgment-debtor makes no difference. Whatever doubts may have at one time been entertained as to whether a purchaser at an execution sale is bound by the doctrine of lis pendens, See Chunder Nath Mullick v. Nilakant Banerjee 8 C. 690 they have been completely set at rest by the repeated decisions of the Privy Council since that case affirming the proposition that he is so bound. See Radha Madhub Holdev v. Monohur Mookerji 15 I.A. 97 : 15 C. 756, Moti Lal v. Kan-ab-ul-din 24 I.A. 170 : 25 C. 179; Faiyas Husain Khan v. Muns Prag Narain 34 I.A. 102 : 29 A. 339 : 11 C.W.N. 561 : 4 A.L.J. 344 : 5 C.L.J. 563 : 17 M.L.J. 263 : 9 Bom. L.R. 656 : 2 M.L.T. 19 : 10 O.C. 314. Neither does the fact that the compromise decree was not absolute, but was conditional in its nature render it less binding. The fundamental policy upon which the rule is based clearly demands the continuance of the operation of the Us till the essential relief appropriate to the nature of the suit has been obtained, for instance, in a suit for possession of immovable property or for foreclosure of a mortgage, by delivery of possession (see Section 333, Civil Procedure Code), in a suit upon a mortgage for sale, by sale and by confirmation thereof see Prem Chand Pal v. Purnima Dasi 15 C. 546 and Bibijan Bibi v. Sachi Beivah 31 C. 863 (F.B.) and pari ratione in a suit for specific performance, by execution and delivery of the conveyance, Osenton v. Nichols 12 South-Western Rep. 278 and 'where possession is also claimed in the suit, as is sometimes done see for example Gregson v. Udayi Aditya Deb) 16 I.A. 221 : 17 C. 223, by delivery of possession Jackson v. Warren (1863) 32 Illinois 331. It does not, in my opinion, signify that the kobala in this case was executed not by the Court but by defendant No. 4 himself. The compromise decree could doubtless be satisfied out of Court by payment of the balance of the purchase money and execution and delivery of the kobala, and in this case satisfaction obtained in this mode was certified to and recorded by the Court. I am unable to agree with the view of the learned Judge of this Court that because the balance of the purchase-money was paid by plaintiff after the purchase by defendant No. 2 at the execution sale, the kobala in favour of the plaintiff is not binding upon the former. The balance of the purchase-money could only have been paid at or upon the execution and delivery of the kobala. If the kobala had been executed by the Court, the plaintiff would have had to pay the balance of the consideration at or upon such execution of the kobala and delivery thereof. In that case by virtue of the doctrine of lis pendens the kobala would have been binding upon defendant No. 2 and plaintiff's title would have prevailed over his. I fail to see why a different result should follow in the case where the kobala is executed by the judgment-debtor himself.

12. It was strenuously urged on behalf of the respondents that although the defendant No. 2 might have been bound by the kobala if it had been in strict conformity with the terms of the compromise decree, it is not binding upon him inasmuch as there is a material variance between the kobala and the compromise decree, in that the former conveys to the plaintiff, besides the property in dispute, arrears of rents due from tenants, money decrees, instalment bonds and certain sums of money deposited in Court, and so forth. -There is admittedly no variance between the compromise decree and the kobala so far as the property in dispute is concerned. These additional items are in their nature personal claims and are either connected with the property in suit or are independent of, it. In the former case, if the plaintiff has, under the kobala, acquired a valid title to the property, he has acquired a title to these additional items too as incidental to the right to the property itself. In the latter case, the defendant No. 2 is not prejudiced by this transfer made by defendant No. 4 of such additional items to which he, the defendant No. 2, has not by his purchase at the execution sale acquired any title.

13. It was next contended that the kobala was not in pursuance of the compromise decree, in that it was executed by defendant No. 4 alone in respect of the half share of the properties in suit, whereas under the compromise decree the kobala was to have been executed by defendants Nos. 3 and 4 in respect of the entire property. There is, however, nothing in the law which prevents a decree holder from obtaining partial satisfaction of the decree out of Court from one or more of the judgment-debtors and obtaining satisfaction of the rest of the decree from the remaining judgment-debtors through the aid of the Court.

14. For the foregoing reasons, I am of opinion that this appeal ought to be decreed and the judgments of the Courts of appeal below ought to be reversed and the judgment and decree of the first Court restored with costs in all Courts.


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