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In Re: R. Brown, an Insolvent - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Judge
Reported in(1885)ILR12Cal629
AppellantIn Re: R. Brown, an Insolvent
Cases ReferredBarrow v. Bell
Excerpt:
insolvent act (11 & 12 vic., clause 21), sections 23, 73 - order and disposition--reputed ownership--form of petition of appeal under insolvent act--civil procedure code. 1882, section 590. - .....see whether on the 6th august the goods were in the possession, order or disposition of brown as reputed owner with the consent of the true owner, it is necessary, first, to consider how things stood down to the 1st august.2. the provisions of the deed as to possession are difficult to understand, for the reason that they are to a large extent obviously dealing rather with words than with things. the only things that seem clear are, that until default the mortgagor was to have the free use of the goods on the premises; but that the mortgagee was to have a durwan on the premises who should, in some sense, have the custody of the goods, which custody must at least, we think, have extended to preventing the removal of the goods, if the mortgagor attempted such a thing. and this.....
Judgment:

Wilson, J

1. Who (after setting out the facts and stating that it was unnecessary to consider the facts of Mrs. Vardon's claim except, so far, if at all, as they affected the position of Dwarkanath Mitter) continued.--In order to see whether on the 6th August the goods were in the possession, order or disposition of Brown as reputed owner with the consent of the true owner, it is necessary, first, to consider how things stood down to the 1st August.

2. The provisions of the deed as to possession are difficult to understand, for the reason that they are to a large extent obviously dealing rather with words than with things. The only things that seem clear are, that until default the mortgagor was to have the free use of the goods on the premises; but that the mortgagee was to have a durwan on the premises who should, in some sense, have the custody of the goods, which custody must at least, we think, have extended to preventing the removal of the goods, if the mortgagor attempted such a thing. And this arrangement was carried out. After default the mortgagee was to have the right to step in and deal with the goods as his own.

3. But down to the 1st August no attempt was made to exercise this right; so that down to that date things remained unchanged, so far as regards the point we are now considering.

4. Possession, order or disposition by an insolvent, to defeat the title of the true owner, must be actual possession; apparent possession is not sufficient. This is very clearly shown by the case of Ex parte National Guardian Assurance Co. L.R. 10 Ch. D. 408.

5. And it may well be open to question, whether enjoyment of the use of goods, but without the power of removal (the latter being prevented by the presence of the servant of the true owner placed for the purpose) is possession within the meaning of the section. It is not easy to see any material difference in point of fact between the position of a man placed in possession, and remaining in the back premises of a house, as in the case just cited, and that of a durwan placed upon the premises, as in the present case.

6. In each case the enjoyment of the goods is undisturbed; in each their removal is provided against. But, on the other hand, the placing a man in possession is in England a proceeding long familiar, the meaning and intention of which is well understood. It can hardly perhaps, be said; that in this country the putting a durwan in charge is an equally unambiguous act. We think it unnecessary to express an opinion as to whether prior to the 1st August, these goods were in the possession, order or disposition of Brown as reputed owner; we assume that, as has been held by the learned Judge, they were so.

7. We have then to consider the effect of what took place on the 1st August. Those who went to the house went clearly on behalf of the appellant and in opposition to Brown. On that day the durwan openly acted as the servant of the appellant; he admitted the appellant's representatives within the gate adversely to Brown, and, as the latter complained to the appellant in his letter of the same date, 'degraded him to his servants.' Had the persons who went to the house been permitted to carry out their intention of cataloguing and lotting the goods for sale, they would have openly asserted and acted upon the rights of ownership of the appellant, and dealt with the goods as his. If this had taken place, it would have been difficult to contend that the goods were any longer in the possession, order or disposition of Brown. It would, we think, have been impossible to say that they were in his possession, order or disposition as reputed owner; that is to say, under such circumstances as fairly to lead to the supposition that he was the' true owner. If what it was attempted to do on that occasion would, had the attempt succeeded, have taken the goods out of the possession, order or disposition of Brown as reputed owner, it follows that the attempt prevented their being any longer in that position with the consent of the true owner. The cases in. which it has been held that a demand of the goods, or an attempt to put an end to the reputed ownership, is sufficient to terminate the consent are numerous. It is sufficient to refer to Smith v. Tepping 5 B. & Ad. 674 Brewin v. Short 5 E. & B. 227 Ex parte Harris L.R. 8 Ch. D. 46 Ex parte Ward L.R. 8 Ch. D. 144 Ex parte Montagu L.R. 1 Ch. D. 554 In re Eslick L.R. 4 Ch. D. 496.

8. The case of Reynolds v. Hall 4 H. & N. 519 throws an instructive light upon the case. In that case Bate, a wine and spirit merchant, executed a bill of sale of all his goods to the defendant on the 15th May, but remained in possession of the goods as before. It was arranged between Bate and the defendant that the defendant, who was an auctioneer, should sell the goods on the 17th June. The sale was advertised; and on the 17th June the defendant attempted to sell, but found no bidders, and went away again. On the 22nd June Bate committed an act of bankruptcy. The facts were stated in a special case, and the second question asked was this: 'Was the attempted sale of the 17th June a withdrawal by the defendant of his consent to the goods being in the order and disposition of Bates?' The Court decided in the negative. The report is short, hut the ground of decision very clearly appears. In the course of the argument, at p. 522, Martin, B., is reported as saying 'what did the handbills say? If they stated that the goods were to be sold as the defendant's goods that put an end to the bankrupt's reputed ownership.'

9. In giving judgment Bramwell, B., says on this point: 'If the handbills bad announced that the goods were the property of the defendant, the fact would have been stated. The case only states that the sale was advertised. If the advertisement simply announced that the goods were to be sold, it would have no effect. Neither party has desired to have it set out and therefore we must assume that it does not affect the question.' And Channell, B., says: 'The advertisement of the sale did not destroy the apparent ownership, and was no withdrawal of the defendant's consent to its continuance. We can see no substantial distinction between what was done in that case and what was attempted in this. In each case the true owner endeavoured to sell, and went as far as he could to carry out that intention. But there is this essential difference, that in this case everything done or attempted was done or attempted openly and unmistakeably on behalf of the appellant, in the exercise of his rights, and adversely to Brown.

10. The case of In re Agabeg 2 Ind. Jur. N.S. 340 referred to by the learned Judge who heard this matter, was much pressed upon us in argument on behalf of the respondents. In that case Phear, J., held, upon the evidence before him, that the goods then in question were in the order and disposition of the insolvent. Questions of order and disposition are questions of fact; and the decisions in any two cases upon such questions cannot be said to be in conflict in the same strict sense as if they turned upon pure points of law. But having regard to the more recent decisions in England already referred to, we think it very doubtful whether that case could now be decided as it was decided. We find it difficult to see what the true owners in that case could have done to assert their title more than they did do.

11. It was contended, however, on the part of the respondents that the conversation already referred to, of which the appellant himself gave evidence, showed a fresh consent on the part of the appellant to the goods being in the possession of Brown as reputed owner, and so re-established the state of things existing before the 1st August. But, as has been pointed out,[1] it is by no means clear whether that conversation took place before or after the 1st August. It lay upon those who now rely upon it to fix its date, and they have made no attempt to do so. And supposing the conversation to have taken place after the 1st August, we do not think, on the evidence as it stands, it had the effect attributed to it. The appellant had on the 1st August attempted to assert his right. He was not bound to do more in order to protect his title; he was not bound to make a second attempt by force, at the risk of a breach of the peace; he was not bound to bring a suit. The only other thing he could have done was to try to sell the furniture without catalogue or lotting, a matter probably impossible. If in this state of things Brown asked him to give him four or five days, which seems to mean to do nothing for four or five days, promising, if the money were not paid within that time, to go to Mackenzie, Lyall's and facilitate the sale, and if he assented, we do not think that necessarily amounted to a fresh consent to the goods being in the possession, order or disposition of the bankrupt. And it lay upon those who assert that the conversation had such an effect to make it clear.

12. We think, therefore, that the furniture in question was not in the possession, order or disposition of Brown as reputed owner with the consent of the appellant on the 6th August when the insolvency petition was filed.

13. Assuming, however, that the view we have expressed is incorrect, and that the goods were, after the 1st August, still in the order and disposition of Brown within the meaning of the section, so far as any action of the appellant affects the matter, it was argued that the seizure of them under Mrs. Vardoh's execution took them out of that order and disposition, and that the appellant is entitled to the benefit of that circumstance; and we think it difficult to resist this contention. The duty and liability of the officer executing a decree against moveable property in the possession of the judgment-debtor are defined by Section 269 of the Civil Procedure Code. 'The attachment shall be made by actual seizure, and the attaching officer shall keep the property in his own custody or in the custody of one of his subordinates, and shall be responsible for the due custody thereof.' The bailiff of the Small Cause Court, in executing Mrs. Vardon's decree, appears to have followed this provision. It is difficult to see any distinction between the position of goods so attached and that of goods seized by the sheriff under an English writ of fieri facias. There is some difficulty in reconciling the English decisions upon the question, whether the seizure of goods in the possession of the debtor, but of which another is the true owner, terminates the reputed ownership. The autherities in favour of the affirmative view are Fletcher v. Manning 12 M. & W. 571 and the judgment of Turner, L.J., in Ex parte Foss 2 De G. & J. 230.

14. Those in favour of the other view are Barrow v. Bell 5 Ell. & B1 540 and Ex parte Edey L.R. 19 Eq. 264. But the only ground suggested in any of those cases for saying that an actual seizure by the sheriff does not put an end to the reputed ownership, is that the sheriff is in such a case a mere wrong-doer; his only authority being to seize the seizable goods of the judgment-debtor, and goods under mortgage, in which his interest is only equitable, not being liable to seizure under a fieri facias. In this country there is no distinction between legal and equitable titles for the purpose of execution, and the officer executing process by seizure is not a mere wrong-doer in a case like the present. The considerations, therefore, upon which it has been thought in England that seizure by the sheriff does not take goods out of the order and disposition of the judgment-debtor, do not seem to apply in this country. Upon this point, however, it is not necessary to give any actual decision.

15. In our opinion the appellant's claim has been established. He is entitled to have the sale-proceeds applied towards satisfaction of his debt, and to rank as a creditor for the balance.

16. Mrs. Vardon, who is the appellant's real opponent, must pay her costs in both Courts. The costs of the Official Assignee will come out of the estate.

[1] In setting out the facts and alluding to the transactions given in the evidence of the mortgagor, the learned Judge expressed his opinion 'that the evidence left it very obscure when it was that Brown asked for four or five days further time; no attempt being made in cross-examination to clear up the difficulty, and no witness being called on the subject by Brown.'


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