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Deb NaraIn Dutt Vs. Ram Sadhan Mandal and ors. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported in9Ind.Cas.989
AppellantDeb NaraIn Dutt
RespondentRam Sadhan Mandal and ors.
Cases ReferredAnund Moye Dabi v. Girish Chunder Myti
Excerpt:
right of suit - contract, breach of--suit by person not party to contract--vendor and purchaser--arrangement between vendor and purchaser that purchaser should pay off vendor's creditor out of purchase-money--purchaser whether trustee--limitation act (iv of 1877), section 10, and schedule ii, articles 62, 83, 103 and 116. - .....kind was, no doubt, intended by the testator solely for the benefit of the creditors and was not intended to benefit himself in any way. whereas here, the direction to defendant no. 5 to pay the plaintiff was intended by defendants nos. 1 to 4 entirely for their own benefit. even in the case which i have cited it was held that in a case where the executors were directed to pay debts out of the property left by the testator limitation would run. i think it would be impossible to hold that whenever a person gives money to another with a direction to pay it to a third, the second is a trustee for the third to such an extent that the third can sue him for the money without any question of limitation ever arising.7. thirdly, it is argued that the facts found do not justify the decision that.....
Judgment:

Coxe, J.

1. Defendants Nos. 1 to 4 in this case executed a simple bond in favour of the plaintiff in July 1899. They appear to have deposited with him a pattah which Seems to have been a title-deed covering some of their properties. In August 1903 these defendants conveyed their land to defendant No. 5 and it was then arranged between all the defendants and the plaintiff, that defendant No. 5 should pay off the plaintiff out of the purchase-money and that the plaintiff should accept defendant. No. 5 as his debtor in the place of the first four defendants. The conveyance was registered.

2. The plaintiff has now brought this suit against all the defendants on the original bond and recited in the plaint the circumstances under which he is entitled to hold defendant No. 5 responsible.

3. The suit has been dismissed by both the Courts below on the ground of limitation. It has been held that defendants Nos.1 to 4 have no longer any liability to the plaintiff after the arrangement of August 1903, and as regards defendant No. 5 that he is liable only under an oral contract, and that consequently the suit is barred by limitation.

4. The plaintiff appeals to this Court, and on his behalf it has been argued that the suit under Article 116 of the Limitation Act could be brought within six years of the registered contract of August 1903. That registered contract was executed by defendants Nos. 1 to 4 in favour of defendant No. 5 and by it they sold their land to him for Rs. 2,000 and authorised him to pay off the plaintiff and recover from him the pattah in deposit with him. The plaintiff was no party to that contract. It has been argued that, although the plaintiff was not formally a party to that contract, he was virtually a party and was intended to be benefited by that contract; and it is contended on the authority of the case of Husaini Begam v. Khawaja Muhamwad Khan 29 A. 161 : 4 A.L.J. 13 : A.W.N. (1907) 3 and on the decision of the Privy Council in appeal from the same case Nawab Khawaja Muhammad Khan v. Nawab Husaini Begam alias Dilbari Begam 14 C.W.N. 865 (P.C.) : 7 Ind. Cas. 237 : 7 A.L.J. 871 : 1 M.W.N. 313 : 8 M.L.T. 147 : 12 C.L.J. 205 : 12 Bom. L.R. 638 : 20 M.L.J. 614 : 32 A. 410 that the plaintiff is entitled to sue on that contract. The case cited seems to me to be of a very different character from that before me. The contract in that case was executed in favour of the father of the plaintiff and was to the effect that if the plaintiff's father gave her in marriage to the defendant's son, the defendant would pay her Rs. 500 a month. The father of the plaintiff who was a party to the contract took no benefit or advantage whatever. The whole benefit of the contract was intended exclusively for the plaintiff and it may perhaps be added that the plaintiff performed her share of what had been stipulated. I do not think that it can be supposed that the Privy Council meant to lay down in that case that any body who receives any benefit under a contract between strangers can sue on that contract. Here, so far as the registered contract is concerned the people who were intended by the defendants Nos. 1 to 4 to be benefited were themselves. The plaintiff was entitled to the payment of his bond, whether from them or from defendant No. 5, what they wanted was that they should be relieved from their liability to the plaintiff. It was for that purpose that they sold their land and not that the plaintiff might recover his dues. The case Which I have cited must, I think, be regarded as exceptional, while there is nothing in the present case I think which justifies any departure from the ordinary rule that a person suing for compensation for breach of a contract must be a party to that contract. It appears to me, therefore, that the plaintiff is not entitled to sue on the registered conveyance and is, therefore, not entitled to the benefit of Article 116 of the Schedule to the Limitation Act.

5. It has also been argued by the learned Vakil for the respondent that he would not in any case be entitled to the benefit of that Article inasmuch as the contract was not signed by both the parties. He has shown to me authority in Bombay and Madras in support of his contention. But, with all respect to that authority, I am bound by the decision of this Court in the case of Girish Chandra Dass v. Kunja Behari Malo 35 C. 683 : 12 C.W.N. 628.

6. The second point taken is that the case comes under Section 10 of the Limitation Act inasmuch as by the contract the sale-proceeds of the property were entrusted to defendant No. 5 to hold in trust for the benefit of the plaintiff, and it is argued that defendant No. 5 is a trustee for the plaintiff, and that no question of limitation can arise. But it does not appear to me that defendant No. 5 can be regarded as a trustee for the plaintiff; for, as I have said, the intention of defendants Nos. 1 to 4 was to benefit themselves--to relieve themselves of the liability to pay this debt and not to benefit the plaintiff. The case is quite different from that of Anund Moye Dabi v. Girish Chunder Myti 7 C.772 which was a case where a testator had directed his executor to pay his creditors. A direction of that kind was, no doubt, intended by the testator solely for the benefit of the creditors and was not intended to benefit himself in any way. Whereas here, the direction to defendant No. 5 to pay the plaintiff was intended by defendants Nos. 1 to 4 entirely for their own benefit. Even in the case which I have cited it was held that in a case where the executors were directed to pay debts out of the property left by the testator limitation would run. I think it would be impossible to hold that whenever a person gives money to another with a direction to pay it to a third, the second is a trustee for the third to such an extent that the third can sue him for the money without any question of limitation ever arising.

7. Thirdly, it is argued that the facts found do not justify the decision that the proper period of limitation to be applied is that prescribed by Article 116. Articles 83 and 103 have been referred to. Article 83 refers to contract to indemnify, clearly here there is no contract of that nature. Defendant No. 5 did not agree to indemnify the plaintiff against the default of defendants Nos. 1 to 4 The liability of defendants Nos. 1 to 4 came to a complete end and there was a new contract by defendant No. 5. Nor does Article 103 apply either; and even if it did, the plaintiff would not, in my opinion, be benefited. The contract was, according to the plaint, that defendant No. 5 would soon pay the amount due on account of the bond. This agreement was come to in 1903, and the suit was instituted on the 25th January 1908. It lay upon the plaintiff to show that his cause of action arose within three years from that date, and clearly, in the circumstances, his cause of action must have arisen far more than three years before the institution of the suit.

8. The fourth ground taken is that defendant No. 5 can be sued on the original bond as representative of defendants Nos. 1 to 4 and with this may be taken the 5th ground that the plaintiff is, at any rate, entitled to a decree against defendants Nos. 1 to 4. Both these grounds appear to me to be concluded by the finding of the Courts below that the liability of defendants Nos. 1 to 4 had come to a complete end and that of defendant No. 5 had been substituted for it. It is argued that the Courts below have not found in express terms that the plaintiff accepted the 5th defendant as his debtor instead of defendants Nos. 1 to 4. It appears to me that that is the only possible meaning that can be attached to the decisions of the Courts below. The first Court uses the word 'novation' and refers at length to Section 62 of the Contract Act and its first illustration holding at the end,--'As regards the liability of the defendants Nos. 1 to 4 the plaintiff having accepted the defendant No. 5 as his debtor their liability has terminated under Section 62 of the Contract Act.' The learned District Judge in appeal says 'plaintiff has elected to enter into a fresh contract with defendant No. 5.' It would have been impossible for the Courts below to come to this conclusion if they were not satisfied that the parties intended that the liability of defendants Nos. 1 to 4 should come to an end. The express reference to Section 62 of the Contract Act and the illustration under it shows that the Munsif considered that the first contract had been completely superseded by the second and that the plaintiff had agreed to accept defendant No. 5 as his debtor in the place of defendants Nos. 1 to 4. On these findings the plaintiff is entitled to no decree against defendants Nos. 1 to 4. Nor can defendant No.. 5 be regarded in any way as the representative in interest of defendants Nos. 1 to 4 so as to enable the plaintiff to sue him on the original bond.

9. These are all the points taken and it appears to me that they all fail. The appeal must be dismissed with costs.


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