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Sarbesh Chandra Basu and ors. Vs. Hari Dayal Singh Rai and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Judge
Reported in5Ind.Cas.236
AppellantSarbesh Chandra Basu and ors.
RespondentHari Dayal Singh Rai and ors.
Cases ReferredMortlock v. Buller
Excerpt:
consent decree - setting aside--unlawful compromise--agreement to lease by administrator in excess of powers, voidable and unlawful--contract to lease other shares--entire and indivisible agreement-- void in entirety. - .....been argued in these appeals relates to the right of the plaintiffs-appellants to set aside two consent decrees made in previous litigations between the parties to the present suits. the circumstances under which the plaintiffs attack these decrees are somewhat complicated, but in so far as it is necessary to state them for our present purpose, they do not admit of any doubt or dispute. lot gopinagore constitutes a patni taluk of which one-half was owned by one brindaban chandra bose, now represented by the plaintiffs, and the other half by a family of singhs, now represented by the defendants. in 1873 the patni rents fell into arrears, whereupon the predecessors of the defendants saved the property from sale, and, under section 13 of regulation viii of 1819, tained possession thereof.....
Judgment:

1. The substantial question of law which has been argued in these appeals relates to the right of the plaintiffs-appellants to set aside two consent decrees made in previous litigations between the parties to the present suits. The circumstances under which the plaintiffs attack these decrees are somewhat complicated, but in so far as it is necessary to state them for our present purpose, they do not admit of any doubt or dispute. Lot Gopinagore constitutes a patni taluk of which one-half was owned by one Brindaban Chandra Bose, now represented by the plaintiffs, and the other half by a family of Singhs, now represented by the defendants. In 1873 the patni rents fell into arrears, whereupon the predecessors of the defendants saved the property from sale, and, under Section 13 of Regulation VIII of 1819, tained possession thereof as mortgagees. In 1904 the plaintiffs commenced an action against the defendants for recovery of possession of their half share of the patni taluk upon declaration that the mortgage lien had been satisfied from the usufruct and also for accounts and incidental reliefs. Shortly after, the defendants commenced an action against the plaintiffs for specific performance of a contract of sale, alleged to have been made in their favour by the latter, for transfer of this half share of the patni taluk. These two suits came on for trial together, and the parties filed a petition of compromise on the 3rd March 1905. It is necessary to mention that one of the plaintiffs by name Sarbesh Chandra Basu was a party to the previous suits in his personal capacity and also as administrator to the estate of his deceased brother Sudhist Chandra Bose, whose sole heir was his infant widow. Consequently in the petition of compromise to the terms of which we shall presently refer, Sarbesh Chandra acted in a doubt capacity, for himself and as administrator of the estate of his brother, The effect of the compromise was that the present plaintiffs agreed to grant a durpatni of their half share to the then defendants in consideration of a bonus of Rs. 100 and a net annual rental of four hundred rupees payable in four equal instalments. There were covenants as to the payment of the head rent and cesses by the durpatnidar, to which no detailed reference is necessary for the purposes of the present litigation, but the petition further recited that the plaintiffs would execute and register a regular durpatni lease within five months and that before the execution of the lease, Sarbesh Chandra, as administrator to the estate of his deceased, brother, would obtain the necessary permission from the Original side of the High Court where Letters of Administration have been granted. The parties apparently did not contemplate that such permission might be refused, and the petition merely provided that if either of them refused to execute the pattah and the corresponding kabuliyat, it would be executed by the Court on behalf of the defaulter. On the basis of this petition of compromise, consent decrees were drawn up in both the suits. The decree in the suit for possession by the plaintiffs declared their title as patnidars and provided that the defendants would become durpatnidars under them for the bonus and annual rent specified; and the claim for account was dismissed, in the suit for specific performance of the contract of sale set up by the present defendants, a similar decree was drawn up, which set out in full the various terms to be embodied in the durpatni pattah and kabuliyat, which, it was stated, were to be executed after Sarbesh Chandra had obtained the leave of the Court. The two suits were thus disposed of on the 3rd March 1905. The event, however, which had not been contemplated by the parties actually happened. Sarbesh Chandra applied to the Original Side of this Court on the 22nd July, 1905, for permission to execute the durpatni lease in respect of the share of his deceased brother, of which he had been appointed administrator. On the 31st August, 1905, this application was refused, on the ground that, as found by the Official Referee, the net annual profit of the half share of the patni was over one thousand rupees and a lease of one-fourth of such half share for a proportionate rental of one hundred rupees was not beneficial to the infant. On the 20th February, 1906; the plaintiffs commenced these actions to set aside the consent decrees. They attacked the compromise on which the decrees were based substantially on two grounds, namely, first, that the defendants had obtained their consent to the settlement by fraud and misrepresentation, that they were in possession of the entire property for many years partly as owners of the putni and partly as mortgagees and that though they had collection papers which showed what the true income was, they represented to the plaintiffs that the property was held by them at a loss and that its income was not sufficient for payment of the head rent, cesses, and collection charges; secondly, that as the settlement had been made on the assumption that the necessary permission from the High Court would be obtained as a matter of course, and as such leave had been refused, the settlement had become inoperative as to the share of Sudhist Chandra and further that as the contract was entire and indivisible, it must fail in its entirety. The defendants denied the allegations of the plaintiffs as to fraud and misrepresentation and contended that the consent decrees were not open to objection in fact or in law. In the Court of first instance, the Subordinate Judge, found that the allegation of fraud and misrepresentation was amply supported by the evidence. On this ground he decreed the suits and set aside the consent decrees. Upon appeal the learned District Judge held that there was not one particle of evidence in proof of the case of misrepresentation. He further held that the administrator was estopped from denying that he had no power to enter into the compromise and that at any rate as a transfer by an administrator is not void bat merely voidable, it was needless to disturb the consent decrees. In this view of the matter, the District Judge allowed the appeals and dismissed the suits. The plaintiffs have now appealed to this Court, and on their behalf, the decision of the District Judge has been challenged on two grounds, namely, first, that upon the materials on the record, specially the road-cess returns, the case of misrepresentation has been abundantly proved; secondly, that the consent decrees by which the administrator may be compelled to execute a durpatni lease, although the High Court has found that such lease would not be beneficial to the infant concerned, ought not to be allowed to stand, specially as the parties obviously contemplated that the execution of the lease should be dependent up n the grant of permission by the High Court; and, further, that if the settlement fails as to a substantial part, it is so interwoven with the remainder that the entire compromise must be cancelled. In our opinion, it is needless to examine the first ground, because the appellants are clearly entitled to succeed on the second point.

2. Section 90, Sub-section 3 of the Probate and Administration Act, provides that an administrator may not, without previous permission of the Court by which the Letters of Administration were granted, lease, any property for the time being vested in him under Section 4 for a term exceeding five years. Sub-section 4 then provides that a disposal of property by an Administrator in contravention of Sub-section 3 is voidable at the instance of any other person interested in the property. In other words, as observed by the Judicial Committee in Nawab Akbari Begum v. Peara Saheb 1 C.L.J. 594 : 9 C.W.N. 938 : 15 M.L.J. 336 : 2 A.L.J. 758 : 7 Bom. L.R. 876 : 33 C. 116, Section 90 gives an administrator large but not unlimited powers of disposition and an alienation by him in excess of his powers without leave of the Court is voidable Eastern Mortgage and Agency Co. v. Rebati Kumar Roy 3 C.L.J. 260. It is manifest, therefore, that if a permanent lease were granted in this case by the administrator without leave of the High Court, the beneficiary might maintain an action to cancel it. Such an agreement by the administrator under these circumstances is clearly in contravention of law, and if a suit were compromised on these terms by an administrator, acting admittedly in excess of his powers, it would obviously be competent to the Court, to refuse to pass a decree in accordance therewith under Section 375 of the Code of 1882, on the ground that the suit had not been adjusted by a lawful agreement or compromise. Indeed, it has been maintained that if a consent decree is by inadvertence made on the basis of an agreement or compromise contrary to law, the Court of execution has power to refuse to execute the decree Lakshmana Swami v. Rangamma 26 M. 31. It is not necessary for our present purpose to consider whether the execution Court has power to question the validity of the decree; but this much is clear that if a consent decree has been made on the basis of an unlawful compromise, a suit can be maintained to set aside such decree, Golab Koer v. Badsha Bahadur 2 Ind. Cas. 129 : 10 C.L.J. 420 : 13 C.W.N. 1197. In this case, it was pointed out, on the authority of Huddersfield Banking Co. v. Lister (1895) 2 Ch. 273 : 12 R. 331 : 72 L.T. 703 : 43 W.R. 567 : 64 L.J. Ch. 523, that although a consent decree might have been drawn up and completed, it might be set aside upon any ground which would justify the Court in setting aside the agreement entered into between the parties, because the consent decree is a mere creature of the agreement and if a greater validity were attributed to it because it had received Judicial sanction, it would be to give the branch an existence which is independent of the tree. It is clear, therefore, that as a lease by an administrator in excess of his powers is voidable on the ground that it is in contravention of law, a consent decree based on an agreement in that behalf is equally open to attack. The position of the appellants in the present case is moreover fortified by an additional circumstance. The terms of the agreement plainly indicate that both the parties contemplated that the grant of the lease by the administrator should be sanctioned by the High Court and they treated the grant of such sanction as an essential preliminary requisite to the execution of the lease. As such sanction was refused on the ground that the contemplated lease was not beneficial to the infant concerned, the agreement as also the consent decree based thereon must be treated as open to successful attack in a suit properly framed for the purpose. There is another point of view, however, from which the accuracy and justness of this conclusion may be emphasised. If the agreement in question had not ripened into a decree, would any Court of Justice have enforced specific performance thereof? The answer must clearly be in the negative. Section 21 Clause (c) of the Specific Relief Act provides that a contract made by trustees either in excess of their powers or in breach of their trust cannot be specifically enforced. In section 3 of the Act, a trustee is defined to include every person holding expressly by implication or constructively a fiduciary character, Shrewsbury & Birmingham Railway Co. v. London & N.W. Railway Co. 4 De. G.M. and G. 115 : affirmed 6 H.L.C. 113, This definition is obviously comprehensive enough to include the case of an Administrator of the estate of an infant in relation thereto. Reference may in this connection be made to the case of Harnett v. Yeilding 2 Sch. and Lef. 549 at p. 553 : 9 R.R. 98, where Lord Redesdale in declining to compel specific performance of an agreement which would necessitate a breach of trust, namely, execution of a lease by a trustee in excess of his powers, observed as follows: 'The plaintiff must also show that in seeking the performance he does not call upon the other party to do an act which he is not lawfully competent to do, for if he does, a consequence is produced that quite passes by the object of the Court in exercising the jurisdiction, which is to do more complete justice'. To the same effect are the decisions in Byrne v. Acton 1 Bro. P.C. 186, Bellringer v. Blagrave De. G. and S. 63 : XI Jur. 407, Sneesby v. Throne 1 Jurist N.S. (1058) affirmed in 7 De. G.M. andG. 399 : 3 W.R. 605. Mortlock v. Buller 10 Ves. 294 : 7 R.R. 417, Motee Dass v. Modhoo Soodun 1 W.R. 4, Narain Pattro v. Aukhay Narain 12 C. 152. Now in the case before us, if the consent decrees were allowed to stand and to be enforced at any time, what would the position of the administrator be? If he executed the lease, as directed by the decree, he would act in defiance of the authority of the High Court which had refused to grant him permission on the ground that the intended transaction was injurious to the estate of the infant now under his charge. On the other hand, if he refused to execute the lease, he would be clearly guilty of contempt of the Court which made the decree. In the former contingency he might be rendered liable under the administration bend given by him for faithful management of the estate. In the latter event, he might be punished in exercise of the disciplinary powers of the Court. The principle, therefore, that a Court will not lend its aid to give effect to a contract which is illegal, whether it violates the common law or the statute law either expressly or by implication, is eminently applicable to the case before us; for, as observed by Chanceller Walworth in Pratt v. Adams 7 Paige 615, it is a well-settled principle that no Court of Justice will lend its aid to enforce the performance of any contract or agreement which was intended by the parties thereto to contravene the provisions of a positive law or the performance of a contract which is contrary to public policy, and such a contract will not be enforced even with the consent of the parties Fowler v. Senlly 72 Pa. 456. Under these circumstances it is clear that the decree in so far as it affects the estate of Sudhist Chandra Base ought not to be allowed to stand.

3. The next question which requires consideration is, whether the decree ought to be set aside in part only or in its entirety. The test to be applied is, whether the reliefs granted are severable or not. Now in the case before us, as already stated, there were originally two suits which were compromised; one of these was for recovery of possession of a half share in the patni on the ground that the satutory lien created under the Patni Regulation had been satisfied out of the usufruct of the property and also for accounts and incidental reliefs; the other suit was for specific performance of an alleged contract of sale of the same share of the putni. When the parties consented to the creation of a durpatni of the disputed share, it must be assumed to have been entered into in settlement of the dispute in both the suits. If, therefore, the agreement was maintained as to the shares of the executants other than that vested in the administrator, it might terminate the suit for specific performance; but the other suit for recovery of possession and for account of the receipts by the mortgagee would have to be continued, so far-as the estate of Sudhist Chandra is concerned. Under such circumstances, it appears to us that the consent decree ought to beset aside in its entirety and both the suits re-opened and heard on the merits. It may be observed that there is authority for the proposition Price v. Griffith 1 De. G.M. and G. 80 : 21 L.J Ch. 78 : 15 Jur. 1093, that where agreement to grant a lease of an entire property cannot be enforced as to the whole, it will not necessarily be enforced as to a share because as Knight, Bruce L.J. puts it, a lease of an undivided moiety may be a very different thing from a lease of the whole. In the case before us it is fairly clear that the parties intended that the durpatni lease, if any, should be in respect of one-half of the property, so that the possession of the whole might vest in one of the parties and thus all disputes avoided in future. Under such circumstances, if the intended lease must fail as to a part, the arrangement should stand cancelled in its entirety. No rule of universal application, however, can be laid down in cases of this description Hexter v. Pearce (1900) 1 Ch. 341 : 69 L.J. Ch. 146 : 82 L.T. 109 : 48 W.R. 330, but, in the absence of misrepresentation or misconduct the general rule is that where a person is jointly interested in an estate with another poison and purports to deal with the entirety, specific performance will not be granted against him as to his share Lumley v. Ravenscroft (1895) 1 Q.B. 683 : 64 L.J.Q.B. 441 : 14 R. 347 : 72 L.T. 382 : 43 W.R. 684 : 59 J.P. 277. The case of course will be different if nothing more than partial performance is possible by reason only of the default of the defendant, because no man ought to be allowed to take advantage of his own wrong. In the case before us, however, the parties acted with their eyes open, and the present defendants were fully aware that the plaintiff administrator could not execute a valid permanent lease without the sanction of the Court. Under such circumstances, it is clear that the decrees ought not to be maintained as to a part though no doubt as observed by Lord Eldon in Mortlock v. Buller 10 Ves. 294 : 7 R.R. 417, if the vendee chooses to take as much as he can have, ordinarily he has a right to that and to an abatement.

4. The result, therefore, is that those appeals must be allowed, the decrees of the District Judge set aside, and those of the Subordinate Judge restored with costs in all the Courts. The effect of this decision will be that the two Original Suits which were compromised will stand revived and the parties will be at liberty to proceed with them.


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