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H. Mathewson Vs. Raja Ram Kanai Singh and ors. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported in16Ind.Cas.387
AppellantH. Mathewson
RespondentRaja Ram Kanai Singh and ors.
Cases ReferredOriental Financial Corporation v. Overend Gurney and Co. L.R.
Excerpt:
surety - suit by creditor against principal debtor and surety--dismissal of suit against principal debtor and decree against surety--appeal by surety--cross-appeal by creditor without making debtor respondent-dismissal of suit against surety by appellate court--second appeal by creditor--sigh court's inability to interfere--contract act (ix of 1972), section 134. - .....singh, another son of rani churamoni, who is said to have executed in favour of the plaintiff a surety bond, of even date with the mortgage-bond, undertaking to pay the mortgage-money. the claim was resisted by all the defendants on the ground that the bond was without consideration and had not been validly executed by the ladies. the third defendant took an additional special defence on the ground that he was an infant when the security bond was executed. the court of first instance dismissed the suit as against the first two defendants on the ground that neither execution, nor consideration, was proved, but decreed it as against the third defendant on the ground that he had stood surety. the latter preferred an appeal as against the plaintiff, who thereupon preferred a cross-appeal,.....
Judgment:

1. This is an appeal on behalf of the plaintiff the suit to enforce a mortgage security, alleged to have been executed in his favour on the 31st January, 1899, by two ladies, Rani Churamoni and Rani Ranapriya. The plaintiff joined three persons as parties defendants; the first was Raja Ram Kanai, the son of Rani Churamoni now deceased; the second was the mortgagor Rani Rampriya; and the third was Sham Sundar Singh, another son of Rani Churamoni, who is said to have executed in favour of the plaintiff a surety bond, of even date with the mortgage-bond, undertaking to pay the mortgage-money. The claim was resisted by all the defendants on the ground that the bond was without consideration and had not been validly executed by the ladies. The third defendant took an additional special defence on the ground that he was an infant when the security bond was executed. The Court of first instance dismissed the suit as against the first two defendants on the ground that neither execution, nor consideration, was proved, but decreed it as against the third defendant on the ground that he had stood surety. The latter preferred an appeal as against the plaintiff, who thereupon preferred a cross-appeal, and urged that the bond was executed by the ladies for good consideration. For some unexplained reason, however, the first two defendants were not made parties respondents to this cross-appeal. Upon the appeal of the third defendant, the Judicial Commissioner has, in concurrence with the original Court, held that the bond was not executed by the ladies and that there was no consideration for it. The Judicial Commissioner has consequently held that the plaintiff had no enforceable right as against the surety because there was really no debt secured by the mortgage-bond for which the third defendant might be deemed to have stood surety. In this view, the suit has been dismissed as against all the defendants.

2. The plaintiff has now appealed to this Court and has joined all the three defendants as respondents. In so far as the first two defendants are concerned, it is clear that the appeal must fail. The Omission of the plaintiff to join these defendants as parties respondents to his cross-appeal makes it impossible for this Court to interfere with the decision of the original Court in their favour. In so far as the third defendant is concerned, it has been argued that there was consideration for the mortgage-bond and that this defendant is liable as surety. In our opinion, this position cannot be maintained in view of Section 134 of the Indian Contract Act. That section provides that the surety is discharged by any act or omission of the creditors, the legal consequence of which is the discharge of the principal debtor. As Kelly, C.B. put it in Cragoe v. Jones L.R. 8 Ex. 81 : 42 L.J. Ex. 68 : 28 L.T. 36 : 21 W.R. 408 if the creditor, without the consent of the surety, by his own act, destroys the debt or derogates from the power which the law confers upon the surety to recover it against the debtor in case he shall have paid it to the creditor, the surety is discharged. The essence of the matter is that the creditor must not, either actively or passively, prejudice the right to indemnity of the surety against the principal debtor Capel v. Butler 2 S. & S. 457 : 4 L.J. (O.S.) Ch. 69; Wulff v. Jay L.R. 7 Q.B. 756; Watson v. Allcock 4 Deg M. & G. 242 : 1 Eq. R. 231 : 22 L.J. Ch. 858 : 17 Jur. 568 : 1 W.R. 399 : 102 R.R. 109; Mayor v. Harding (1892) 2 Q.B. 493 and 802. In the case before us, the plaintiff, by reason of his omission to join the first two defendants as respondents to his cross-appeal, made it impossible for the District Judge to review the decision of the original Court in favour of the principal debtors. As between the plaintiff on the one hand and these defendants on the other, it has, therefore, been conclusively determined that the bond was not executed by the ladies; and that there was no consideration for it. The plaintiff has in substance made it impossible for the Court to disturb this decision, and cannot consequently claim a decree against the surety on the ground that the decision as against the first two defendants was erroneous. The present case is clearly distinguishable from Shaik Ali v. Mahomed 14 B. 267 where the creditor, notwithstanding his failure to prosecute the claim against the principal debtor, retained the right to sue him again, so that the principal debtor was not released and the liability of the surety was not affected Maung Pyo Tha v. Ko Min Syu 1 L.B.R. 150. The cases of Krishto Kishori v. Radha Romun 12 C. 330 and Hajarimal v. Krishnaray 5 B. 647 also do not militate against the view we take, as the creditor there merely forbore to sue the principal debtor within the meaning of Section 137. Oriental Financial Corporation v. Overend Gurney and Co. L.R. 7 Ch. App. 142 at p. 150 : 41 L.J. Ch. 332 : 25 L.T. 813. Here the creditor has sued the principal debtor, has failed, and has preferred in appeal which has become infractions by reason of his omission to join the principal debtors as respondents. The decree of the Judicial Commissioner, in so far as it dismisses the suit as against the third defendant, must, consequently, be affirmed. Bat we do not pronounce any opinion upon the question, which may possibly hereafter arise between the parties, whether, upon a true construction of the surety bond of the 31st January 1899, the plaintiff may not have a personal remedy as against the third defendant.

3. The appeal must, therefore, be dismissed and the appellant will pay to the third defendant-respondent the costs of the appeal.


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