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Registered Jessore Loan Co., Ltd. Vs. Gopal Hari Ghose Choudhury and anr. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported inAIR1926Cal657,94Ind.Cas.159
AppellantRegistered Jessore Loan Co., Ltd.
RespondentGopal Hari Ghose Choudhury and anr.
Cases ReferredManindra Chunder Nundy v. Jamahir Kumari
Excerpt:
contract act (ix of 1872), sections 69, 70, scope of - contribution--equity--liabilities of parties, determination of. - .....no. 12 was benefited to the extent of his share. whether his purchase in execution of the rent decree was a better bargain or not has no real effect on the question.5. in my opinion, it is not necessary, therefore, to invoke any principle of equity or justice in the present case as i think that both sections 69 and 70 of the contract act are applicable to the facts of the case so far as the share which the defendant no. 12 purchased in execution of his mortgage decree is concerned, namely, the share which originally belonged to the defendants nos. 13 to 15.6. but as regards the share which belonged, to the defendant no. 1, i think the position is different. the learned subordinate judge has made a joint decree against the defendant no. 1 and the defendant no. 12 so far as this.....
Judgment:

Chakravarti, J.

1. This is an appeal by the defendant No: 12--the Registered Jessore Loan Company, Ltd., against a judgment and decree of the learned Subordinate Judge of Jessore, dated the 10th December 1923, by which the suit of the plaintiff for contribution was decreed in full. The question raised in this appeal is a question of law applicable to the facts of this case which are not disputed and they are as follows : The plaintiff and the defendants other than the defendant No. 12 were the owners of a permanent tenure. The defendant No. 12 purchased the share of the defendants Nos. 13,14 and 15 which was 1 anna odd gundas in execution of a mortgage decree in his favour on the 20th June 1921. The said defendant No. 12 is now also the mortgagee of a 3 anna odd gunda share which belonged to the defendant No. 1. The plaintiff's share in the tenure was 3 annas 4 gundas. In execution of a decree for arrears of rent obtained by the landlords, the property was put up to Bale and was purchased by the defendant No. 12 on the 20th January 1923 for Rs. 25,000. The plaintiff thereupon deposited the decretal money together with the usual Compensation to the purchaser amounting to Rs. 17,000 odd and the sale was set aside. The plaintiff brought the suit claiming contribution from the several defendants in proportion to their respective shares and contended that the defendant No. 12 was liable to contribute to the extent of the two shares in which, as already stated, he was interested, namely, the share of the defendants Nos. 13, 14 and 15 and the share of the defendant No. 1. The decree was passed without contest against the defendants other than the defendant No. 12. The defendant No. 12 alone contested the suit and resisted the claim of the plaintiff on two grounds. It was contended on his behalf, first, that the share of the defendants Nos. 13, 14 and 15 which the defendant No. 12 purchased in execution of the mortgage decree against the said defendants was not liable for the rent at the time when the defendant No. 12 purchased the same; in fact, the arrears of rent for which the decree was obtained fell due before this purchase. It was next contended that, so far as the share of the defendant No. 1 was concerned, the defendant No. 12 was no more than a mere mortgagee of that share as the sale of that share had already been set aside; and, therefore, it was said that the defendant No. 1 remained liable, if there was any liability for contribution to the extent of his share. Now, the learned Subordinate Judge, as already stated, passed a decree without contest against the defendants other than the defendant No. 12 and they do not question the decree made against them. It is the defendant No. 12 alone who has preferred this appeal.

2. The learned Advocate who appeared for the defendants-appellants contended, first, that neither Section 69 nor Section 70 of the Indian Contract Act were applicable to the facts of the present case; and, therefore, he said that the plaintiff was not entitled to any contribution from the defendant No. 12 upon the payment made by him. It was stated that the elements necessary to attract the operation of Section 69 did not exist in the present case nor did the provisions of Section 70 apply to this case. As regards this point, I need hardly say that the liability to contribution is not entirely contained in the two sections of the Contract Act referred to above, although generally speaking a large number of such cases do come within the purview of those two sections. The Court as a Court of Justice, equity and good conscience may, in certain circumstances--although such circumstances do not bring the case strictly within the purview of these two sections, allow contribution, if the claim appears to be either just or equitable. I need hardly cite more than one case in which the question was discussed, namely, the case of Matungini Debi v. Brojeswar Banerji 27 Ind. Cas. 22 : 20 C.L.J. 205. Mr. Justice, Mookerjee in delivering the judgment in that case said as follows: 'The right of contribution has its foundation in and is controlled by the principles of justice equity and good conscience. It does not arise from contract, although it has sometimes been based on the theory of an implied contract for contribution supposed to exist between the parties jointly liable ex-contract Every joint debtor who has been compelled to pay more than his share of the common debt, has the right of contribution from each of the co-debtors. The principle is that one who has discharged a common liability can recover from his co-obligors only for the excess that he has paid over his share, and each co-obligor is liable to contribute only in proportion to his share of the common debt or obligation.' Now, the same case is also authority for the proposition that, in cases such as the present one is, both Sections 69 and 70 of the Contract Act are applicable, I shall presently refer to the distinction, which the learned Advocate for the appellants has drawn as to why the same rule should not be applied to the facts of the present case.

3. Taking Section 69 first, it enacts that 'a person who is interested in the payment of money which another is bound by law to pay and who, therefore, pays it is entitled to be reimbursed by the other.' It is argued that the present plaintiff cannot be said to have been interested in the payment because ha was also liable to pay the money. It was also argued that the defendant No. 12 was not bound to pay the money because he was neither a party to the decree for rent nor was the period for which the rent was claimed subsequent to his purchase. It appears to me that this contention is not sound. The plaintiff was interested in the payment of this decretal amount. He was interested because it affected his property. He was further interested because there was the decree against him and he was interested to see that that amount was paid. A person may be interested in a payment, though he may be liable for or bound to pay only a part of the money. Here the plaintiff was not bound to pay the whole of the money. The share, according to the plaintiff, which the defendant No. 12 held was liable for the money and, therefore, Section 69 applies. I think, therefore, the argument that the plaintiff was not interested within the meaning of Section 69 is not tenable nor is the argument that the defendant No. 12 was not bound to pay the same tenable, because, although the said defendant was neither a party to the decree nor were the arrears due for a period subsequent to his purchase, he was bound in law to pay the same as the property which he purchased was liable for the payment of that money. The section does not speak of mere personal liability. There is abundant authority for the proposition which I have relied upon. Take the case of Manindra Chandra Nandy v. Jamahir Kumari 32 C. 643 : 9 C.W.N. 670 which the learned Advocate for the appellant cited in support of his contention. In that case, Mr. Justice Ghose in delivering the judgment of the Court said that a mortgagee who purchased a tenure in execution of his mortgage-decree purchased it subject to the liability for the rent with which the tenure was charged. It may be pointed out that rent is the first charge--a charge which is superior to the charge of the mortgagee himself. The learned Judge pointed out in that case that the reason for this view was that when a mortgagee in execution of his decree purchased the tenure the price that he paid must have been in view of the liability for the arrears of rent to which the tenure was subject. Therefore, in the present case, the share which the defendant No. 12 purchased in execution of his mortgage decree was liable for the amount of the decree for rent, although the period for which the rent was due was anterior to his purchase. Other cases may also be cited in support of the same view: but it is not necessary to do so. I shall only quote the words used in the case to which I have just referred, namely, the case of Manindra Chunder Nundy v. Jamahir Kumari 32 C. 643 : 9 C.W.N. 670. It was held there that 'a mortgagee who purchases a property at an execution sale is under a liability to pay the rent due upon the property at the time of the purchase and, therefore, cannot claim under Section 69 of the Contract Act contribution from the mortgagor.' The defendant No. 12 was, therefore, legally bound to pay a part of the money due on the decree.

4. Now, taking Section 70 of the Contract Act, the argument advanced by the learned Advocate on behalf of the defendants-appellants was that the defendant No. 12 was not benefited by the payment and, therefore, Section 70 had no application to the case. It was conceded that the payment made by the plaintiff was not a voluntary payment and, therefore, he did lawfully pay the money; but as the plaintiff's deposit set aside the sale of the entire property, it was argued that the defendant was not benefited, because, in the result, he lost the benefit of his purchase of the entire property and was left only with the share which he held before. In my opinion, there is a fallacy in this argument. The character in which the plaintiff sued the defendants and the character in which the defendant No. 12 was charged with the liability was the character of co-sharers as between themselves; and, as the property was saved by the deposit the defendant No. 12 was benefited to the extent of his share. Whether his purchase in execution of the rent decree was a better bargain or not has no real effect on the question.

5. In my opinion, it is not necessary, therefore, to invoke any principle of equity or justice in the present case as I think that both Sections 69 and 70 of the Contract Act are applicable to the facts of the case so far as the share which the defendant No. 12 purchased in execution of his mortgage decree is concerned, namely, the share which originally belonged to the defendants Nos. 13 to 15.

6. But as regards the share which belonged, to the defendant No. 1, I think the position is different. The learned Subordinate Judge has made a joint decree against the defendant No. 1 and the defendant No. 12 so far as this share is concerned. This was obviously wrong. In a suit for contribution, the respective liabilities of the parties should be ascertained and determined once for all and nothing should be left undetermined which may lead to further litigation for the ascertainment of such liability between two or more of the parties to the suit. That is not the only error in the decree. It appears that, so far as the share of the defendant No. 1 is concerned, the defendant No. 12 was no more than a mere mortgagee--not a mortgagee in possession but an ordinary mortgagee. The property no doubt was liable for the rent due on it; but the liability was primarily the liability of the defendant No. 1. So long as the defendant No. 12 did not purchase in enforcement of his mortgage against the defendant No. 1, the defendant No. 1 was liable to pay the rent and, even if the defendant No. 12 was obliged to make any payment to save the property from sale in execution of a rent decree, the defendant No. 1 would be ultimately liable to pay that money to the defendant No. 12 and the defendant No. 12 would be entitled to add that money to the mortgage-debt due to him by the defendant No. 1. Therefore, so long as the defendant No. 1 remained the owner of the property as a mortgagor and was in possession, the liability to save the property from sale in execution of the decree, for arrears of rent was his liability and not the liability of the defendant No. 12. Consequently, neither Section 69 nor Section 70 of the Contract Act would apply so far as the share of the defendant No. 1 is concerned. The plaintiff, therefore, has failed to establish any liability of the defendant No. 12 for the amount due on account of the share which belonged to the defendant No. 1.

7. In this view, I think that the decree of the learned Subordinate Judge should be varied. The appeal should be dismissed so far as regards the amount due on account of the share of the defendants No. 13, 14 and 15 and it should be allowed in so far as the decree of the Court below makes the defendant No. 12 liable for the amount due in respect of the share which belonged to the defendant No. 1 who alone should be held liable. Costs will be in proportion to the respective success and failure of the parties in both the Courts. The hearing fee is assessed at Rs. 200.

8. There is a cross-objection by the plaintiff and it raises only one question, namely, that the learned Subordinate Judge ought to have allowed the plaintiff interest upon the amount found due to him from the date of the suit. I think that that contention is right. The plaintiff will be entitled to interest at 6 per cent. per annum on the amount found due to him by the lower Court from the date of the suit until realisation. No order is made as to the costs in the cross objection.

Walmsley, J.

9. I agree.


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