As rightly pointed out by the learned Counsel for the respondent though in the plaint it is averred that the defendant agreed to sell the share of her son-in-law as his agent, but the agreement itself does not refer to any such agency or power of attorney. At best, the agreement Ex.A1 as far as the share of the son-in-law of the defendant is concerned, merely serves the purpose of informing the plaintiff by the defendant that the owner of the other half share might also be willing to sell his share. When the plaintiff had not bothered to take any agreement from the owner of the other half share, the question of the defendant being under an obligation to convey the other half share would scarcely arise. The mere fact that the agreement Ex.A1 records that the defendant agreed to sell her share as well as the share of her son-in-law, in the absence of assertion on her part that she was under law or under any authority of document authorised to enter into such an agreement, would create any obligation binding the defendant to convey the other half share in the property to the purchaser.
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Andhra High Court
Polepalle Subramanyam Chetty And ... vs Gundamreddy Peddakka on 24 July, 2000
Equivalent citations: 2000 (5) ALD 719, 2000 (5) ALT 659
1. This appeal is directed against the judgment dated 17-4-1989 passed in AS No.92 of 1979 on the file of the Subordinate Judge, Madnapalle under which he dismissed the appeal challenging the judgment dated 9-8-1979 rendered in O.S.No.1610 of 1974 on the file of the Court of the 1 Additional District Munsiff, Madanapalle.
2. The facts germane to the case may be stated briefly as follows:
The plaintiff filed the suit for specific performance of an agreement of sale dated 6-5-1972 executed by the defendant on behalf of herself and on behalf of Amavasya Rami Reddy, who is her son-in-law in favour of the first plaintiff in respect of the land described in the plaint schedule. According to the plaintiff, the defendant represented to him that the plaint schedule property belongs to herself and her son-in-law and accordingly agreed to sell the said property on her behalf and as agent of her son-in-law for Rs.3,500/-. She received a sum of Rs.200/- as advance and agreed to receive the balance of sale consideration within four months from 6-5-1972 and to execute a registered sale deed. An agreement to this effect was executed by her on 6-5-1972 on her behalf and on behalf of her son-in-law. The first plaintiff has been demanding the defendant and her son-in-law to execute a registered sale deed but they were postponing on some pretext or the other. The first plaintiff issued a registered notice on 19-7-1993 but there was no reply from the defendant and there was no compliance of the terms of the agreement. Amavasya Rami Reddy in fact denied the agreement itself.
3. It is averred that the plaintiff has been and was always ready and willing to perform his part of the contract. As the said Rami Reddy denied the execution of the agreement, the defendant is liable to perform her part of contract with regard to her half share in the suit properties. The plaintiff also claimed Rs.1,000/- towards damages. It appears during the pendency of the suit, the first plaintiff died and plaintiffs 2 and 4 have been brought on record as legal representatives and now they claim specific performance of the contract.
4. The defendants in her written statement admitted that she was entitled to half share in the suit property while the other half belong to Amavasya Rami Reddy. It is stated that the defendant was having dealings with the plaintiff for longtime and due to confidence she affixed thumb impression on blank papers as well as on stamp papers. She is an illiterate and innocent woman and she suspects that the said agreement was created by using one of such stamped papers. According to her, she never agreed to sell the property and that the suit agreement appears to be a forged one. She has no right to sell the half share belonging to her son-in-law. She never acted as an agent of her son-in-law and never tried to sell his share. It is stated that the plaintiff never tendered sale consideration. However, the receipt of the notice about two years prior to her written statements is admitted and that after receiving the notice she approached the plaintiff, who has taken back the notice by stating that he would look after the affair and thereafter cheated the defendant. It is stated that due to confidence the defendant failed to give reply to the said notice. Thus, the defendant denied the allegation that she executed the agreement of sale.
5. On these pleadings, the trial Court framed the following issues :
1. Whether the suit agreement dated 6-5-1972 is true, valid and binding on the defendant?
2. Whether the plaintiff is entitled to the specific performance of the agreement of sale dated 6-5-1972?
3. Whether the plaintiff is entitled to Rs.1,000/- towards damages?
6. On behalf of the plaintiffs, PWs.1 to 3 have been examined and Exs.A1 to A7 have been marked. On behalf of the defendant, she examined herself as DWf and got Ex.B1 marked.
7. On this evidence, the learned District Munsiff held on Issue No.2 that the suit agreement dated 6-5-1972 was true, but it was not valid and binding on the defendant on the ground that, the agreement was not divisible and that since the son-in-law of the defendant is not a party to the agreement the defendant has no right to convey the share of her son-in-law and that she never agreed that she would get her son-in-law's share also sold under the agreement. It is thus held that the specific performance of the contract with respect to the defendant's share cannot be granted under Section 16 of the Specific Relief Act in favour of the plaintiff. On the same grounds, the learned District Munsiff dismissed the claim of the plaintiff for damages and accordingly dismissed me suit.
8. The first appellate Court had held that the willingness of the plaintiff to perform his part of the contract was linked with his claim for execution of the sale deed in respect of the half share belonging to the defendant's son-in-law inasmuch as realising that the defendant cannot convey any title to the said half share, the plaintiff claimed Rs.1,000/- as damages. The learned Subordinate Judge observed that though the plaintiffs now offered (during the hearing of the appeal) to obtain the sale deed for the remaining half without claiming any damages, the Court feels that the offer is not justifiable at this late stage. On these grounds, the appeal was dismissed.
9. In this appeal, the learned Counsel for the appellant Sri S.V. Ramana Reddy urges that on the basis of the findings of fact as arrived at by both the Courts below, the suit for specific performance of the contract in respect of the half share of the defendant should have been decreed as the matter is squarely convered under Section 12(3 )(a) of the Specific Relief Act.
10. The questions for consideration are:
1. Whether the findings of the first appellate Court that the plaintiff was not entitled to specific performance of the contract in view of his conditional offer to have specific performance in respect of half share of the defendant is tenable and whether the plaintiff has succeeded in proving that he was ready and willing to perform his part of the contract?
2. Whether the facts of the case are covered by the provision in Section 12(3) (a) of the Specific Relief Act entitling the plaintiff to have specific performance of the contract?
The contention of the learned Counsel for the appellant Sri Ramana Reddy is that both the Courts below having concurrently found that the defendant entered into an agreement of sale of suit property under Ex.A.1, there was no reason for refusal of specific performance of the contract. It is further contended that the refusal of relief of specific performance by the Court below on the ground that the plaintiff was ready and willing to perform his part of the contract in respect of the whole of the property which was the subject matter of the agreement between the parties and that he was not willing to perform his part of the contract in respect of the half share of the defendant only in the property is erroneous. It is further contended that the first appellate Court having noted that the plaintiff was prepared to abandon the relief in respect of damages for the remaining half share of the property agreed to be sold by the defendant should have taken note of this relinquishment of the claim for compensation and should have decreed the suit and should have seen that the case of the plaintiff falls within the provisions of Section 12(3) of the Specific Relief Act (hereinafter referred as the Act).
11. The learned Counsel for the respondent Ms. Aparna for Sri T, Niranjan Reddy on the other hand contends that basically the plaintiff has not succeeded in proving that he was willing and ready to perform his part of the contract. It is contended that both the plaintiff and defendant were aware that the defendant had title only to half share of the property mentioned in the agreement Ex.A1 and that though in the plaint it is averred that the defendant agreed to sell her son-in-law's share as his agent, the agreement itself does not recite the fact that she was acting as an authorised agent of her son-in-law who owned the remaining half of the property. The contention thus, is that Section 12(3) of the Specific Relief Act does not apply to the facts of this case and as such the Courts below rightly dismissed the suit of the plaintiff.
12. To appreciate the contentions of both sides on the applicability of Section 12(3) of the Act, it is relevant to extract the Section 12(3).
S.12 : Specific performance of part of contract :--(1) Except as otherwise hereinafter provided in this section the Court shall not direct the specific performance of a part of a contract, (2) Where a party to a contract is unable to perform the whole of his part of it, but the part which must be left unperformed bears only a small proportion to the whole in value and admits of compensation in money, the Court may, at the suit of either party, direct the specific performance, of so much of the contract as can be performed, and award compensation in money for the deficiency, (3) Where a party to a contract is unable to perform the whole of his part of it, and the part which must be left unperformed either,
(a) forms a considerable part of the whole, though admitting of compensation in money; or
(b) does not admit of compensation in money: he is not entitled to obtain a decree for specific performance; but the Court may, at the suit of other party, direct the party in default to perform specifically so much of his part of the contract as he can perform, if the other party.
(i) in the case falling under Clause (a), pays or has paid the agreed consideration for the whole of the contract reduced by the consideration for the part which must be left unperformed and in a case falling under Clause (b) (pays or has paid) the consideration for the whole of the contract with out any abatement and action for the whole of the contract and all rights to compensation, either for the deficiency or for the toss or damage sustained by him through the default of the defendant.
(4) When a part of a contract which, taken by itself can and ought to be specifically performed, stands on a separate and independent footing from another part of the same contract which cannot or ought not to be specifically performed, the Court may direct specific performance of the former part.
It is obvious from the above provisions that they provide for a situation in which a party to the contract is unable to perform the whole of his part of it. It contemplates a situation where the purchaser and the vendor both proceeded on the assumption that the vendor has title to and is able to convey title in respect of whole of the property which is the subject matter of the contract. This provision has been enacted to meet a contingency in which after the agreement is concluded the parties or one of the parties discover that the other party to the contract (viz., vendor) is incapable of performing his part of contract in respect of whole of the properly. In case of contracts of sale of immovable property what is entails is though the buyer and vendor proceeded on the assumption that the vendor has title to the entire property, it was later discovered that he has tide to a part of the property agreed to be sold and that he is in no position to convey title in respect of the other part. In this case both the plaintiff and the defendant were awar that the defendant had title only to the half share in the property and that the other half share was owned by the vendor's son-in-law. Obviously it is not a case where the parties to the agreement subsequently found that the vendor had not title to the whole of the property. Incapability to perform the contract referred to in Section 12 of the Act must be in relation to the agreement entered into by the said party. The inability to perform the contract by the vendor obviously therefore, refers to inability to convey title to the whole of the property agreed to be sold where the buyer and the vendor both were quite aware that the defendant had title only to the half share of the property, the question of buyer subsequently discovering that the vendor had title only to the half share of the property does not arise. Further it is not a case where the vendor falsely misrepresented that she had title to the whole of the property agreed to be sold.
12. As rightly pointed out by the learned Counsel for the respondent though in the plaint it is averred that the defendant agreed to sell the share of her son-in-law as his agent, but the agreement itself does not refer to any such agency or power of attorney. At best, the agreement Ex.A1 as far as the share of the son-in-law of the defendant is concerned, merely serves the purpose of informing the plaintiff by the defendant that the owner of the other half share might also be willing to sell his share. When the plaintiff had not bothered to take any agreement from the owner of the other half share, the question of the defendant being under an obligation to convey the other half share would scarcely arise. The mere fact that the agreement Ex.A1 records that the defendant agreed to sell her share as well as the share of her son-in-law, in the absence of assertion on her part that she was under law or under any authority of document authorised to enter into such an agreement, would create any obligation binding the defendant to convey the other half share in the property to the purchaser.
13. According to the learned Counsel for the appellant, Section 12(3) is applicable to the facts of this case, inasmuch as the portion of the property which the defendant is incapable of conveying any title to forms considerable part of the whole being half of it. The learned Counsel refers to Section 12(3) (b) of the act which provides :
"but the Court may, at the suit of other party, direct the party in default to perform specifically so much of his part of the contract as he can perform, if the other party,
(i) in the case falling under Clause (a), pays or has paid the agreed consideration for the whole of the contract reduced by the consideration for the part which must be left unperformed and in a case falling under Clause (b) (pays or has paid) the consideration for the whole of the contract with out any abatement and,
(ii) in either case, relinquishes all claims to the performance of the remaining part of the contract and all rights to compensation, either for the deficiency or for the loss or damage sustained by him through the default of the defendant."
The contention is that inasmuch, in this case the plaintiff, during the course of arguments before the first appellate Court as recorded by the said Court has expressed willingness to relinquish all claims of compensation in respect of the half share in the property as the defendant not being its owner was unable to convey, there is no reason why a decree for specific performance should not be granted in favour of the plaintiff to the extent of half share of the defendant. As discussed above, these provisions would apply to a case where the defendant had entered into a legal and binding agreement to sell certain property, but it was later found that due to some defect in title or other reasons he is unable to convey title to the whole of the property in favour of the plaintiff. In this case there is no valid and binding agreement between the defendant and the plaintiff in respect of the half share owned by the son-in-law of the defendant. As observed above, there is no mention in the agreement Ex.A1 itself that the defendant under any valid instrument of authority was authorised to enter into an agreement to convey title to the property in respect of the half share owned by her son-in-law. In fact it is quite manifest that both the plaintiff and the defendant were aware that the defendant had title only to the half share of the property and the remaining half was owned by a third party with whom there is no valid and binding agreement. To such cases, Section 12(3) of the Act obviously does not apply. In the case of Babu Rameshwar Prasad v. Mst. Anandi Devi and another, His Lordship Justice Sinha of Patna High Court held that to such cases Section 15 of the Specific Relief Act, 1877 does not apply. The following observations are relevant:
"Defendant 1 did not make any representation that the whole of the property, the subject matter of the contract belongs to her. She had made a contract in her behalf and on behalf of somebody else and it has been found that the contract is not enforceable in law as far as that somebody else is concerned. To such a case Section 15 has no application."
Following the observations in Para 10 at Page 56, the observations in the same para at page 57 also appear to be significant.
"If he had held himself out and contracted as the owner of the whole, the case would have been different. But, in the absence of misrepresentation or misconduct, the general rule in that, where a person is jointly interested in an estate with another person, and purports to deal with the entirety, specific performance will not be granted against him as to his share."
14. In this case, as elaborately discussed by the trial Court and also referred to by the first appellate Court from the very beginning the plaintiff has been insisting for performance of contract on the part of the defendant to convey the whole of the property agreed upon. Notice issued on behalf of the plaintiff Ex.A2 calls upon the defendant to execute the sale deed in respect of the entire property and it does not mention the willingness of the plaintiff to take a conveyance in respect of only half share owned by the defendant. However, this claim seems to have been abandoned in the plaint in which conveyance for the half share held by the defendant is sought to be obtained by specific performance of the contract, but the plaintiff has claimed compensation for breach of contract in respect of remaining half share of the property. Considering these circumstances the trial Court rightly held that the so called willingness of the plaintiff to perform his part of the contract was initially for obtaining conveyance in respect of the entire property from the defendant and even at the stage of the plaint, the said willingness was conditional on the claim of compensation in respect of the remaining half share which the defendant was unable to convey.
15. The learned Counsel for the appellant contended that as far as claim for compensation is concerned, it was open to the plaintiff to renounce at any stage and that inasmuch as there is evidence to show that he relinquished the claim for compensation during the course of arguments of the Counsel for the plaintiff during the appeal, such relinqtushment should have been accepted. The learned Counsel relies on the case in L. Parthasarathi mudaliar v. Venkata Kondiash Chettiar, the judgment of the Division Bench of the Madras High Court and also on the case of Kalyanpiur Lime Works Limited v. State of Bihar and another, the judgment of the Supreme Court reported in AIR 1954 SC 1625, in which it was held that the relinquishment of claim to further performance and all rights to compensation either for the deficiency or the loss or damage sustained by the purchaser can be made at any stage of the proceedings. It was thus held that specific performance of part of the contract can therefore, be decreed even at the appellate stage. This would apply where the case falls within the four corners of Section 12(3) of the Act. As discussed above, in view of specific facts and circumstances of this case, it does not fall within compass of the provisions of Section 12(3) of the Act. The question of acceptance of the plaintiffs relinquishment for the claim of compensation at the appellate stage, therefore, would not arise. Under these circumstances it has to be held that the plaintiff has not succeeded in proving that he was willing to perform his part of the contract with the defendant in respect of the half share held by the defendant in the property agreed to be sold. At any rate, his readiness must be held to be conditional on the claim of compensation.
16. Apart from this, the agreement relied upon by the plaintiff which was entered into on 6-5-1972 (Ex.A1) records the fact that the plaintiff was required to pay balance of sale consideration and obtain a sale deed within four months form the date of agreement. There is no evidence except the bald statement of the second plaintiff as PW1 that they were always ready and willing to pay the money towards balance of sale consideration, though he claim that they demanded the defendant to execute sale deed ten time, but there was none present on all those occasions. However, it is significant to note that the notice calling upon the defendant to execute sale deed was issued on 19-10-1973 almost 18 months after the agreement of sale as against the four months period provided for performance in the agreement Ex.A1 Considering the totality of the circumstances, the dismissal of the suit of the plaintiff for specific performance on the ground that the plaintiffs readiness and willingness to perform his part of the contract was not unconditional and was only conditional is justified.
There are no merits in the appeal and the appeal is accordingly dismissed, but without costs.
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