Friday, 20 February 2015

Whether legal heirs of deceased are entitled to defend suit for specific performance filed against deceased?

 In the light of the law laid down as above, there is no escape from the proposition that in the case of death of the original vendor defending a specific performance suit, his legal representatives have to be joined as party Defendants upon his death and it is they alone, who represent the estate of the deceased vendor and not the subsequent transferee of the original vendor.
Equivalent Citation: 2014(6)ABR776,AIR 2015(NOC)207 Bom


IN THE HIGH COURT OF BOMBAY
Chamber Summons Nos. 614 and 1056 of 2014 in Suit No. 1166 of 2006
Decided On: 27.08.2014

 Nirav Deepak Modi
Vs.
 Najoo Bhiwandiwala
Hon'ble Judges/Coram:S.C. Gupte, J.







1. Chamber Summons No. 614 of 2014 is taken out by the Plaintiff for impleadment of the legal heirs of deceased Defendant No. 1. The companion Chamber Summons, Chamber (Lodging) No. 1056/2014, is taken out by Defendant Nos. 3 and 4 for leave to continue with the proceedings in the suit in the capacity of legal representatives of Defendant No. 1 under the provisions of Order 22 Rule 4 and/or Order 22 Rule 10 of the Code of Civil Procedure, 1908.
2. It is a case of the Plaintiff that on the date of filing of Chamber Summons No. 614/2014, the Plaintiff was not fully aware of the legal heirs of Defendant No. 1. Accordingly, in prayer clause (a) of the Chamber Summons, the Plaintiff has sought disclosure of names and addresses of legal heirs of Defendant No. 1 from Defendant Nos. 2 to 4. At the hearing of the Chamber Summons, the particulars of the legal heirs of Defendant No. 1 have been furnished by the other Defendants to the Plaintiff. Accordingly, a draft amendment is proposed by the Plaintiff to the Chamber Summons seeking to add two legal heirs of Defendant No. 1 as Defendant No. 1(a) and 1(b) and make consequential changes in the body of the plaint. The draft amendment is allowed by consent of the parties and the Chamber Summons will be considered for joinder of the proposed Defendant Nos. 1(a) and 1(b).
3. A short conspectus of the facts of the case, which are relevant for deciding the Chamber Summons, and which are not disputed by the parties, is outlined below :
The Plaintiff had originally filed the present suit for specific performance of an agreement for sale described in paragraph 3 of the plaint and contained in Exhibits D-1, D-2, D-3 and D-4 to the plaint concerning the suit property described in Exhibit-B to the plaint. The present suit was filed on 13 April 2006. A lis pendens was accordingly registered on 2 May 2006. During the pendency of the suit, by a Deed of Conveyance and Power of Attorney dated 13 December 2007, Defendant No. 1 transferred the suit property to Defendant Nos. 3 and 4. Accordingly, on a Chamber Summons taken out by the Plaintiff, Defendant Nos. 3 and 4 were added as party Defendants to the present suit. The suit has since proceeded to trial. Defendant No. 1, and Defendant Nos. 3 and 4 have been represented by separate sets of Advocates. The hearing of the suit has commenced. The Plaintiff's witness was under cross-examination by Defendant No. 1, at which stage, Defendant No. 1 expired. By the present Chamber Summons, namely, Chamber Summons No. 614/2014, the Plaintiff seeks to join the legal heirs of Defendant No. 1, as party Defendants to the suit. The Chamber Summons is opposed by Defendant Nos. 3 and 4, who have taken out their own Chamber Summons, being Chamber Summons No. 1056/2014, for leave to continue with the suit in the capacity of legal representative of Defendant No. 1 either under Order 22 Rule 4 or Order 22 Rule 10.
4. The case of Defendant Nos. 3 and 4 is that they are not only entitled to defend the suit as successors-in-interest of Defendant No. 1 under Order 22 Rule 10, but are entitled to represent the estate of Defendant No. 1 as legal representatives under Order 22 Rule 4. It is submitted by the Defendants that Defendant Nos. 3 and 4 are alone entitled to represent the estate of deceased Defendant No. 1 and that the legal heirs of Defendant No. 1 ought not to be joined as party Defendants to the suit. This is the broad controversy between the parties.
5. Mr. Rustomjee, learned Senior Counsel appearing for the Plaintiff, submits that in a specific performance suit, the Plaintiff is entitled to arraign both the original vendor of the Plaintiff as well as the subsequent transferee, who claims under the vendor. Learned Counsel submits that a proper form of a decree in a specific performance suit, where there has been a subsequent transfer of the suit property, is to direct specific performance of the contract between the vendor and the Plaintiff and make the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the Plaintiff. Learned Counsel further submits that the vendor Defendant having died during the pendency of the suit, his estate needs to be represented so as to obtain a proper decree in this form in this specific performance suit of the Plaintiff. It is submitted that the subsequent purchaser cannot himself be termed as a legal representative within the meaning of Order 22 Rule 4 of the CPC. Learned Counsel relies on the judgments in the cases of Lala Durga Prasad vs. Lala Deep Chand MANU/SC/0008/1953 : 1954 SCR 360 : AIR 1954 SC 75, Chhotalal Hariram vs. Dilip Kumar Chatterjee MANU/WB/0417/1976 : 1976 CHN 531 : AIR 1976 Cal 337, Manni Devi vs. Ramayan Singh MANU/BH/0013/1985 : 1984 SCC OnLine Pat 143 : AIR 1985 Pat 35 : 1985 PLJR 36, and Kasturi vs. Iyyamperumal MANU/SC/0319/2005 : (2005) 6 SCC 733 in support of his submissions.
6. On the other hand, it is submitted by Mr. Sen, learned Senior Counsel appearing for Defendant Nos. 3 and 4, that in the present case, Defendant Nos. 3 and 4 claim to be impleaded as legal representatives of the deceased vendor and not simply as transferees of the suit property. It is submitted by the learned Counsel that the assignees of a property in certain circumstances would be the legal representatives of the assignor, not generally but in respect of the property assigned. Learned Counsel in this behalf relies on the covenants contained in the Deed of Conveyance executed by Defendant No. 1 in favour of Defendant Nos. 3 and 4. These covenants, submits learned Counsel, provide for the sole responsibility of the transferees, namely, Defendant Nos. 3 and 4, to defend and prosecute the various litigations by or against the vendor Defendant No. 1 including the present litigation. It is further submitted that having regard to the affirmation of the Deed of Conveyance in favour of Defendant Nos. 3 and 4 by Defendant No. 1 in her written statement filed in the present suit, Defendant Nos. 3 and 4, as admitted transferees of the suit property, ought to be impleaded in place of the deceased Defendant No. 1 as legal representatives in respect of the suit property. It is submitted that the estate of Defendant No. 1 generally retains no interest in the suit property.
7. At the very outset, one needs to notice the peculiar position of a vendor and his subsequent transferee in a specific performance suit. The primary obligation in a contract for sale of property to perform the contract by executing a transfer always remains on the vendor and is passed on his death to his legal representatives. The sale in favour of the subsequent transferee is voidable at the option of the earlier contractor. The basis of allowing a joinder of the subsequent transferee is contained in Clause (b) of Section 19 of the Specific Relief Act. Clause (b) of Section 19 provides that a specific performance of a contract may be enforced not only against a party to that contract but also against any person claiming under a party to the contract by a title arising subsequently to the contract, except the transferee for value who has paid his money in good faith and without notice of the original contract. The subsequent transferee, who claims title to the property which is the subject matter of a specific performance suit, may always be allowed to be impleaded so that a good title is conveyed to the Plaintiff in pursuance of the agreement for sale of which specific performance is sought. In Durga Prasad's case (supra), the Supreme Court dealt with a case where a subsequent purchaser was sought to be added as a party Defendant to the Plaintiff's specific performance suit against the vendor. The Court observed that though the practice of the courts in India had not been uniform, there were three distinct lines of thought. According to one point of view, a proper form of a decree would be to declare a subsequent purchase void as against the plaintiff and direct conveyance by the vendor alone, whereas the second one was to make both vendor and vendee join in the conveyance in pursuance of a decree that may be passed. The third point of view was to limit the execution of the conveyance to the subsequent purchaser alone, since the original vendor had already divested his title in the suit property in favour of the subsequent purchaser. After evaluating these alternatives, the Supreme Court found the second alternative to be the preferred alternative amongst the three. The Supreme Court held that a proper form of decree was to direct specific performance of contract between the vendor and the plaintiff and simultaneously to direct the subsequent purchaser to join in the conveyance so as to pass on the title which resides in him to the successful plaintiff. It is to be noted that the primary liability to perform the contract is of the vendor. It is the vendor who has to complete the transfer and perform the covenants made between him and his purchaser. When he passes on his title to the subsequent transferee, he does not necessarily pass on the liability to join in the special covenants made between him and the plaintiff (i.e. the earlier purchaser). The subsequent purchaser is joined simply to pass on title, such as the one he has to the successful plaintiff.
8. Having regard to these special positions of a vendor and his transferee in a specific performance suit, the Plaintiff has, in the present suit, joined both his vendor, namely, Defendant No. 1, and the latter's subsequent transferee, namely, Defendant Nos. 3 and 4. The Plaintiff has sought a declaration in the present suit regarding invalidity of the subsequent transfer executed between Defendant No. 1 and Defendant Nos. 3 and 4. In the alternative and in the event of the Court coming to the conclusion that such transfer is not liable to be declared as null and void and not binding on the Plaintiff, a declaration is sought against Defendant Nos. 3 and 4 that the Plaintiff is entitled to specific performance of the suit agreement for sale also against Defendant Nos. 3 and 4. It cannot possibly be disputed that this frame of the suit is proper and in accordance with the law laid down by the Supreme Court in Durga Prasad's case.
9. Now, the controversy arises as a result of the death of Defendant No. 1 during the pendency of the suit. The Plaintiff has applied for joinder of legal heirs of deceased Defendant No. 1 under Order 22 Rule 4 of the CPC to represent the interest of Defendant No. 1, whereas Defendant Nos. 3 and 4 have opposed the Plaintiff's Chamber Summons and applied for leave under Order 22 Rule 10, or in the alternative, under Order 22 Rule 4 for being treated as legal representatives of the deceased Defendant No. 1. Order 22 Rule 4 of the CPC provides as follows :
4. Procedure in case of death of one of several defendants or of sole defendant--(1) Where one of two or more defendants dies and the right to sue does not survive against the surviving defendant or defendants alone, or a sole defendant or sole surviving defendant dies and the right to sue survives, the Court, on an application made in that behalf, shall cause the legal representative of the deceased defendant to be made a party and shall proceed with the suit.
(2) Any person so made a party may make any defence appropriate to his character as legal representative of the deceased defendant.
(3) Where within the time limited by law no application is made under sub-rule (1), the suit shall abate as against the deceased defendant.
[295] [(4) The Court whenever it thinks fit, may exempt the plaintiff from the necessity of substituting the legal representatives of any such defendant who has failed to file a written statement or who, having filed it, has failed to appear and contest the suit at the hearing; and judgment may, in such case, be pronounced against the said defendant notwithstanding the death of such defendant and shall have the same force and effect as if it has been pronounced before death took place.
(5) Where--
(a) the plaintiff was ignorant of the death of a defendant, and could not, for that reason, make an application for the substitution of the legal representative of the defendant under this rule within the period specified in the Limitation Act, 1963 (36 of 1963) and the suit has, in consequence, abated, and
(b) the plaintiff applies after the expiry of the period specified therefor in the Limitation Act, 1963 (36 of 1963), for setting aside the abatement and also for the admission of that application under section 5 of that Act on the ground that he had, by reason of such ignorance, sufficient cause for not making the application within the period specified in the said Act, the Court shall, in considering the application under the said section 5, have due regard to the fact of such ignorance, if proved.
On the other hand, Order 22 Rule 10 provides as follows:
10. Procedure in case of assignment before final order in suit--(1) In other cases of an assignment, creation or devolution of any interest during the pendency of a suit, may, by leave of the Court, be continued by or against the person to or upon whom such interest has come or devolved.
(2) The attachment of a decree pending an appeal therefrom shall be deemed to be an interest entitling the person who procured such attachment to the benefit of sub-rule (1).
The definition of 'legal representative' is contained in Section 2(11) of the CPC and is in the following terms:
(11) "legal representative" means a person who in law represents the estate of a deceased person, and includes any person who intermeddles with the estate of the deceased and where a party sues or is sued in a representative character the person on whom the estate devolves on the death of the party so suing or sued;
10. Thus, it may be seen that Rule 4 of Order 22 provides for joinder of legal representatives of a deceased defendant, such legal representatives being persons who in law represent the estate of the deceased. On the other hand, Rule 10 of Order 22 provides for continuation of a suit by or against an assignee with leave of the Court to whom the interest has been assigned during the pendency of the suit. The question in the present suit is not whether the suit can be continued with the leave of the court against the assignees of Defendant No. 1 under Order 22 Rule 10. The question is whether legal representatives should be brought on record under Order 22 Rule 4 and whether assignees of the deceased defendant can be termed as the only possible persons representing the estate of the deceased defendant.
11. In the case of Chhotalal Hariram (supra), the Calcutta High Court was concerned with a case where during the pendency of the suit, the defendant vendor sold the property to third parties. The defendant vendor died during the pendency of the suit. The suit was continued only against the third party transferees. It was contended before the Calcutta High Court that on the death of the vendor, his heirs and legal representatives are required to be brought on record inasmuch as the contract could not be enforced in the absence of the vendor and his legal representatives. It was submitted that the person primarily bound to complete the contract was the vendor and upon his death, his legal heirs and representatives. Relying on the law stated by the Supreme Court in the case of Durga Prasad (supra), it was submitted that in the absence of a primary party, namely, the legal representatives of the deceased vendor, the suit could no longer proceed. The Calcutta High Court considered the law laid down by the Supreme Court in the case of Durga Prasad (supra) and came to a conclusion that to convey perfect title to the vendee in all cases of subsequent transfers both vendor and the subsequent transferee from him are required to be made parties to convey the title to the vendee. This requirement is not altered in any way by the death of vendor-his position being taken by his legal representatives. The Court held that, in the premises, there was no escape from the position that on the death of the defendant vendor, it was necessary that his legal representatives were brought on record in his place and the right to sue could not have survived only against the subsequent transferees.
12. In the case of Manni Devi (supra), the Patna High Court was concerned with a similar question. On an analysis of the law on the point, the Court held that Section 49 of the Transfer of the Property Act read with Section 19 of the Specific Relief Act provided for the enforceability of the contract as against the transferee but that the transferee was not the only person to complete the contract, since he was not the person, who had entered into the contract. He was in the nature of a trustee in respect of the property and was, therefore, only a necessary party to the suit as held by the Supreme Court. The Court affirmed the proposition laid down by Calcutta High Court in Chhotalal Hariram's case (supra) that the primary obligation to perform the contract always of the vendor and passed on his death to his legal representatives; and that his legal representatives must, therefore, be brought on record.
13. Finally, in Kasturi's case (supra), the Supreme Court held as follows:
"6. In our view, a bare reading of this provision namely, second part of Order 1 Rule 10 sub-rule (2) of the CPC would clearly show that the necessary parties in a suit for specific performance of a contract for sale are the parties to the contract or if they are dead, their legal representatives as also a person who had purchased the contracted property from the vendor. In equity as well as in law, the contract constitutes rights and also regulates the liabilities of the parties. A purchaser is a necessary party as he would be affected if he had purchased with or without notice of the contract, but a person who claims adversely to the claim of a vendor is, however, not a necessary party. From the above, it is now clear that two tests are to be satisfied for determining the question who is a necessary party. Tests are-(1) there must be a right to some relief against such party in respect of the controversies involved in the proceedings; (2) no effective decree can be passed in the absence of such party."
14. In the light of the law laid down as above, there is no escape from the proposition that in the case of death of the original vendor defending a specific performance suit, his legal representatives have to be joined as party Defendants upon his death and it is they alone, who represent the estate of the deceased vendor and not the subsequent transferee of the original vendor.
15. Mr. Sen, however, relied upon the decisions of the Supreme Court in cases of Mohammad Arif vs. Allah Rabbul Alamin AIR MANU/SC/0007/1982 : 1982 SC 948, Ghafoor Ahmad Khan vs. Bashis Ahmad Khan MANU/SC/0163/1982 : AIR 1983 SC 123, Khemchand Shankar Choudhary vs. Vishnu Hari Patil MANU/SC/0168/1982 : AIR 1983 SC 124, PPK Goopalan Nambiar vs. PPK Balakrishnan Nambiar MANU/SC/0354/1995 : AIR 1995 SC 1852, Rajeshwari Prasad Singh vs. Shashi Bhushan Prasad Singh MANU/SC/0042/1996 : AIR 1996 SC 181, Dhurandhar Prasad Singh vs. Jai Prakash University MANU/SC/0381/2001 : (2001) 6 SCC 534 and Amit Kumar Shaw vs. Farida Khatoon MANU/SC/0284/2005 : AIR 2005 SC 2209. On the basis of these decisions, he submitted that under certain circumstances, the transferee of the vendor's interest was entitled to represent the vendor as a legal representative. Mr. Sen also relied upon the particular covenants contained in the Deed of Conveyance in the present case, as also the affirmation thereof in the written statement of the deceased Defendant No. 1 and submitted that the present case was a proper case, where such transferees ought to be allowed to represent the deceased Defendant as his legal representatives.
16. In the first place, all these cases relied upon by the learned Counsel deal with provisions of Order 22 Rule 10. Secondly, none of these cases arises in a specific performance suit. The suits in these cases were mostly partition suits, where, during the pendency of the suit, the interest of a party was transferred to a third party. In Ghafoor Ahmad Khan's case (supra), the Supreme Court observed that during the lifetime of the sole respondent, there was a transfer of the property by way of a gift to his wife or in other words, devolution of interest falling under Order 22 Rule 10. Having regard to the devolution, the Court held that there was no question of abatement and the transferee was brought on record. The court particularly noted that it was not a case where on the death of the sole respondent, his heirs were sought to be brought on record. Khemchand's case (supra) was a case of a partition suit. The Court held that the position of a person on whom the interest had devolved in the interregnum on account of a transfer was similar to the position of an heir or legal representative of that person. This was again a case of devolution of interest under Order 22 Rule 10 in a partition suit. The case of PPK Balakrishnan Nambiar (supra) also arose in a partition suit where by operation of Order 22 Rule 10, the interest of a respondent devolved by transfer on the other respondents, who were already on record. The Court held that there was no need to bring the legal representatives of the deceased respondent on record. Rajeshwari Prasad Singh's case (supra) was also a case of partition where the Court held that the interest had devolved in the interregnum on the transferee and under Order 22 Rule 10 the suit could be continued against the transferee. This was again a case under Order 22 Rule 10 in a partition suit. The case of Amit Kumar Shaw (supra) also related to a lis pendens transferee under Order 22 Rule 10. These cases, in the first place, concerned, as noted above, devolution of interest pendente lite and the continuance of the suit by the transferee with leave of the court under Order 22 Rule 10 and not application to bring on record legal heirs of a deceased defendant under Order 22 Rule 4. Secondly, at any rate, these cases hold that in certain categories of suits, particularly, partition suits, there may not be any need to join legal representatives of the deceased defendant whose interest has been assigned during the pendency of the suit and the assignees are on record as party defendants. Even otherwise, these cases do not lay down that legal representatives of deceased defendants could not be joined, but that they need not be joined if the assignees are on record and could continue the suit with leave of the court under Order 22 Rule 10. In a case where the plaintiff desires to join legal representatives, the plaintiff as dominus litus cannot be prevented from doing so. Lastly, and at any rate, these cases do not deal with suits for specific performance. As noted above, the situation of the parties, namely, the original vendor defendant and his subsequent transferee vis-a-vis the prior purchaser plaintiff in a specific performance suit, is of a peculiar nature and it is the vendor and his transferee both, who ought to join the deed of conveyance upon a decree of specific performance.
17. In that view of the matter, the Plaintiff's Chamber Summons deserves to be allowed. Accordingly, the Chamber Summons is made absolute in terms of prayer clause (c) as amended by the draft amendment. Amendment to be carried out within a period of two weeks from today. Copies of the plaint and proceedings to be served on the newly added Defendants.
18. Having regard to the above discussion, there is no merit in the Chamber Summons of Defendant Nos. 3 and 4. Chamber Summons (Lodging) No. 1056/2014 is accordingly dismissed.
19. There shall be no order as to costs.
20. On the application of the learned Counsel for Defendant Nos. 3 and 4, the order is stayed for a period of two weeks from today.
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