Madras High Court
Gladys Devavaram vs S.Subbiah on 28 June, 2011
Author: T.Mathivanan
Bench: T.Mathivanan
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 28.06.2011 CORAM: THE HON'BLE MR.JUSTICE T.MATHIVANAN A.S..No.1133 of 2007 Gladys Devavaram, W/o.Rev. E.G.Devavaram .... Petitioner Vs. 1.S.Subbiah S/o.Sivappa 2.K.S.Sundararajan, S/o.K.R.Srinivasan ..... Respondents Prayer :Appeal is filed under Section 96 CPC of the Civil Procedure Code against the judgment and decree dated 12.04.2006 and made in O.S.No.17 of 2004 on the file of the learned District Judge of The Nilgiris at Uthagamandalam. For Petitioner : Mr.V.Nicholas For Respondent : Mr.B.Ramamoorthy For R1 Mr.J.Saravanavel For R2 ***** J U D G M E N T
Being dissatisfied with the judgment and decree dated 12.04.2006 and made in O.S.No.17 of 2004 on the file of the Learned District Judge Nilgiris at Udhagamandalam, the first defendant has come forward with this appeal after invoking the proviso to Section 96 of CPC.
2. The facts which are absolutely necessary for the disposal of this appeal may be summarised as under.
3. The legal character of the parties to the suit need not be changed and may be as it is in the suit.
4. That on 10.04.1997, the first defendant who is the appellant herein had entered into an agreement for sale of the suit property with the second defendant. She had received a sum of Rs.3 lakhs by cash on the date of agreement and further a sum of Rs.3 lakhs by way of a post dated cheque drawn on Canara Bank Aruvankadu bearing No.840871 dated 02.05.1997 towards advance of sale consideration. The time for execution of the sale deed and payment of balance of sale consideration was fixed on 25.08.1997. The sale shall be in favour of the purchaser or his nominee.
5. At the time of agreement the plaintiff was the tenant in the suit property under the first defendant. In the meanwhile, the second defendant had received a sum of Rs.6 lakhs from the plaintiff and assigned his rights under the suit agreement in his favour. The plaintiff had therefore, stepped into the shoes of the second defendant under the same terms and the first defendant is aware of this fact and she had also consented to the assignment. The nominee clause comes fairly and squarely into operation in any event and therefore the first defendant is bound to sell the suit property to the plaintiff. The plaintiff had always been ready and willing to pay the balance of sale price and to perform his part of contract.
6. The assignment was reduced into writing in October 1996 and the second defendant had addressed to the first defendant about the assignment and he had no objection to the sale being made over in favour of the plaintiff. In the second week of June 1997, the first defendant had attempted to forcibly evict the plaintiff and the plaintiff had also sent a notice on 18.06.1997 calling upon her not to alienate the property to anyone else. In view of the agreement there is no question of payment of any rent.
7. The plaintiff had also filed a suit for injunction on the file of the Learned District Munsif of Coonoor, against the first defendant in O.S.No.141 of 1997 restraining eviction except by due process of law. The first defendant had filed a petition for eviction against the plaintiff in RCOP.No.33 of 1997 on the file of the Rent Controller of Coonoor and along with that petition she had also filed a petition in I.A.No.116 of 1998 under Section 11(1), 11(3) and 11(4) of the Tamil Nadu Buildings Lease and Rent Control Act for payment of rent and that petition was dismissed by the Rent Controller. The first defendant had also not appealed against the said order.
8. The suit agreement is in force and the time is not the essence of contract. In an event, the development of assignments in the proceedings of the court clearly show that the time is not the essence of contract. Since the agreement mentions 25th August 1997, for the payment of balance and since the legal proceedings had intervened, the plaintiff had issued a legal notice dated 10.08.2000 to the defendant calling for the performance of the suit agreement. Since the agreement stipulates that the date of payment of balance is 25.08.1997, the plaintiff had filed the suit before 25th August, 2000 and hence the suit is well within the time and not barred by the Law of Limitation. The plaintiff is ready to pay the balance of sale price of Rs.11 lakhs and to perform his part of contract and to finalise the sale deed in his name. He has also prayed for the alternative relief as per the Specific Relief Act.
9. The first defendant has contended in her written statement that the suit is speculative and it is an abuse of process of the Court. As per the terms and conditions of the sale agreement the second defendant had agreed to pay a sum of Rs.5 lakhs towards sale consideration on 30.06.1997 and to pay the balance of sale price within 25.08.1997. At the request of the second defendant this defendant had presented the cheque dated 02.05.1997 for collection through her banker viz., Indian Overseas Bank, Coimbatore. But it was bounced back with an endorsement saying that no sufficient fund is available in the account of the second defendant to honour the cheque. The second defendant was not having fund to purchase the property. As agreed, the second defendant did not pay the sum of Rs.5 lakhs on or before 30.06.1997, which itself would go to show that he had failed to perform his part of contract by not paying the sale consideration as agreed and got the sale deed executed in his name at his expenses. Though the first defendant had expressed her readiness and willingness to perform her part of contract by executing the sale deed, the second defendant was not able to pay the balance of sale consideration and perform his part of the contract. Despite several communications and personal requests, the second defendant had not chosen to pay the balance of sale consideration. Ultimately, the first defendant had sent a telegram and also a legal notice dated 01.08.1997 to the second defendant cancelling the sale agreement dated 10.04.1997 and forfeiting the advance amount paid.
10. It is true that at the time of the execution of the sale agreement the plaintiff was a tenant in the suit property. The second defendant had agreed to take possession of the suit property from the plaintiff and therefore, the delivery of possession of the suit property does not arise. The second defendant himself had no right in the suit property, as the sale agreement dated 10.04.1997 was cancelled and the advance amount was forfeited. When there is no such agreement in force, the second defendant cannot assign the right which was not in existence. The first defendant is not aware of the alleged assignment and she had not consented to the assignment. The second defendant ought to have sent a notice and inform the first defendant about the alleged assignment. Their conduct would go to establish that the plaintiff in collusion with the second defendant had created and fabricated the alleged assignment. The alleged factum of assignment and alleged payment of Rs.6 lakhs by the plaintiff to the second defendant is not known to the first defendant.
11. The first defendant is not a party to the assignment and hence, the alleged assignment will not bind her. The sale agreement dated 10.04.1997, was cancelled on 01.08.1997 and hence, the suit is hopelessly barred by limitation. There is no cause of action for the plaintiff to file the suit against the first defendant. Since the plaintiff had not made payment to the first defendant he is not entitled to ask for alternate relief against this defendant. The relief sought for is defective and equally the plaintiff cannot enforce the agreement which was canceled on 01.08.1997 against the first defendant.
12. The second defendant had not chosen to contest the suit as he remained ex parte. Based on the pleadings of the parties viz., plaintiff and the first defendant, the trial Court had formulated as nearly as seven issues as detailed hereunder, "1. Whether the cheque dated 02.05.1997 issued by the second defendant for Rs.3 lakhs in favour of the first defendant was dishonoured by the bank when it was presented for collection;
2. Whether the contention that the second defendant did not comply with the terms and conditions of the agreement and committed breach of the same is correct ?
3. Whether the allegation of the first defendant that the second defendant was not ready and willing to perform his part of the contract is true ?
4. Whether the plaintiff paid Rs.6 lakhs to the second defendant for getting the assignment of the agreement ?
5.Whether the contention of the first defendant that the second defendant's right in the suit agreement is rescinded and such the plaintiff is not entitled for any suit claim is true ?
6. Whether the plaintiff is entitled for specific performance as prayed for
7.To what relief ?"
13. In order to substantiate their respective cases both the plaintiff and the first defendant were put on trial. The plaintiff was examined as PW 1 and during the course of his examination Exs.A1 to A18 were marked. On the other hand the first defendant was examined as DW 1 and during the course of her examination Ex.B1 to B5 were marked. On evaluating the evidences both oral and documentary the trial court had found the issues 1 to 3 as against the plaintiff. Issue No.4 and 5 were found in favour of the plaintiff. While deciding the issue No.6 and 7 the trial Court had concluded that since the plaintiff had paid Rs.6 lakhs to the second defendant towards the assignment under Ex.A2 and the first defendant had received Rs.3 lakhs only from the second defendant on the date of suit agreement Ex.A1, the plaintiff is entitled for the relief of payment of Rs.3 lakhs from the first defendant and the remaining balance of Rs.3 lakhs from the second defendant with interest at the rate of 7.5% per annum from the date of suit till the date of realization with costs towards the alternative relief. The trial Court had also found that the plaintiff is not entitled for the relief of charge over the suit property towards the alternative relief as he had paid the court fee only under Section 42 of the Tamil Nadu Court Fees and Suits Valuation Act 1955. Ultimately the trial court had dismissed the suit in respect of the relief of specific performance and decreed the suit in respect of the alternative relief as aforestated. Impugning the judgment and decree dated 12.04.2006, the first defendant stands before this Court by way of this first appeal.
14. Heard both sides.
15. From the grounds of memorandum of appeal and the submissions made by the learned counsel for the appellant/first defendant and the learned counsel for the first respondent/plaintiff, this court regards that this appeal could be disposed of on the following point.
1.Will the alleged assignation of suit sale agreement made by the second defendant in favour of the plaintiff not bind the first defendant as she had no knowledge and not consented for the same ?
2.Whether the second defendant had no right in the suit property, to assign the suit sale agreement in favour of the plaintiff ?
3.Is it correct to say that the suit itself is barred by the time ?
Point No.1- In so far as the first point is concerned Ex.A2 is the relevant document. It has been self styled as the agreement dated 21.03.2000 appears to have been executed between the second defendant, Mr.K.S.Sundar Rajan and the plaintiff, Mr. Subbiah. It refers the suit sale agreement Ex.A1 dated 10.04.1997. It recites that the second defendant after consultation and discussion with the first defendant Mrs.Gladys Devaram decided to assign, attorn and relinquish his claim in and over the schedule mentioned property under the said Sale Agreement in favour of the plaintiff, Mr. Subbiah. It also recites that the plaintiff has paid a sum of Rs.6 lakhs to the second defendant with the consent of the first defendant, Mrs.Gladys Devaram, being the amount paid as advance by the second defendant in respect of the schedule mentioned property. It also reads that in consideration of the said sum of Rs.6 lakhs paid by the plaintiff to the second defendant, the second defendant had issued a letter of no objection addressed to the first defendant Mrs.Gladys Devaram for executing proper and valid sale deed in favour of the plaintiff on receipt of the balance of sale price.
16. In the last paragraph it stipulates that the second defendant undertakes and agrees to do all such acts and deeds as may be required to get a proper and valid sale deed executed to and in favour of the plaintiff by the first defendant Mrs.Gladys Devaram. From the averments of the document under Ex.A2, it creates a little confusion as to whether it is an agreement or assignation. It is seen from this document that prior to the making of assignation, the second defendant had a consultation with the first defendant. It is also seen that the second defendant had issued a letter of no objection and addressed to the first defendant Mrs.Gladys Devaram for executing a proper and valid sale deed in favour of the plaintiff on receipt of balance of sale consideration.
17. But this has been vehemently disputed by the first defendant. She has contended that the second defendant had no right in the suit property since he failed to perform his part of the contract by paying the balance of sale price and get the sale deed executed at his expenses. It is also her contention that the alleged assignment was fabricated and brought about by the plaintiff in collusion of the second defendant; she has also contended that she had not agreed nor even consented for the alleged assignment and payment of Rs.6 lakhs by the plaintiff in favour of second defendant. It is pertinent to note here that the second defendant remained ex parte even before the trial Court. He did not opt to contest the suit. It is also significant to note here that the execution of Ex.A2, the alleged agreement or assignment is left unproved as it is hanging on the question mark as to whether it is a valid agreement or assignation ?
18. It is imperative on the part of this Court to make a mention here that on scrutinizing the document under Ex.A2, it appears to this Court that the very averments of the documents itself would go to characterize that this is an incomplete document. In the second page at paragraph No.3 it is stated that the first party i.e., the second defendant after consultation and discussion with Mrs.Gladys Devaram (D1) decided to assign, attorn or relinquish his claim in and over the scheduled mentioned property under the said sale agreement in favour of his nominee the second party herein, (plaintiff).
19. From the above context it could easily be inferred that the second defendant had decided to assign his claim over the suit property in favour of the plaintiff, whom the second defendant has described as his nominee. The words "decided to assign" will not convey the definite meaning that the agreement of sale under Ex.A1 was assigned in favour of the plaintiff. If the suit sale agreement was really assigned in favour of the plaintiff, then the plaintiff would not have been called himself as nominee, instead, he should have been described as an "assignee". Obviously, Ex.A1 suit sale agreement is a bilateral agreement. Both the first defendant being the owner of the suit property and the second defendant being the proposed purchaser have signed in it. If any party to the sale agreement wants to assign her or his right or interest under the sale agreement in favour of others, it shall not be done or cannot be done without the knowledge and consent of the other party. If it is done so that it would be called as an unilateral one. No doubt the plaintiff was the tenant under the first defendant in respect of the suit property. This has not been denied by the first defendant. It is apparent that the plaintiff is not a party to the suit sale agreement (A1). In so far as the plaintiff is concerned, he is an alien or a third party to the suit sale agreement.
20. The claim of the plaintiff is that the second defendant had assigned his interest or his right accrued in pursuant to the suit sale agreement in his favour for the consideration of Rs.6 lakhs towards the advance of sale price. Though the document under Ex.A2 recites that the first defendant was aware of the alleged agreement or assignment what ever may be the case, it has not been substantiated by any legal evidence. As discussed earlier, the plaintiff ought to have summoned the second defendant to establish this factum, or the first defendant should have been effectively cross-examined when she was standing in the box.
21. Nowhere in Ex.A2, it is stated that the second defendant had assigned his claim over the suit property under Ex.A1 sale agreement in favour of the plaintiff. When such being the case how it could be understood that the right or claim over the suit property under the sale agreement was assigned in favour of the plaintiff ? Mere taking a decision to assign does not mean that it was duly assigned
22. Ex.B1 is the notice sent by the plaintiff to the first defendant through his counsel stating as if the first defendant had promised to sell the suit property for a total sum of Rs.17 lakhs in favour of the plaintiff in the month of December 1986. He had also stated that he was willing to purchase the suit property owned by the first defendant and that he was waiting for her promise to purchase the house property. He had also stated that if at all the first defendant was willing to sell the property he must be given first preference as he was the tenant in the suit property. This notice has been admitted by PW1 in his evidence. It shows that he expressed his willingness to purchase the suit property as he was the tenant in respect of the same.
23. Ex.A2 is the reply issued by the first defendant's counsel in which she had stated that at no point of time she had agreed to sell the property to anyone as she was keen on occupying the property herself. PW 1 has also admitted that he had also entered into an agreement under Ex.A2 with the second defendant. Of the agreements Ex.A1 and Ex.A2, the suit has been instituted only on the basis of Ex.A1 suit sale agreement. Plaintiff has also fairly admitted that no undertaking was given in Ex.A1 that the suit property should be sold in his favour. Similarly, he has also admitted in his cross-examination that no undertaking was given in Ex.A2 that the sale deed must be executed in his favour. It is pertinent to note here that PW 1 has specifically admitted that the first defendant had never agreed in Ex.A2 that she would execute the sale deed in respect of the suit property in his favour. He has also admitted that in Ex.A1 it had been specifically stipulated, the mode of payments towards the balance of sale price, and that he did not know anything about the communication which were exchanged between the first and the second defendant.
24. In Ex.B5, letter dated 16.08.1999, addressed to the first defendant by the second defendant D2 has stated that as per the agreement, though he could not honour his commitment due to various reasons beyond his control, he was ready to complete the deal as early as possible. He had also asked D1 to get the income tax clearance certificate so as to enable him to effect the payment and get the property registered. The contents of the letter, Ex.B5 goes to establish that after entering into the sale agreement under Ex.A1, he was not ready to pay the remaining sale price and got the sale deed registered in his favour. When questioned about Ex.B5, PW 1 has deposed that he did not know about this letter. PW 1 has also answered that he did not know about the details of cancellation of Ex.A1 sale agreement by the first defendant after forfeiting the advance amount of Rs.3 lakhs. The cancellation of suit sale agreement under Ex.A1 and forfeiting of the advance amount of Rs.3 lakhs will be discussed in detail in point No.2.
25. It is pertinent to note here that PW 1 has categorically admitted that, it is correct to state that since the second defendant had failed to act in accordance with the norms and conditions stipulated under Ex.A1, it was cancelled duly by the first defendant. Surprisingly, the plaintiff has stated in his cross-examination that only on the instruction given by the first defendant, he had parted with a sum of Rs.6 lakhs to the second defendant. But he has miserably failed to establish this fact. Neither in the advocates notice under Ex.A9, nor in the plaint or in his chief examination, PW 1 has stated this fact. For the first time he has come forward to say that only on the instruction given by the first defendant he had parted with Rs.6 lakhs to the second defendant for the suit sale agreement assigned in his favour.
26. Admittedly, the second defendant was not called to substantiate this fact by the plaintiff. On a cursory perusal of Ex.A9, Advocates Notice, dated 10.08.2000, it has been stated that the sale agreement was assigned in favour of the plaintiff by common consent.
27. It is pertinent to note here that in so far this case is concerned, the plaintiff, first defendant and the second defendant are placed in triangular points. In the first point i.e., On the top D1 is placed, and on the left point D2 is placed whereas, the plaintiff is placed on the right point. From the case of the plaintiff, this Court understands that the plaintiff was already in occupation of the suit property under the first defendant, in the capacity of tenant. He had been demanding the first defendant to sell the property to him for which the first defendant was not willing. But any how, the plaintiff wanted to achieve his goal. The second defendant had approached the first defendant and got her acceptance to sell the property in his favour and therefore, he along with the first defendant entered into the suit sale agreement. As seen from Ex.A1, Rs.6 lakhs was given towards the advance for the total sale consideration of Rs.17 lakhs of which Rs.3 lakhs was given in cash and the other Rs.3 lakhs was given by way of a post dated cheque dated 02.05.1997 and when the cheque was presented it was dishonoured. But there is no reference to show that the cheque amount was paid back to the first defendant. Therefore, as per the case of the plaintiff, a sum of Rs.3 lakhs alone was given in cash to the first defendant as advance. The plaintiff in order to achieve his goal had approached the second defendant and it is alleged that he had parted with Rs.6 lakhs to the second defendant and got the suit sale agreement assigned in his favour. Though the plaintiff had stated in his notice, that the suit sale agreement was assigned in his favour by a common consent, there is no legal proof available to establish that the first defendant had given consent to the second defendant to assign his right under the suit sale agreement in favour of the plaintiff.
28. In so far as the civil proceeding is concerned, the proof a fact which is said to be in existence is very much essential. Ex.A3, is the letter dated 19.05.2000, which appears to have been addressed to the first defendant Mrs.Gladys Devaram by the plaintiff Mr.Subbiah, in which it is stated that he had sent his co-brother and his nephew to Coimbatore, to pay the balance of sale price of Rs.7 lakhs to the first defendant and to call upon her to execute the sale deed in respect of the house, and that he was put to understand that the first defendant had refused to accept the balance of sale price. When this letter, was confronted with the plaintiff by the learned counsel for the first defendant, in his cross-examination he has stated that it was wrong to say that he had written the letter to the first defendant and even he went to the extent of denying his signature find a place in Ex.A3. In this connection, a question has arisen as to what accelerated the plaintiff to mark this letter under Ex.A3 on his behalf. If this letter is against his case then why he had opted to produce this letter. This would go to show his demeanour towards his case, and de-mean himself for having denied his own document.
29. Another document has been marked under Ex.A13, by the plaintiff, stating that the second defendant had addressed another letter dated 02.05.1999 to the first defendant. In this letter it is stated that:
"as discussed by Shri Subbiah, the tenant of your house situated at No.16, Applebe Road, Coonoor, I relinquish my claim in the above property as I have received the entire payment advance to you from Shri Subbiah. I have no objection at all in making the deal directly to Shri Subbiah and have it registered in his name. The original sale agreement to this effect has been handed over to Shri Subbiah."
30. When this letter under Ex.A13, was confronted with PW1 he would state that he did not know any thing about the details of this letter which was said to have been addressed by the first defendant by the second defendant.
31. On the other hand, the first defendant in her evidence(PW 1) has stated that without her knowledge and consent, the second defendant had assigned his claim under the suit sale agreement over the suit property in favour of the second defendant. Her evidence in Chief had withstood the test of cross-examination.
32. With regard to the subject matter of this case this Court desire to refer Section 15(b) of The Specific Relief Act 1963. It enacts as follows;
"Section 15. Who may obtain specific performance Except as other wise provided by this Chapter, the specific performance of a contract may be obtained by -
(b) the representative-in-interest or the principal, of any party thereto: Provided that where the learning, skill, solvency or any personal quality of such party is a material ingredient in the contract, or where the contract provides that his interest shall not be assigned, his representative in interest of his principal shall not be entitled to specific performance of the contract, unless such party has already performed his part of the contract, or the performance thereof by his representative-in- interest, or his principal, has been accepted by the other party;"
33. The scope of Section 15(b) is that the parties, besides, the actual contractors can sue for specific performance of a contract. It lays down no principle peculiar to the remedy of specific performance. In general it could be stated that the proper person to bring an action is the person whose rights have been violated. The remedy is either between the parties who stipulated what is to be done, or those who stand in their place. It may be said that those (a) who entered into the contract, (b) who stand in their place, (c) who are interested in the subject-matter, are, as a rule, the only proper parties to the suit.
34. It is significant to note here that the proviso to Clause (b) to Section 15 of the Specific Relief Act, 1963, contemplates that the specific performance of the contract may be obtained by (1) their representative in interest or (2) the member of any party thereto. Similarly, the parties to a contract are primarily bound to perform their respective promises. No doubt the expression "respective in interest" or "any party thereto" as contemplated under Section 15(b) clearly includes the transferees and assignees from the contracting party in whose favour the right exists.
35. As rightly observed in Shyam Singh v. Daryao Singh reported in AIR 2004 SC 348 (351) "Such right of seeking specific performance would, however, be not available in terms of proviso below clause (b) where the contract provides that the 'interest shall not be assigned'."
36. On coming to the instant case on hand at page No.2 of Ex.A1, suit sale agreement the last paragraph recites as under;
"The sale shall be executed in favour of the purchaser or his nominee."
37. The above expression will reflect the object and intention of the vendor i.e., the first defendant that the sale deed shall be executed only in favour of the second defendant or his nominee. In this regard a question is arisen as to whether the second defendant who is the purchaser had acted against the intention of the vendor i.e., the first defendant by assigning his right or interest what ever may be the case under the suit sale agreement in favour of the plaintiff ? The above wordings i.e., the sale shall be executed in favour of the purchaser or his nominee would clearly show that the vendor (first defendant) was intending to sell the property only in favour of the second defendant who is the purchaser or his nominee and not in favour of the plaintiff who is the assignee. Otherwise, these words would not have been incorporated in the suit sale agreement.
38. It is pertinent to note here that the plaintiff was the tenant in respect of the schedule mentioned property under the first defendant. This fact has been admitted by the plaintiff. First paragraph of the suit sale agreement in page No.2 recites that;
"And whereas the vendor has agreed with the purchaser to sell the respective property including all the fitting and fixtures more fully described in the scheduled hereunder and to the purchaser and the purchaser has agreed to purchase the said property free from encumberances."
39. At page No.3 in paragraph No.4, it has been clearly stipulated that;
"The purchaser shall get the possession of the scheduled property from the existing tenant living at present on or after the sale deed."
40. These wordings also clearly reflect the intention of the vendor (D1) that she was originally intending to sell the property in favour of the second defendant and not in favour of the plaintiff who was the tenant under D1 in respect of the suit schedule property, at the time of execution of Ex.A1. It is also pertinent to note here that the plaintiff in his evidence has clearly admitted that he had approached the first defendant and requested her to sell the property in his favour for which she had refused. The clear admission of PW 1 has also been ratified by Ex.B1 dated 18.06.1997, which appears to have been issued to the first defendant as well as the second defendant by the plaintiff through his counsel. In this notice the plaintiff had admitted that he was the tenant under the first defendant in respect of the suit property. It is also stated that as if the first defendant had promised to sell the said house property along with the land for a sum of Rs.17 lakhs during the month of December 1996 to the plaintiff and that he was also willing to purchase the property for the said price. It is also stated that he was waiting (plaintiff) for the promise of first defendant to purchase this house property.
41. Keeping in view of the above discussions, it is thus clear that the first defendant was intending to sell the property only in favour of the second defendant(purchaser) or his nominee as stipulated in the last paragraph of page 2, of the suit sale agreement.
42. It also requires specific mention that the suit sale agreement under Ex.A1 recites "that the expression 'the purchaser' shall unless excluded by or repugnant to the context to be deemed to include her heirs, legal representatives, administrators, assignors and executors. If it is left with this, we can understand that the expression 'purchaser' includes the meaning of assignee as stated above.
43. But in the last paragraph, at page 2 of Ex.A1, it has been specifically stated that "the sale shall be executed in favour of the purchaser or his nominee." Here the expression 'nominee' has been carefully employed, by both the parties to the contract i.e., D1 and D2.
44. In Black's Law Dictionary, 6th edition, the expressions "assignee" and "nominee are defined as under;
(1) Assignee A person to whom an assignment is made; grantee under uniform commercial code, assignee is subject to all defenses which may be asserted against assignor by account debtor. Assignee in fact is one to whom an assignment has been made in fact by the party having the right. The assignee in law is one in whom the law vests the right; as an executor or administrator. The expression "assignment" has also been defined as under;
"The act of transferring to another all or part of one's property, interest or rights. A transfer or making over to another of the whole of any property, real or personal, in possession or in action, or of any estate or right therein. It includes transfers of all kinds of property (Higgins v. Monckton, 28 Cal.App.2d 723, 83 P.2d 516, 519), including negotiable instruments. The transfer by a party of all of its rights to some kind of property, usually intangible property such as rights in a lease, mortgage, agreement of sale or a partnership. Tangible property is more often transferred by possession and by instruments conveying title such as a deed or a bill of sale."
(2) Nominee One who has been nominated or proposed for an office. One designated to act for another in his or her place.
A form of securities registration widely used by institutional investors to avoid onerous requirements of establishing the right of registration by a fiduciary.
One designated to act for another as his representative in a rather limited sense; e.g., stock held by brokerage firm in street name to facilitate transactions even though customer is actual owner of securities. It is used sometimes to signify an agent or trustee. It has no connotation, however, other than that of acting for another, in representation of another, or as the grantee of another. Schuh Trading Co. v. Commissioner of Internal Revenue, C.C.A.III., 95 F.2d 404, 411.
45. As defined in Black's Law Dictionary the expression assignee and nominee are distinctively having there own meaning. These expressions cannot be clubbed with each other.
46. On coming to the present case on hand, D1 and D2 who are the parties to the contract of sale under Ex.A1, have carefully put the words, that the sale shall be executed in favour of the purchaser or his nominee and not in favour of the "assignee". The very stipulation under Ex.A1 has specifically barred the second defendant who is the purchaser, from assigning his right or interest under the suit sale agreement in favour of others.
47. Since the second defendant had assigned his interest under the suit sale agreement, without the express consent of the first defendant, the first defendant is not bound to perform her part of the contract.
48. Further, upon the true construction of the contract of sale agreement under Ex.A1, it must be read as if it has been expressly agreed to be sold in favour of second defendant or his nominee and therefore, if at all the contract of sale is to be completed and the first defendant is under the obligation to execute the sale deed that is to be executed in favour of the second defendant. From the conduct of the second defendant, by assigning his interest under the suit sale agreement in favour of the plaintiff, he has violated and breached the contract as the contract of sale is in terms confined to the second defendant only.
49. As has been interpreted under Section 2 of the Indian Contract Act 1872, "a contract is a bilateral transaction between two or more than two parties".
50. As per Section 2(h) of the Contract Act "An agreement enforceable by law is a contract;
As per Section 2 (g) "An agreement not enforceable by law is said to be void."
51. In the instant case, the contract of sale effected between the first defendant and the second defendant comes under the amplitude of Section 2(g) as the second defendant himself is the reason in making the said contract void by assigning his interest in favour of the plaintiff without the express consent of the first defendant.
52. It is the duty of the Court to see that no party takes undue advantage in seeking specific performance. There is also no convincing evidence available on record to prove that the first defendant ever consented for the assignment of the suit sale agreement in favour of the plaintiff by D2. When there is no express consent from the first defendant, she cannot be forced to execute the sale deed in favour of the plaintiff. Had she never agreed to, merely because it is very light and no more ownerous than something which she agreed to.
53. Having regard to the discussions made above this Court is of considered view that the alleged assignation of suit sale agreement under Ex.A2 made by the second defendant in favour of the plaintiff will not bind the first defendant as she had no knowledge and not consented for the same.
54. Point No.2- On the date of sale agreement, i.e., on 10.04.1997 the second defendant had paid a sum of Rs.3lakhs. He had also issued a post dated cheque dated 02.05.1997 Bearing No.840871, for the value of Rs.3lakhs. In all, the first defendant had received a sum of Rs.6lakhs. This fact has also been admitted. But what the first defendant would contend is that when the post dated cheque dated 02.05.1997, was presented for encashment it was bounced back with an endorsement "insufficient funds" in the account of the first defendant. She has also admitted in her evidence that she did not proceed against the second defendant with regard to the dishonor of the cheque. As per the claim of the first defendant, she had received only Rs.3lakhs only from the second defendant in cash. With regard to the dishonor of cheque for the value of Rs.3lakhs, the second defendant did not come to the box to rebut the claim of the first defendant. Even the plaintiff had not chosen to summon the second defendant to disprove this factum. Under this circumstance it can safely be construed that the first defendant had received only Rs.3lakhs.
55. Secondly, under Ex.A1, the following conditions have been stipulated. The third sale price balance amounting to Rs.5lakhs shall be paid on or before 30th day of June, 1997. The balance amount of Rs.6lakhs shall be paid at the time of registration of sale deed before the Sub-Registrar of assurance Coonoor, in respect of the scheduled property on or before 25th August 1997. From the averments of Ex.A1, it is thus clear that apart from the payment of Rs.3 lakhs in cash and another post dated cheque dated 02.05.1997 for the value of Rs.3 lakhs, the second defendant shall have to pay a sum of Rs.5 lakhs on or before 30.06.1997 and thereafter, he shall pay the remaining balance of Rs.6 lakhs before the Sub-Registrar of Coonoor at the time of registration of the sale deed.
56. According to the first defendant, the second defendant had not come forward to pay the third sale price amounting to Rs.5 lakhs on or before 30.05.1997. In this connection the learned counsel for the appellant would submit that the second defendant had failed to perform his part of the contract by paying the balance sale consideration as agreed and get the sale deed executed in his name at his own expenses. He has also contended that even in spite of several communications, and personal requests, the second defendant had failed to pay the balance of sale consideration and therefore, the first defendant had sent a telegram and also a legal notice dated 01.08.1997, to the second defendant cancelling the sale agreement dated 10.04.1997 and forfeiting the advance amount paid. The Xerox copy of the telegram, cancelling the suit sale agreement under Ex.A1 has been marked under Ex.B4. DW 1 has also deposed in harmony with the submissions of her counsel. Even with regard to the cancellation of the suit sale agreement, the second defendant had not chosen to come and refute her evidence.
57. PW 1 has also admitted in his evidence that it is true that on or before 30.06.1998, the second defendant had to pay a sum of Rs.5 lakhs, towards the balance of sale price and that the amount was not paid as agreed by D2. Further he has also admitted in his cross-examination that he did not know as to whether the second defendant had acted in accordance with the terms of the sale agreement under Ex.A1 and it is also correct to say that on 28.07.1997, the suit sale agreement was cancelled by the defendant as the second defendant had not paid the remaining balance. In this regard the learned counsel for the first defendant would contend that the second defendant was not having capacity to pay the balance of sale consideration to perform his part of contract and got the sale deed executed in his favour. It is the contention of the first defendant that after cancelling the suit sale agreement on 28.07.1997, the second defendant had no interest or any semblance of right over the suit property. It is also her contention that when there was no agreement in force as on 21.03.2000, D2 could not assign the right which was not in existence. The contention of the first defendant has also been left uncontested.
58. Under this circumstance this Court, on taking into consideration of the submissions made on behalf of the first defendant and on considering the submissions made on behalf of the plaintiff has concluded that the second defendant had no right in the suit property at the time of assignation of suit sale agreement in favour of the plaintiff under Ex.A2. This Court has also gone through the judgment of the trial Court and found that the trial Court has failed to see that when the agreement dated 10.04.1997 was not in force on 21.03.2000, the second defendant could not have assigned his right under the sale agreement in favour of the plaintiff.
59. Point 3 It is substantiated that the first defendant had terminated the suit sale agreement as early as on 28.07.1997. Ex.B4, true copy of the telegram would ratify this factum. This suit appears to have been filed on 24.08.2000. According to the first defendant the suit is hopelessly barred as it has been filed beyond the period of limitation.
60. As evident from Ex.B4 true Xerox copy of the telegram, the sale agreement was terminated on 28.07.1997. Admittedly the suit is filed on 24.08.2000.
61. Article 54 of the Limitation Act contemplates that; for filing a suit for the relief of specific performance of a contract, the period of limitation is three years. The period of limitation shall be reckoned from the date fixed for the performance, or of no such date is fixed, when the plaintiff has notice that performance is refused.
62. Even in spite of receipt of the telegram, the second defendant did not come forward to reply. The plaintiff has also not chosen to summon the second defendant to disprove the fact that the suit is barred by limitation.
63. On a perusal of Ex.A1, suit sale agreement the schedule of payment has been stipulated stage by stage. But this has not been followed by the second defendant. As adumbrated supra, the plaintiff has also admitted the latches on the part of the second defendant in his evidence. Further the averments of E.A1 would go to show the intention of the parties to the contract, that time is the essence of the contract. Since, the second defendant had failed to adhered to the norms and conditions stipulated in the suit sale agreement, the first defendant had proceeded to terminate the contract of sale and therefore, as rightly observed in M.Mohar Ali v. Md. Mamud Ali reported in 1998 (3) CCC 328 (Gau) the suit itself is barred by limitation and this has also not been considered by the trial Court. Further the second defendant was never ready and willing to perform his part of the contract. On the date of assignation of suit sale agreement i.e., under Ex.A2 on 21.03.2000, the second defendant was not having any right or interest over the suit property so as to enable him to assign the suit sale agreement in favour of the plaintiff.
64. Having regard to the findings given above and on analysing the evidences both oral and documentary adduced on behalf of both sides this court is of considered view that the appeal is liable to be allowed.
In the result the appeal is allowed. The judgment and decree dated 12.04.2006 and made in O.S.No.17 of 2004 on the file of the learned District Judge of The Nilgiris at Uthagamandalam is set aside and the suit in O.S.No.17 of 2004 is dismissed with costs.
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