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K. Syamalambal v. N. Namberumal Chettiar.

Madras High Court

Aug 16, 1956

Judgment

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Structured Summary of the Opinion

Factual and Procedural Background

The appellant sued for recovery of Rs. 10,300 as damages for unlawful attachment of her properties. The undisputed material facts in the opinion are:

Defendant obtained a decree against one Peruri Suryaprakasam on 9 May 1934 (C. S. No. 166 of 1934).
On 11 January 1935 Suryaprakasam transferred the suit properties to P. Venkatasubba Rao.
The defendant, in execution of his decree, attached the suit properties.
Venkatasubba Rao petitioned under Order XXI, Rule 58 C.P.C. claiming the properties as purchaser; that petition was allowed.
The defendant filed a suit (O.S. No. 171 of 1940) contesting that order. Meanwhile, Venkatasubba Rao agreed to sell to Murugesa Mudaliar on 15 January 1940; actual attachment occurred 19 January 1940; sale deed executed 1 July 1940.
The Subordinate Judge found the transfer from Suryaprakasam to Venkatasubba Rao was intended to defraud creditors but held Murugesa a bona fide transferee for consideration; the suit was dismissed.
The defendant appealed (A.S. No. 289 of 1944). This Court dismissed the appeal on 13 November 1946, holding the sale to Murugesa bona fide and thus not liable to attachment; but the Court observed the decree-holder might in future seek execution against portion of the purchase price paid or payable by Murugesa.
Murugesa later died; his heirs conveyed the properties to T. Doraiswami Mudaliar and Pappu Chetti Lakshminarayana by sale deeds dated 27 October 1945; those vendees then conveyed to the appellant by deeds dated 31 December 1945.
On 5 April 1946 the defendant applied for transmission of his decree to the Subordinate Court at Chingleput and stated an intention to execute against the purchase price. The actual execution petition filed 6 November 1946 sought attachment of the suit properties; an order for attachment was made 23 November 1946 (the document records an attachment effected on 26 January 1947 by affixture and beat of tom-tom).
The appellant applied under Order XXI, Rule 68 C.P.C. (E.A. No. 130 of 1947) to have the attachment raised; the defendant opposed claiming that the sales were really for the benefit of the judgment-debtor. The Subordinate Judge allowed the appellant's application on 19 November 1947. The defendant did not pursue the remedy of a suit under Order XXI, Rule 63 C.P.C.
On 10 March 1948 the appellant brought the suit for Rs. 10,300 as damages for unlawful attachment; the defendant denied liability and asserted he acted bona fide and reasonably, and alleged the appellant was a benamidar (nominee) for the judgment-debtor.
The trial Judge (Krishnaswami Nayudu, J.) dismissed the suit, finding the attachment unlawful but that the defendant acted with reasonable and probable cause and without malice; accordingly, damages were denied. The appellant appealed but limited the claimed amount to Rs. 2,000 on appeal.

Legal Issues Presented

Whether the appellant is entitled to damages for wrongful/unlawful attachment of immovable property.
If damages are available, whether the right of action is properly characterised as (a) trespass to property or (b) abuse of civil process (an action akin to malicious prosecution), and the differing burdens of proof that follow.
Whether the defendant had reasonable and probable cause or acted with malice when he procured the attachment.

Arguments of the Parties

Appellant's Arguments

The appellant sought damages (initially Rs. 10,300; on appeal limited to Rs. 2,000) for the unlawful attachment of her properties by the defendant.
Learned counsel for the appellant contended that once the trial Judge found the attachment unlawful, the appellant was entitled to damages.

Defendant's (Respondent's) Arguments

The defendant denied liability and asserted he was not aware of the sale in favour of the appellant and that he attached the properties bona fide, having reasonable and probable cause to do so.
He further alleged the appellant was a benamidar (a nominal transferee) for the judgment-debtor, and that the sales were in substance for the benefit of the judgment-debtor's family.
At trial the defendant argued his honest belief justified his use of the process of court to recover moneys due to him.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Kissori Mohun Roy v. Harsukh Das, 17 Ind App 17; ILR 17 Cal 436 (Privy Council)	Principle recited: where property of a person not party to the suit is wrongly attached, no finding of malice or want of reasonable care is necessary; such actions are treated as founded on trespass rather than on special damage.	The opinion records this principle (as quoted in Srinivasayya v. Lakshmayya) and notes the distinction drawn between attachments of movable and immovable property; the current Court considered the authority as part of the background in discussing whether the action is trespass or abuse of process but did not apply it to hold the defendant liable.
Srinivasayya v. Lakshmayya, 1938-1 Mad LJ 73; AIR 1937 Mad 811	Varadachariar J.'s observations on whether wrongful attachment of property of a non-party is actionable as trespass and the question whether attachment of immovable property necessarily causes damage; discussion of de minimis and trespass definitions.	The Court noted these observations were brought to its attention by respondent's counsel and described them as obiter in that earlier case; the present Court did not adopt a definitive stance on the abstract legal question but used the discussion to frame the issues (trespass v. abuse of process) and to explain the legal positions available.
A. S. No. 289 of 1944 (Mad) (A) — earlier appeal in this matter (this Court's judgment delivered 13 November 1946)	Determination that the sale in favour of Murugesa Mudaliar was a bona fide transaction not liable to be set aside; observation left open that the decree-holder might seek execution against that portion of the purchase price paid or payable by Murugesa.	The Court in the present opinion treated the defendant as bound by that judgment and accepted the earlier conclusion that Murugesa's acquisition was bona fide; that factual and legal history informed the present Court's assessment that the defendant could reasonably have believed later transfers were for the judgment-debtor's benefit, supporting his plea of reasonable cause.

Court's Reasoning and Analysis

The Court undertook a step-by-step analysis focused on the legal character of the appellant's claim and the factual circumstances bearing on the defendant's state of mind:

Characterisation of cause of action:
- The Court identified two possible heads for the appellant's tort claim: (a) trespass and (b) abuse of civil process (an action analogous to malicious prosecution when judicial process is improperly used).
- The Court set out the legal distinctions: an action for trespass requires proof of trespass (with the defendant then proving justification or excuse) and does not require proof of malice; an action for abuse of process requires proof of absence of reasonable and probable cause and also requires proof of malice (the plaintiff carries higher burdens in the abuse-of-process form).
Precedential and doctrinal background:
- The Court reviewed obiter observations in Srinivasayya v. Lakshmayya (which itself refers to Kissori Mohun Roy v. Harsukh Das) that wrongful attachment of property of a non-party can be treated as trespass and that in such cases malice need not be found. It noted debate in that authority about whether attachments of immovable property cause damage in the same way as attachments of movable property, and whether the entry by an officer to affix notices might constitute trespass.
- The Court observed these statements were obiter in the cited case and declined to express a final view on the abstract question whether attachment of immovable property necessarily gives rise to trespass damages.
Application of law to facts — defendant's reasonable cause:
- Rather than resolving the abstract distinction, the Court found it unnecessary to do so because, on the facts, the defendant had a reasonable excuse for the attachment whether the claim was framed as trespass or abuse of process.
- Key factual points supporting the defendant's reasonable belief were:
  - The appellant was a close relation of the judgment-debtor and likely interested in him and his family.
  - The earlier transfer by the judgment-debtor to Venkatasubba Rao had been found by both the Subordinate Judge and this Court to be a sham intended to defraud creditors.
  - Although Murugesa was held to be a bona fide purchaser, the properties subsequently came, by intermediate transfers, into the appellant's hands shortly after purchase by vendees who were employees of the appellant's family.
  - Given that sequence, it was reasonable for the defendant to believe the later transfers were ultimately for the benefit of the judgment-debtor's family and thus subject to attachment in execution of his decree.
- Therefore, whether the action is characterised as trespass (where the defendant must show a good cause) or as abuse of process (where the plaintiff must show absence of reasonable and probable cause and malice), the defendant had established a valid plea of defence based on reasonable and probable cause and the absence of malice.
Trial court findings and appellate acceptance:
- The trial Judge had found the attachment unlawful but characterised the defendant's conduct as made in honest belief and with reasonable or probable cause; the attachment was "technically" wrongful but not malicious or without reasonable cause.
- The appellate Bench agreed with that assessment and therefore found no basis for awarding damages to the appellant.

Holding and Implications

Holding:

APPEAL DISMISSED. The Court affirmed the trial Judge's dismissal of the appellant's suit for damages and dismissed the memorandum of cross-objections. The Court made no order as to costs.

Implications:

Direct effect on the parties: The appellant's suit for damages arising from the attachment was dismissed; she recovers nothing by way of damages. The defendant is not held liable for damages because he established a reasonable and probable cause for the attachment and was not shown to have acted with malice.
The Court emphasised that the attachment was "technically wrong" (as found by the trial Judge and acknowledged on appeal), which is why it made no order as to costs despite dismissing the appeal.
On broader law: the Court did not lay down a new rule resolving the abstract question whether wrongful attachment of immovable property always warrants trespass damages; it declined to express a final view on that debate and decided the case on the particular facts and the defendant's reasonable belief. Thus, no new precedent resolving that abstract legal question was established by this opinion.

This summary is based exclusively on the text of the provided opinion and does not add or infer facts or legal conclusions beyond what the opinion contains.

Show all summary ...

1. This appeal arises but of a suit filed by the appellant for the recovery of a sum of Rs. 10,300 from the defendant as damages for -unlawful attachment of her properties. The material facts which are beyond controversy are: The defendant obtained a decree against one Perurl Suryapra-kasam on 9th May 1934 in C. S. No. 166 of 1934 on the original side of this Court. On llth January 1935 the suit properties among others were transferred by the said Suryaprakasam to one P. Venkatasubba Rao.

The defendant in execution of the decree obtained by him attached the suit properties. Venkatasubba Rao filed a petition under Oder XXI, Rule 58 C. P. G. claiming the properties on the strength of his purchase. The petition was allowed in his favour. As against this order the defendant filed a suit. O. S. No, 171 of 1940, ,in the Subordinate Judge's Court of Chingleput. Meanwhile, on the 15th January 1940, there was an agreement to sell the suit properties by Venkata-subba Rao in favour of one Murugesa Mudaliar. This was one day prior to the order of pre-ccpt Issued by this Court in the execution application filed by the defendant. The actual attachment was made on 19th January 1940. The sale deed was eventually executed by Venkatasubba Rao in favour of Murugesa Mudaliar on 1st Joly 1940. The plaintiff, therefore, made Murugesa Mudaliar also a defendant in his suit, O. S. No. 171 of 1940. The learned Subordinate Judge held that though the transfer of the properties by the judgment-debtor Suryaprakasam to Venbatasubba Rao was intended to defraud the creditors, Murugesa was a transferee in good faith for consideration.

On this finding the suit was dismissed. The defendant preferred an appeal to this Court, A. S. No, 289 of 1944 (Mad) (A). The appeal was dismissed by this Court which found that the sale in favour of Murugesa Mudaliar was a bona fide transaction not liable to be set aside and therefore the properties were not liable to be attached in execution of the defendant's decree. But the Court made the following observations:

"While holding that the two villages cannot be directly attached by the plaintiff in execution of his decree, we leave it open to the plaintiff to contend in future proceedings that he can execute his decree against that portion of the purchase price which was paid (by Murugesa) or to be paid after, the attachment."

The judgment of this Court in appeal was deliver, ed on 13th November 1946. Meanwhile the properties had been conveyed by the heirs of Murugesa Mudaliar who had died, to two persons, T. Doraiswami Mudaliar and Pappu Chetti Lakshmi-narayana, by two sale deeds dated 27th October 1945. Within two months thereafter, these two vendees conveyed the properties purchased by them to the plaintiff under two sale deeds dated 31st December 1945.

On 5th April 1946 the defendant filed E. P. No. 94 of 1946 for transmission of the decree obtained by him in C. S. No. 166 of 1934 to the Sub Court of Chingleput through the District Court for execution. It appears that in the application for transmission it was stated that the defendant intended to execute the decree against the purchasc price in respect of the suit .properties in the hands of the purchasers.

The execution petition actually filed on 6th November 1946 in the court of the Subordinate Judge of Chingleput, however, was for attachment of the suit properties. The defendant added as parties to this execution petition the legal repre-sentative of the original Judgment-debtor, Ven-katasubba Rao and Paramsiva Mudaliar, the legal representative of Murugesa. The relief prayed was that the Court may be pleased to order attachment of the properties and to sell them. On this application an order for attachment was made on 23rd November 1940.

In pursuance of this order attachment was effected on 26th January 1947 by beat of torn torn & by affixture of a copy of the order of attachment on the wall of a temple situated in one of the villages and of another copy to a tree in the other village. Thereupon the plaintiff filed an application under Order XXI, Rule 68 O. P. Code (E. A. No. 130 of 1947) praying that the attachment may be raised because the properties belonged to her and did not belong to the judgment-debtor.

The defendant opposed the application on the ground that the sales under which the plaintiff claimed were intended really for the benefit of the Judgment-debtor who it was alleged was in possession of the properties. The application was allowed eventually by the learned Subordinate Judge by his order dated 19th November 1947. The defendant did not choose to "have this set aside by a suit as provided in Order XXI, Rule 63 C. P.' Code. On 10th March 1948, the plaintiff brought the suit out of which this appeal arises, claiming the sum of Rs. 10,300 as damages for the unlawful attachment of her properties procured by the de fendant. The defendant denied his liability to the plaintiff to pay any damages.

The defendant stated that he was not aware of the sale of the villages in favour of the plaintiff and he attached them bona fide and had every reasonable and probable cause to attach them and that the plaintiff was only a benamidar for the Judgment-debtor.

2. Krishnaswami Nayudu, J.-, who tried the suit dismissed it. The learned Judge found that the defendant was bound by the judgment of this Court in A. S. No. 289 of 1944 in which it had been held that the suit properties were not liable to attachment in the hands of Murugesa Mudallar and prima facle it should be held that the attachment was not legal and proper. But he also found that the defendant cannot be said to have acted without reasonable or probable cause; nor could it be said that he was actuated by malice, and that in his opinion the attachment was made by the defendant in the honest belief that he was making use of the process of court in order to recover the moneys due to him. Though the attachment was wrongful, it was only technically so. In the result the learned Judge dismissed the suit.

The plaintiff has filed the above appeal but has restricted her claim to Rs. 2000. Learned counsel for the plaintiff-appellant contended that once the learned trial Judge had found that the attachment was not lawful, the plaintiff would be en-titled to damages: Before this contention can. be dealt with, it Is necessary to discuss the basis of the plaintiff's action. The claim obviously arises In tort.

In our opinion the claim can fall under one of two heads, namely, CD trespass and (b) abuse of civil process. No direct authority has been cited by counsel for either party bearing on this ease. The following observations of Varadachariar J. in Srinivasayya v. Lakshmayya, 1938-1 Mad LJ 73: (AIR 1937 Mad 811) (B), were brought to our notice by. learned "counsel for the, respondent:

"According to the principle laid down in Kissori Mohun Roy v. Harsukh Das, 17 Ind App 17: ILR 17 Cal 436 (PC) (C), no finding of malice or want of reasonable care is necessary in case where the property of a person who is not a party to the suit is wrongly attached. In such cases, the action is really one founded on trespass and not on special damage.... Mr. Somayya, however, contended that in all the reported cases where damages for wrongful attachment have been awarded on the footing of trespass, the complaint had been made with reference to the attachment of moveable property which was taken away from the custody of the real owner in consequence of the attachment. He argued that such deprivation of goods must necessarily have caused damage in that class of cases, but that in the case of attachment of immoveable property there can be nothing similar to it. Under the law, the attachment of immoveable property merely operates as a prohibition of alienation by the person against whom the order is made and who is supposed to be its owner; there Is nothing in the attachment to fetter the rights of the real owner, if he is not the defendant or party sought to be proceeded against.

At best, there might be a cloud cast upon his title, which must be remedied by proceedings under Order 21 Rule 58 C. P. C. but it cannot be said that an attachment of immoveable property involves anything in the nature of trespass or necessarily causes damage to the real owner. It cannot be denied that there is some force in this distinction Insisted on by Mr. Somayya.

Mr. Krishnaswami Aiyangar, the learned counsel for the respondents, sought to answer this distinction by pointing out that even in the case' of attachment of immoveable property, the amin has necessarily to go upon the property, to affix the notice of attachment thereon as required by law and that this would amount to a trespass. He invited our attention to the very wide definition of the term "trespass" in the authorities and con-tended that if trespass in law is established, the presence or absence of damage is Immaterial.

We do not propose to express any final opinion upon the maintainability or otherwise of this distinction where an attachment takes place at the instance of a decree-holder, or upon the question whether, if all that the real owner can complain of consisted in the entry of the amin on the property to affix the notice, the principle of de minimis non curat lex will avail the defendant, to save him from liability for damages."

3. The learned Judge found it unnecessary to decide the question as the attachment in the case before him was made under Oder XVI, Rule 10 C. P. Code. Though the above observations are obiter and do not decide the liability for damages, the learned Judge was apparently of the opinion that when the property of a person not a party I to the suit is wrongly attached the action is really one founded on trespass.

4. But there is another aspect of the matter, when the act of attachment complained of was done under judicial sanction, though at the instance of a party, the remedy is an action for abuse of process. The law is thus summed up by Mr. Ramaswami Ayyar in his book on Torts, 4th Edn:

"An arrest or attachment in execution before Judgment is an act of the Court .and therefore If a person procures it improperly against another he can be sued only in that form of action. If, however, the act complained of is not authorised by the order or warrant of the Court, then the party who procures it can be sued for trespass without proof of damage or malice, e.g. seizure of property not specified in the warrant of attachment.

6. There are substantial points of distinction between an action for abuse of civil process and an action for trespass to property. In the former, which resembles an action for malicious prosecution, the plaintiff has to prove absence of reasonable and probable cause. But in an action for trespass the plaintiff hasonly to prove the trespass and it is for the defendant to prove a good cause or excuse. In an action for abuse of process the plaintiff has further to prove malice on the part of the defendant; but in an action for trespass this is not necessary.

6. In this case we do not think it necessary to decide finally the nature of the plaintiff's claim because we are convinced - and in this we are in agreement with the learned Judge - that the defendant had a reasonable excuse for attaching the properties in the hands of the plaintiff. We have come to this conclusion in the following circumstances. The plaintiff is a close relation Of the Judgment-debtor and presumably Interested in him and his family.

The original transfer by the judgment-debtor to his relation venkatasubba Rao was found by both the Subordinate Judge as well as by this Court to be a sham transaction intended to screen the properties from creditors. Though Murugesa Mudaliar was held to be a bona fide purchaser, when the properties Were again acquired by the plaintiff, it was reasonable on the part of the defendant to think, that it was for the benefit of the judgment-debtor's family.

The two vendees under the sale deeds of 21th October 1945 were employees of the plaintiff's family and two months after-then purchase the properties were again conveyed to the plaintiff. The defendant might have honestly believed that the properties were finally purchased by the plaintiff for the Judgment-debtor's family and there. fore they were liable to be attached in execution of his decree.

Whether the action is treated as one for trespass or as one for abuse of civil process, the defendant has established a good plea in defence. We agree with the learned Judge that the suit should be dismissed. The appeal is dismissed but we make no order as to costs because the attachment was technically wrong.

(7) The memorandum of cross-objections is also dismissed. No costs.