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Kunhami & Others v. Pokker & Another
Factual and Procedural Background
The plaintiff, a sub-tenant, deposited arrears of rent in prior eviction proceedings to protect his sub-tenancy and prevent eviction of the tenants. Eviction was ultimately refused, although costs were awarded. He then sued to recover the deposited amounts, claiming a charge over the interests of the relevant defendants. The trial court and first appellate court decreed the suit. Defendants 4 to 9 appealed, contending that the claim was limitation-barred and that no charge could be claimed. [1]
Legal Issues Presented
- Whether the plaintiff’s claim for reimbursement fell within Section 69 of the Indian Contract Act. [2]
- Whether the amounts deposited created an enforceable charge by applying the principle of salvage lien, thereby avoiding limitation. [3][4]
- Whether the plaintiff could claim the landlord’s rent charge despite not deriving it by assignment. [5]
- Whether the defendants could raise, at the second-appeal stage, the contention that part of the deposits related to revenue for which they were not liable. [6]
Arguments of the Parties
Defendants 4 to 9
- They argued that the suit was barred by limitation because it was filed more than three years after the last deposit and no charge was available. [1]
- They contended that the charge for rent under Section 41 of the Malabar Tenancy Act was personal to the landlord and did not pass even to an assignee; consequently, the plaintiff could not claim its benefit. [5]
- They also sought to argue that part of the deposited amount represented revenue for which they had no contractual liability. This contention had not been raised or investigated earlier. [6]
Plaintiff
- The plaintiff’s payments were made to protect his sub-tenancy and to prevent eviction, giving rise to a reimbursement claim and an equitable charge. [1][5]
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Nugenderchunder Ghose v. Sreemutty Kaminee | A person interested in property who pays revenue to prevent its sale may obtain a charge for the amount paid. | The case was cited as recognition of the salvage-lien principle. [7] |
| Dakhina Mohan Roy v. Saroda Mohan Roy | A person in possession who pays money to prevent a revenue sale may obtain reimbursement even if the underlying decree is later set aside. | The Court relied on it as further support for reimbursement based on the salvage-lien principle. [7] |
| Nagall Kotayya v. Koganti Kotappa | A co-sharer paying rent on behalf of another may obtain a charge, with Article 132 of the Indian Limitation Act applying to enforcement. | The Court treated it as supporting a charge for a person who makes a payment on behalf of another. [5] |
| M. Chengalroya Reddi v. Udai Javour | The salvage-lien principle may confer a charge on a person who deposits money to save property from revenue sale. | The Court followed this Madras High Court authority. [5] |
| Swaminatha Iyer v. Ramanatha Iyer | Applied the principle that payment made to preserve property can support a charge. | The Court noted that this decision followed M. Chengalroya Reddi. [5] |
| Kayakkool Pillati Krishnan Atiyoti v. Thayyullathil Moosa | Concerned whether an assignee of a landlord was entitled to a charge. | The Court held that this decision did not undermine the earlier authorities because it decided only the assignee question. [5] |
| Shrivallabh Badrinath v. Laxman Vinayak Bhava | A mortgagee paying rent due from a tenant could obtain subrogation to the landlord’s charge. | The Court cited it as supporting subrogation of a charge in favour of a person making the payment. [5] |
| Ramanandan Prasad Singh v. Ram Das | Held that the facts did not establish a case under Section 69 of the Indian Contract Act. | The Court preferred the contrary Madras High Court authorities. [5][4] |
| Sitaram Sheolal Marwari v. Krishnarao Balaji Kunhi | Apparently held that there was no subrogation under Sections 92 and 100 of the Transfer of Property Act, without invoking salvage lien. | The Court preferred the Madras authorities over this decision. [5][4] |
Court's Reasoning and Analysis
The Court found that the plaintiff had paid rent due from the tenants to the landlord, that the tenants were legally bound to pay it, and that the plaintiff had a direct interest in making the payments because they were necessary to avert eviction and preserve his sub-tenancy. The claim therefore fell squarely within Section 69 of the Indian Contract Act. [2]
The Court held that reimbursement could be secured by an equitable charge. It relied on the principle that subrogation by operation of law rests on the same equity of reimbursement reflected in Section 69, and that such payment may create an equitable charge where the payer is not a mere volunteer. [3][8][9]
The landlord’s statutory charge under Section 41 of the Malabar Tenancy Act was not being transferred to the plaintiff by assignment. Instead, the plaintiff independently claimed a charge because he had paid money to save the tenancy and protect his own rights. The Court therefore distinguished the issue of assignment from the separate principle of salvage lien. [5]
Following the cited Madras High Court decisions, and preferring them to the contrary authorities from Patna and Nagpur, the Court held that the plaintiff was entitled to a charge for the deposited amounts. Because the claim was enforceable as a charge, the limitation objection failed. [5][4]
The Court declined to entertain the revenue-related contention because it had not been raised or investigated in the first court and had not properly been available for consideration in the appeal. [6]
Holding and Implications
The second appeal was dismissed with costs to the plaintiff-respondent. The plaintiff’s reimbursement claim under Section 69 of the Indian Contract Act was enforceable as a charge under the principle of salvage lien and was therefore not barred by limitation. [2][4][6]
The direct effect was that the decree in favour of the plaintiff was maintained. The opinion discusses no broader consequence beyond applying the salvage-lien principle to these payments.
Velu Pillai, J.:— The plaintiff has sued to recover a sum of money which he had deposited in O.S 440 of 1943. That was a suit by the landlord and by one Ammad Haji on the strength of a melcharth of the year 1940 in favour of the latter, for eviction of one Mammi and one Kunhammed Kutty who were tenants in possession under a Marupat of the year 1922. Mammi is represented in this suit by the first defendant; Kunhammed Kutty assigned his interest to the second defendant, who in his turn made an assignment to Kunhavulla whose legal representatives are defendants 4 to 9. In O.S 440 of 1943 the present plaintiff was impleaded as the 23rd defendant in his capacity as sub-tenant under defendants 1, 2 and 4 to 9. The eviction of tenants came to be stayed by Madras Act XVII of 1946 and Madras Act XXIV of 1949 conditionally on the deposit of arrears of rent, as prescribed. In the event of eviction, the plaintiff's sub-tenancy would come to an end and so, in order to avoid this, he deposited the arrears of rent payable by the tenants to the landlord from time to time. Ultimately eviction was refused in O.S 440 of 1943 though costs were decreed. The present suit is for the reimbursement of the total amount deposited, charged upon the interests of defendants 1, 2 and 4 to 9 in the holding. Defendants 4 to 9 contended that the suit is barred by limitation having been filed more than three years after the date of the last deposit no charge being allowable. The two courts have negatived their contentions and decreed the suit; they are the appellants here.
2. There was no dispute that the plaintiff had paid rent due from him to the tenants who are their lessors, and that what he deposited was rent which the latter were bound by law to pay to the landlord and which the plaintiff was interested in paying in order to avert eviction. This brought the claim for reimbursement squarely within the scope of Section 69 of the Indian Contract Act and this was not disputed.
3. Unless this liability is enforceable as a charge, the suit would be barred by limitation. I do not see why a charge should not be given. The law is summarised thus by Mulla on Transfer of Property Act, 4th edition. The relevant part of the summary which begins at page 529 is as follows:
“Subrogation by operation of law rests therefore on the same equity of reimbursement as is enacted in S. 69 of the Indian contract Act, that ‘a person who is interested in the payment of money, which another is bound by law to pay, and who therefore pays it, is entitled to be reimbursed by the other.’ Such payment sometimes carries with it an equitable charge.”
4. At page 530 it is stated:
‘The equitable charge is analogous to a salvage lien in maritime law but differs from it in that it is not available to a volunteer. The doctrine of salvage lien was recognised by the Privy Council in Nugenderchunder Ghose v. Sreemutty Kaminee ((1867) II M.I.A 241, 258) where their Lordships said in the case of a mortgagee paying revenue to prevent a taluk from being sold ‘that they would find it difficult to come to any other conclusion than that the person who had such an interest in the Talook as entitled him to pay the revenue due to the Government, and did actually pay it, was thereby entitled to a charge on the Talook as against all persons interested therein for the amount of the money so paid.’ Again in Dakhina Mohan Roy v. Saroda Mohan Roy ((1893) 20 I.A 160) a person in possession under a decree of a Court paid money to prevent a sale of the estate for arrears of revenue and was entitled to reimbursement even though the decree was afterwards set aside.”
5. It was urged, that the charge for arrears of rent which is conferred by section 41 of the Malabar Tenancy Act is personal to the landlord and does not enure even to his assignee, and being so, the plaintiff cannot by any process, claim the benefit of such charge. Here the question is different. The landlord had a charge for rent due to him from his tenant. To save the tenancy from destruction, and also to safeguard his own rights, the plaintiff a sub-tenant made payment. This generated a valid claim in his favour for reimbursement against defendants 1, 2 and 4 to 9. The only question is whether he could not also claim, not by assignment, but on the principle of salvage hen, a charge for the amount paid. In Nagall Kotayya v. Koganti Kotappa (XLIX M.L.J 117) one co-sharer paying on behalf of another, rent which is a charge under the Estates Land Act, was held entitled to a charge for the enforcement of which Article 132 of the Indian Limitation Act was applicable. The principle of salvage lien was applied in favour of a person to give him a charge, for depositing money to save property from revenue sale, by Varadachariar and Stodart JJ. in M. Chengalroya Reddi v. Udai Javour (A.I.R 1936 Madras 758). This was followed by Somayya J. in Swaminatha Iyer v. Ramanatha Iyer (A.I.R 1943 Madras 573). The authority of this has not been shaken by the later decision of the Madras High Court in Kayakkool Pillati Krishnan Atiyoti v. Thayyullathil Moosa (A.I.R 1944 Madras 557), in which the point decided was only whether the assignee of a landlord is entitled to a charge. Similarly in Shrivallabh Badrinath v. Laxman Vinayak Bhava (A.I.R 1947 Nagpur 43) the mortgagee of a holding paying rent due from the tenant was held entitled to subrogation of the charge in favour of the landlord. As against these, in Ramanandan Prasad Singh v. Ram Das (A.I.R 1934 Patna 70), relied on, it was ruled that no case under Section 69 of the Indian Contract Act was made out. In Sitaram Sheolal Marwari v. Krishnarao Balaji Kunhi (A.I.R 1940 Nagpur 156) the facts do not appear fully from the report, but it seems to have been held, that there was no case of subrogation under section 92 read with section 100 of the Transfer of Property Act; the principle of salvage lien was not invoked.
6. With respect, I follow the cases of the Madras High Court referred to above in preference to the last two cases cited and hold that the plaintiff is entitled to a charge on the principle of salvage lien. If so, there was no further question that the suit would not be barred.
7. Learned counsel for defendants 4 to 9 also wanted to urge, that part of the amount deposited was towards revenue payable, for which defendants 4 to 9 had no liability under the original contract; the point not having been taken in the first court or investigated was not allowed to be urged before the Subordinate Judge in appeal. I do not entertain it here. The second appeal is dismissed With costs to the plaintiff-respondent.
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