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Subbaratnam Chettiar v. Gunavanthalal Vidyasankar By Agent Narendralal Gunavanthalal

Madras High Court
Oct 28, 1936
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Structured Summary of the Opinion (Second Appeal concerning Small Cause Suit)

Factual and Procedural Background

The second appeal arises from a suit brought by the present plaintiff seeking a declaration that the decree in Small Cause Suit No. 2888 of 1924 (Small Cause Court, Trichinopoly) is not binding on him or on the family properties in his hands. The small cause action was founded on a promissory note executed by the plaintiff's undivided paternal uncle, Muthukrishna Chettiar. The uncle died while that suit was pending. After his death the plaintiff—then a minor—was impleaded as second defendant and represented by a Court guardian. The small cause judgment and decree record that the Court guardian engaged a vakil and that a defence was pleaded on behalf of the minor alleging (inter alia) that the deceased uncle was not the managing member and that the debt had been incurred for immoral purposes. The Small Cause Judge found the promissory note binding on the family properties because the uncle had executed it while in management and the debt arose from trading dealings (rubies).

In the present suit the plaintiff alleged the small cause decree was not binding on him or on the family properties on two grounds: (i) that he was not properly represented in the small cause suit (notably because he had a Court guardian while his mother was alive), and (ii) that his guardian ad litem was guilty of gross negligence in failing to raise a defence that would have prevented a decree against family properties. The District Munsiff initially granted a decree in the plaintiff's favour on these findings, but the District Judge set that decree aside, concluding there was no evidence of culpable negligence by the guardian. This second appeal follows.

Legal Issues Presented

  1. Whether the decree in the small cause suit is binding on the present plaintiff and on the family properties that came into his hands after the death of his uncle.
  2. Whether the minor plaintiff was properly represented in the small cause suit (including whether appointment of a Court guardian when his mother was alive was improper or fraudulent).
  3. Whether omission by the guardian ad litem to raise the defence that the uncle's trade was not ancestral (and hence family property not liable) constituted gross negligence sufficient to invalidate the small cause decree against the minor and family properties.
  4. Whether, as a matter of procedure and law, a plea regarding liability of family property in the hands of a surviving member could properly have been raised and tried in the small cause suit at all (i.e., whether surviving members can be impleaded as legal representatives for family property liability in such a suit).

Arguments of the Parties

Appellant (Plaintiff in present suit) — Contentions summarized from the opinion

  • The decree in the small cause suit is not binding on him or on the family properties that came into his hands, because he was not properly represented at the previous trial (he had a Court guardian despite his mother being alive).
  • The guardian ad litem in the small cause suit was guilty of gross negligence in failing to plead or establish the defence that the uncle's ruby trade was not ancestral and so the family property in the minor's hands could not be held liable by survivorship.

Respondent (Plaintiff in small cause suit) — Contentions summarized from the opinion

  • Mr. T.R. Srinivasa Aiyar (for the respondent) argued that the lower Court's finding of fact (that there was no culpable negligence by the guardian) is a factual finding not to be disturbed by the appellate court in a second appeal.
  • He further contended, as a matter of law, that a decree obtained against a minor can be set aside only on the ground of fraud and not on the ground of gross negligence of the guardian; he relied on authority supporting that narrower rule.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Raghubar Dyal Sahu v. Bhikya Lal Misser (1885) I.L.R. 12 Cal. 69 Cited as authority for the proposition that a minor can have a decree set aside only on the ground of fraud (as argued by respondent). The Court noted there is "something in support" of the respondent's contention in this case but observed that all later authorities are contrary; it did not follow this case as the controlling rule.
Punnayyah v. Viranna (1921) 42 M.L.J. 429 : I.L.R. 45 Mad. 425 Authority supporting that a decree obtained against a minor can be set aside on grounds other than fraud (including gross negligence by guardian). The Court relied on this later Madras authority as representative of a line of decisions contrary to Raghubar Dyal Sahu, and treated it as sufficient to show that negligence (not only fraud) can ground setting aside such decrees.
Jogarao v. Venkamma A.I.R. 1927 Mad. 497 Listed as one of the later authorities against the limited rule in Raghubar Dyal Sahu. The Court cited this case among others to show that subsequent Madras authorities support relief from decrees obtained against minors on grounds of gross negligence of guardians.
Ayya Pillai v. Ayyadurai Goundan (1934) 67 M.L.J. 927 Another later authority supporting that negligence of the guardian can justify setting aside decrees against minors. Used with other cases to establish that later authorities do not follow the narrow view in Raghubar Dyal Sahu.
Gotepati Subban v. Gotepati Narasamma (1914) 27 M.L.J. 486 Authority for the principle that omission to put forward the correct defence (or putting forward an absurd defence) by a guardian ad litem constitutes gross negligence. The Court applied this principle directly: holding that failure to raise the clearly available defence that the trade was not ancestral amounted to gross negligence and justified setting aside the small cause decree.
Sellappa Goundan v. Masa Naiken (1923) 45 M.L.J. 675 : I.L.R. 47 Mad. 79 at 83 Contains a passing reference to Raghubar Dyal Sahu but does not imply dissent from Punnayyah v. Viranna. The Court observed that the passing reference in this case does not contradict the later Madras authorities represented by Punnayyah.
Raj Gopal Acharjya v. Upendra Acharjya Goswami (1926) I.L.R. 5 Pat. 768 Decision turned on the express language of Section 258 of the Chota Nagpur Tenancy Act (statutory point). The Court distinguished this Patna decision on its statutory basis and therefore did not treat it as controlling on the general principles under consideration.
Kali Charan v. Hirdai Narain A.I.R. 1935 Pat. 24 at 28, 29 Patna High Court observations showing the Patna Court has taken the same view as the Madras Court on relevant principles. Referred to as confirming that the Patna Court had expressed similar views to the Madras authorities on the availability of relief to minors for guardian negligence.
Krishna Aiyar v. Krishnasami Aiyar (1900) I.L.R. 23 Mad. 597 Authority making it permissible for a creditor to include in one suit both (a) claim against the maker of a promissory note and (b) claim against other members of the joint family in respect of that debt. The Court acknowledged this line of authority but emphasized that such a suit in effect combines two causes of action and does not change the rule that, on the death of the maker, the cause of action on the note survives only against legal representatives in the strict sense (heirs-at-law) and not generally against other joint family members.
Veerappa Chettiar v. Ramaswami Aiyar (1903) I.L.R. 27 Mad. 106 Recognized that surviving members cannot be treated as legal representatives for the purpose of family property liability arising from a deceased member's debt. Used by the Court to support the view that surviving joint family members (other than sons) are not legal representatives for the purpose of binding joint family property by a suit on a promissory note.
Gyanendra Nath Basu v. Rani Nihalo Bibi (1910) I.L.R. 32 All. 404 Similar recognition that surviving members are not legal representatives for joint family property liability. Included among authorities relied on to show that a decree could not be made against joint family property by merely impleading survivors as legal representatives.
Sumeshar Bind v. Baldeo Sahu (1934) 33 A.L.J. 293 Authority addressing whether possession and devolution of separate property must be proved before impleading a surviving member as legal representative; recognizes limits on execution against joint family property. The Court cited this decision in discussing procedural and substantive limits on impleading survivors; noted a difference of opinion between this and a Madras case but agreed that after impleading a survivor a decree can only be against the assets of the deceased.
Dwarka Das v. Krishan Kishore (1921) I.L.R. 2 Lah. 114 at 117, 118 Authority recognizing that surviving members are not legal representatives regarding joint family property liability. Used as one of several precedents demonstrating the principle that surviving members (other than sons) are not to be treated as legal representatives for joint family property liabilities.
Viraragavamma v. Samudrala (1885) I.L.R. 8 Mad. 208 Authority holding that a decree obtained against a member of a joint Hindu family cannot be executed against shares of other members unless they are sons of the judgment-debtor. Cited to support the proposition limiting execution of decrees against joint family members' shares.
Guruvappa v. Thimma (1887) I.L.R. 10 Mad. 316 Same principle as Viraragavamma about execution against shares of other members. Included among cases showing the rule limiting execution against other family members' shares.
Sathuvayyan v. Muthusami (1888) I.L.R. 12 Mad. 325 Again, establishes limits on executing decrees against other members' shares. Referred to with similar cases to demonstrate the consistent view on execution limitations.
Lakshmana Chettiar v. Muthu Chellia Goundan (1934) 68 M.L.J. 104 Another case affirming the rule that a decree against one member cannot be executed against other members' shares unless they are sons. Used to reinforce the Court's discussion of execution limits against joint family property in the hands of survivors.
Seshayya v. Sanjivarayudu (1933) 67 M.L.J. 393 Held that in a suit on a promissory note executed by a member of a joint Hindu family, surviving members cannot be impleaded as legal representatives. Cited to support the proposition that survivors should not be treated as legal representatives for such causes of action.
Rengathammal v. Venkatachariar A.I.R. 1930 Mad. 575 Part of a disagreement in the Court as to whether possession of separate property and its devolution must be proved before impleading a surviving member. Referred to in describing a difference of opinion in the Court on procedural proof before impleading survivors; not treated as altering the core practical result discussed.

Court's Reasoning and Analysis

The Court proceeded through a sequence of factual observations and legal conclusions strictly based on the record and authorities cited:

  1. Representation issue: The Court accepted the District Judge's observation that, at this late stage and given that records of the small cause suit had been destroyed, it could not be held that the minor was the victim of fraud by being represented by a Court guardian while his mother was alive. The Court reasoned that appointment of a Court guardian in the first instance is unlikely; steps must usually have been taken to appoint someone else and only on failure of those steps would a Court guardian be appointed. Accordingly, the Court declined to interfere with the lower Court's conclusion on proper representation.
  2. Guardian negligence and factual findings: Both the District Munsiff and the District Judge found that the uncle's ruby trade was not ancestral but was started by the uncle himself. Both courts also held that on this fact the minor nephew could not have been held liable for the uncle's debt by survivorship as regards joint family property. The District Munsiff therefore gave a decree for the plaintiff; the District Judge set it aside because there was "no evidence at all as to what [the guardian] did" and he considered the omission to be unsupported by positive evidence of culpable negligence.
  3. Appellate review on negligence: The Court accepted that while it is bound by the facts found by the lower Judge, it is open in a second appeal to consider whether those facts, properly understood, amount in law to negligence. The Court rejected the respondent's contention that as a matter of law a minor can have a decree set aside only on grounds of fraud; after reviewing authorities it found that later Madras and other authorities support setting aside decrees for gross negligence by guardians.
  4. Procedural propriety of raising family liability in small cause suit: The Court examined whether the question of family liability should have been allowed to be raised and tried in the small cause suit at all. It recognised a line of authority (e.g., Krishna Aiyar) permitting inclusion of both the maker's personal liability and the joint family's liability in one suit, but emphasised that such a suit combines two causes of action and that on the maker's death the cause of action on the note survives only against his legal representative in the strict sense (heir-at-law) and not against other surviving family members (except where statutory provisions like Section 53, Civil Procedure Code, may affect sons). Several authorities were cited to show surviving members are not legal representatives for purposes of joint family property liability; the Court concluded an objection could have been taken to impleading the minor as legal representative and that, if impleaded, he could only raise defences appropriate to that representative character — and that an issue as to binding character of the note on the family should not have been permitted to be raised and dealt with in the small cause suit.
  5. Merits and culmination on gross negligence: Even assuming omission to take the procedural exception in the small cause suit would not itself constitute gross negligence, the Court found a stronger ground on the merits. Because both lower courts found the trade was not ancestral, the defence that family property could not be held by survivorship was clearly available. The Court held that omission to plead this meritorious defence (or to investigate and present facts to support it) amounted to gross negligence by the guardian ad litem — whether the guardian was the Court-appointed guardian or the minor's mother acting as guardian. The Court stated that it was not asserting that mere failure to advance untenable defences would qualify, but here the defence was clearly tenable and available; the alternative defence advanced earlier (illegality/immorality) was a stock defence not substantiated. The Court applied the principle from Gotepati Subban that omission to put forward the correct defence is equivalent to putting forward an absurd defence and constitutes gross negligence.
  6. Remedy and procedural closure: On these grounds the Court held the second appeal should be allowed, restored the decree of the trial Court in favour of the present plaintiff (with costs in both lower courts), and declined leave to file a Letters Patent Appeal because the amount involved (approximately Rs. 367 plus interest) did not justify further prolongation of litigation.

Holding and Implications

Holding: THE SECOND APPEAL IS ALLOWED; the decree of the trial Court (District Munsiff) is restored in favour of the present plaintiff, with costs here and in the Court below. Leave to file a Letters Patent Appeal is refused.

Implications:

  • Direct effect on the parties: The trial Court's decree in favour of the plaintiff (that the small cause suit decree is not binding on him or on the family properties in his hands) is restored. The small cause decree is thereby invalidated to the extent challenged in the present suit, and the plaintiff recovers costs from the respondent for both the trial and appellate courts.
  • On broader law: The opinion relies on a series of Madras and other authorities to confirm that a decree obtained against a minor may be set aside not only on proof of fraud but also on the ground of gross negligence by the guardian ad litem where a tenable defence was omitted. The Court also reiterated limitations on impleading surviving joint family members as legal representatives in suits on promissory notes — and emphasised that the liability of joint family property is a distinct cause of action which, on death of the maker, survives only in limited, statutory or strictly representative circumstances.
  • The opinion does not purport to set a broad new precedent beyond applying existing authorities to the facts; its practical effect is to vindicate the plaintiff's rights in this particular factual matrix and to refuse further appeal in the matter for reasons of proportionality (small amount involved).
Show all summary ...

1. This second appeal arises out of a suit brought by the plaintiff for a declaration that the decree in small cause suit No. 2888 of 1924 on the file of the Small Cause Court, Trichinopoly, is not binding on the plaintiff or the family properties in his hands. The small causes suit was instituted on a promissory note executed by the plaintiff's undivided uncle, one Muthukrishna Chettiar, who died pending that suit. On his death the plaintiff who was then a minor was impleaded as the second defendant and all that appears at present is that he was represented by a Court guardian. The decree and the judgment show that the Court guardian engaged a vakil for the minor plaintiff and it was pleaded on his behalf that the deceased first defendant was not the managing member of the family and that the debt was incurred by him for immoral purposes. An issue was raised whether the suit promissory note was binding on the family. The small cause Judge held that the plaintiff in that suit was entitled to a decree not merely against the assets of the deceased first defendant but also against the family properties of both the defendants, because the promissory note had been executed by the first defendant when he was in management of the family affairs for a debt which was found due on dealings. He added:

The first defendant was a ruby merchant and the dealings related to the purchase of rubies. The defendants are a Chetti family which may be presumed to be a trading family. The first defendant was a trader in rubies.

2. In the present suit, the plaintiff alleged that the decree was not binding upon him and the family properties in his hands, on two grounds (i) that he was not properly represented in the small cause suit, and (ii) that his guardian ad litem had been guilty of gross negligence. The objection as to proper representation rests on the circumstance that the plaintiff had been represented by a Court guardian when his mother was alive. The learned District Judge rightly points out that at this time of the day when the records of the small cause suit had been destroyed, it is not possible to hold that the plaintiff in the small cause suit must have been guilty of fraud in the matter of getting the minor represented by a Court guardian.

3. It is scarcely likely that any Court would in the first instance have appointed a Court guardian. Some steps must have been taken to have somebody else appointed guardian and it is only on failure of these steps that a Court guardian is likely to have been thought of. I am not therefore prepared to interfere with the lower Court's conclusion so far as the first ground is concerned.

4. As regards the second ground, the fact, as now concurrently found by both the Courts, is that the ruby trade in connection with which the uncle executed the promissory note to the plaintiff in the small cause suit was not an ancestral trade but one started by the uncle himself. Both the Courts have also held that on these facts the minor nephew could not have been legally held liable for that debt of the uncle, nor the family property which had come into his hands, by survivorship. On these findings, the District Munsiff gave a decree in the plaintiff's favour, but the learned District Judge set it aside with the following observations:

It has not however been shown that the omission to take this line of defence was due to any culpable negligence on the part of the Court guardian. There is no evidence at all as to what he did and what particular step he took.... The pleader who appeared for plaintiff has also not been examined to show from whom and in what circumstances he derived his instructions. In the absence of any positive evidence from him or from plaintiff's mother....I consider that this appeal should be allowed.

5. On behalf of the respondent, Mr. T.R. Srinivasa Aiyar contends that this is a finding of fact which I am not entitled to interfere with; I cannot accede to that contention. I am bound by the facts stated by the learned Judge but the question whether on these facts what will amount in law to negligence has been made out or not is one which it is open to this Court in second appeal to consider. I may also dispose of another contention of Mr. Srinivasa Aiyar, viz., that as a matter of law a minor can have a decree against him set aside only on the ground of fraud and not on the ground of gross negligence on the part of the guardian. There is no doubt something in support of this contention in Raghubar Dyal Sahu v. Bhikya Lal Misser (1885) I.L.R. 12 Cal. 69, but all the later authorities are against it. It is sufficient to refer to Punnayyah v. Viranna (1921) 42 M.L.J. 429 : I.L.R. 45 Mad. 425, Jogarao v. Venkamma A.I.R. 1927 Mad. 497, Ayya Pillai v. Ayyadurai Goundan (1934) 67 M.L.J. 927 and Gotepati Subban v. Gotepati Narasamma (1914) 27 M.L.J. 486. The passing reference in Sellappa Goundan v. Masa Naiken (1923) 45 M.L.J. 675 : I.L.R. 47 Mad. 79 at 83, to the decision in Raghubar Dyal Sahu v. Bhikya Lal Misser (1885) I.L.R. 12 Cal. 69, certainly does not imply dissent from the considered judgment in Punnayyah v. Viranna (1921) 42 M.L.J. 429 : I.L.R. 45 Mad. 425. The decision in Raj Gopal Acharjya v. Upendra Acharjya Goswami (1926) I.L.R. 5 Pat. 768, turned on the express language of Section 258 of the Chota Nagpur Tenancy Act. That on general principles the Patna High Court has taken the same view as the Madras Court will be seen from the observations of that Court in Kali Charan v. Hirdai Narain A.I.R. 1935 Pat. 24 at 28, 29.

6. Before dealing with the particular ground dealt with in the Courts below, I may state that there is one other point which also seems to me to be of some importance in the case, namely, whether the plea of the liability of the family property in the hands of the minor defendant should have been allowed to be raised in the small cause suit at all. As stated already, that suit was on a promissory note executed by the minor's paternal uncle and he was the only defendant in the first instance. It is true that a line of authority in this Court beginning from Krishna Aiyar v. Krishnasami Aiyar (1900) I.L.R. 23 Mad. 597, makes it permissible for the creditor to include in one and the same suit not merely the claim against the maker of the promissory note but also the claim against the other members of the joint family in respect of the debt represented by the note. But there can be little doubt that such a suit really combines two causes of action and two kinds of liability, namely, that of the maker under the note, and that of the other members under the Hindu Law. The authorities bearing upon this question have been considered at some length in a recent judgment in Appeal Suit No. 89 of 1931 to which I was a party and it is unnecessary to re-capitulate them here. There can be no doubt that on the death of the maker the cause of action on the note would have survived only against his legal representative in the strict sense, i.e., his heir-at-law and not against the surviving members of the joint Hindu family other than sons. In the case of sons the special provision enacted in Section 53, Civil Procedure Code, may introduce a difference. But in the case of the other members of the joint family the mere fact that they may be equally liable with the maker for the debt will not make them legal representatives of the maker. That they cannot be legal representatives so far as the joint family property in their hands is concerned has been recognised in several cases. It is sufficient to refer to Veerappa Chettiar v. Ramaswami Aiyar (1903) I.L.R. 27 Mad. 106, Gyanendra Nath Basu v. Rani Nihalo Bibi (1910) I.L.R. 32 All. 404, Sumeshar Bind v. Baldeo Sahu (1934) 33 A.L.J. 293 and Dwarka Das v. Krishan Kishore (1921) I.L.R. 2 Lah. 114 at 117, 118. Cases in this Court have also held that a decree obtained against a member of a joint Hindu family even if it be for a debt binding on the family cannot be executed against the shares of other members of the family unless they be sons of the judgment-debtor. Cf. Viraragavamma v. Samudrala (1885) I.L.R. 8 Mad. 208, Guruvappa v. Thimma (1887) I.L.R. 10 Mad. 316 and Sathuvayyan v. Muthusami (1888) I.L.R. 12 Mad. 325 and Lakshmana Chettiar v. Muthu Chellia Goundan (1934) 68 M.L.J. 104. In a recent case Seshayya v. Sanjivarayudu (1933) 67 M.L.J. 393, it was held by Cornish, J., that in a suit on a promissory note executed by a member of a joint Hindu family the surviving members of the joint family cannot be impleaded as legal representatives. There has been some difference of opinion between a case in this Court, Rengathammal v. Venkatachariar A.I.R. 1930 Mad. 575 and the decision of the Allahabad High Court in Sumeshar Bind v. Baldeo Sahu (1934) 33 A.L.J. 293, as to whether the possession of separate property by the deceased member of the joint Hindu family and the devolution thereof on a surviving member of a joint Hindu family should be proved in the first instance even before the surviving member could be impleaded as a legal representative. But even in the Allahabad case, the Court recognized that after impleading the survivor as a legal representative, a decree could be passed only against the assets of the deceased and not as against the joint family property. In the light of these considerations I am of opinion that an objection could have been taken on behalf of the minor defendant to his being impleaded as a legal representative in the small cause suit on the death of his undivided uncle. When he was so added he could have raised only such defences as were appropriate to his character as legal representative. An issue as to the binding character of the note on the family should not have been permitted to be raised and dealt with at all." Cases which relate to the immovable property possessed by a joint Hindu family in respect of which a member of the family sues or is sued in a representative character and cases in which the managing member of a family may sue on debts due to the family stand on a different footing altogether and do not bear any analogy to the present case.

7. Assuming, however, that the omission to take exception in the small cause suit to the trial of the question of the liability of the family property would not of itself amount to gross negligence on the part of the guardian ad litem, because the question must at least have been tried in a separate suit, the minor has a stronger ground on the merits in the present case. As I have stated already, both the Courts have concurrently found that the trade in the course of which the debt was incurred by the uncle was not an ancestral trade but one started by the uncle. If this fact had been pleaded, a decree could not have been passed as against the joint family property in the hands of the minor. I do not see how the omission to examine the plaintiff's mother or the vakil who appeared for him in the former litigation bears upon this question. I am prepared to assume for the purpose of argument that the mother herself was the guardian ad litem of the minor. The respondent could not put his case on a higher footing. It will then follow either that she was not aware of the law or that she was not aware of the material facts. In either view, the omission to raise the plea will amount to gross negligence. I am not for a moment asserting that untenable or unfounded defences should have been put forward but the investigation of the facts in the present case has shown that this defence was clearly available. On the other hand, the only defence thought of on the former occasion was the stock defence of illegality and immorality which no attempt was made to substantiate. As held in Gotepati Subban v. Gotepati Narasamma (1914) 27 M.L.J. 486, the omission to put forward the correct defence equally with the putting-forward of an absurd defence will constitute gross negligence on the part of the guardian ad litem. The second appeal must therefore be allowed and the decree of the trial Court restored with costs here and in the Court below.

8. Application is made to me for leave to file a Letters Patent Appeal. I should gladly have granted the leave if the interests involved were large enough to justify it. The amount of the small cause decree is only about Rs. 367 and subsequent interest. I do not think it justifies the further prolongation of this litigation. I decline to grant leave.