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Citation Codes
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citation codes
Case Number
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Acts
  • Section 2(12) Civil P.C.,
  • Section 6(e), T.P. Act,
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • Section 2(12) Civil P.C.,
  • Section 6(e), T.P. Act,
Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

Some of the co-owners of certain properties transferred their rights in those properties in favour of the plaintiff. They also purported to transfer their rights to past profits arising from those properties. Defendant 1 resisted the plaintiff's claim to the past profits on the basis that, under Section 6(e) of the Transfer of Property Act (T.P. Act), a "mere right to sue" cannot be transferred. The matter reached the court on a second appeal. The court examined whether the assignment amounted to a prohibited "mere right to sue" or a valid transfer of property and related profit claims, and ultimately allowed the second appeal with costs and restored the judgment of the trial court.

Legal Issues Presented

  1. Whether the transfer in favour of the plaintiff was a "mere right to sue" (and thus void under Section 6(e), T.P. Act), or whether the transferee acquired an interest beyond a bare right to sue.
  2. Whether the claim to past profits constituted an assignment of "mesne profits" (which the defendant contended would be invalid), and if so, whether that affected the validity of the assignment.

Arguments of the Parties

Defendant 1's Arguments

  • That under Section 6(e) of the Transfer of Property Act a "mere right to sue" cannot be transferred; thus the purported transfer of past profits was invalid if it amounted to only a mere right to sue.
  • That the transfer was of "mesne profits" and therefore invalid (the defendant resisted the claim to profits on this basis).

The opinion does not contain a detailed account of the plaintiff's legal arguments beyond the factual statement that co-owners transferred their rights (including purported rights to past profits) in favour of the plaintiff and that the property itself was transferred along with the right to profits.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Yerukola v. Yerukola, AIR 1922 Mad 150 Cited for the proposition that the receipt of profits by a co-sharer is not wrongful possession. The court relied on this authority to distinguish profits received by a co-sharer from "mesne profits" (which connote wrongful possession), supporting the view that the right against a co-sharer is not a right to mesne profits.
Ramiah v. Rukmani Ammal (1913) 18 IC 138 Cited for the principle that the right to obtain and call for an account (against a co-sharer in possession) can be transferred. The court applied this precedent to hold that the right to past profits (a right to an account) is transferable and therefore the assignment to the plaintiff did not contravene law.
Annamalai Chettiar v. Muthukaruppan Chettiar, AIR 1981 PC 9 Cited for the same general proposition that rights to accounts or similar proprietary claims can be assigned. The court relied on this authority together with Ramiah v. Rukmani Ammal to support the conclusion that the assignment of the right to call for an account of profits is valid.

Court's Reasoning and Analysis

The court considered first whether the transfer was a "mere right to sue" under Section 6(e) of the Transfer of Property Act. It interpreted the adjective "mere" to mean a situation in which the transferee acquires no interest other than a bare right to sue. The court found that in the present case the transfer included not only the right to past profits but also the property itself; therefore the transfer was not a "mere right to sue."

Turning to the defendant's contention that the transfer was of "mesne profits" (and so invalid), the court stated it was unnecessary to decide generally whether mesne profits are assignable. The court observed that the term "mesne profits" implies wrongful possession (citing Section 2(12) Civil P.C.), but noted established authority that a co-sharer receiving profits is not in wrongful possession (citing Yerukola v. Yerukola). Accordingly, the court held that the right to profits against a co-sharer in possession is not a right to mesne profits but is instead a right to obtain and call for an account.

Finally, the court relied on precedent (Ramiah v. Rukmani Ammal and Annamalai Chettiar v. Muthukaruppan Chettiar) establishing that a right to obtain an account can be transferred. Applying those principles to the facts, the court concluded that the assignment in favour of the plaintiff did not contravene any principle of law and therefore must be recognized.

Holding and Implications

Core holding: The second appeal is allowed; the assignment in favour of the plaintiff is recognized as valid and the judgment of the trial court is restored.

Implications and direct consequences:

  • The assignment of the property and the right to past profits in favour of the plaintiff was held valid and not to be a prohibited "mere right to sue."
  • The court awarded costs to the plaintiff both before this court and in the court below.
  • The opinion does not articulate any broader legal rule beyond the application of existing authorities; the decision resolves the dispute between the parties without announcing a new precedent.

    Susai Lazar Villavarayar v. M. Ramaswami Naidu

    1. Some of the co-owners transferred their rights in certain properties in favour of the plaintiff. They also purported to transfer their right to the past profits. Defendant 1 resists the claim to the profits on the ground that under Section 6(e), T.P. Act, a mere right to sue cannot be transferred. In the first place, was what was transferred a mere right to sue? The word "mere" in the section is not without significance and in my opinion implies that the transferee has acquired no interest other than a bare right to sue. But in this case not only was the right to the profits assigned, but the property itself was transferred. Secondly, defendant 1's contention is that the transfer was of mesne profits and is therefore invalid. It is unnecessary to inquire whether mesne profits can be assigned or not. The expression "mesne profits" connotes that the defendant is in wrongful possession: vide Section 2(12) Civil P.C., but it is well settled that the receipt of profits by a cosharer in not wrongful; sea Yerukola v. Yerukola AIR 1922 Mad 150. The right to the profits against a cosharer in possession, is not in law a right to mesne profits, but is a right to obtain and call for an account, and such a right, it has been repeatedly held, can be transferred: see Ramiah v. Rukmani Ammal (1913) 18 IC 138 and Annamalai Chettiar v. Muthukaruppan Chettiar AIR 1981 PC 9. In this view the assignment in favour of the plaintiff does not contravene any principle of law and must be recognized. In the result the second appeal is allowed with costs here and in the Court below and the judgment of the trial Court is restored.

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    Susai Lazar Villavarayar v. M. Ramaswami Naidu
    (Apr 20, 1933)