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Sir William Comer Petheram

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Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

The plaintiffs (respondents) brought a suit alleging that on 27 June 1872 two members (Kishandeo and Barhamdeo) of a three-person Mitakshara joint family (the third being Baldeo) executed a bond that purported to mortgage certain properties. On 25 July 1882 the defendants described as "2nd party" sued on that bond and obtained a decree against Kishandeo, Barhamdeo and Baldeo; execution of that decree led to an alleged irregular sale of mauzas Pipra and Bangra, purchased on 16 March 1888 by the defendant described as "1st party" (Hardhani Lal).

Prior to the suit by the 2nd party (in August 1881) the three joint owners had mortgaged Pipra and Bangra to a third person, Narsingh Das. Narsingh Das obtained a decree on his mortgage on 13 March 1884 and caused mauza Pipra to be sold in execution; the plaintiffs purchased Pipra on 21 November 1884 and obtained possession.

The plaintiffs alleged the 1872 mortgage to the 2nd party was invalid and the subsequent decree and sale irregular; they sought a declaration of invalidity or, alternatively, a determination of the lien and the right to redeem on payment. The 1st party resisted and maintained his auction purchase was valid; the 2nd party additionally argued that a suit for redemption could not proceed because not all persons interested in the jointly mortgaged properties were parties. The 3rd party did not appear.

The lower court decided (without addressing one of the trial issues) in favor of the plaintiffs, declaring the 1872 mortgage and the decree and sale based on it invalid, and confirming the plaintiffs' possession. Both the 1st and 2nd party defendants appealed that decree; the appeals were heard together.

Legal Issues Presented

Whether the bond of 27 June 1872 created a valid mortgage and, if so, upon what property (the 1st issue framed at trial).
What are the respective rights of the various parties (the 8th issue framed at trial).
On appeal, whether a mortgage executed by two of three undivided coparceners without the consent of the third is binding on all three.
Whether the mortgage was valid as regards the shares of the mortgagors or at least created an equitable charge on those shares.
Whether the suit, insofar as it sought redemption, could proceed in the absence of all persons interested in the originally mortgaged properties (i.e., defect of parties).
Whether the plaintiffs had any cause of action (an objection raised on appeal but not taken below).

Arguments of the Parties

Appellants (defendant, 1st party, and defendants, 2nd party)

Contended that the 1872 mortgage bond, although executed by only two of the three joint owners, was binding upon all three.
Argued alternatively that the mortgage was valid at least as regards the shares of the executing mortgagors, or that at minimum the bond created an equitable charge upon those shares.
Asserted that, insofar as the suit sought redemption, it could not proceed due to defect of parties (not all persons interested in the original mortgage were made parties).
Maintained the plaintiffs had no cause of action.

Plaintiffs (respondents)

Alleged that the 1872 mortgage was invalid and that the decree and execution sale predicated on it were irregular and ineffectual against them.
Plead that they had purchased mauza Pipra in execution under the prior mortgage to Narsingh Das, had obtained possession, and that the auction purchaser (1st party) was challenging and obstructing their peaceful possession.
Sought a declaration of invalidity of the 1872 mortgage or, alternatively, determination of the lien and a right to redeem upon payment.

Other procedural positions

Defendants, 3rd party, did not appear.
The 2nd party earlier raised the procedural point that a redemption suit requires all persons interested to be joined as parties.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Sadabart Prasad Sahu v. Foolbash Koer, 3 B.L.R. (F.B.) 31; 12 W.R. (F.B.) 1	Held by the Full Bench that one co-sharer has no authority, without the consent of co-sharers, to mortgage his undivided share in a portion of joint-family property to raise money for his own account (i.e., limitation on unilateral alienation by a co-sharer). The case left undecided whether the mortgaged interest could be recovered without redemption because the facts were insufficient.	The lower court relied on this case to decide against the appellants. The appellate court found that Sadabart does not settle whether a subsequent purchaser (claiming under the mortgagors) can be compelled to accept recovery without redemption; thus it was not dispositive of the present question.
Mahabeer Persad v. Ramyad Singh, 12 B.L.R. 90; 20 W.R. 192	Division Bench held that where joint property had been mortgaged by some members (without necessity and without consent of another coparcener), on setting aside the alienation the shares of the mortgagors should be held subject to an equitable lien for the money advanced (i.e., the mortgagors' shares remained chargeable until repayment) to prevent unjust enrichment.	The court treated Mahabeer Persad as establishing the equitable principle that, to avoid leaving mortgagors with both the property and the mortgage money, recovery may be subject to an equitable charge; applied this principle to hold the plaintiffs must pay the mortgage money with interest as an equitable charge on the shares they claim — i.e., their only right is to redeem.
Madho Parshad v. Mehrban Singh, I.L.R. 18 Cal. 157; L.R. 17 I.A. 194	Judicial Committee approved the Division Bench decision in Mahabeer Persad (endorsing the equitable-charge principle described therein).	The appellate court noted this approval and relied upon it as further support for treating the outstanding mortgage advance as an equitable charge on the mortgagors' shares, reinforcing the conclusion that plaintiffs must redeem by paying the mortgage money with interest.
Nilakant Banerjee v. Suresh Chundra Mullick, I.L.R. 12 Cal. 414	States that in a suit for redemption all persons interested in the properties originally mortgaged must be made parties to the suit.	The court invoked this authority to conclude that, because the plaintiffs' only right was one of redemption, all persons interested must be before the court; as not all had been made parties, the matter should be remanded so necessary parties can be joined and the suit tried as one for redemption.

Court's Reasoning and Analysis

The appellate court considered the primary points raised on appeal and addressed them sequentially:

On whether the two executants bound the entire joint family: the court found insufficient evidence that the two who signed the bond were acting as managers (i.e., lacked proof of authority to bind the joint family). The fact that Baldeo did not object to a decree against him in the earlier suit was held not to be evidence against the plaintiffs, because that earlier suit and decree were instituted after the mortgage to Narsingh Das through whom the plaintiffs claimed.
On the objection that the plaintiffs had no cause of action (a point not taken in the lower court): the appellate court rejected the late-raised objection, observing that the plaintiffs had pleaded interference with peaceful possession and that the defendants could have met such an objection with evidence if it was timely raised.
On whether the mortgage created at least an equitable charge on the mortgagors' shares: the court examined prior authorities. It distinguished Sadabart Prasad Sahu as not decisively answering the present question (Sadabart had left open whether the mortgaged interest could be recovered without redemption). The Division Bench decision in Mahabeer Persad — and its approval by the Judicial Committee in Madho Parshad — established the equitable principle that, where an alienation by mortgagors would otherwise result in them retaining both the property and the mortgage money, the mortgagors' shares should remain subject to a lien for the money advanced until repayment. Applying that principle, the appellate court held that although the two mortgagors lacked authority to mortgage the undivided family shares without consent, plaintiffs who claim under those mortgagors are not entitled to recover those shares free of charge; instead, they must pay the mortgage money with interest, which stands as an equitable charge on the shares. Thus, the plaintiffs' substantive right against the 1st and 2nd party is limited to the right to redeem.
On whether mauza Pipra was included in the 1872 mortgage: the court reviewed the mortgage bond terms and agreed with the lower court that contentions to the contrary were untenable.
On the defect of parties in a suit for redemption: because the appellate court concluded that the plaintiffs' only enforceable right was redemption, the rule that all persons interested in the originally mortgaged properties must be parties applied (citing Nilakant Banerjee). As not all necessary parties had been joined, the court determined it would be improper to dismiss outright; instead it remanded the case to the lower court for trial as a suit for redemption after making all necessary persons parties and for determination of the 8th issue (the respective rights of the parties).

The appellate court therefore reversed the lower court's declaration of total invalidity and incomplete remedy, and substituted the equitable principle that repayment of the mortgage advance (with interest) is required to redeem the affected shares.

Holding and Implications

Holding (core ruling): The decree of the lower Court declaring the mortgage of 1872 and the decree and sale based thereon invalid is set aside; the case is remanded to the lower Court to be tried as a suit for redemption after all necessary persons interested in the originally mortgaged properties are made parties.

Direct implications for the parties:

The appellate court held that the plaintiffs' only right as against the 1st and 2nd parties is the right to redeem the mortgaged shares by paying the money advanced under the 1872 mortgage with interest — that sum is to be regarded as an equitable charge on those shares.
The lower court's unqualified declaration of invalidity in favor of the plaintiffs is set aside; the matter is remitted for fresh trial on the basis that the suit is one for redemption and that all necessary parties must be joined.
The appellants (defendant, 1st party, and defendants, 2nd party) are entitled to the costs of these appeals, with only one hearing fee allowed; other costs are left to the discretion of the lower court.

Broader implications: The opinion applies existing equitable principles (as articulated in Mahabeer Persad and approved in Madho Parshad) to prevent mortgagors or their privies from retaining both the property and the mortgage money; it emphasizes procedural requirements for redemption suits (all interested persons must be parties). The opinion does not purport to establish a novel precedent beyond applying those principles to the facts before the court.

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Jamuna Parshad And Anr v. Ganga Pershad Singh And Ors

1. The suit out of which these two appeals arise was brought by the plaintiffs, respondents, on the following allegations, viz., that two persons, Kishandeo and Barhamdeo, who with a third, Baldeo, formed a Mitakshara joint family now represented by the defendants, 3rd party, executed in favour of defendants, 2nd party, Jamuna Prashad and Ishri Prashad, on the 27th June 1872, a bond mortgaging certain properties, not very clearly described; that defendants, 2nd party, on the 25th July 1882, brought a suit upon the bond and obtained a decree against the said Kishandeo and Barhamdeo and also against Baldeo, and in execution of that decree improperly put up to sale mauzas Pipra and Bangra, which were purchased by defendant, 1st party, Hardhani Lal, on the 16th March. 1888; that before the institution of the suit by defendants, 2nd party, Kishandeo, Barhamdeo, and Baldeo in August 1881 mortgaged to one Narsingh Das the mauzas Pipra and Bangra; that Narsingh Das, having on the 13th of March 1884, obtained a decree on his mortgage, caused the mortgaged property, mauza Pipra, to be sold in execution, and the plaintiffs purchased the same on the 21st of November 1884 and duly obtained possession; that the mortgage to defendants, 2nd party, was invalid and the sale at their instance was irregularly held; and that the defendant, 1st party, was setting up his auction purchase against the plaintiffs and offering opposition to their peaceful possession. And the plaintiffs prayed that the Court might declare that the mortgage bond of the 27th June 1872 was invalid, and the decree and the execution sale upon the basis thereof ineffectual as against them; and that if the Court was of opinion that the said mortgage bond was valid, it might determine the amount of the lien chargeable upon Pipra and declare the plaintiffs' right to redeem on payment of such amount.

2. Defendant, 1st party, resisted the claim on various grounds, and maintained that his auction purchase was valid; and defendants, 2nd party, urged in addition that the suit as one for redemption could not proceed, as persons interested in the other properties mortgaged jointly with Pipra were not made parties to the suit. Defendants, 3rd party, did not appear.

3. The parties went to trial upon various issues, of which it is necessary to notice here only two, namely, the 1st and the 8th, which were as follows:

1st.--Did the bond of June 27th, 1872, create a valid mortgage; and, if so, upon what property 1 8th.--What are the respective rights of the various parties?

4. In the view which the Court below took of the case, it was not necessary to consider the 8th issue. But it decided all the other issues, except the second part of the first, in favour of the plaintiffs, and gave them a decree, declaring the mortgage of 1872 and the decree and sale based thereon invalid, and confirming the plaintiffs' possession.

5. Against that decree these two appeals have been preferred by the defendant, 1st party, and defendants, 2nd party. They were heard together, and the points urged were--

first, that the mortgage bond of 1872, though executed by two only of the three joint owners, was binding upon all the three;

second, that at any rate the mortgage was valid as regards the shares of the mortgagors, or that the bond created an equitable charge as regards those shares;

third, that the suit, so far as it was one for redemption, could not proceed by reason of defect of parties; and fourth, that the plaintiffs had no cause of action.

6. As to the first point, there is no sufficient evidence to show that the two executants of the bond were acting as managers for the joint family. Great stress was laid upon the fact that Baldeo, the remaining member of the joint family, allowed the decree on the bond to be passed against him; but seeing that the suit which resulted in that decree was instituted after the mortgage to Narsingh, through whom the plaintiffs claim, neither that decree, nor the fact of Baldeo not having objected to the decree being passed against him, would be any evidence against them.

7. The fourth point also must be decided against the appellants, as no such objection was raised in the Court below, though the plaintiffs made a distinct allegation in paragraph 10 of the plaint that their peaceful possession had been interfered with by the defendant, 1st party. If the objection had been taken in time, it might have been met by evidence. We think it too late for the defendants to raise it now.

8. Upon the second point the Court below has decided against the appellants upon the authority of Sadabart Prasad Sahu v. Foolbash Koer 3 B.L.R., (F. B) 31; 12 W.R. P.B. 1 But we do not think that case settles the present question. It is true that the mortgage here was one by two out of three undivided coparceners in respect of joint property without the consent of the third, in order to raise money for the benefit of those two and not for that of the family; and it is true also that the Pull Bench in Sadabart's case held that one co-sharer' had no authority, without the consent of his co-sharers, to mortgage his undivided share in a portion of the joint-family property, in order to raise money on his own account, and not for the benefit of the family;' but the question whether the mortgaged interest could be recovered without redemption was expressly left undecided, as the facts were not sufficiently stated to enable the Court to determine that question. Moreover, the question of the validity of the mortgage in Sadabart's case was raised by the non-alienating coparcener, who did not claim through the mortgagor, and to whom the interest of the latter had passed by survivorship; whereas in the present case that question is raised not by persons claiming the mortgagor's interest by survivorship, but by persons claiming the same under a subsequent alienation made by those mortgagors jointly with their co-sharer.

9. In the case of Mahabeer Persad v. Ramyad Singh 12 B.L.R. 90; 20 W.R. 192 which was decided after the Full Bench case of Sadabart Prasad Sahu v. Foolbash Koer 3 B.L.R. (F.B.), 31; 12 W.R. (F.B.) 1 a father and his elder son, without legal necessity, and without the consent of a minor son who was their coparcener, had mortgaged their joint property, and a suit was brought to set aside the alienation in the lifetime of the mortgagors; and a Division Bench of this Court (PHEAR and AINSLIE, JJ.), while setting aside the alienation in the interest of the minor, directed that on recovery of the property, it should be held and enjoyed in defined shares, and that the shares of the father and his older son should be jointly and severally subject to the lien thereon of the mortgagees for the sum advanced by them with interest until repayment, the reason for making the loan an equitable charge upon these shares being that a decree without such qualification would have the effect of restoring their property to the father and son, and leaving them at the same time in possession of the money which they had borrowed on its security--a result that would have been contrary to equity and good conscience. The last-mentioned decision was approved by the Judicial Committee in Madho Parshad v. Mehrban Singh I.L.R. 18 Cal. 157; L.R. 17 I.A. 194.

10. The present case differs from the cases of Sadabart Prasad Sahu v. Foolbash Koer 3 B.L.R. (F.B.), 31; 12 W.R. (F.B.). 1 and Madho Parshad v. Mehrban Singh I.L.R. 18 Cal. 157; L.R. 17 I.A. 194 in this, that the mortgage is here sought to be declared invalid by persons claiming under the mortgagors, and not as in those two cases by persons to whom the interests of the mortgagors had passed by survivorship. It differs also apparently from the case of Mahabeer Persad v. Ramyad Singh 12 B.L.R. 90; 20 W.R. 192 in this, that the persons who would benefit directly by the setting aside of the mortgage are not as in that case the mortgagors themselves, but are persons deriving title from them and their co-sharer jointly. But the persons who would ultimately benefit by the unqualified setting aside of the mortgage would be the mortgagors, they retaining in that case the mortgage money as well as the full value of their interest in the mortgaged property--a result no less contrary to equity and good conscience than if they had retained the mortgage money and the property itself; and therefore, as far as the point under consideration is concerned, the present case does not really differ from that of Mahabeer Persad, and should be governed by the principle which was held applicable to that case. We are, therefore, of opinion that though Kishandeo and Barhamdeo, the mortgagors, had no authority, without the consent of their co-sharer Baldeo, to mortgage their undivided shares to defendants, 2nd party, yet the plaintiffs, who derive title from those mortgagors, are not entitled to recover their shares without paying to the defendant, 1st party, who has by his auction purchase acquired the rights of the mortgagees, the money advanced under the mortgage of 1872 with interest, which should be considered as an equitable charge on the said shares. In other words, the only right which the plaintiffs have got as against defendants, 1st party and 2nd party, is the right to redeem.

11. It was faintly contended before us that mauza Pipra was not covered by the mortgage of 1872; but, having regard to the terms of the mortgage bond, we think the Court below was quite right in holding that such a contention is wholly untenable.

12. It remains now to consider the third point raised before us. The only claim that the plaintiffs are, in our opinion, entitled to make being one for redemption, the suit cannot proceed unless all the persons interested in the properties originally mortgaged in 1872 are before the Court [see Nilakant Banerjee v. Suresh Chundra Mullick I.L.R. 12 Cal. 414. And as those persons have not all been made defendants, we were asked to dismiss this suit for defect of parties. We do not think, however, that that would be the proper order in this case. In the view that the Court below took of the plaintiff's rights, they were entitled to a declaration that the defendants, 1st party and 2nd party, had no claim against them, and they were entitled to the property in dispute without redeeming the same; and the Court below did not, therefore, consider itself called upon to make any persons parties to the suit who were necessary parties to it if it was a suit for redemption. As, however, that view is in our opinion incorrect, and as the 8th issue raised in the case has now to be decided, we think the proper course to take in this case will be to send the case back to the Court below to try the suit as one for redemption after making all necessary persons parties to it.

13. The result is that the decree of the Court below will be set aside, and the case remanded to that Court for trial with reference to the directions contained in this judgment. The appellants will be entitled to the costs of these appeals, only one hearing fee being allowed. Other costs will be in the discretion of the Court below.

Jamuna Parshad And Anr v. Ganga Pershad Singh And Ors

Structured Summary of the Opinion

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellants (defendant, 1st party, and defendants, 2nd party)

Plaintiffs (respondents)

Other procedural positions

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Jamuna Parshad And Anr v. Ganga Pershad Singh And Ors

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