LORD DAVEY, SIR ANDREW SCOBLE, SIR ARTHUR WILSON, SIR FORD NORTH
body1902
DigiLaw.ai
Judgement Appeal from a decree of the High Court (Aug. 28, 1900) reversing a decree of the Subordinate Judge of Madura (Oct. 15, 1898). The suit was brought under the circumstances detailed in the judgment of their Lordships by Ramanadhan Chettay, since deceased, associating his son, the appellant, with him, to recover from Ramasami Chettiar and his sons, the respondents, twenty-six instalments, amounting to Rs.14,724, as g due under an assignment of a claim under a document dated July 9, 1895, given by Ramasami to the Raja of Ramnad, whereby he had agreed to pay Rs.500 a month for ten successive years. The plaint stated that this stipulation was one of the terms of a lease granted by the Raja to Ramasami five days previously; that it was agreed to before the execution of the lease along with the other terms embodied therein; and it was further stated therein that it was agreed that the said stipulation should not be inserted in the lease deed. Ramasami in his written statement admitted the execution of the lease and counterpart, but denied any agreement " at the same time " to pay Rs.500 a month for ten years beginning from July, 1895. He pleaded, amongst other defences, that such agreement as was alleged was bad in law and was not enforceable by reason of non-registration; and further that the same was without consideration, and he denied the plaintiffs right to the relief claimed or to any relief at all; and he further pleaded that by reason of an indenture dated July 12, 1895, and executed by the Raja to one Rao Bahadur Vencatarangaiyar, by which the Raja assigned to Rao Bahadur " all the outstanding debts, claims, demands, and sums of money of whatsoever kind or description then due, owing, or payable " to himself, the Raja had subsequent to July 12, 1895, no subsisting claim or right to or in the sums of money in dispute, and that the claim of the plaintiffs under the alleged assignment, which was made to the first plaintiff by the Raja on December 9, 1895, that is subsequent to the said July 12, 1895, was ineffectual and of no avail. The Subordinate Judge decreed for the plaintiff as prayed.
The Subordinate Judge decreed for the plaintiff as prayed. In his judgment he considered the effect of s. 107 of the Land Transfer Act, and agreed that all the terms of the lease, including its consideration, must be included in a registered document. He considered, however, that the monthly pay ments were neither a rent nor a premium, but that they were given in consideration of something which the tenant got by the lease, but which was no part of the lease. The document agreeing to these payments the judge said was only a news letter, containing two pieces of news 1st. That he (the tenant) had received from the Raja a permanent lease for a certain yearly rent. 2nd. That as consideration for the same, as already agreed, he would make the Raja a series of monthly payments. With regard to the objection that the claim for monthly payments had been assigned under s. 5 of the trust deed before it was assigned to the plaintiff, the Subordinate Judge held that the claim did not come within any of the words in that assignment " I find that there is no assignment in the trust deed of the debt constituting the subject-matter of this suit, and that the trustee has acquired no right thereto." The High Court reversed this decision, resting its judgment on two grounds—(1.) that the claim arising under the document dated July 9, 1895, did pass to the trustee under the deed of July 12; (2.) that the terms of the first-named deed formed part of the bargain for the lease, and were therefore inoperative as being written on an unregistered paper. To hold otherwise would defeat the object of the Transfer of Property Act, which clearly is to have the whole transaction, with all its terms, expressed in a registered instrument. The High Court did not come to any finding as to the circumstances under which the document of July 9 was given. Cohen, K.C., and G. Branson, for the appellant, contended that the High Court ought to have held that the agreement to pay the said instalments was a valid agreement binding on the respondents. They ought also to have held that the document of July 9, 1895, did not require registration in order to render it operative.
Cohen, K.C., and G. Branson, for the appellant, contended that the High Court ought to have held that the agreement to pay the said instalments was a valid agreement binding on the respondents. They ought also to have held that the document of July 9, 1895, did not require registration in order to render it operative. They ought further to have held that the real and oral agreement by the lessee to pay instalments was made in con sideration of the said permanent lease being granted to him, and was valid and binding before it was put into writing, and was collateral to the lease. As it was not charged upon land, it was contended that it required neither writing nor registration as between Hindus to give it effect. Reference was made to the Evidence Act (I. of 1872), s. 92 ; the Transfer of Property Act (IV. of 1882), ss. 9, 105, and 107; the Registration Act (III. of 1877), s. 17; Lindley v. Lacey (( 1864) 34 L. J. (C.P.) 7, 9.); Morgan v. Griffith (( 1871) L. R. 6 Ex. 70.); Martin v. Pyecroft (( 1852) 2 D. M. & G. 785.) ; Palmer v. Johnson (( 1884) 13 Q. B. D. 351.); Bank of New Zealand v. Simpson. ([ 1900] A. C. 182.) They also contended that the Rajas claim in respect of the instalments of Rs.500 a month did not pass to the trustee under the deed of July 12, 1895, but was validly vested in the appellant. Clause 5 of that deed only applied to debts "then due, owing, or payable" to the Raja. The debt to him now in question did not fall within that description, as the instalments did not, any of them, become payable till after the date of the deed. See Biddle v. Bond (( 1865) 34 L. J. (Q.B.) 137; 6 B. & S. 225), Rogers v. Lambert ([ 1891] 1 Q. B. 318.), and Farquharson Brothers v. King & Co. ([ 1901] 2 K. B. 697.) Mayne, for the respondents, contended that the High Court was right in law in holding that the document of July 9, 1895, was invalid and inoperative. First, it was unregistered; second, it was without consideration; third, it was inadmissible in evidence under s. 92 of the Evidence Act. It required registration under s. 107 of the Transfer of Property Act.
First, it was unregistered; second, it was without consideration; third, it was inadmissible in evidence under s. 92 of the Evidence Act. It required registration under s. 107 of the Transfer of Property Act. It was not a collateral contract extrinsic to the terms of the lease. It was a splitting up of those terms, and putting some of them into an agreement separate from the lease which equally with the principal agreement required writing and registration. Besides, whatever claim the Raja had under this document had passed to the trustee of the deed of July 12, 1895, before the date of the assignment to the respondents. They passed under clause 5 of that deed, and did not come within the matters reserved to the Raja by the latter part of that clause. Counsels for the appellant were not heard in reply. The judgment of their Lordships was delivered by SIR ARTHUR WILSON. The material facts of this case were not in dispute before their Lordships, and they can be briefly stated. The Raja of Ramnad was the proprietor of the zemindary of the same name. On July 4, 1895, he executed a reversionary lease of portions of his zemindary in favour of Ramasamy Chettiar. The lease recited that there were subsisting leases affecting the properties demised, some of which would not expire till the Fasli year 1318, corresponding to A.D. 1911. The new lease was accordingly made to commence with the Fasli year 1319; it was expressed to be perpetual, the annual rent was fixed, its recovery, as well as that of road-cess and other charges, was provided for, and the rights and obligations of both parties defined. A counterpart of the lease was executed, and both lease and counterpart duly registered. During the negotiations for the lease it was agreed between the Raja and Ramasamy that, in consideration of his obtaining the lease, Ramasamy should pay to the Raja a sum of Rs.500 a month for a period of ten years from July, 1895. On July 9, 1895, the arrangement with regard to the pay ment of Rs.500 a month was put in writing in the form of a letter addressed by Ramasamy to the Raja in the following terms— "Varthamana Kaduthasi. "Sivamayam (God everywhere). "To M. R. Ry. Bhaskara Sethupathi Maharajah Avergal. "Varthamana Kaduthasi (letter) written by A. L. A. R. Ramasami Chetti of Devakottah.
"Sivamayam (God everywhere). "To M. R. Ry. Bhaskara Sethupathi Maharajah Avergal. "Varthamana Kaduthasi (letter) written by A. L. A. R. Ramasami Chetti of Devakottah. “You have let to me on permanent lease on the 4th day of the current month of July the villages of Kannangudi Vagaira Division for a sum which represents the average income of ten faslis together with one-eighth thereof. As agreed to by me to pay as consideration therefor, I shall pay you at the rate of five hundred rupees per mensem for ten years, that is, for one hundred and twenty months, (beginning) from July current. In default of payment in any one month, I shall pay the sum in respect of which default was made with interest at 1 per cent, per mensem from the date of default. "(Signed on one anna stamp) "Thiruvutharakosamangai, Ramasami Chetti. "9.7.95." On July 12 the letter was sent to the Huzur Treasury with a note that " it should be kept in the treasury for safe custody " ; and on the 15th its receipt was registered. On July 12, 1895, the Raja executed a trust deed in which he recited that he was possessed of his zemindari subject to subsisting debts, charges, incumbrances, and leases, and that he was desirous of making a settlement for the benefit of his heir-apparent and elder minor son. The deed assigned to Venkatarangaiyar as trustee (in paragraph 4) the zemindari with its incidents.
The deed assigned to Venkatarangaiyar as trustee (in paragraph 4) the zemindari with its incidents. In paragraph 5 he further assigned " all and singular the outstanding debts arrears of rent mesne profits claims demands and sums of money of whatsoever kind or description now due owing or payable to the settlor on any account whatsoever and all rights to prosecute any suit or other proceeding existing in favour of the settlor at the date of these presents and also all monies hundies cheques currency notes or other securities for money now in the Huzur Treasury Office at Ramnad and in the several Taluq Treasuries in the said zemindari and also all securities for such debts arrears of rent mesne profits claims demands and sums of money as aforesaid or any of them and other documents in respect of the same respectively and also all other documents records correspondence and other papers now in the Record Office Huzur and Taluk Offices respectively in the said zemindari or which have been produced by or on behalf of the settlor or his agents officers clerks or servants in any public office or Court in connection with any suit proceeding or matter and which relate in any wise to the said properties hereinbefore expressed to be hereby granted con veyed and assigned respectively or any of them and also all firearms and other weapons belts and badges now held or used by any peons or other servants of the settlor and also all furniture fixtures and other articles in the Huzur and Taluq Offices in the said zemindari And all the estate right title and interest claim and demand of him the settlor into and upon the same premises respectively hereinbefore expressed to be hereby granted conveyed and assigned respectively except and always reserving unto the settlor out of the said heredita- ments and premises and the grant and assignment hereby made all those several devastanams chatrams and kattalais with their respective appurtenances situate in the said zemindari and now under the superintendence and control of the settlor and the lands and endowments of whatsoever description attached thereto respectively and situate in the said zemindari and all outstanding debts arrears of rent and other claims and demands payable and to become payable to the settlor in respect of the said devastanams chatrams and kattalais respectively (other than the dhurma magamai and jari magamai payable in respect of devastanams and charities) and reserving also unto the settlor all rights to prosecute any suit or other proceedings now existing in respect of the same and to or in which he is a party or is otherwise interested and also all movable property in or about the buildings and premises erected and being on the said lands and premises firstly secondly thirdly and fourthly described in the said first schedule hereto and reserving also unto the settlor during his life the right at all times to reside with the members of his family in the several palaces and buildings comprised in the said lands and the zemindari and in the said premises described in the said first schedule hereto but without prejudice nevertheless to the right of the said Raja Rajeswara Dorai otherwise called Muthu Ramalinga Dorai or his heir to reside with the members of his family in all or any of the said palaces and buildings." The trusts were declared, which included the payment of a monthly allowance to the Raja himself.
No payments having been made by Ramasamy in respect of his agreement to pay Rs.500 a month, the Raja on December 9, 1895, assigned that agreement for value to Ramanadhan Chettiar; and notice of this assignment was at once given to Ramasamy. On the 21st September, 1897, the present suit was filed in the Court of the Subordinate Judge of Madura East by Ramanadhan Chettiar, since deceased, and his son Subramanian Chettiar, the present appellant, against Ramasamy, since deceased, and others who now represent him and who are the respondents. The claim was to recover twenty-six monthly instalments at the rate of Rs.50Q a month with interest. It is only necessary to refer to two grounds of defence. It was contended, first, that the original agreement for the payment of Rs.500 a month was void in law as not being in writing registered, and that the plaintiffs were not entitled in law to prove the existence of such oral agreement. It was contended, secondly, that whatever right the Raja might have had under the agreement to pay him Rs.500 a month had been transferred by him under the trust deed of July 12, 1895, and that therefore neither Ramanadhan nor his representatives had any right to sue upon the agreement. The Subordinate Judge decided in the plaintiffs favour upon both points, and made a decree in accordance with the claim of the plaint. An appeal was filed in the High Court of Madras, and that Court reversed the decision of the Lower Court and dismissed the suit, holding that both the grounds of defence were good in law. With respect to the first of these questions, that going to the legal validity of the agreement for the payment of Rs.500 a month, it is necessary to refer to certain of the terms of three Acts of the Indian Legislature. Sect. 92 of the Evidence Act (I. of 1872) enacts that— "When the terms of any such contract, grant, or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or state ment shall be admitted, as between the parties to any such instrument, or their representatives in interest, for the purpose of contradicting, varying, adding to, or subtracting from its terms." The Registration Act (III.
of 1877), s. 17, includes amongst the documents requiring registration, " leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent." The Transfer of Property Act (IV. of 1882), s. 105, defines a lease thus— A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms/ And s. 107 says that—"A lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument." The agreement for the payment of Rs.500 a month for ten years from July, 1895, is in no way inconsistent with the lease of the 4th of that month. Its provisions form no part of the terms of the holding under the lease; their effect will be exhausted some years before the lease takes effect. The pay ment bargained for is no charge on the property; it is not rent nor recoverable as rent, but a mere personal obligation collateral to the lease. Their Lordships are of opinion that the agreement is not affected by s. 92 of the Evidence Act; and that there is nothing in the Registration Act or in the Transfer of Property Act which required that it should be registered as part of the lease. The second question is whether the respondents are right in their contention that the benefit of Ramasamys agreement to pay Rs.500 a month to the Raja passed to the trustee under the trust deed of July 12, and that therefore the subsequent assignment to Ramanadhan was ineffectual, and that the plaintiffs in this suit had no right to sue. The answer to this question depends upon the construction to be placed upon the trust deed. The Rs.500 a month not being rent, the right to it could not pass under the grant of the zemindari with its incidents contained in paragraph 4.
The answer to this question depends upon the construction to be placed upon the trust deed. The Rs.500 a month not being rent, the right to it could not pass under the grant of the zemindari with its incidents contained in paragraph 4. But it was contended that the right was conveyed by the more general words of paragraph 5, by which the settlor assigned " the outstanding debts arrears of rent mesne profits claims demands and sums of money of whatsoever kind or description now due owing or payable to the settlor on any account whatsoever and all rights to prosecute any suit or other proceeding existing in favour of the settlor at the date of these presents." The use in an Indian document of the words " now due owing or payable in defining the claims transferred, coupled with the words which follow restricting the transfer of rights of suit in respect of such claims to those existing at the date of the deed, appear to their Lordships to shew that rights of the nature of that now under consideration, accruing after the date of the deed, were not intended to pass—a view which is somewhat strengthened by the employment of the phrase " demands payable and to become payable" in the exception and reservation which follows. And it appears to their Lordships that under the agreement between the Raja and Ramasamy all the instalments now sued for accrued due after the date of the trust deed. It was further suggested that the words in the same paragraph, "all monies hundies cheques currency notes or other securities for money now in the Huzur Treasury Office at Ramnad," included Ramasamys letter of July 9, and that therefore the Rajas right to the Rs.500 a month passed under the trust deed. As to this suggestion, it is sufficient to say that there is no evidence that the letter in question was in the treasury when the deed was executed. All that appears is that on July 12, the day on which the trust deed was executed, but whether before or after the execution does not appear, the letter was sent to the treasury for safe custody, and that its receipt was recorded on the 15th. Their Lordships will humbly advise His Majesty that the decree of the High Court be reversed with costs, and that of the Subordinate Judge restored.
Their Lordships will humbly advise His Majesty that the decree of the High Court be reversed with costs, and that of the Subordinate Judge restored. The respondents will pay the costs of this appeal.