AMEER ALI, LORD ATKINSON, LORD DUNEDIN, LORD PHILLIMORE, LORD SHAW, SIR LAWRENCE JENKINS, VISCOUNT HALDANE
body1923
DigiLaw.ai
Judgement Appeal (No. 51 of 1922) from a decree of the High Court (August 14, 1919) affirming a decree of the Subordinate Judge of Ghazipur (December 23, 1915). The suit was brought) in 1915 by the two first respondents, minors suing by their mother, for a declaration that a decree passed in 1912 against their father Sita Ram and themselves upon a mortgage for Rs. 11,000 executed by him on March 4, 1903, was not binding upon the plaintiffs. The plaint alleged that the mortgage had been executed by their father upon the joint family property without necessity so as to bind them, and that they had not been properly represented in the suit in which the decree had been made ex parte. Both when the mortgage was executed and the suit was brought Sita Ram and the plaintiffs formed a joint Hindu family governed by the Mitakshara. The defendants to the suit were the mortgagees, the appellant and the fourth respondent, and Sita Ram, the fifth respondent. The mortgage was upon ancestral property of the joint family, and was expressed to be made in order to discharge mortgages upon the same property made in 1905 and 1907 by Sita Ram ; it was found by the High Court that the whole of the sum advanced had been applied to that purpose. It was found in both Courts that the plaintiffs had not been properly represented in the suit which resulted in the decree of 1912. The trial judge made a decree setting aside the decree. Upon appeal the learned judges of the High Court (Tudball and Muhammad Rafique JJ.) dealt with the question whether the money borrowed under the mortgage of 1908 was money raised to discharge " an antecedent debt " within the meaning of the Mitakshara law. They were of opinion that observations in the judgment of the Judicial Committee in Sahu Ram Chandra v. Bhup Singh (L. R. 44 I. A. 126.) established that a mortgage by the managing member of a joint Hindu family upon its property could not constitute an " antecedent debt " to validate a later mortgage, and consequently that that decision was fatal to the validity of the mortgage of 1908. The judgment of the High Court is reported at I. L. R. 41 A. 235.
The judgment of the High Court is reported at I. L. R. 41 A. 235. It was then urged on behalf of the mortgagees that the mortgages of 1905 and 1907 might have been binding upon the estate as having been incurred for an antecedent debt within the limited meaning attributed to that expression in the observations in the above appeal. The High Court accordingly remanded the case to the trial judge to record an additional finding on that question, directing him that to support the mortgage of 1908 the earlier mortgages must have been made to discharge obligations incurred not only antecedently but also wholly irrespective of the ownership of the joint family estate. The Subordinate Judge, after hearing further evidence, found that Sita Ram had borrowed the money in 1905 and 1907 on the security of the joint family estate, and not merely upon his personal security. Upon return of the finding to the High Court the learned judges held that the mortgages of 1905 and 1907 did not constitute antecedent debts, and made a decree dismissing the appeal. The present appeal was first argued in April, 1923, and was ordered to be re-argued before a Full Board. 1923. Oct. 18, 20. De Gruyther K.C. and Dube for the appellant. The liability under the mortgages of 1905 and 1907 was an antecedent debt which rendered the mortgage of 1908 binding upon the sons. The appellant concedes that if the debt due from the father had been incurred as part of the mortgage transaction which is impeached, the debt could not have been an " antecedent debt" so as to validate the mortgage. The actual decision of the Board in Sahu Ram Chandra v. Bhup Singh (L. R. 44 I. A. 126.) went no further. For the reasons stated by the Full Bench of the Madras High Court in Armugham Chetty v. Muthu Koundan (( 1919) I. L. R. 42 M. 711.) the observations in the judgment of the Board cannot be treated as authority for the view that an earlier and independent mortgage of the joint family property cannot be an "antecedent debt." The observations to the effect that the pious obligation of the sons to pay the fathers debts arises only upon the death of the father were also not necessary for the determination of the appeal, and are not in accordance with authority.
[In addition to the cases referred to in the judgment of the Judicial Committee reference was made to the definition of "antecedent debt" in Khalilul Rahman v. Govind Pershad (( 1892) I. L. R. 20 C. 328, 346, 347.), and (on the question of the pious obligation of the sons) to Suraj Bunsi Koer v. Sheo Proshad Singh (( 1879) L. R. 6 I. A. 88.); Laljee Sahoy v. Fakeer Chand(( 1880) I. L. R. 6 C. 135.); Dattatraya Vishnu v. Vishnu Narayan (( 1911) I. L. R. 36 B. 68.); Chidambara Mudaliar v. Koothaperumal (( 1903) I. L. R. 27 M. 326.); Kandasami Goundan v. Kuppu Mooppan. (( 1919) I. L. R. 43 M. 421, 423.) Upon the question whether Sahu Rams Case (L. R. 44 I. A. 126.) had been acted on by the Judicial Committee reference was made to Narain Prasad v. Sarnam Singh (( 1917) L. R. 44 I. A. 163.) ; Jogi Das v. Ganga Ram (( 1917) 21 Cal. W. N. 957.); and Chet Ram v. Ram Singh. (( 1922) L. R. 49 I. A. 228.)] Nov. 14. The judgment of their Lordships was delivered by LORD DUNEDIN. The facts in this case may be very shortly stated. On March 4, 1908, Sita Ram granted a mortgage for Rs. 11,000 in favour of Raja Narain Brij Rai and Jagdish Narain Rai. The mortgage was secured on ancestral and joint property of which Sita Ram was at that time manager, the other members of the joint family being his two sons, minors. In 1912 the mortgagees brought a suit on the mortgage and obtained a decree ex parte. In 1913 the present suit was raised by the mother on behalf of her two minor sons (the elder has since become major) to have it declared that the mortgage was not binding on them and that the decree granted was, so far as they were concerned, null and void. The mortgage in suit is expressed to have been executed in order to pay off two prior mortgages on the same property of date December 12, 1905, and June 19, 1907, respectively. In the suit the plaintiffs impleaded the two mortgagees and their own father Sita Ram, who had granted the mortgage. Sita Ram did not appear to defend.
The mortgage in suit is expressed to have been executed in order to pay off two prior mortgages on the same property of date December 12, 1905, and June 19, 1907, respectively. In the suit the plaintiffs impleaded the two mortgagees and their own father Sita Ram, who had granted the mortgage. Sita Ram did not appear to defend. Jagdish Narain Rai made over his interest to his brother Raja Narain Brij Rai, who appeared to defend and pleaded that the mortgage in question having been granted to pay off an antecedent debt of the plaintiffs father, it was binding on the estate. The Subordinate Judge found as facts (1.) That the property was ancestral and joint. (2.) That the money raised under the mortgage was to the extent of Rs. 10,265 employed inpaying off the earlier mortgages. (3.) That the sons had not been properly represented when the ex parte decree of 1912 was granted. He then found in law that the plaintiffs sons were not bound by the decree of 1912, and he accordingly set aside the decree of 1912 so far as the sons were concerned ; he made no further declaration. The defendant appealed. The learned judges who heard the appeal affirmed the findings of fact of the Subordinate Judge with the variation that they found that the whole Rs. l 1,000 had been employed in paying off the earlier mortgages ; but in view of what had been said by this Board in the case of Sahu Ram Chandra v. Bhup Singh (L. R. 44 I. A. 126.), decided after the date of the decree under appeal, they remitted the suit to the Subordinate Judge to find whether the earlier mortgages were incurred to discharge obligations not only previously incurred but incurred wholly irrespective of the joint family property. The learned Subordinate Judge set out additional evidence as to the two earlier mortgages. On this evidence being taken up by the learned judges of the appellate Court, they came to the conclusion that it was impossible to say for what precise purpose the money raised by the two earlier mortgages had been used, or that the debt then incurred was incurred wholly irrespective of the family property. They accordingly dismissed the appeal. Appeal was then taken to the King in Council.
They accordingly dismissed the appeal. Appeal was then taken to the King in Council. The defendant admits that the ex parte decree is not binding on the minors in respect that they were not properly represented, but contends that there ought to have been a declaration that under the circumstances the property became bound and is liable to be taken in execution. In the case of Sahu Ram Chandra v. Bhup Singh (L. R. 44 I. A. 126.) the suit was brought upon a mortgage twenty-seven years old for Rs. 200, and Rs. 15,000 was demanded in respect of the principal and accrued interest. It was pleaded that the Rs. 200 had been borrowed for family necessity, but this contention was negatived in fact. It was, therefore, a simple case of a debt having been constituted by way of mortgage on the family estate by the father manager and been allowed to swell to gigantic proportions, no money having been paid thereon. The creditors had put forward the universal proposition that if debt was found to incumber the estate, it was necessary for the other members of the family who wished to affirm its non-efficiency to prove that it was incurred for immoral purposes. If they failed to do so, then the incumbrance must stand without further question. This view was negatived by the High Court, and in order to allow the point to be settled leave was given to appeal to the King in Council. The appeal was heard ex parte. At the hearing it became clear that there was in no sense an antecedent debt. The incumbrance itself was the debt, the money being advanced as the incumbrance was granted.
The appeal was heard ex parte. At the hearing it became clear that there was in no sense an antecedent debt. The incumbrance itself was the debt, the money being advanced as the incumbrance was granted. In the course of the judgment, however, Lord Hobhouses opinion in Nanomi Babuasin v. Modun Mohun (( 1883) L. R. 13 I. A. 1.) was cited, and commenting on this it was said " In their Lordships opinion these expressions, which have been the subject of so much difference of legal opinion, do not give any countenance to the idea that the joint family estate can be effectively sold or charged in such a manner as to bind the issue of the father, except where the sale or charge has been made in order to discharge an obligation not only antecedently incurred, but incurred wholly apart from the ownership of the joint estate or the security afforded or supposed to be available by such joint estate." (L. R. 44 I. A. 126, 134.) The learned judges interpreted that to mean that a mortgage per se could not be an antecedent debt, for a mortgage is obviously a security which is not apart from the security of the estate over which it is constituted. If, therefore, it could not be shown that an anterior mortgage had been incurred in respect of an antecedent debt unconnected with the estate, then the anterior mortgage could not be held to be debt antecedent to the subsequent mortgage, and that subsequent mortgage could not stand though its proceeds were entirely used to pay off the prior mortgage. Before the present case came up to their Lordships, the expression used in Sahu Rams Case (L. R. 44 I. A. 126.) had come before the consideration of the High Court in Madras in the case of Peda Venkanna v. Sreenivasa Deekshatulu (( 1917) I. L. R. 41 M. 136.), and again in Armugham Chetty v. Muthu Koundan (( 1919) I. L. R. 42 M. 711.), where the question was referred to a Full Bench. In the latter case the pleader had gone the whole length of saying that, no mortgage could ever be an antecedent debt the payment of which was capable to support a new mortgage.
In the latter case the pleader had gone the whole length of saying that, no mortgage could ever be an antecedent debt the payment of which was capable to support a new mortgage. In both cases the Madras Court came to the conclusion that the judgment of the Board in Sahu Rams Case (L. R. 44 I. A. 126.) ought not to be so interpreted. Upon this appeal, when their Lordships were satisfied that there was this discrepancy of opinion between the judgments of the High Court of Allahabad in this case and that of Madras in the others, they thought it advisable to have the question argued before a Full Board, which has been done. Their Lordships have had the advantage of a very full and able argument in which many authorities have been quoted. It is to be regretted that this case also is ex parte, but their Lordships are satisfied that the whole of the authorities bearing on the question have been fairly brought to their notice. It cannot be denied that the law on the subject of what binds an estate when the manager of the joint family estate is the father, and the other members are the sons, is in a state which is somewhat illogical and in the absence of binding authority could not be accepted. On the one hand it is settled law that the manager as such cannot bind the estate at his own free will and without any compelling cause so as to bind the other members. He can bind it for necessity, the necessity being the necessity of the family, and so far there is no difficulty in principle, though the question of whether in any particular instance there was a necessity may, like other questions of fact liable to be involved in a question of decree, be difficult to decide. But then there comes in the further doctrine that, a debt having been contracted by the father, the pious obligation incumbent on the son to see his fathers debts paid prevents the son from asserting that the family estate, so far as his interest is concerned, is not liable to purge that debt.
But then there comes in the further doctrine that, a debt having been contracted by the father, the pious obligation incumbent on the son to see his fathers debts paid prevents the son from asserting that the family estate, so far as his interest is concerned, is not liable to purge that debt. It may become liable by being taken in execution on the back of a decree obtained against the father, or it might become liable by being mortgaged by the father to pay the debt for which otherwise decree might be taken and execution be sought. It is more than apparent how in practice these two principles may clash, nor is this in any sense a new discovery. Nothing clearer could be said than what was said by Lord Hobhouse delivering the judgment of the Board in Nanomi Babuasin v. Modun Mohun (L. R. 13 I. A. 1, 17, 18.) already quoted " Destructive as it may be of the principle of independent coparcenary rights in the sons, the decisions have, for some time, established the principle that the sons cannot set up their rights against their fathers alienation for an antecedent debt, or against his creditors remedies for their debts, if not tainted with immorality. On this important question of the liability of the joint estate, their Lordships think that there is now no conflict of authority." It is probably bootless to speculate as to how these seemingly conflicting principles were allowed to develop. On the one hand there is the general rule of the Mitakshara law that the manager cannot burden the estate for his own purposes. This is set forth at some length in the judgment in Sahu Rams Case. (L. R. 44 I. A. 126.) On the other hand there is the obligation of the son to discharge his fathers debts, based on the doctrine of pious duty, but perhaps reflecting a remanet, as suggested by Sadasiva Ayyar J. in Armugham Chetty v. Muthu Koundan (I. L. R. 42 M. 711, 730.), from the older laws of Manu under which the son had no interest during the fathers lifetime. It is enough to say that both principles are firmly established by long trains of decision, and it certainly occurs to the view that the term " antecedent " debt represents a more or less desperate attempt to reconcile the conflicting principles.
It is enough to say that both principles are firmly established by long trains of decision, and it certainly occurs to the view that the term " antecedent " debt represents a more or less desperate attempt to reconcile the conflicting principles. For after all, if looked at straight in the face, what position could be more anomalous than this ? A father who is manager, borrows a like sum from A. and B. To A. he gives a mortgage on the family estate containing a personal covenant. To B. he gives a simple acknowledgment of loan. B. sues and gets a decree ; on this decree execution can follow and the estate can be taken. A., suing upon his mortgage, cannot recover. It seems to have been felt that if the. debt for which a mortgage was given was in any proper sense antecedent, then it, so to speak, escaped the direct infringement of the principle that the father manager could not burden the estate except for necessity. In such a matter as the present it is above all things necessary stare decisis, not to unsettle what has been settled by a long course of decisions. Their Lordships entirely agree with the views of the learned Chief Justice in the Full Bench Madras case, Armugham Chetty v. Muthu Koundan. (I. L. R. 42 M. 711.) They think that Sahu Rams Case (L. R. 44 I. A. 126.) must not be taken to decide more than what was necessary for the judgment— namely, that the incurring of the debt was there the creation of the mortgage itself and that there was there no antecedency either in time or in fact. Moreover, if proper attention is paid to the word " incurred," they think that it will be seen to be a proper interpretation of the sentence which has caused the doubts. There are, however, some observations in Sahu Rams Case (L. R. 44 I. A. 126.) which are not necessary for the judgment but which their Lordships are bound to say that they do not think can be supported. Founding upon them, the learned counsel in this case argued in the Court below that no liability of the sons, based on the pious obligation to pay a fathers debt, could be made available to the creditor while the father was still alive.
Founding upon them, the learned counsel in this case argued in the Court below that no liability of the sons, based on the pious obligation to pay a fathers debt, could be made available to the creditor while the father was still alive. Here again, if the point was open, there would be much to be said in favour of a position which seems consonant with common sense. But their Lordships are satisfied that a long train of authorities has settled the question. Instances of sale being permitted when the father for whose debt the sale was made was still alive may be found in the following cases Girdharee Lall v. Kanto Lall (( 1874) L. R. 1 I. A. 321.); Deendyal Lal v. Jugdeep Narain Singh (( 1877) L. R. 4 I. A. 247.); Nanomi Babuasin v. Modun Mohun (L. R. 13 I. A. 1.) ; Bhagbut Pershad v. Girja Koer (( 1888) L. R. 15 I. A. 99.); Meenakshi Naidu v. Immudi Kanaka Ramaya Kounden (( 1888) L. R. 16 I. A. 1.) ; Mahabir Pershad v. Markunda Nath Sahai (( 1889) L. R. 17 I. A. 11.); Sripat Singh v. Tagore. (( 1916) L. R. 44 I. A. 1.) It is true that the point was not actually taken so far as appears in any of these cases, but when a long series of cases, extending over a long period of time, the parties being represented by eminent counsel, is decided in one way, and if an evident plea had been taken and upheld the decisions would have been the other way, there arises an irresistible conclusion that the plea was not taken because it was felt to be bad. The plea, however, was actually taken in Badri Prasad v. Madan Lal (( 1893) I. L. R. 15 A. 73, 79, 80 (F. B.).) and was rejected by a Full Bench. In Govind Krishna Gujar v. Sakharam Narayan (( 1904) I. L. R. 28 B. 383, 389, 390.) Chandavarkar J. says " The law is now well established that under the Hindu law the pious obligation of a son to pay his fathers debts exists whether the father is alive or dead." The point was again taken and negatived in Ramasami Nadan v. Ulaganatha Goundan.
(( 1898) I. L. R. 22 M. 49, 63 (F. B.).) Their Lordships may sum up the propositions which they would wish to lay down as the result of these authorities as follows — (1.) The managing member of a joint undivided estate cannot alienate or burden the estate qua manager except for purposes of necessity ; but (2.) If he is the father and the other members are the sons he may, by incurring debt, so long as it is not for an immoral purpose, lay the estate open to be taken in execution proceeding upon a decree for payment of that debt. (3.) If he purports to burden the estate by mortgage, then unless that mortgage is to discharge an antecedent debt, it would not bind the estate. (4.) Antecedent debt means antecedent in fact as well as in time, that is to say, that the debt must be truly independent and not part of the transaction impeached. (5.) There is no rule that this result is affected by the question whether the father, who contracted the debt or burdens the estate, is alive or dead. Applying these propositions to the present case, their Lordships consider that the present mortgage was raised in order to pay an antecedent debt—namely, the two older mortgages, and consequently binds the estate. The result will be that the appeal will be allowed and the decrees of the Courts below set aside with costs, and a declaration made that the mortgage of March 4, 1908, affects the estate which may be brought to sale. Their Lordships will advise His Majesty accordingly. The respondents will pay the costs of the appeal.