Judgement Appeal (No. 26 of 1939) from a decree of the High Court (March 18, 1937) reversing a decree of the Subordinate Judge, 1st Class, Delhi (October 30, 1935). The question which arose in this appeal was whether an agreement entered into on October 2, 1920, between one Saleem Mahomed Shah, who died on September 17, 1925, and the appellant, Lala Ram Sarup, and the fourth respondent, Lala Alopi Parshad. whereby the two latter, who were business partners, in consideration of having a specified share in the property recovered, if any, agreed to finance litigation by Saleem Mahomed Shah in which he sought to establish that he was the legitimate son of Shahzada Mirza Souriya Jah, of the Moghul dynasty, and entitled to possession of his late fathers property, was binding on the first three respondents, who were the Court of Wards, and Saleem Mahomed Shahs widow and daughter, all of whom had refused to recognize the claim under the agreement. Saleem Mahomed Shah, in his action, had succeeded, by a decision dated May 10, 1925, in establishing his legitimacy, and had been awarded possession of seven-sixteenths, amounting to Rs.88, 753, of the estate of his late father. The appellant and the fourth respondent brought their action on the agreement of October 2, 1920, on October 16, 1928. The facts and the terms of the agreement sued upon appear from the judgment of the Judicial Committee. The Subordinate Judge held that the plaintiffs claim, being one for specific performance of an agreement, was by virtue of art. 113 of the First Schedule to the Indian Limitation Act, 1908, barred as having been brought more than three years from the date of the decree in Saleem Mahomed Shahs action, namely, May 10, 1925. On appeal the High Court (Coldstream and Abdul Rashid JJ.) reversed the Subordinate Judges finding on the question of limitation. They held that the second part of art. 113 of the Limitation Act applied, and that time ran not from May 10, 1925, when the decree in favour of Saleem Mahomed Shah was passed, but from the date when performance was refused, which was less than three years before the institution of the present suit. The suit was not, therefore, time-barred. They further held that the agreement of October 2, 1920, was highly detrimental to Saleem Mahomed Shahs interests, and was inequitable and unenforceable. The suit was not, therefore, time-barred. They further held that the agreement of October 2, 1920, was highly detrimental to Saleem Mahomed Shahs interests, and was inequitable and unenforceable. They assessed the reasonable expenses of Saleems suit at Rs.8440, and gave the plaintiffs a decree for that sum. 1939. Oct. 19, 20, 23. Eddy K.C., and A. P. Pennell for the appellant. The appellant is suing on what is undoubtedly a champertous agreement, but it is well settled that the English law of champerty is not in force in India. In Ram Coomar Coondoo v. Chunder Canto Mookerjee (( 1876) L. R. 4 I. A. 23. 47) it was stated that "Cases may be easily supposed in which it would be in "furtherance of right and justice, and necessary to resist "oppression, that a suitor who had a just title to property, "and no means except the property itself, should be assisted "in this manner.” It is submitted that those words apply to the present case. The appellants case in the Courts below was that the financiers—the appellant and his partner, the fourth respondent—had in truth spent sums amounting to Rs. 19,500 on litigation to establish Saleems legitimacy. The agreement of October 2, 1920, provided in substance that the financiers should bear all the expenses of the case, and in return should get three-sixteenths of the immovable property recovered if there was no appeal to the Privy Council, and four-sixteenths if there was. There was in fact no appeal at all. The suit succeeded, a decree was passed, and the value of Saleems share was Rs.88,753. The appellant contends that the agreement now sued upon was a good one, and that the financiers are entitled to their share. On January 5, 1926, Saleem having died on September 17, 1925, the appellant and his partner presented a petition to the Deputy Commissioner asking for a three-sixteenths share of the property decreed in Saleems favour. That petition was rejected on March 5, 1926. The appellant and his partner rejected an offer of Rs.8500 by the Deputy Commissioner, and on October 16, 1928, instituted the present suit. That petition was rejected on March 5, 1926. The appellant and his partner rejected an offer of Rs.8500 by the Deputy Commissioner, and on October 16, 1928, instituted the present suit. The Subordinate Judge held that time ran from the date of the decree in Saleems suit, namely, May 10, 1925, and that the suit was time-barred under art.113 of the First Schedule to the Limitation Act, 1908, which provides that for the specific performance of a contract the period of limitation is three years, which is to run from the date fixed for the performance, or, if no such date is fixed, when the plaintiff has notice that performance is refused. It is submitted that the action is not time-barred, and that the view of the High Court that time ran from the date on which performance was refused, and not from the date of the decree, May 10, 1925, is correct. The High Court were wrong, however, in holding that the agreement was inequitable and unenforceable; they failed to consider that the financiers ran a considerable risk in undertaking to finance Saleems suit and that their remuneration in the event of success should be commensurate to that risk. The evidence supports the view that in all the circumstances the agreement was not inequitable and unconscionable Chedambara Chetty v. Renga Krishna Muthu Vira Puchaiya Naickar (( 1874) L. R. 1 I. A. 241, 264.); Kunwar Ram Lal v. Nil Kanth ((1803) L. R. 20 I. A. 112.); Rajah Mokham Singh v. Rajah Rup Singh (( 1893) L. R. 20 I. A. 127.); Lal Achal Ram v. Raja Kazim Husain Khan (( 1905) L. R. 32 I. A. 113); Bhagwat Dayal Singh v Debt Dayal Sahu (( 1907) L. R. 35 I. A. 48.); Indar Singh v. Munshi (( 1919) I. L. R. 1 Lah. 124.); and Fateh Jang v. Bute Khan.(( 1934) A. I. R. (Lah.) 1017.) The earliest statute in England with regard to champerty was passed in 1275 (3 Edw. 1, c. 25) (6th ed. of Chittys Statutes, vol. ii, p. 29). A. P. Pennell followed. W. Wallach for the respondents. In Ram Coomar Coondoo v. Chunder Canto Mookerjee ((T876) L. R. 4 I. A. 23, 44.) there are passages which show what principles have been adopted and laid down by this Board in cases of this nature. 1, c. 25) (6th ed. of Chittys Statutes, vol. ii, p. 29). A. P. Pennell followed. W. Wallach for the respondents. In Ram Coomar Coondoo v. Chunder Canto Mookerjee ((T876) L. R. 4 I. A. 23, 44.) there are passages which show what principles have been adopted and laid down by this Board in cases of this nature. While the litigation itself may be necessary, the agreement to finance it may be against public policy. A plaintiff basing his claim on such an agree ment has to show that it is a fair and proper agreement. If, however, the burden is on the respondents here, it is submitted that they have discharged it, because, considering the evidence, together with the terms of the agreement, the agreement falls within the words of the authority cited above, and was an unconscionable agreement which amounted to gambling in litigation; it was an agreement to obtain not a reasonable recompense, but one for improper objects. The bargain here is unconscionable for two reasons firstly, because of the state of mind of Saleem Mahomed Shah at the time he entered into it; and, secondly, because the reward expected by the financiers was excessive in proportion to the expenditure involved. Every case of this nature has to be considered on its particular facts. [Reference was made to Kunwar Ram Lal v. Nil Kanth (( 1893) L. R. 20 I. A. 112.2); Rajah Mokham Singh v. Rajah Rup Singh (( 1893) L. R. 20 I. A. 127, 136.); and Chunni Kuar v. Rup Singh.(( 1888) I. L. R. 11 A. 57, 66-7)] The transaction must not be judged by what the financier actually got. On the question of limitation, the date fixed for performance is the date of the final decree in Saleems suit. If that date is accepted the present action was out of time. If time is to run from the date of the refusal to perform the agreement, namely, March 5, 1926, the suit is within time. Eddy K.C. replied. The contract here is not per se opposed to public policy, and the onus of showing that it is on the respondents. [Reference was made to Bakshi Das v. Nadu Das.(( 1905) 1 Cal. L. J. 261.)] Nov. 7. The judgment of their Lordships was delivered by SIR GEORGE RANKIN. Eddy K.C. replied. The contract here is not per se opposed to public policy, and the onus of showing that it is on the respondents. [Reference was made to Bakshi Das v. Nadu Das.(( 1905) 1 Cal. L. J. 261.)] Nov. 7. The judgment of their Lordships was delivered by SIR GEORGE RANKIN. The appellant, Lala Ram Sarup, and respondent No. 4, Lala Alopi Parshad (herein called the plaintiffs), brought the suit out of which this appeal arises in the Court of the District Judge at Delhi on October 16, 1928. The suit was brought upon an agreement of a champertous nature, dated October 2, 1920, and made between the plaintiffs and one Saleem Mahomed Shah. Saleem had since January 26, 1920, been suing in the Court of the District Judge at Delhi to establish his legitimacy as son to Shahzada Mirza Souriya Jah, of the Moghul dynasty, who had died in 1913, possessed of considerable property. Besides Saleem, Souriya had left him surviving two widows and two daughters. The Court of Wards had, in 1913, taken over his whole estate as belonging to these female heirs, giving a compassionate allowance to Saleem as a temporary measure. It had been decided by the Chief Commissioner that the Court of Wards should not upon its own responsibility recognize Saleem as entitled to succeed to any portion of the estate, but that he should be invited to obtain the decision of a civil court, and informed that the Court of Wards would give all possible aid to the civil courts in order to arrive at an early decision with the least possible cost to the litigants. His application for a loan was not unnaturally refused by the Court of Wards, who gave him instead some inexpert advice about bringing a friendly suit for a mere declaratory decree on a court fee of ten rupees, and about suing in forma pauperis. By June, 1919, he had approached a Muslim lawyer of Delhi, by name Abdur Rahman. This gentleman was a Khan Bahadur, and has since become a knight and a judge of the High Court of Madras. Having made an arrangement with Saleem to take a fee payable by monthly instalments of Rs.100, he undertook the case, and acted for Saleem throughout. This gentleman was a Khan Bahadur, and has since become a knight and a judge of the High Court of Madras. Having made an arrangement with Saleem to take a fee payable by monthly instalments of Rs.100, he undertook the case, and acted for Saleem throughout. On January 26, 1920, Saleem attempted to proceed in forma pauperis by filing an application under Order 33, C. P. C, containing the same particulars as a plaint. He impleaded the Court of Wards, his fathers junior widow and daughter, and the husband of a deceased daughter. The senior widow had died in 1919. Two schedules (P. 1 and P. 2) were annexed to the application, being lists of the movable and immovable property left by Souriya according to such information as Saleem had been able to obtain. P. 2 comprised a considerable number of immovable properties, some of which had been held by Souriya as jagirs, and were not heritable. The claim was for possession or administration of the whole movable and immovable property left by Souriya on the footing that by a family custom over-riding the Mahomedan law Saleem, as the only son, was the sole heir. He asked for mesne profits, accounts and enquiries and other relief, and valued his suit at ten lacs of rupees. The Court of Wards did not, however, fulfil the expectations which it had held out as regards facilitating an early decision in a friendly and inexpensive suit. Mr. Modad Ali, its manager, opposed the grant of leave to sue in forma pauperis on a number of grounds, with the result that the Subordinate Judge on April 7, 1920, framed four issues, and adjourned the case till August 3, 1920, for evidence and arguments on the question whether leave should be given. When August came, Saleem, despairing of progress along these lines, had got into touch with respondent No. 4, Alopi Parshad, who at that time (and until 1923) carried on business with the appellant, Ram Sarup, as moneylenders and bankers. Saleem succeeded in arranging that they should find the money to pay the Court fee (Rs.3000) so that his suit should proceed in the ordinary way and not in forma pauperis, and also that they should meet all the expenses of the litigation. Mr. Saleem succeeded in arranging that they should find the money to pay the Court fee (Rs.3000) so that his suit should proceed in the ordinary way and not in forma pauperis, and also that they should meet all the expenses of the litigation. Mr. Abdur Rahman, on August 27, 1920, applied to the Court and obtained leave to put in the Court fee by October 4. The money was paid into the Treasury on October 2, and on October 8 the Court made an order treating the application made under Order 33 as a plaint. The agreement for finance (which is now sued upon) is a registered instrument, dated October 2. It recites that Saleem had only an allowance of Rs.100 per month, that he had filed a case in forma pauperis, and that it could not be quickly or satisfactorily conducted in that way. A long list of immovable properties is attached to the agreement; it is said to be in the same terms as the list attached to the application under Order 33. The agreement provides that the financiers, the present plaintiffs, should bear all the expenses of the case, and in return therefor should get a three annas share of the immovable property recovered, provided that this should be increased to four annas should the case be taken on appeal to the Privy Council. It was to be in Saleems option either (a) to have the property partitioned and give the plaintiffs their share, or (b) to have the property valued and pay the plaintiffs in cash. It is not disputed that the plaintiffs carried out their part of the agreement, providing whatever money was required of them; such moneys as had previously been raised by Saleem and paid to Mr. Abdur Rahman being refunded out of the sums provided by the plaintiffs. The suit was decided by the Subordinate Judge on May 10, 1925. By his judgment of that date he disposed of a large number of issues which had apparently been argued before him for sixteen days. Abdur Rahman being refunded out of the sums provided by the plaintiffs. The suit was decided by the Subordinate Judge on May 10, 1925. By his judgment of that date he disposed of a large number of issues which had apparently been argued before him for sixteen days. He found that Saleem was the legitimate son of Souriya; that a document put forward as Souriya’s will was not proved, and was otherwise invalid; that the alleged family custom of succession excluding females was not proved; and that the succession to the property of Souriya was governed by the rules of Mahomedan law, so that Saleem was entitled to a 14/32nds share, and no more. As regards the immovable property of Souriya, he found that there was hardly any dispute, the Court of Wards having filed two lists at Saleems instance; but the record before their Lordships in the present appeal does not enable them to say what properties were held to have descended to the heirs of Souriya. He found that the claim in respect of movables was barred by limitation except as regards any movables which came to the hands of the Court of Wards. He thought it unnecessary to direct accounts or administration, as the property was under management by the Court of Wards, and he confined his decree to a direction in Saleems favour " for possession of 14/32nds share of the estate of his late father.” From this decree neither side, upon consideration, thought fit to bring an appeal. In consequence of the decision, the Court of Wards, on July 16, 1925, was placed in charge of Saleems share, with retrospective effect, on the ground that he was a co-sharer with female wards. Soon afterwards, on September 17, 1925, Saleem died, leaving a widow and a daughter (defendants two and three in the present suit). As neither these ladies nor the Court of Wards were willing to recognize the plaintiffs claim under the agreement of October 2, 1920, the present suit was brought against them on October 16, 1928, asking for a decree for possession of 21/256ths share in the immovable properties belonging to Souriyas estate, and for partition thereof, as well as for mesne profits since May 10, 1925. The plaintiffs, Ram Sarup and Alopi Parshad, gave evidence, and called on their behalf Mr. Abdur Rahman. For the defendants, Mr. The plaintiffs, Ram Sarup and Alopi Parshad, gave evidence, and called on their behalf Mr. Abdur Rahman. For the defendants, Mr. Modad Ali, manager of the Court of Wards, Saleems widow, and a collateral relation of his called Nazir-ud-din, was the main witnesses. The learned Subordinate Judge (October 30, 1935) held that the plaintiffs claim being a claim for specific performance of an agreement was by virtue of art. 113 of the First Schedule to the Limitation Act of 1908 barred as having been brought in October, 1928, more than three years from the date of the decree of May 10, 1925. But he found in the plaintiffs favour that Saleem was not of weak intellect, that the agreement of October, 1920, was executed by him of his own free will, and that the agreement was not unlawful or opposed to public policy. The High Court on appeal (June 10, 1937) reversed the trial courts decision as to limitation, holding that time did not begin to run against the plaintiffs on the date of the decree of May 10, 1925, but only when the plaintiffs had notice that performance was refused. But the learned judges, having referred to the evidence as to Saleems being given to drink and being of weak intellect, held that it was highly probable that Saleem Mohomed Shah was induced to enter into an unfair bargain whereby he agreed to give up property worth a lac and fifty thousand rupees for a sum of ten or twelve thousand rupees." They held that the agreement of October 2, 1920, was highly detrimental to his interests, and was inequitable and unenforceable. They assessed the reasonable expenses of Saleems suit at Rs.8440, and gave the plaintiffs a decree for that sum, refusing them any costs on the ground that the Court of Wards had offered Rs.8500 before the suit was filed. Upon the question of limitaion, their Lordships agree with the High Court that Saleems obligation under the agreement sued upon was not that on the same day as that on which the trial court should give judgment he should get the property partitioned or valued, and should transfer the plaintiffs share of the lands or pay the plaintiffs the value thereof in cash. May 10, 1925, cannot be regarded as the date fixed for the performance of the agreement of October 2, 1920. May 10, 1925, cannot be regarded as the date fixed for the performance of the agreement of October 2, 1920. On the merits, however, their Lordships consider that the High Court have taken an unduly unfavourable view of the agreement, which was neither extortionate nor inequitable. There is some dispute as to the amount of money found by the plaintiffs for the purposes of Saleems suit. The plaintiffs produce four cheques, amounting to Rs. 19,000, which were paid by them to Mr. Abdur Rahman, and are dated August 23, 1920 (Rs.5000), January 13, 1921 (Rs,500), February 21, 1921 (Rs.10,000), and June 6, 1921 (Rs.3500). Both they and Mr. Abdur Rahman deposed that these cheques were all given for the expenses of the suit. The latter says that by January, 1920, he had agreed with Saleem for an inclusive fee of Rs.10, 000, to be paid in monthly instalments of Rs.100. The widow and Nazir-ud-din say that the fee agreed on was Rs.2000, but the trial judge thought that there was no "reason to disbelieve the statement of Sir Abdur Rahman "that his fee was Rs.10, 000.” The learned judges of the High Court do not say that they disbelieve the statement, but express the opinion that a fee of Rs.10,000 was highly excessive. The plaintiffs cannot be held responsible for fixing the fee, which had been settled before they were approached, and their Lordships think it sufficiently proved that the fee was paid by the plaintiffs. The learned Subordinate Judge was satisfied that "about Rs.10,000 in "all must have been spent on carrying on the litigation by "the plaintiffs," but as there was a junior counsel, and some expense upon commissions to examine witnesses, it seems reasonably clear that the expenditure exceeded that figure by several thousands of rupees. According to Sir Abdur Rahman he got the money from the plaintiffs cheques and used it all for the suit, giving money to Saleem, who kept an account of his expenditure which he showed to Sir Abdurs clerk and himself when asking for more money. It seems quite probable, therefore, that the whole Rs. 19,000 was expended in this manner, and had the case gone on appeal to the High Court further moneys to a considerable amount might have become necessary. What, then, in the events that have happened, has been the plaintiffs reward? It seems quite probable, therefore, that the whole Rs. 19,000 was expended in this manner, and had the case gone on appeal to the High Court further moneys to a considerable amount might have become necessary. What, then, in the events that have happened, has been the plaintiffs reward? It is now admitted that, as the Court of Wards accounts show, the total value of Saleems share of his fathers estate is Rs.88,753, of which three-sixteenths is Rs.16,641. So that the plaintiffs have got a poor return for their venture, if indeed they have not actually lost money by it. The trial judge, on a review of these matters, held that the agreement sued on was neither unlawful nor opposed to public policy, and their Lordships agree. The learned judges of the High Court based a contrary opinion mainly upon the statement of Alopi Parshad that he had seen the properties in Delhi which were mentioned in the agreement, and could approximately assess the value of those outside the city; and that he estimated the value of them all, including the jagirs, at about eight lacs of rupees. Mr. Modad Ali, the Court of Wards manager, deposed "The value of the property was fixed by "the plaintiff (i.e. Saleem) as ten lacs, in which he claimed "his own share, but the value of the whole property in fact "was about three lacs." The learned judges of the High Court, taking three-sixteenths of eight lacs as Rs. 1,50,000, say that by the agreement in suit Saleem "agreed to give up property "worth a lac and fifty thousand rupees for a sum of ten or "twelve thousand rupees." This, their Lordships think, is to mistake the business meaning of the transaction. Though the Court of Wards was not minded to accept Saleem as Souriyas legitimate son, he had, and was thought by his lawyer and by the plaintiffs to have, a good chance of establishing his legitimacy. Even so, he had certain difficulties to overcome, e.g. as regards the alleged will of Souriya. But beyond that lay a great difficulty—that of proving a custom, in derogation of the rules of Mahomedan succession, whereby he could succeed to the whole estate. On this point he would indeed appear to have had little chance of success. Even so, he had certain difficulties to overcome, e.g. as regards the alleged will of Souriya. But beyond that lay a great difficulty—that of proving a custom, in derogation of the rules of Mahomedan succession, whereby he could succeed to the whole estate. On this point he would indeed appear to have had little chance of success. To speak of the plaintiffs as though they were having three-sixteenths of eight lacs handed to them for ten or twelve thousand rupees is, therefore, a serious mistake. But in truth the figure of eight lacs refers in part to property which was not heritable at all, and takes no account of any mortgages or charges, still less of any question as to debts left by Souriya. The shrinkage in the value of Saleems inheritance to the figure of Rs.88,753 may be due in part to a fall in values not expected in October, 1920; but even that is not a contingency too remote to be taken into account by business men striking a bargain for the finance of a suit to recover immovable property. The High Courts conclusion appears to have been influenced by the evidence that Saleem was given to drink, and of weak intellect. This they regard as rendering it "probable that he was induced to enter into "an unfair bargain." But there is no evidence that the agreement sued upon was entered into by him while under the influence of drink, and much to show that he took a long time to consider it, consulted with his wife and his lawyer, and fully understood it. The evidence that he was of weak intellect is very thin indeed, and Sir Abdur Rahman denied this, though he admitted that Saleem was occasionally intoxicated. The trial judge had very correctly dealt with the evidence upon this aspect of the case, and had found against the contentions of the defendants, which the High Court appear to have accepted on the ground that they were "highly probable.” The fairness of the agreement of October 2, 1920, must be considered independently of unproved suggestions that it may have been improperly obtained. Champertous transactions are in their essence speculative and the fairness or otherwise of a particular bargain are almost always open to some debate. Saleem was a poor man with a reasonable and, as it turned out, a just claim. Champertous transactions are in their essence speculative and the fairness or otherwise of a particular bargain are almost always open to some debate. Saleem was a poor man with a reasonable and, as it turned out, a just claim. He was put by the Court of Wards in the position of having to undertake expensive litigation. He was well justified in his own interest in resorting for finance to persons willing to take a risk; and the plaintiffs were prima facie justified in helping him to his rights upon terms that they would share in his good fortune if he succeeded and lose their money if he failed. Not only is there no proof to support the suggestion that the agreement of October 2, 1920, was obtained by unfair means, or was not fully considered by Saleem and freely accepted by him, but in the events which have happened it appears that, after taking all risks of the suit being unsuccessful, the plaintiffs, notwithstanding that it succeeded, are likely—to put it no higher—to gain little or nothing by the transaction. Had the suit succeeded in all respects the plain tiffs reward would doubtless have been high, but Saleem would have become a rich man, retaining thirteen annas in the rupee. In applying the principle that "a fair agreement to supply funds to carry "on a suit in consideration of having a share of the property, "if recovered, ought not to be regarded as being, per se, "opposed to public policy " (Ram Coomar Coondoo v. Chunder Canto Mookerjee (( 1876) L. R. 4 I. A. 23, 47.)), it is essential to have regard not merely to the value of the property claimed, but to the commercial value of the claim. This has to be estimated by the parties in advance of the result, and where they have weighed the probabilities in a manner which has not operated unfairly, it is more reasonable to regard this as confirming their shrewd estimate of the chances, than to condemn the agreement outright as unfair, by reason only of the possibility that a great gain to the claimant would have had to be shared with the financier. Though it is clearly not conclusive, the pro portion to be retained by the claimant is an important matter to be considered when judging of the fairness of a bargain made at a time when the result of the litigation is problematical. The uncertainties of litigation are proverbial, and if the financier must needs risk losing his money he may well be allowed some chance of exceptional advantage. Their Lordships agree with the trial judge in thinking that the agreement of October 2, 1920, is valid and binding. The order to be made on this appeal should, in their Lordships opinion, direct that the appeal be allowed, and the decree of the High Court, dated March 18, 1937, set aside; declare that the agreement dated October 2, 1920, should be specifically performed; that the defendants should be permitted to elect whether to have a valuation of such of the properties mentioned in the said agreement as were recovered by Saleem Mahomed Shah in Suit No. 235/127 of 1920-22 in the Court of the Senior Subordinate Judge at Delhi, and to pay three-sixteenths of such value to the plaintiffs, or to have a partition thereof; that the present suit should be remanded to the trial court for further consideration in accordance with these directions and such other directions in that behalf as the High Court may think fit to give, having regard to the fact that some of the said properties are under management by the Court of Wards. Their Lordships will humbly advise His Majesty accordingly. The defendants must pay the plaintiffs costs in the trial court and in the High Court, as also the appellants costs of this appeal.