JUDGMENT : S. Krishna Pillai, J. These two appeals arise out of two suits in one of which the appellant is the plaintiff and in the other he is the defendant. As plaintiff he sued in O.S. No. 112 of 1122 of the District Court of Trivandrum for specific performance of contract to sell land which was in his possession under a mortgage and as defendant in O.S. No. 113 of 1122 of the same court he resists the suit for redemption filed by the respondent who claims to have purchased the equity of redemption from the original mortgagor. The suit for specific performance was dismissed and the suit for redemption allowed. 2. The plaint property originally belonged to Sri Masilamony who for some time was the State Geologist of Travancore. He mortgaged the property to plaintiff under Exhibit V mortgage dated 5.6.1939. It was for a sum of Rs. 2000/- and for a period of three years. To the plaintiff these premises were essential for purposes of his transport business and it was acknowledged on all hands that its importance and utility had risen considerably with a new contract he had entered into with the railway authorities in 1942. The plaintiff was thereupon said to have approached the mortgagor for an extension of the term of the mortgage. Nothing appears to have come out of it as the latter was in a hurry to sell the property. He accordingly wrote to the plaintiff on 13th July 1943 intimating his intention to sell the property to whomsoever that chose to purchase it. As a result of this letter the plaintiff hurried to meet the other in his house at Trivandrum on the 15th July when they were said to have come to a certain definite agreement relating to the sale of the property. One of the conditions was that they should meet again on 17th July, prepare the draft and in another seven days’ time register the conveyance for a sum of Rs. 6000/-, paying Rs. 4000/- only after deduction on account of the mortgage. This meeting on the 17th July did not take place owing to the inconvenience of the plaintiff as a result of which Sri Masilamony sent Ext. B letter to the plaintiff on the same day repudiating the contract. On receipt of the letter the plaintiff hurried to Trivandrum with the sum of Rs.
This meeting on the 17th July did not take place owing to the inconvenience of the plaintiff as a result of which Sri Masilamony sent Ext. B letter to the plaintiff on the same day repudiating the contract. On receipt of the letter the plaintiff hurried to Trivandrum with the sum of Rs. 4000/- and requested the other to execute the deed on acceptance of the amount. The latter was however found to be intractable. He refused to consider the contract as still binding for the simple reason that the plaintiff had as stated in Exhibit B letter neglected to meet him on the appointed day and perform what he had undertaken to do. The plaintiff returned disappointed hoping that better counsel would prevail when he had sufficiently cooled down. In the meantime the respondent, a provision seller from Ceylon who had established a provision store on the opposite side of the road appeared on the scene. He knocked off the bargain for the identifical sum of Rs. 6000/- and immediately without further enquiry took Ext. VI sale-deed on 16.9.1943. The plaintiff thereupon brought the present suit for specific performance of contract in which both vendor and vendee were made parties. This was followed by the respondent’s suit for redemption. The vendor and vendee both denied the contract alleged by the plaintiff and the respondent-vendee pleaded that in any event he was protected as a bona fide purchaser without notice. These are the simple facts of the case. 3. The question that arises for determination upon the above facts are (i) whether there was contract between the plaintiff and the mortgagor for the sale of the equity of redemption to the plaintiff, (ii) whether if there was such a contract the failure of the plaintiff to appear before the other on the 17th July 1943 would be a justification for the latter to resile from the contract, (iii) whether the defendant was a bona fide purchaser without notice and lastly (iv) whether the plaintiff is entitled to a decree for specific performance against the defendant. 4. On the first question we have only to consider the evidence furnished by Exhibits A and B and the testimony of P.Ws 1 and 5.
4. On the first question we have only to consider the evidence furnished by Exhibits A and B and the testimony of P.Ws 1 and 5. It is clear from the evidence that the plaintiff who was the mortgagee in possession of the holding was much interested in retaining it not merely as a covetable possession but as absolutely essential for purposes of his business. There is therefore nothing improbable in the plaintiff’s case that he had on some former occasion discussed the matter with the other. Though there is no indication that it led to any tangible results it is clear that Sri Masilamony, as a man of education and intelligence had been impressed with the fact that the plaintiff was one of the most likely purchasers when the time came. There is no doubt that one was in hurry to sell and the other was ready to purchase. But the negotiation starts with an abruptness which would throw any ordinary businessman off his balance. He came from Madras the previous evening and wrote Exhibit A letter on 13.7.1943 from Trivandrum. The letter is as follows: “I returned from Madras last night and the sale of my property you are holding on mortgage will, I expect, be effected during the course of the next few days and I shall b leaving for Nellore soon after. I hope that there will be no difficulty on your part to deliver the property to the purchaser.” To this he added a postscript asking the plaintiff for a reply. We do not know what justification there was for the statement that the sale would be “effected during the course of the next few days” for at that time and for some time thereafter there was no purchaser in sight except the plaintiff. As the evidence shows that sale to the respondent was more a matter of chance than of any previous negotiation. Evidently it was a feeler and probably also a lever for working up the plaintiff. We are not able to read the letter in any other light and coming as it does from a man of Sri. Masilamony’s position it cannot be understood as indicating anything else. What is more important is however what followed. 5. Instead of sending a reply as desired of him the plaintiff went to Trivandrum and interviewed the other.
We are not able to read the letter in any other light and coming as it does from a man of Sri. Masilamony’s position it cannot be understood as indicating anything else. What is more important is however what followed. 5. Instead of sending a reply as desired of him the plaintiff went to Trivandrum and interviewed the other. This indicates, to our mind, his evident anxiety for closing the deal without correspondence and consequent delay. Sri. Masilamony merely wanted to sell as early as possible and leave the place with the money he could get out of the transaction. On all account he was prepared to sell the property for Rs. 6000/- including the mortgage and so far as the plaintiff was concerned he was anxious to purchase it no matter what the price was. So on the question of the intention of the former and the preparedness of the latter there could not be any doubt. It is in this setting that we have to read Ext. B. This, to our mind, indicates in clear terms that both had come to an agreement, the one to sell and the other to purchase, for Ext. B is meaningless if it is not read and understood in the above sense. It is conceded by both parties that on the 15th they had agreed to meet again on the 17th but that the meeting did not take place on that date. It is unnecessary to enquire into the reasons for the failure; all that we are concerned with is whether the failure of the plaintiff to turn up on the 17th would justify the other from resiling from whatever contract he had entered into with the plaintiff on the 25th. That will depend on the question whether there was a completed contract on the 15th. Ext. B letter reads as follows: “As you have not made your appearance today as promised by you on Thursday when you met me here, I take it that you are not prepared to purchase my property at Nagercoil.
That will depend on the question whether there was a completed contract on the 15th. Ext. B letter reads as follows: “As you have not made your appearance today as promised by you on Thursday when you met me here, I take it that you are not prepared to purchase my property at Nagercoil. I consider that I am released from the promises made on that day; and that I am free to make other arrangement.” This, to our mind, is capable of only one interpretation and that is that an agreement has come to between him and the plaintiff on the previous day from the obligations of which he could be released only with the consent of the other. That at any rate was how Sri Masilamony had understood it and no one can have right to understand it in any other manner. We do not speak of release from the promises except where a binding promise has been made and you do not ask for freedom to make other arrangements unless that freedom has been lost for some reason. We are unable to understand what could have been this promise of the 15th except that he would sell the land to plaintiff for Rs. 6000/-. It was a binding promise which in his view could be relieved against only with the concurrence of the other contracting party or as he thought in this case there was a breach of an essential condition. Admittedly the plaintiff failed to turn up on the 17th as he had promised. What we have to consider is whether the failure of the plaintiff to turn up on the 17th was such a breach of the contract as would relieve the other from the obligation to perform his contract. Was he justified in his conclusion that an plaintiff had not turned up he was not prepared to purchase the property? He had only one idea uppermost in his mind, that is, the sale of his property. The speed with which he was to get the sum of Rs. 4000/- might also have been a matter of concern for him, but a delay of a day or two would not make any difference to the plaintiff so long as he was conscious that there was a binding agreement for sale.
The speed with which he was to get the sum of Rs. 4000/- might also have been a matter of concern for him, but a delay of a day or two would not make any difference to the plaintiff so long as he was conscious that there was a binding agreement for sale. Sri Masilamony was probably a man of iron discipline, but whether it was justified in this case we doubt. Before even the appointed day is out he writes to say that the contract is broken on account of non-appearance of the other and would refuse to treat with him thereafter. He had not the good sense even to issue a notice fixing a reasonable time limit for closing the business. This, we think, is nothing but petulance and discloses an exaggerated notion of the proprieties of human conduct in every day life. 6. It is averred in the plaint that immediately on receipt of Ext. B letter the plaintiff ran up to Trivandrum on the 20th, offered the sum of Rs. 4000/- and requested execution of the deed. There seems to be a good deal of truth in this version though it is denied by the defence. Considering the prompt response which the plaintiff gave to Ext. A letter we cannot think that he would have remained away without making an attempt to remove what according to him, was a misfortune in a matter of such vital concern to him. The questions whether there was or was not a meeting on the 20th, whether the plaintiff had offered the sum of Rs. 4000/- at that time and whether the plaintiff had notified by sending Ext. C letter of his intention not to release the other from his promises, to our mind, are not matters of much significance. The contract was made on the 15th July and there was no further contract to make on any subsequent date. The probabilities are against sending any letters as it would not be reasonable to expect a fight over the niceties of one’s legal rights at that moment. The reasonable course is what was done on the 20th. The presence of the plaintiff on the 20th which seems to be in keeping with the probabilities must be accepted. On both points there is reliable evidence on the side of the plaintiff. 7.
The reasonable course is what was done on the 20th. The presence of the plaintiff on the 20th which seems to be in keeping with the probabilities must be accepted. On both points there is reliable evidence on the side of the plaintiff. 7. We must here observe that little assistance is derived from the lower court’s judgment. It indulged in sentiments hardly reconcilable with judicial detachment. Its statement that “to rely solely on the uncorroborated testimony of the plaintiff is contrary to law and equity, justice and good conscience” occurring in one portion of the judgment is typical of its tendency. We do not think it necessary to go into it in any detail. P.W.5 was present on the occasion of the meeting between the two on the 15th. He swears that the price demanded by Sri Masilamony and agreed to by the plaintiff was Rs. 6000/- and that there was no controversy at all about the same. All that Sri Masilamony had told him, according to the witness, was that if he wanted the property he must come and take the sale deed within a week which also the plaintiff agreed to P.W.3 who is the Vakil employed by the plaintiff for the conduct of his cases swears that on the 15th July he had told him that the contract for the purchase of the land from Sri Masilamony was completed and that the draft should be prepared for which purpose the mortgage deed must be picked up from the deed box in his office. It is a misfortune that Sri Masilamony was not available for examination as a witness in the case. He died during the pendency of the case and his legal representatives who were brought on record simply adopted his contentions and pleaded that if any relief is to be granted it must be granted against the estate of the deceased. In these circumstances we have to believe the plaintiff and P.W.5 on the point and conclude that there was a contract of sale whereby Sri Masilamony had agreed to sell the property to the plaintiff for a sum of Rs. 6000/- which after deduction of the mortgage amount was liable to be paid in cash on registration. 8. The next question for consideration is whether the failure of the plaintiff to turn up on the 17th justified the other from resiling from his agreement.
6000/- which after deduction of the mortgage amount was liable to be paid in cash on registration. 8. The next question for consideration is whether the failure of the plaintiff to turn up on the 17th justified the other from resiling from his agreement. There is nothing to indicate that time was of the essence of the contract and that unless the plaintiff turned up at a particular time on the 17th the contract was to be treated as having been abandoned. Time is not ordinarily of the essence of a contract of sale though the parties can make it so by express agreement in the contract itself or inferred if the nature of the property intended to be sold requires it. This point was discussed by the Privy Council in Jamshed Khodaram v. Burjorji Dhunjibhai, I.L.R. 40 Bombay 289. It was pointed out in that case that equity which governs the rights of the parties in cases of specific performance of contracts to sell real estate, looks not at the letter but at the substance of the agreement in order to ascertain whether the parties, notwithstanding that they named as specific time within which completion was to take place, really and in substance intended more than that it should take place within a reasonable time. In Mussa Mahomed v. Motilal, A.I.R. 1922 Bombay 14, Macleod, C.J., had occasion to deal with a case of this nature where on default on the appointed day the vendor issued notice to the plaintiff and demanded completion of the contract within four day on default of which it was to be cancelled. The learned Chief Justice observed as follows: “No doubt, what actually was required to be done on the 27th August, was only the enforcement and stamping of the conveyance and handling over of the purchase-money, and it might be said all that could be done within the space of a few hours. But that is not the only consideration which must weigh with the Court. One has to consider whether, as a matter of fact, from the surrounding circumstances, the defendant would be so prejudiced by further delay in the completion of the contract that equity would not assist the plaintiff in getting it performed”. The same principle was laid down by a Full Bench of the Travancore High Court in Damodaran Namburi v. Dharmaraja Iyen, 15 T.L.J. 110.
The same principle was laid down by a Full Bench of the Travancore High Court in Damodaran Namburi v. Dharmaraja Iyen, 15 T.L.J. 110. There was no notice here much less any reasonable notice. We cannot say that time was of the essence of the contract in this case and that a refusal to turn up at Trivandrum on the 17th was such a breach as would entitle Sri Masilamony to put an end to the contract he had entered into with the plaintiff on the 15th. The only prejudice to Sri Masilamony in this case was the delay and inconvenience arising from a postponement of his trip on Nellore as indicated in Ext. A. We therefore hold that Sri Masilamony was not justified in refusing to execute the conveyance to the plaintiff. 9. The next important question that arises in the case is whether the defendant was a bona fide purchaser without notice against whom specific performance cannot be enforced. The defendant on his own showing is one who made no enquiries before he entered into the transaction. He swears that Sri Masilamony met him by accident in the Travellers' Bunglow, that Sri Masilamony showed him over the premises and that immediately he agreed for the price offered by the latter. It is undoubted that the defendant is a person who owns a shop quite opposite to the premises and from his evidence it is clear that he was also aware of the fact that the plaintiff was in possession. It must therefore be held that it was incumbent on him to make enquiries of the plaintiff to ascertain under what title he was in possession. He said that he went to the plaintiff one day after the sale deed was registered. This is certainly not conduct consistent with bona fides, for as we understand it, the good faith of a purchaser is to be gauged from the enquiries which a bona fide purchaser would make before he purchases and the opportunities which he had of making enquiries. We are unable to believe that a person demanding surrender of a property on the strength of a sale-deed is a person who takes the sale-deed in good faith. We are therefore led to infer that the defendant is not a bona fide purchaser for value. The case-law on the point leaves no room for doubt on this matter.
We are unable to believe that a person demanding surrender of a property on the strength of a sale-deed is a person who takes the sale-deed in good faith. We are therefore led to infer that the defendant is not a bona fide purchaser for value. The case-law on the point leaves no room for doubt on this matter. In Baba Sah v. Hajee Mohamed Akbar Sahib, A.I.R. 1923 Mad. 563, it was pointed out that it was incumbent on a purchaser of immovable property not in the possession of the vendor to enquire into the nature of the interest held by the person in possession and if he wilfully abstains from making any enquiry or is grossly negligent in making enquiry he will be in law effected with notice of any fact which he would have come to know had he made such enquiry. To the same effect is the decision in Faki Ibrahim v. Faki Culam, A.I.R. 1921 Bombay 459. In that case Macleod. C.J., held that where a purchaser of immovable property knowing that his vendor is not in possession purchases the property without making any enquires must be take to have had constructive notice of all the equities in favour of that one in possession. The following passage occurring in Daniels v. Davison, (1809) 16 Ves. 249, was also quoted as justifying the above view; “Where there was a tenant in possession under a lease or an agreement a person, purchasing part of the estate, must be bound to enquire on what terms that person was in possession .... that this tenant being in possession under a lease, with an agreement in his pocket to become the purchaser, those circumstances altogether gave him an equity repelling the claim of a subsequent purchaser, who made no enquiry as to the nature of his possession’. In Bhup Narain v. Gokul Chand, A.I.R. 1934 P.C. 68, it was pointed out that the burden of proving bona fides is on the transferee.
In Bhup Narain v. Gokul Chand, A.I.R. 1934 P.C. 68, it was pointed out that the burden of proving bona fides is on the transferee. Adverting to S. 27 which saves bona fide purchases in suits for specific performance of contract Their Lordships pointed out as follows: “In Their Lordships’ opinion, the section lays down a general rule that the original contract may be specifically enforced against a subsequent transferee but allows an exception to that general rule not to the transferor, but to the transferee, and, in Their Lordships’ opinion, it is clearly for the transferee to establish the circumstances which, will allow him to retain the benefit of a transfer which prima facie he had no right to get”. There are many decisions of the Travancore High Court which deal with the above principle. In a recent decision in Raghavan Pillai v. Janardanan Nair, 1947 T.L.R. 412, it is pointed out that contracts relating to real property can necessarily be satisfied only by a conveyance of the particular estate or parcel contracted for and a Court of equity decrees performance of a contract for land, not because of the real nature of the land but because damages at law, which must be calculated at the general money value of the land, may not be a complete remedy to the purchaser to whom the land may have a particular and special value. 10. The result is that we find that there was completed contract between the plaintiff and Sri Masilamony, that Sri Masilamony out of petulance and possibly out of an exaggerated notion of the importance of time in a contract of this kind did not allow the contract to be fulfilled and that the respondent either without caring to know it or recklessly took Ext. VI sale. We are satisfied in these circumstances that the contract is liable to be specifically enforced against him. We therefore allow both appeals with costs decreeing the suit for specific performance (O.S. No. 112 of 1112) and dismissing the suit for redemption, (O.S. No. 113 of 1122). Defendants 1 and 2 who are the assignees of the 3rd defendant will execute the conveyance to the plaintiff, failing which the plaintiff will take the necessary steps as provided in O. 21 R. 30 of the Code of Civil Procedure and get the document registered.
Defendants 1 and 2 who are the assignees of the 3rd defendant will execute the conveyance to the plaintiff, failing which the plaintiff will take the necessary steps as provided in O. 21 R. 30 of the Code of Civil Procedure and get the document registered. The defendants 1 and 2 who had deposited mortgage amount in court will be entitled to get back the amount. They will also draw from Court the amount deposited by the plaintiff towards the value of the equity of redemption. S. Govinda Menon, J. I agree but not without some hesitation. I am not without doubts as to the correctness of the interpretation put by my Lord the Chief Justice upon the letter, Ext. B. I am not also impressed with the conduct of the appellant in regard to this transaction. However that be, His Lordship the learned Chief Justice has taken a different view regarding these matters and my learned brother Mr. Justice Sankaran has agreed with His Lordship. Under the circumstances I do not propose to contribute a judgment of my own discussing the above matters. Appeals allowed.