Judgment :- 1. These appeals arise out of two suits instituted by a banking company on two promissory notes for Rs. 5,000 each, Ext. D-1 dated the 19th January 1953 executed by one Narayandas and his brother Hargovindas, and Ext. D-2 of the same date by the same Narayandas and another brother of his, Narotamdas. In both promissory notes the executants jointly and severally promised to pay the sum mentioned. Narayandas had other dealings with the bank. He had a cash credit account on the basis of an agreement dated the 27th March 1952, guaranteed to the extent of Rs. 10,000 by his cousin, Ramdas, for which a prior mortgage by this Ramdas, given as continuing security for his liabilities to the bank, was, under the terms thereof, security. Narayandas had also on the same day as the suit promissory notes executed a third joint and several promissory note in favour of the bank along with Ramdas. This was for Rs. 6,000. These facts are not disputed and appear from Ext. A-3, the plaint in O.S. No. 70 of 1954 of the District Court, Parur, a suit instituted by the plaintiff bank against Narayandas for the recovery of the amounts due from him on account of his cash credit account and his three promissory notes of the 19th January 1953 including the two promissory notes now in suit. Recovery was sought both personally and by the sale of property which Narayandas had mortgaged on 3rd January 1952 to the plaintiff bank for Rs. 25,000 as continuing security for his liabilities then in existence and thereafter to be incurred. In the plaint fin that suit) the plaintiff bank said that it would be instituting separate suits against Hargovindas, Narotamdas and Ramdas in respect of their several liabilities with regard to the same debts; and, so far as Hargovindas and Narotamdas are concerned, it did this by the present suits, O.S. 204 of 1954 and O.S. 30 of 1955 of the District Court, Anjikaimal, which were subsequently transferred to the Sub-Court, Ernakulam and heard by that court as O.S. 205 and 215 of 1956. During the pendency of these suits, the plaintiff bank obtained a decree against Narayandas in the suit in the Parur Court, and in execution thereof, brought Narayandas's property to sale and thereby realised a sum of Rs.
During the pendency of these suits, the plaintiff bank obtained a decree against Narayandas in the suit in the Parur Court, and in execution thereof, brought Narayandas's property to sale and thereby realised a sum of Rs. 20,000 which being adjusted towards the other liabilities of Narayandas and the costs of that suit leaves, it is said, nothing for credit towards the promissory note debts which are the subject-matter of the present suits. Both these suits were decreed by the Subordinate Court, Ernakulam, but the plaintiff was disallowed costs on the score that it could have sued Hargovindas and Narotamdas also in its Parur suit. Hargovindas and Narotamdas have appealed against the decrees against them, while the plaintiff has appealed in both suits against the disallowance of its costs. A.S. 660 of 1958 is the appeal by Hargovindas, the defendant in O.S. 205 of 1956, and A.S. 703 of 1958 is the appeal by the plaintiff. A.S. 661 of 1958 is the appeal by Narotamdas, the defendant in O S.215 of 1956, while A.S. 702 of 1958 is the appeal by the plaintiff. 2. The defendants have raised the same contentions in the appeals as in the suits. They are: (1) That order II, R.2, C.P.C. is a bar to the present suits by reason of the plaintiff not having included his claims therein in his Parur suit, O.S. 70 of 1954; (2) that O. S.70 of 1954 includes the cause of action in the present suits and that the present claims have therefore merged in the decree in that suit; and (3) that by reason of the plaintiff's failure to take any action against Ramdas and by reason of its conduct in negligently, fraudulently and collusively getting Narayanadas's property which was worth at least Rs. 40,000 sold (and bought by itself) for the low price of Rs. 20,000 the defendants are absolved of liability by reason of S.131,141 and 146 of the Indian Contract Act. 3. Counsel on both sides have argued these questions at considerable length with reference to a wealth of authority, but it seems to me that the questions are essentially simple and that the contentions put forward by the defendants need not detain us long. To take first, the bar of order II, R.2, it is to be noted that the promises in both the promissory notes are joint and several promises.
To take first, the bar of order II, R.2, it is to be noted that the promises in both the promissory notes are joint and several promises. Therefore, the question whether by reason of S.43 of the Indian Contract Act [which as pointed out by the Federal Court in Jainarain v. Surajmull A.I.R. 1949 F.C. 211, in departure from the English law, makes every joint promise in India a joint and several promise in the absence of express agreement to the contrary] the rule in King v. Hoare 153 E.R. 206 is not applicable in India does not arise. The promises we are now considering are expressly joint and several, and, even under the English law, the rule in Hoare's case does not apply to joint and several obligations. Now, it seems to me - and this in fact has been said in Hoare's case in the last but one paragraph of the judgment - a joint and several bond by two or more persons is, in effect, a joint bond by all of them and a separate bond by each one of them. In the Parur suit, as well as in the present suits (although the Parur suit was partly for the recovery of the same debts as form the subject-matter of the present suits) the plaintiff is enforcing the several liabilities of Narayandas, Hargovindas and Narotamdas, not their joint liability. It is as if it were suing them on separate contracts (that the contracts are embodied on the same piece of paper makes no difference) and I think it obvious that the cause of action in respect of separate contracts cannot be the same so as to attract order II, R.2. 4. I might mention that it is on sub-rule (3) of the rule read in the light of the Explanation to the rule that specific reliance is placed. It is said that in the Parur suit the plaintiff could have asked for relief against the present defendants also since they were joint executants of the promissory notes sued upon. But this sub-rule can apply only in case of reliefs in respect of the same cause of action, and, as I have observed, in the enforcement of the several liabilities under the promissory notes the causes of action are different and not the same.
But this sub-rule can apply only in case of reliefs in respect of the same cause of action, and, as I have observed, in the enforcement of the several liabilities under the promissory notes the causes of action are different and not the same. It is however said that by reason of the Explanation, the obligations which the plaintiff seeks to enforce in the present suits, and the collateral security given by Narayandas in the shape of the mortgage sued upon in the Parur suit, do constitute but one cause of action. But this argument forgets that Narayandas's mortgage was only security for his own obligations under the promissory notes and not for the obligations of the present defendants; and what is being enforced in the three separate suits is the several obligations under the promissory notes, not the joint obligations. No doubt, by reason of the Explanation the personal obligation of Narayandas under the promissory notes, and his obligation under the mortgage by way of collateral security, do constitute but one cause of action and that is obviously why the plaintiff sued in respect of both these obligations in the Parur suit. 5. It is scarcely necessary to cite authority for the proposition that the obligations of different persons under different contracts can never constitute a single cause of action, but I might say that from Dhunput Singh v. Sham Soonder Mitter I.L.R. 5 Cal. 291 onwards it has been consistently held (being either expressly decided or taken for granted) that order II, R.2 and its forerunners, S.43 of the Code of 1882 and S.7 of Act 8 of 1859, can be no bar to a suit against "one or two or more joint and several obligers, though for the same debt a suit had been already brought and decree obtained against another of such obligers, that decree remaining unsatisfied". Muhammad Askari v. Radhe Ram Singh I.L.R. 22 All. 307, Dampanaboyina Gangi v. Addala Ramaswami I.L.R. 25 Mad. 736, Ramanjulu Naidu v. Aravamudu Aiyangar I.L.R. 33 Mad. 317, In re Vallibhai Adamji A.I.R. 1933 Bom. 407, and Phani Bhusan v. Rajendra Nandan A.I.R. 1947 Cal. 11, are some of the cases that have been cited.
Muhammad Askari v. Radhe Ram Singh I.L.R. 22 All. 307, Dampanaboyina Gangi v. Addala Ramaswami I.L.R. 25 Mad. 736, Ramanjulu Naidu v. Aravamudu Aiyangar I.L.R. 33 Mad. 317, In re Vallibhai Adamji A.I.R. 1933 Bom. 407, and Phani Bhusan v. Rajendra Nandan A.I.R. 1947 Cal. 11, are some of the cases that have been cited. It has been recognised in all of them that, for a cause of action to be the same and attract order II, R.2, there must be an identity of parties and this is recognised also in Mohammed Khalil Khan v. Mahbub Ali Mian A.I.R 1949 P. C. 78, the decision on which great reliance is placed on behalf of the defendants. In fact, in that case, the substantial identity of the parties which is found in Para.47 and 48 of the judgment forms the very basis for the application of order II, R.2. As observed by Bhashyam Ayyangar, J., in Dampanaboyina Gangi v. Addala Ramaswami I.L.R. 25 Mad. 736 at p. 740, a cause of action is not an abstraction independent of the defendant and it is impossible to hold that a cause of action against one person is a part of the cause of action against another even though it is not a joint one against both. In Balmakund v. Sangari I.L.R. 19 All. 379, it is said (at 383 of the report) that what S.43 of the Code of 1882 provides against is the splitting up of a cause of action and that the section is founded on the maxim that no one shall be twice vexed for one and the same cause. What the section forbids is the institution of a second suit against the same defendant or his representatives in interest upon the same cause of action which was the foundation of the first suit. In Phani Bhusan v. Rajendra Nandan A.I.R. 1947 Cal. 11, B.K. Mukherjea, J. (as he then was) says thus at page 14 of the report: "To make the rule (order II, R.2) applicable two things are essential: First, that the previous and the present suits must arise out of the same cause of action; and secondly, they must be between the same parties". With great respect I would put it thus: "To make the rule applicable one thing is essential.
With great respect I would put it thus: "To make the rule applicable one thing is essential. The previous and the present suits must arise out of the same cause of action and the cause of action cannot be the same unless there is a substantial identity of parties". 6. R.6 of order I of the Code which says that the plaintiff may, at his option, join as parties to the same suit all or any of the persons severally or jointly and severally liable on any one contract, including parties to bills of exchange, hundis and promissory notes, necessarily implies that, to take the case with which we are now concerned, namely, of a joint and several obligation, he is not bound to bring a single suit but may sue the obligers separately. The rule is permissive and indicates that separate suits are the rule and joinder an exception permitted by the rule. This is what Mulla has to say with respect to joint and several liabilities on a contract in his commentary on R.6 of order I: "The legal consequences of a joint and several liability on a contract are the same as those of several liability. Thus, if A and B pass a bond to C for Rs. 5,000 and the bond provides that A and B shall jointly and severally pay the amount to C, C may sue A and B jointly, or he may sue them separately, as in the case where the liability is several". Neither R.6 of order I nor Mulla could have forgotten the provisions of order II, R.2. 7. Not one decision cited before me supports the contention put forward on behalf of the defendants that in the case of a joint and several promise, the promisee may sue all or any, but that if he sues one or more without suing the others, he cannot later sue the others. 8. A number of decisions have been cited on behalf of the defendants. To Mohammad Khalil Khan v. Mahbab Ali Mian A.I.R. 1949 P. C. 78, I have already made reference. The others on which according to counsel for the defendants he places special reliance are, District Board, Fyzabad v. Mt. Ram Kishore A.I.R. 1947 Oudh 135, Kempe Gowda v. Lakke Gowda A.I.R. 1952 Mys. 99, Bala Singh v. Gokuleshwar Singh A.I.R. 1953 V.P. 31, Krishnaji v. Ragunath A.I.R. 1954 Bom.
The others on which according to counsel for the defendants he places special reliance are, District Board, Fyzabad v. Mt. Ram Kishore A.I.R. 1947 Oudh 135, Kempe Gowda v. Lakke Gowda A.I.R. 1952 Mys. 99, Bala Singh v. Gokuleshwar Singh A.I.R. 1953 V.P. 31, Krishnaji v. Ragunath A.I.R. 1954 Bom. 125, Subbarayadu v. Balaramayya A.I.R. 1955 Andhra 194, and Haridas v. Anath Nath A.I.R. 1961 S. C. 1419. All I need say about them is that there is nothing in any of them contrary to what I have held. 9. The next contention, of merger in the decree obtained in the Parur suit, is obviously based on the rule of English law laid down in Hoare's case (already cited) which, as I have said is not, even under English law, applicable to cases of joint and several liability. 10. The third contention based on S.131,141 and 146 in the Contract Act depends on the assumption that the defendants were only sureties for Narayandas, an assumption for which there is no basis whatsoever. In the first place, the promissory notes, Exts. D-1 and D-2, executed by them shows that they are as much principal debtors as Narayandas, for the obligation they undertook along with him was a joint and several obligation. Oral evidence to the contrary would be barred by S.91 and 92 of the Evidence Act and any agreement as between themselves and Narayandas would by reason of S.132 of the Contract Act be of no avail against the plaintiff bank even if the bank had knowledge thereof - See Venkiteswara Prabhu v. Ramachandra Pai XXXVI Cochin L. R.493, where the entire question is thoroughly discussed with reference to the statutory provisions and the case law. 11. I might mention that the evidence in support of the contention that the defendants were only sureties is based on nothing more than their assertion (denied by the plaintiff bank and found against by the court below) that the sums mentioned in the promissory notes - the defendants, it may be noted, have no case that there was any failure of consideration - were not paid in cash, but were adjusted to some other liability of Narayandas to the plaintiff bank. To argue from this that the defendants were only sureties is a fallacy as pointed out in Gopala Moller v. Velloth Krishnan A.I.R. 1942 Mad. 134. 12.
To argue from this that the defendants were only sureties is a fallacy as pointed out in Gopala Moller v. Velloth Krishnan A.I.R. 1942 Mad. 134. 12. I might add and that there is no evidence whatsoever in support of the allegation that Narayadas's property was sold in execution of the decree of the Parur court negligently, fraudulently, and collusively for a sum much less than its real value, and that this allegation is based on nothing more than that property which was in 1952 mortgaged for Rs. 25,000 was in 1958 sold in court auction for Rs. 20,000. Also that, even assuming that Ramdas and the defendants were co-sureties, S.146 of the Contract Act has no bearing on their liability to the plaintiff, but refers only to their rights and obligations inter se. 13. It follows that defendants' appeals, A. S. Nos. 660 and 661 of 1958, fail, and they are accordingly dismissed with costs. 14. So far as the plaintiff's appeals, A.S. Nos. 702 and 703 of 1958, are concerned I think that the basis on which the lower court denied the plaintiff costs in accordance with the usual rule is wrong, for, I do not think that the plaintiff could have combined his present suits against Hargovindas and Narottamdas with his Parur suit against Narayandas which was in enforcement not merely of Narayandas's personal liability under the three promissory notes executed by him and under his cash credit account, but also of his liability under the mortgage which was collateral security for all these obligations. It follows that these appeals by the plaintiffs must be allowed, and they are allowed with costs. 15. It should not be necessary to say that, altogether the plaintiff bank cannot recover in the three suits (namely the Parur suit and the present suits) more than is due to him on his promissory notes plus the costs awarded to him. The court below has given the necessary directions to ensure this, but, in view of the fact that I have awarded costs (both of the suits and the appeals) to the plaintiff I might make it clear that the plaintiff is entitled to appropriate any sums recovered in the present suits first towards the costs awarded to it and need appropriate only the balance towards the sums due to it under the promissory notes.