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1996 DIGILAW 1272 (MAD)

V. A. M. Mohammed Hanifa Sahib v. Kanie, M. A. Anifa Sahib

1996-12-24

E.PADMANABHAN

body1996
Judgment :- 1. The two Second Appeals arise out of the common judgment rendered by the courts below. 2. The defendants in the two suits against whom the suits have been decreed are the appellants in both the second appeals. 3. The plaintiff is one and the same person who has instituted S. No. 895 of 1979 and 1125 of 1979 for recovery of Rs. 2,522.50 and Rs. 2,380/- respectively, against the defendant in each of the suits. 4. The common pleadings and the crux of the pleadings as well, are to the effect that the plaintiff brought forth a sale transaction between the defendant and a third party and that his remuneration has not been paid. According to the plaintiff he acted as a broker and that he is a professional broker who normally engages himself for the conclusion of contract between the seller and purchaser and for such conclusion of sale he receives the remuneration, in other words called as commission. 5. In this connection, it was the specific case of the plaintiff that the sale agreement entered between the defendant and third parties was brought forth by him, that the sale was concluded on 31.1.1979, that despite demands by letters dated 22.6.1979, 6.7.1979 and the registered notice dated 20.7.1979, his remuneration, has not been paid by the defendants. 6. The defence by the defendants in the two suits is common and it is one of total denial. The defendants pleaded that the plaintiff has nothing to do with the transaction, that the plaintiff has not brought forth the transaction that the plaintiff, a real estate broker by profession has not taken part in the negotiation as a broker and that the plaintiff is a total stranger. 7. The plaintiff has claimed his remuneration at 2 per cent of the total sale consideration, for which the sale was concluded. Though the plea of limitation has been allowed to be raised by the first Appellate Court, no such plea has been raised in the written statement. The defendants though specifically pleaded that they do not know the plaintiff as a broker, admitted the transaction of sale between themselves and the third party Ramalingam besides denying the plea of plaintiff that has negotiated with the said Ramalingam. 8. The plaintiff examined himself and two other witnesses, while one of the defendant examined himself and one Mohamed Ismail as P.W. 2. 8. The plaintiff examined himself and two other witnesses, while one of the defendant examined himself and one Mohamed Ismail as P.W. 2. The plaintiff marked Exhibits A-1 to A-24 and the defendants marked agreement as Exhibit B-1. The two suits were tried together and a common judgment judgment was delivered on 21.2.1991. 9. The trial court decreed the suit, holding that the plaintiff has acted as a broker and he is entitled to commission at the rate of 2 per cent of the sale price. The suits were decreed. 10. The appellants herein preferred A.S. Nos. 48 and 49 1981 respectively on the file of the Subordinate Judge, Tiruppur. The first Appellate Court concurred with the findings rendered by the trial court and confirmed the decree passed by the trial court. The first Appellate Court allowed the defendants to raise the plea of limitation and after due consideration, the first Appellate Court held that the suit claim is not barred by limitation. As against the dismissal of the first appeal, the defendants in the two suits have preferred the above Second Appeals. 11. At the time of admission on 9.11.1982 the following three substantial questions of law have been framed:— 1. Whether the judgment of the lower appellate Court in decreing the claims of the respondent as in time, is illegal as the cause of action under both the claims arose as early as 1974 rendering both the suits barred by limitation under Article 18 of the Limitation Act? 2. What is the legal inference to be drawn on attestation of a person to a document? Does it import any financial interest to the person attesting? 3. Whether the judgment of the lower court is illegal in granting interest to the claim of the respondent in the absence of contract for payment of interest and hence contravening the provision of the Interest Act? 12. Mr. A.R.L. Sundaresan, the learned counsel for the appellants sought to challenge the findings rendered by the Courts below and in fact took me through the evidence recorded by the trial court in this respect. Though it is a concurrent finding and though this Court is not inclined to appreciate the evidence once again, for the purpose of satisfying the correctness of findings, this Court went through the evidence. Though it is a concurrent finding and though this Court is not inclined to appreciate the evidence once again, for the purpose of satisfying the correctness of findings, this Court went through the evidence. Even after consideration of oral evidence, I am to hold that the findings rendered by the Courts below are correct and the same cannot be challenged by the appellants and that too in these Second Appeals. That, apart the evidence of P.W. 1 and 2 have been accepted by both the Courts below. Hence, I am not inclined to interfere with the findings of the two Courts below sitting in second appeal. 13. The first substantial question of law framed revolves on the plea that the suit claim is barred by limitation. In the present case, on the facts it is found that the agreement to sell was entered on 17.4.1974 and its due performance was extended on two occasions and ultimately the sale deed was executed and the sale was concluded on 31-1-1979. The plaint has been presented on 21.7.1979. Article 18 of the Limitation Act, which governs the transaction reads as follows:— For the price of work done by the plaintiff for the defendant at his request, where no time has been fixed for payment Three years When the work is done In terms of Article 18, for the price of work done by the plaintiff for the defendant, the suit for recovery of the price has to be instituted within three years, when the work is done. According to the learned counsel for the appellants, the work of the plaintiff was done or performed on 17.4.1974 itself and hence the limitations has to be reckoned from 17.4.1974, while Mr. T. Thirugnanam, the learned counsel for the respondent contended that the work was done on 31.1.1979, the date on which the sale was concluded and the sale deed was registered and as such the suit claim is not barred by limitation. The controversy is as to when the price of work done by the plaintiff has to be paid by the defendants? It has to be found as to when the work is done? When the price has become payable by the defendant for the work done by the plaintiff? 14. The contract between the plaintiff and defendants is only oral. The controversy is as to when the price of work done by the plaintiff has to be paid by the defendants? It has to be found as to when the work is done? When the price has become payable by the defendant for the work done by the plaintiff? 14. The contract between the plaintiff and defendants is only oral. The plaintiff has pleaded that he is entitled to 2 percent commission on completion of sale. The defence is one of mere denial and no alternative plea at all has been raised. The evidence of P.W. 1, which has been accepted by the two Courts below, which is relevant for deciding the question is extracted hereunder:— Tamil It is thus clear that the remuneration or commission is payable on the conclusion of sale. The contention of the appellant is that commission if any, is payable on the parties entering into an agreement to sell, which was concluded on 17.4.1974 itself and hence the suit claim is barred. In my view, such a contention is not sustainable. Apart from the factual aspect of this case, the law on the subject has been well laid down by various rulings. 15. Section 219 of the Contract Act provides as to when the agents right to remuneration arises. In order to entitle as agent to receive his remuneration he must have carried out that which he bargained to do or at any rate must have done so and all conditions imposed by the contract must have been fulfilled. The plaintiff is admittedly a professional real estate agent is commonly referred to as the broker. When a professional agent like the plaintiff is employed, the mere fact of such an employment may give raise to a presumption of contract to pay remuneration. Though there is no written agreement, as the two Courts have concurrently found that there has been contract between the parties and that the plaintiff is entitled to 2 per cent commission, in my considered view such a finding cannot be interfered with in this Second Appeal. A Division Bench of this Court in ( Rao Bahadur P. Ayyaswamy Chetty and others. v. P.K. Subramaniaiyar ) reported in 18 L.W. 560, while analysing the earlier case law on the subject, held that an agent for the purchase of a house would be entitled to no commission if the purchase fell through. A Division Bench of this Court in ( Rao Bahadur P. Ayyaswamy Chetty and others. v. P.K. Subramaniaiyar ) reported in 18 L.W. 560, while analysing the earlier case law on the subject, held that an agent for the purchase of a house would be entitled to no commission if the purchase fell through. In that case also the contract was verbal, and the sale in that case had not taken place as the title of the vendor has not been approved by purchasers vakil. The Division Bench has taken the view that till the sale is concluded, the agent would not be entitled to the commission on the purchase price. True, this decision is on the question as to whether the agent is entitled to commission when the transaction had failed? This reasoning and view of the learned judges supports my view and for taking such a view reasons are set out herein. 16. In Valarshak Seth Apear v. Standard Coal Co. Ltd. (1993-2-M.L.J. 405=(1943) 56 L.W. 766 (P.C.) it has been laid down that a broker who is employed by a seller to introduce him to a prospective purchaser, is entitled to be paid, whatever is in the circumstances the usual commissions on all contracts resulting from that introduction. In ( P.K. Chinnaswami v. C. Doctor & Co. ,) I.L.R. 1945 Madras 338 as well as in ( Sohrabji Bhunjiithoy Medona & another v. Oriental Government Security Life Assurance Co. Ltd. AIR 1944 Sind 168) identical view has been taken by the learned judges. The Division Bench had laid down, following the judgment of this Court in Ayyannah Chetty v. Subramania Iyer reported in AIR 1924 Madras 212=(1923) 18 L.W. 50) and Podcar and Co. v. M.C.T. Mudaliar A.I.R. 1924 Rangoon 232 it has been held that in the absence of a specific agreement, the ordinary rule of law is that the broker engaged to purchase a house for which he is entitled to brokerage is entitled to brokerage only on completion of conveyance. Hence law may be taken to be that in the absence of a contract, brokerage is only payable when the conveyance is complete. In 1944 Sind 168, the passage which is relevant reads as follows:— “Certain authorities were quoted relating to the circumstances under which brokerage was normally payable in such cases in the absence of a specific agreement. Hence law may be taken to be that in the absence of a contract, brokerage is only payable when the conveyance is complete. In 1944 Sind 168, the passage which is relevant reads as follows:— “Certain authorities were quoted relating to the circumstances under which brokerage was normally payable in such cases in the absence of a specific agreement. Reference was first made to 2 Rang. 45, in which a Bench of the Rangoon High Court laid down, that brokerage was payable only for an actual sale, it being the brokers duty to introduce a person willing and able to complete the purchase. It was the learned Advocates contention that although It might be said in this case that defendant 2 was willing to sell his property to defendant, he was unable to do so by reason of the previous sale to a third party. Our attention was also directed to the base in A.I.R. 1924 Mad. 212= (1923) 18 L.W. 50 in which it was held, inter alia that in the absence of a specific agreement the ordinary rule of law was that the broker was only entitled to his brokerage when the conveyance was complete. Particular reference was made to two passages in this judgment one a quotation from the judgment of Lord Esher in the well known case in (1887) T.L.R. 541, to the effect that “land could only be said to be sold when the conveyance was complete, not when there was a mere contract to sell.” The other passage relied upon was as follows: “Why should the principal agree to pay a heavy commission dependent on the amount of the purchase price for the settling of a price as between him and somebody who has no title or whose title is such that his vakils advise him not to become the purchaser? I should want very clear words, in a contract to make me find that the intention of the parties was that the commission should be payable by an intending purchaser whether he actually became the purchaser or not, and I find no such words here.” Now the law may be taken to be that in the absence of a contract, brokerage is only payable on the completion of a deed of conveyance, and the reason for this is obvious.” 17. In A.I.R. 1924 Rangoon 232 it has been laid that in the absence of a specific agreement the ordinary rule of law was that the broker is entitled to the brokerage only when the conveyance was completed. The said pronouncement, where number of earlier authorities have been considered has to be followed and more so when there is no written agreement between the parties. Thus, on a consideration of the provisions of the Indian Contract Act the law relating to Agents, the brokerage or the remuneration where there is no written contract, is payable on the completion of the deed of conveyance. Though Mr. A.R.L. Sundaresan, the learned counsel for the appellants drew my attention to the evidence of P.W. 1, I am unable to agree with his contention that the remuneration is payable immediately on the parties entering into an agreement to sell. P.W. 2 has deposed that remuneration is payable on completion of sale and the delivery of the property. In this case, though property has been delivered on the date of entering into an agreement, the sale came to be concluded only on 31.1.1979. Hence, on facts also the remunearion is payable on completion of deed of conveyance on 31.1.1979. Merley because the agreement to sell came to be concluded on 17.4.1974 and as a part performance, the purchaser has been put into possession, it is untenable to contend the remuneration is payable to the plaintiff even on 31.1.1979. 18. Article 18 of the Limitation Act provides that the suit has to be instituted within three years and the time begins to run when the work is done. The suit claim is not barred by limitation. The plaintiff who is a professional real estate agent in both the suits is entitled to 2 per cent remuneration on the completion of deed of conveyance, unless contract to contrary is established. The first substantial question of law for the above reasons is answered against the appellants. 19. The second question that has been raised, in my view is misconceived. The two Courts have Merely taken into consideration the attestation of the sale agreement and sale deeds by the plaintiff as one of the reasons while concluding that the plaintiff had acted as agent of the defendants at the instance of the defendants and the transaction in question was brought forth by the plaintiff. The two Courts have Merely taken into consideration the attestation of the sale agreement and sale deeds by the plaintiff as one of the reasons while concluding that the plaintiff had acted as agent of the defendants at the instance of the defendants and the transaction in question was brought forth by the plaintiff. Hence, the second question also is answered against the appellants. 20. The third question relates to payment of interest. As already held above commission is payable on the completion of sale. The conveyance in the present case has been completed only on 31.1.1979. Thereafter the plaintiff has been demanding for payment of commission and he has followed it with letters dated 26.7.1979 and 6.7.1979 besides causing a notice through his advocate on 20.7.1979. The defendants have illegally retained the remuneration, which they have agreed to pay. For this deprivation, the plaintiff is entitled to payment of interest. Even assuming that there is no contract for payment of interest it is well settled that interest is payable from the date of demand. 21. The above appeals are dismissed but without costs.