CHAKKUNNY Vs. VISWANATHA IYER

JUDGEMENT

(1.) This appeal arises from an order dismissing objections raised by a surety to enforcement of the bond given by him when certain moveables belonging to the first defendant were attached before judgment. During the pendency of the suit the first defendant was adjudicated insolvent and the Official Receiver was impleaded as additional defendant. Thereafter the plaintiff and the defendants entered into a compromise and a decree was passed in terms of the compromise. When the decree holder sought to enforce the bond, the surety objected contending that the bond should be deemed discharged as the suit was decreed on compromise and not on contest and as the first defendant has been adjudicated an insolvent. These objections were overruled and execution was ordered against the surety; he has therefore preferred this appeal.

(2.) As regards the first point, whether the appellant has become discharged on account of the compromise decree, it was contended that the parties contemplated a decree on contest and that a compromise entered into behind the back of the surety would discharge him of liability. The appellant relies on certain decisions of the Calcutta, Lahore, Patna and Allahabad Courts in support of this argument.

(3.) In National Coal Co. v. Bose & Co. ( AIR 1926 Cal. 818 ) Buckland, J., held that the surety was discharged as the decree in the suit was passed on a compromise allowing payment in instalments. This decision which is based on Tatum v. Evans, ((1885) 54 L. T. 336) was dissented from, in Jia Bai v. Joharmull (ILR 59 Cal. 1450), a decision of a Bench of the same Court to which reference will be made later.