ACHUTHA MENON Vs. NARAYANA MENON

JUDGEMENT

(1.) This is an appeal filed by the legal representatives of the judgment debtor from an order in execution. The deceased judgment debtor was the karyasthan of a Kovilagam & in that capacity he had to account for moneys collected by him to the Kovilagam. The Kovilagam filed O. S. 176/1952 for recovery of the amount, and a decree was passed against the deceased judgment debtor. The decree holder filed an application for execution of the decree, and it was stated in an affidavit filed by him along with the application that the amount due under the decree would not come within the definition of 'debt' in Act XXXI of 1958 as the liability of the deceased judgment debtor arose on account of the misappropriation by him of the amounts collected while he was the karyasthan of the Kovilagam. The appellants contended that they were entitled to the benefit of Act XXXI of 1958, as according to them, the liability was not a liability arising out a breach of trust.

(2.) The execution court held that the execution petition was not maintainable as the appellants were entitled to have the benefit of Act XXXI of 1958. There was an appeal from this order and the lower appellate court set aside the order of the execution court and has remanded the case for a fresh decision.

(3.) The parties are agreed that the decree was obtained against the deceased defendant on the basis of his liability to account as agent of the Kovilagam. It was contended for the appellants that even if the deceased judgment debtor was the karyasthan of the Kovilagam and liable in that capacity to account to the Kovilagam, the liability was not one arising out of a breach of trust. In this connection reliance was placed on the ruling reported in Ratnamma v. Govindan ( 1960 KLT 406 ) where a Division Bench of this court has held that a liability arising out of a breach of contract would not become one in breach of trust merely because confidence was reposed by one person in another. The facts of that case were more or less similar to the present one. There also the question related to the liability of an agent to account for the amounts collected by him on behalf of the principal, & it was held that that liability was not one arising out of a breach of trust. It cannot be stated as a matter of general proposition that an agent is under no circumstances a trustee for the principal. An agent is not generally speaking a trustee in the sense in which that expression is used in the Trusts Act. But there may be circumstances which make him a trustee, but in the absence of those circumstances it cannot be said that he is a trustee although he may be a fiduciary with certain obligations of a trustee. Lord Eldon said in Gholmondeley v. Clinton (1821) 4 Bli. 196):