CATHOLIC UNION BANK LTD Vs. POULO

JUDGEMENT

(1.) These appeals are from the decrees in two suits O.S. Nos. 5 of 1125 and 32 of 1951, tried and disposed of together by the Additional District Judge of Parur. The appeals are by the Catholic Union Bank Limited, Mala, the 1st defendant in O.S.No. 5 and the plaintiff in O.S. No. 32. The two appeals were heard together.

(2.) The facts necessary for the decision of the appeals may be stated. Poulo Varghese and Poulo Thommi, sons of Ouseph Poulo, were carrying on trade in hill produce at Alwaye and they were borrowing money from the branch of the Catholic Union Bank Ltd., at Alwaye for the purpose of the trade. They had pledged goods to the Bank as a security for the loan and the key of the godown was entrusted to the Bank. On inspection of the godown by officers of the Head office of the Bank, considerable shortage in the goods was discovered and the Secretary of the Bank lodged a complaint with the police that Ouseph Poulo and his two sons who were having dealings with the Bank as well as another son Poulo Joseph had colluded with the local agent of the Bank and had fraudulently removed a substantial part of the pledged articles from the godown. The police registered a case and while investigation was going on the parties settled their differences executing in favour of the Bank a simple mortgage Ext. XXVI for Rs. 30,000/- on 22-2-1947 (10-7-1122) and an unregistered deed Ext. B dated 27-2-1947 (15-7-1122) undertaking to pay Rs. 35,000/- to the Bank. These deeds were executed by Ouseph Poulo, his wife, their three sons and the wife of Poulo Joseph. The ladies who joined in the execution of the deed alone had immovable properties in their names which were given as security in Ext. XXVI. The total amount due to the Bank on the date of settlement was Rs. 80,024-5-9 out of which Rs. 10,000/- was made good by surrendering to the Bank, the goods in the godown, Rs. 5,000/- by transferring a car belonging to Thommi to the Bank, and Rs. 24-5-9 by payment in cash. The two deeds Exts. XXVI and B were for the balance. On 28-2-1947 (16-7-1122) the Secretary of the Bank gave a statement to the police that the Banks claim had been settled by the execution of these deeds and that himself and the Managing Director of the Bank were satisfied that there was no removal of goods from the godown as alleged in the complaint but that the parties had in collusion with the agent of the Bank cheated the Bank in respect of goods pledged and that further action was not necessary. The Criminal proceedings were thus dropped. On 15-12-1947 (29-4-1123) Ouseph Poulo, his son Joseph, Pouloses wife Alia and Josephs wife Thersia filed a suit informa pauperis seeking cancellation of the two deeds on two grounds, namely, that the deeds were executed to stifle the criminal prosecution and that the same were executed as a result of undue influence, coercion and threat. The 1st defendant in the suit was the Bank and defendants 2 and 3, Varghese and Thommi, who were originally having dealings with the Bank. The Bank denied the allegations on which cancellation of the deeds was sought. While this suit was pending, the Bank instituted O.S. 32 of 1951 for recovery of money on the basis of the unregistered deed Ext. B, from all the executants of the deed. Defendants 1. 2, 5 and 6 who were plaintiffs in O. S. No. 5, filed a joint written statement repudiating the claim on the same grounds on which they sought a decree in their suit. Defendants 3 and 4, i.e., Poulo Varghese and Poulo Thommi filed a separate written statement adopting the contentions of the other defendants. They however admitted that a sum of Rs. 75,000/- was due from them to the Bank. The learned Judge held that the two deeds were invalid, having been executed to stifle the prosecution and also as ,the same were executed as a result of undue influence, coercion and threat. O.S. No. 5 was accordingly decreed while O. S. No. 32 was dismissed. The Bank has preferred separate appeals from the two decrees. The parties will hereinafter be referred to according to their respective position in O. S. No. 5.

(3.) The two points which arise for decision in these appeals are: