FANNY SKINNER Vs. BANK OF UPPER INDIA LIMITED

JUDGEMENT

(1.) THIS is an appeal from a decree of the High Court at Allahabad, in a mortgagee Bank's suit to realise its security. In decreeing the suit the Court reversed a decree of the Subordinate Judge of Meerut, who had dismissed it. The suit was commenced on December 8, 1923. The mortgage had been granted, on December 8, 1911, by a Mrs. Fanny Skinner, to the Bank of Upper India, Limited. The deed was in the ordinary form of a simple mortgage with a covenant on the part of the mortgagor for payment of the mortgage debt with compound interest at the rate of seven per cent, per annum. In default of payment, the mortgagee Bank had the ordinary right of proceeding by Court sale to realise its security.

(2.) THE property comprised in the mortgage included, among other items, a one-eighth undivided share of the mortgagor in the village of Siswal and a one-tenth similar interest in the village of Badopal. THE mortgagor's brother,. the second appellant, another brother and her sister were the co-sharers with her in these villages. THE further relevant facts with reference to them will be alluded to later. THE Bank of Upper India was in 1911 still a going concern. Subsequently it went into liquidation, and the suit when brought in 1923 was -commenced by the Bank acting through its liquidator. Fanny Skinner, the mortgagor, was then still alive, but she has died since the decree of the High Court was made and her interests are now represented by the two first appellants, who are her heirs. To the suit as brought there was at first only one substantial defence put forward by Fanny Skinner. It was that she was a pardanashin lady ; that the mortgage had been procured from her by her brother (not the second appellant), whom she had entrusted with her power-of-attorney, that he had by means thereof obtained in her name from the Bank an advance of 15,000 rupees ; that no part of that advance was ever received by her; that in point of fact she had not desired to go into the transaction at all, and that there was insufficient compliance with the formalities and conditions requisite before a mortgage executed by a pardanashin lady can be enforced against her. That was, in the first instance, the only substantial defence Fanny Skinner put forward to the suit. Subsequently, and in the course of the proceedings, on her statement that the fact had only just come to the knowledge of her legal advisers, she was allowed to put forward a further defence, to the effect that the plaintiff bank was not entitled to sue by reason of the fact that there had been in 1917 an arrangement come to between the bank by that time in liquidation and its creditors by virtue of which the whole of the assets of the Bank had been transferred to a purchasing company, the Trust of India, Limited : that all interest in this mortgage debt had passed to the Trust so that the Bank had no longer any right to sue in respect of it. Accordingly the following further issue was settled for decision : Were the assets of the Upper India Bank transferred to the Trust of India, l Limited ; if so, is the plaintiff entitled to bring the present suit ?

(3.) WITH regard to the separate defence put forward by the second appellant, the Subordinate Judge expressed the opinion, not of course necessary to his actual decision, that it was mistaken in point of law as no charge which attached to the mortgagor's undivided interest in Siswal at the date of the mortgage could be affected by any subsequent transaction in relation to that interest to which the mortgagee Bank was no party.