(1.) The facts are fully set out in the judgment of Bakewell, J., and need not be repeated. The first question which arises for determination is whether, as found by the learned Judge, Messrs. Arbuthnot & Co, were the Society s bankers, I am clearly of opinion on the evidence that they were not. Messrs, Arbuthnot & Co, wore the Secretaries and Treasurers of the Society. They also carried on a banking business, and the evidence proves no more than that they dealt with the funds of the society in the same manner as they dealt with monies received from their banking constituents, probably in the first instance for no other reason than that of convenience. It was not alleged in the written statement that Messrs. Arbuthnot & Co. held the society s money as bankers, nor was there any issue which raised the question. On the other band the written statement and the issues treat the society s money as held by Messrs, Arbuthnot & Co. as secretaries find treasurers, and in the annual balance sheet the society s cash balance is always shown as "cash with the Secretaries and Treasurers." The manner in which the society s funds were, entered in the accounts of the Banking department does not prove anything in the circumstances of the case. The argument for the respondent on this point was mainly based upon the existence of Exhibit E, which is a book showing receipts and disbursements on account of the society. This book is in the same form as the pass book issued by Messrs. Arbuthnot & Co. to their banking constituents, but in my opinion it also proves nothing Convenience will furnish an ample explanation. Messrs. Arbuthnot & Co, requiting an account book, not unnaturally utilised a book which was ready to their hand. No cheque book was ever issued to the society, though we find printed in Exhibit E, a notice that constituents can only draw upon their banking accounts on the forms furnished by the Bank,
(2.) The position then simply is this. Messrs. Arbuthnot & Co. held the funds of the society as its secretaries and treasurers, and consequently in a fiduciary capacity, and they committed a breach of trust in using the money in their banking business and in not carrying out the directions given to them, in the minute of the 31st "July 1906. This being found, there is no dispute that Messrs. Arbuthnot & Co. became debtors to the society; and it is contended for the respondent that the society can only rank with the unsecured creditors in respect of the amount represented by the Government promissory notes now in question. The answer to this is that it was the duty of Messrs. Arbuthnot & Co. not to mix the money of the society, which they held as its secretaries and treasurers with their own money, and that the society s money is recoverable from the unspent balance in their hands at the time of the insolvency--see In re Hallett s Estate (1879) 13 Ch. D., 690 referred to in The Official Assignee of Madras v. Smith (1901) I.L.R. 32 Mad. 68. It is not contended that the assets of Messrs. Arbubhnot & Co. are not sufficient to meet this and other preferential claims. In these circumstances, the question of fraudulent preference does not arise, and I think the plaintiffs are entitled to the declaration asked for, unless certain other objections taken by the learned Judge to the grant of the declaration are good, The learned Judge held that the plaintiffs were not entitled to sue. But the counsel for the respondent connotes that the plaintiff a who are the secretaries of the society are entitled to sue and under Act VI of i869 the secretaries are the proper persons be sue. The learned Judge was of opinion that all the necessary parties were not joined in the suit, but no objection on this score was taken in the written statement. No doubt any decree that may be passed in this suit will not bind the Secretary of State as he is not a party, but it is so extremely unlikely that he will raise any difficulty about recognising the title declared by the Court that I do not think his absence is sufficient reason for refusing a declaration--see Hem Ckunder Sanyal v. Sarnamoyi Debi (1895) I.L.R. 22 Calc. 354 at p. 359. Finally the learned Judge held that the suit for a declaratory decree was bad, because other remedies were open. What those other remedies were, are not, to my mind, clearly indicated, and no objection on this score was taken in the written abatement, nor was there any specific issue about it. Counsel for the respondent suggests that the plaintiff might have sued, the Secretary of State for the interest due on the promissory notes. But as held above, the Secretary of State is not an absolutely necessary party to this suit and is not likely to require a suit to make him pay the interest to the party found entitled to the notes. I would therefore reverse the decree of the learned Judge, and give the plaintiffs a decree as prayed with costs throughout. Abdur Rahim, J.
(3.) I have also come to the conclusion that the judgment of the learned Judge cannot be sustained.