SATTAMUTHU CHETTIAR Vs. ABDUL KAREEM MARACAYAR

JUDGEMENT

(1.) The petitioner is the plaintiff. His suit was brought on a promissory note executed by defendant 1 in favour of the father of the plaintiff and defendants 2 to 4 and endorsed by the father to the plaintiff as one of the family assets allotted to the plaintiff on the latter's releasing his rights in the family properties. The only point now arising for consideration is whether the lower Court was right in dismissing the suit as against defendants 2 to 4, or whether it should have given a decree against them also on the ground alleged by the plaintiff that the father having indorsed the note to the plaintiff and the maker having defaulted payment, the father was himself personally responsible as the indorser and defendants 2 to 4 are liable as his legal representatives to the extent of his assets in their hands. The ground on which, while giving a decree against the maker of the note, defendant 1, the learned Judge in the Court below refused to give a decree against the assets of the father in the hands of defendants 2 to 4 is that the note was endorsed to the plaintiff as part of a partition, and it is to be presumed that the learned Judge thought that in those circumstances the personal liability of the indorser was negatived by the nature of the transaction.

(2.) In this Court the petitioner's learned advocate has urged first, that under Section 35, Negotiable Instruments Act, the only way in which the father could have excluded personal liability as indorser of the note was by expressly endorsing it "without recourse" and that not having been done, it is not open to the Court to infer any other ground of exemption from liability. It was also urged that there was nothing in the nature of the transaction that the endorsement was part of a family partition wherefrom it may be inferred that the indorser intended to exclude personal liability.

(3.) On the first question the words of Section 35, Negotiable Instruments Act, are clear enough. It says that in the absence of a contract to the contrary, whoever indorsees and delivers a negotiable instrument before maturity, without in such indorsement expressly excluding or making conditional his own liability, is bound thereby to every subsequent holder in case of dishonour by the drawee, acceptor or maker to compensate such holder for any loss or damage by such dishonour, etc.