GULABRAO DADA PATIL Vs. GANPATI TUKARAM KUNBI

JUDGEMENT

(1.) THE question raised in this revision relates to limitation and 0rder

(2.) , Rule 2, Civil P.C. The suit is on an instalment bond containing an eligibility clause under which the whole was to be payable at once in the event of any two instalments remaining unpaid. Two defaults occurred and accordingly the plaintiffs became entitled to sue for the whole. Instead of doing so they sued for the defaulted instalments. Further defaults having occurred they now sue for the whole now due relying on the exigibility clause. The suit is beyond time unless the plaintiffs can claim a right of waiver. It is also argued that Order 2, Rule 2 applies. The lower Court holds that a default clause in a bond is always for the benefit of the creditor, but though this is so in the case of a mortgage, it is not so in the case of a bond. In the latter case the matter is governed by the terms of Article 75, Limitation Act. This has been set at rest so far as this province is concerned by the Full Bench in Vishwanath v. Sadasheo A.I.R. 1932 Nag. 1 and Shamrao v. Moreshwar The only question here is whether the plaintiffs were entitled to exercise the privilege of waiver and whether they did exercise it when they sued for the defaulted instalments in the present suit. That they must be deemed to have waived the exigibility clause is I think clear. Assuming they had the option they could have sued for the whole or for the defaulted instalments. They sued for the latter a ad so clearly exercised their option in that way. That could only have been done by waiving the exigibility clause. The real question is whether they had the right to do this. 2. The article itself merely says: "unless where the payee or obligee waives the benefit of the provision," But there are cases which state that waiver is not a unilateral act which can be exercised at the choice of one side alone. It can only be availed of when there is consent, express or implied, of the other side, or when the bond confers the option. That however is only another way of saying the same thing, because there the consent is given in advance. The Limitation Act does not lay down substantive law, and so the exception made in Article 75 in favour of the creditor, who waives, cannot, I think, be construed as conferring a right which does not exist under the ordinary law. I think clearly the article refers to cases in which the creditor is entitled to exercise the privilege and that it cannot apply when under the ordinary law, or by reason of a special contract, he is precluded from doing so. That at once reconciles the class of case which holds that there can be no waiver when the terms of the bond preclude it. The real point, as I see it, is whether under the ordinary law the right must be specially conferred or whether it can be assumed to exist unless and until it is specially taken away. In my opinion, it is not taken away in this bond.

(3.) I am not impressed with the difficulty about Order 2, Rule 2, Civil P.C. It is quite clear from Article 75 that the right to waive exists in some class of cases. Let us then take as an illustration a case about which there can be no dispute, namely, one in which the option is given to the creditor in express terms. If the first instalment is defaulted on say 1st January 1940, the right to sue for it arises on that date, and if the second is defaulted on, say 1st January 1942, the right to sue for the whole immediately accrues, assuming that two defaults cause exigibility. Unless, therefore, it is assumed that the option to waive must always be exercised before the default occurs or be lost (and I do not think anybody has ever contended that) there will always be a double cause of action as soon as the exigibility arises, namely the right to waive the benefit of the clause and to sue for the defaulted instalments and the right not to waive and to sue to the whole. It the position contended for is correct, then even where the bond expressly gives the creditor the right to waive the eligibility he would never be able to exercise it except out of Court, because the moment he sued after exigibility for a defaulted instalment his right to receive anything further would be for ever barred. I think that the answer to the difficulty is that there is a double cause of action but that only one can be made use of and the moment the option is exercised the other disappears and is deemed not to have been in existence. That, as I see it, is the whole meaning of waiver.