P BALAVENKATARAMA CHETTIAR Vs. MARUTHAMUTHU CHETTIAR

JUDGEMENT

(1.) These second appeals arise out of three suits brought for amounts due respectively on three promissory notes. Two of them, O.S. Nos. 92 and 93 of 1936, were tried together and dismissed by the trial Court. The other O.S. No. 260 of 1937 was decreed. On appeal to the lower Court, the first respondent succeeded in obtaining decrees in all the suits. It may be mentioned here that in O.S. No. 260 of 1937 out of which S.A. No. 765 of 1939 arises the respondent also sought a decree against the temple of which the defendants who executed the promissory notes were trustees at the time of such execution, but this part of the claim was dismissed in both the Courts below and no question now arises with reference to it.

(2.) The promissory notes on which the two earlier suits were brought contained no reference to the trusteeship of the executants and the amounts were stated to have been borrowed "for expenses in connection with our trade". It appears however that the first respondent knew that they were the trustees of the temple and borrowed the amounts for the purposes of the temple. The learned District Munsiff found that though the executants did not sign their names as trustees of the temple, they were induced to execute the notes upon the belief that the temple alone would be made liable, and held that they were protected from personal liability under Section 28 of the Negotiable Instruments Act. The learned District Judge who refers to this finding of the trial Court does not say whether or not he agrees with it. But he held in all" the cases following the decision of this Court in Palaniappa Chettiar V/s. Shanmugam Chettiar that Section 28 of the Negotiable Instruments Act could have no application to promissory notes executed by trustees and accordingly passed decrees against those defendants personally who executed the notes and against the joint family properties in their hands including the shares of their sons who were also impleaded in the suits.

(3.) Mr. Rajah Aiyar for the appellants contended that though Section 28 did not in terms cover promissory notes executed by trustees, the principle underlying the provision applied to such cases and that therefore the learned District Judge should have recorded a finding on the question whether the executants were induced to sign the instruments upon the belief that the temple alone would be held liable, as a finding on that point in favour of the executants would absolve them from personal liability on the notes. In the other appeal S.A. No. 765 of 1939 his contention was that in the promissory note there in question the executants having described themselves in the preamble as "managers of Sri Kannika Parameswari Devasthanam", there was sufficient indication, according to the recent Pull Bench decision of this Court in Sivagurunatha V/s. Padmavathi , dealing with a case under Section 28, that they did not intend to incur personal liability. It will thus be seen that in all the appeals the main point for determination is whether Section 28 of the Negotiable Instruments Act or the principle on which it is said to be based is applicable to promissory notes executed by persons as trustees or managers of a temple.