DAMODARASAMI NAICKEN Vs. MINOR GOVINDARAJULU NAIDU

JUDGEMENT

(1.) In the month of September, 1909, one Rangasami Naicken and his three sons, Govindasami, Venkatasami and Narayanasami, who constituted an undivided family, mortgaged immovable properties belonging to the family to one Lakshminarasimha Aiyar to secure the sum of Rs. 3,000. In 1912 the family separated and there was a partition of the family estate. The mortgaged properties were divided into four shares and one share was allotted to each member. The deed of partition provided that the mortgage-debt should be discharged by the sons in other words, each son was to be liable for one-third of the total debt. In 1913 Govindasami, the fourth defendant in the suit, mortgaged his share of the family properties to Gurusami, the father of the defendants 1 to 3, to secure a ,loan of Rs. 2,500. Govindasami failed to repay the loan and consequently Gurusami was compelled to institute a suit on his mortgage. He obtained a decree and in execution proceedings in 1926 he bought Govindasami's interest in the hypotheca, which was, of course, subject to the prior mortgage in favour of Lakshminarasimha Aiyar. Lakshminarasimha Aiyar died and in 1927 his legal representatives sued to enforce the mortgage which had been created in his favour. They obtained a decree, which contained a direction that the properties purchased by Gurusami should not be brought to sale until the mortgaged properties in the hands of Venkatasami had been sold. Venkatasami had acquired the share of his brother Narayana-swami and therefore possessed two of the shares. The record does not disclose who held the father's share. In execution proceedings instituted in 1928 Lakshminarasimha Aiyar's legal representatives sold the properties in the hands of Venkatasami, but Venkatasami paid into Court sufficient to obtain an order setting aside the sale under the provisions of Order 21, Rule 89, Civil Procedure Code, and consequently it was set aside.

(2.) The plaintiffs in the present suit are the legal representatives of Venkatasami who is also now dead. They sued to recover from Gurusami and his sons one-third of the amount which Venkatasami had been compelled to pay to obtain the order setting aside the sale and relied on the provisions of Section 82 of the Transfer of Property Act. The Subordinate Judge of Coimbatore, who tried the suit, upheld the plaintiff's claim and on appeal his decision was concurred in by the District Judge. The basis of the decision was that Gurusami was bound by the agreement embodied in the deed of partition that the sons should discharge the mortgage in equal proportions. The defendants contend that they cannot be compelled to contribute more than a quarter of the sum as the words "in the absence of a contract to the contrary" in the first paragraph of Section 82 have reference only to a contract which governs both the mortgagee and the mortgagor. There is a conflict of authority of this Court on this question and in the circumstances the learned Judges before whom this appeal came for hearing have referred the following questions to a Full Bench for decision; 1. Whether a contract to the contrary between the co-mortgagors alone can exclude the operation of Section 82 of the Transfer of Property Act? 2. If the answer to question No. 1 is in the affirmative, whether such a contract binds a subsequent assignee of the property of a co-mortgagor with notice of the contract?

(3.) The first paragraph of Section 82 was amended by the Transfer of Property (Amendment) Act, 1929. Before the amendment this paragraph read as follows: Where several properties whether of one or several owners, are mortgaged to secure one debt, such properties are, in the absence of a contract to the contrary, liable to contribute rateably to the debt secured by the mortgage, after deducting from the value of each property the amount of any other incumbrance to which it is subject at the date of the mortgage. This paragraph now reads as follows: Where property subject to a mortgage belongs to two or more persons having distinct and separate rights of ownership therein, the different shares in or parts of such property owned by such persons are, in the absence of a contract to the contrary, liable to contribute rateably to the debt secured by the mortgage, and, for the purpose of determining the rate at which each such share or part shall contribute, the value thereof shall be deemed to be its value at the date of the mortgage after deduction of the amount of any other mortgage or charge to which it may have been subject on that date.