K M MOHAMBARAM Vs. RAM NARAYAN BRAHMIN

JUDGEMENT

(1.) This appeal relates to rival claims by appellant (defendant No. 1) and respondent (plaintiff) to the ownership of a motor-bus. The undisputed facts are as follows: Appellant was the original owner of the bus and had in his possession the registration certificate, which is practically equivalent to a title-deed, and a G permit by virtue of which he was empowered to ply the bus for hire. In may 1932, appellant arranged with one Arumuga Mudaliar that the latter should run the bus as his agent, and left with him a letter signed by himself (Appellant) and addressed to the District Magistrate, requesting that the G permit be transferred to Arumuga Mudali. Arumuga Mudali proceeded to alter this letter, without the knowledge of the appellant into one addressed to the District Superintendent of Police and requesting the transfer to him of the registration certificate. The registration certificate was accordingly transferred, and in December, 1932 the respondent having, of course, every reason to think that Arumuga Mudali was the owner of the bus, purchased it from him. The bona fide nature of respondent's purchase is not contested, and the question is which party is to suffer as the result of Arumuga Mudali's fraud.

(2.) The law to be applied to these facts is to be found in Section 27 of the Sale of Goods Act, the material portion of which runs as follows: Where goods are sold by a person who is not the owner thereof and who does not sell them under the authority or with the consent of the owner,, the buyer acquires no better title to the goods than the seller had, unless the owner of the goods is by his conduct precluded from denying the seller's authority to sell.

(3.) The learned City Civil Judge accordingly addressed himself to the consideration of the appellant's conduct and finds definitely that it is blameworthy. He had no right to leave the registration certificate along with the other papers in the bus, his duty was to keep that certificate in his own possession. If he did not do so, he should have inspected it from time to time, apparently to assure himself that his agent had committed no fraud-and he should have issued some kind of public notice to obviate the possibility of any innocent would-be-purchaser being defrauded.