MUHAMMAD HAFIZ Vs. MUHAMMAD ZAKARIYA

JUDGEMENT

(1.) I have come to the conclusion that this appeal must be. allowed. The suit is one to recover the principal due, the interest being abandoned under circumstances which I will mention in a moment, and for the sale of the property hypothecated, under a bond dated the 14th of September, 1910. The plaintiffs in April, 1914, had brought a suit against the defendant for interest for three years and seven months due from the date of the bond, namely, the 14th of September, 1910, to the 14th of April, 1914, the date of the suit. That action had been brought and determined after the expiration of the period of three years from the date of the bond, three years being the period stipulated for the repayment of the money; and the question which arises in the present suit, Raised by the defendant and decided against him by the learned Subordinate Judge, is whether, having regard to the provisions of Order II, Rule 2, of the Code of Civil Procedure, and of this particular bond, the plaintiffs can, after having sued for the interest in the way which I have mentioned, none the less institute a fresh and a subsequent suit for the principal. The question really turns on the view we take of the meaning of Order II, Rule 2, and of the provisions of this particular bond. The preliminary clause of the bond recites the advance of the money and the promise of the obligor to repay within three years at a stipulated rate of interest. Clause 7, which is in common form, provides that after the expiration of three years the creditor shall be entitled to sue for the whole amount of principal and interest, if failure is made to pay the amount of the bond with interest within that time. If that clause providing for repayment of principal and interest and for the right of the creditor upon default stood alone, there would be, in my opinion, no doubt at all that claims for principal and interest would be claims which the plaintiffs were entitled to make within the meaning of Order II, Rule 1. The provision of that rule is that "every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action." The meaning of the expression "cause of action" has long been judicially settled and finally pronounced in the courts in England in Bead v. Brown (1888) 22 Q.B.D. 128 and adopted by a Full Bench of this Court in Murti v. Bhola Ram (1803) I.L.R. 16 All. 165, a decision which is binding upon us, to mean every fact necessary for the plaintiff to prove, if traversed, in order to support his right to the judgement of the court. This definition obviously involves in it the addition made by Lord Justice Fry in Bead v. Brown (1888) 22 Q.B.D. 128 "every thing which, if not proved, gives the defendant an immediate right to judgement." Applying that definition to this case, the plaintiffs, in order to recover the interest, would have to prove the execution of the bond, the advance, although of course that would be involved in the bond, unless there was some circumstance calling upon them to do it, the terms of the bond, and the right to recover interest under Clause 7, namely, the non-payment of the principal. They would have to prove precisely the same facts if they were suing for the principal. And I feel constrained to hold that if Clause 7 stood alone, the application of Order II, Rule 2, would compel the plaintiffs to include both principal and interest in one suit, being the whole of the claim which they were entitled to make in respect of the cause of action. It is quite true that one or two authorities which are entitled to great respect have been relied upon by Dr. Sapru, for the respondents, which throw doubt upon the correctness of this view. It is sufficient to say that in each of these cases, namely, Yashvant Narayan Kamat v. Vithal Divakar Parulekar (1896) I.L.R. 21 Bom. 267 and Rambhaj v. Devia Punj. Rec. 1881. p. 296 the circumstances of the contract were not the same as that before us, and the ratio decidendi proceeds upon a consideration of English authorities which are not really relevant to this point, inasmuch as the provision we are now considering does not occur, so far as I am aware, in any express provision of English law. It should be observed that no injustice is contemplated or really can occur by the application of this provision, because any result of that kind is carefully guarded against by the further provision which enables the court in a proper case upon the application of the plaintiff to allow him to pursue one or other of his claims and to suspend the other. We have, however, to give effect to all the provisions of this document, and in interpreting it as a whole, to examine each independent provision relied upon in support of the plaintiff s contention. It is argued on behalf of the respondents that, even if Order II, Rule 2, has the effect which we think it has, Clause 2 of the bond enables them to do what they did here. I do not agree. I think the meaning of Clause 2 is quite clear. It gave the creditor an additional right inconsistent with that contained in Clause 7, and was therefore a modification of that clause. I think that it relates only to the period between the expiration of six months from the date of the bond and the expiration of three years from the date of the bond. And all that Clause 2 does is to confer upon the creditor an option to do two things during that period which otherwise he could not do, One is to sue for the principal within three years; secondly, to sue for interest without suing for the principal. I think this in the only possible construction which can be read consistently with Clause 7. The respondent s contention makes Clause 7 superfluous, and this is the error we think the learned Judge below, who agreed with the respondent s view, fell into, Clause 7 is the basis of the contract, Clause 2 provides for a special contingency and confers special rights, Clause 3 merely as the result of Clause 2 defines the rights given by Clause 7 and provides that the rate of interest and mode of payment shall be the same and are not to be affected by the provisions of Clause 2.

(2.) The result may seem somewhat startling. The defendant out of a debt of Rs. 14,000 with considerable accumulation of interest has repaid only Rs. 3,000, and the learned Judge, being in a difficulty with regard to the authorities, not unnaturally took a view which he thought was in accordance with the justice of the case. But if the law is clear, we have no right to consider the consequences, and it is to be borne in mind, as already observed, that the plaintiff s might have protected themselves against such consequences by an ordinary application such as that indicated in the last clause of Order II.

(3.) A further contention has been raised on behalf of the respondent which creates a certain amount of difficulty, I am not prepared to say that if the plaintiffs had clearly put forward their interpretation of the document as a necessary part of the claim which they were making in the previous suit, and their explanation of the form of the claim, in such a way that the defendant ought to have, but did not contest it, it might not be held that the parties were bound by that view of their own contract whatever the general law might otherwise be. But when the proceedings in the first suit are carefully examined, it is clear that nothing of the kind really occurred when the plaintiffs were, so to speak, cutting down their claim to a claim for interest. In the plaint in the previous suit they said that Rs. 3,010 were due on account of interest, in respect of which only the claim was brought according to the terms of the bond. That was a correct statement of a claim for interest. In paragraph 5 of the plaint they stated that they were entitled to realize only the amount of interest due under this bond without instituting a suit in respect of the principal. That was a perfectly innocuous and accurate statement. In paragraph 6 they alleged that they were entitled to bring the property to sale subject to the principal and the remaining amount of interest due on the bond. Nowhere did they allege that they still had a right, or claimed to have a right, or intended to pursue such right, to sue for the principal - at a subsequent date. And, inasmuch as the defendant did not appear and put in no written statement, it is impossible to hold that any issue as to the construction of the bond on this point was raised and determined in that suit, or that the plaintiffs compelled the defendant to plead to the point. Furthermore, the court rightly and carefully decided the plaintiff s suit in the proper form, that is to say, gave a decree for Bale of the mortgaged property in respect of the amount claimed in the suit, but made no decree in the form claimed by the plaintiffs indirectly in paragraph 6 of the plaint; so that, even if it could be said that the plaintiffs raised the point in the former proceeding the court left it entirely undecided. As a matter of fact the place and time to determine such a point is on a proper application by the plaintiff to abandon a part of his claim and to have" it decided by the court before the suit is finally entertained