P S KRISHNA AIYAR Vs. SAVURIMUTHU PILLAI

JUDGEMENT

(1.) I have come to the conclusion that the plaintiff--respondent had no cause of action against the 2nd defendant in the suit. The 1st defendant obtained a decree against one Antonia Pillai whose executor is the present plaintiff.

(2.) The decree amount was paid out of court by the judgment-debtor. The payment however was not certified as required by the law by the decree-holder whose duty it was to do so in the first instance nor did the judgment-debtor inform the Court of the satisfaction as he was entitled to do in default by the decree-holder. The decree was afterwards assigned to he 2nd defendant. A question was raised in the execution of the decree as to whether it had been adjusted, and, if so, whether the adjustment could be recognized. The executing Court held that in the absence of a certificate or record of satisfaction as required by Order 21, Rule 2, it remained an executable decree and it also found that adjustment had not been proved. The 2nd defendant then proceeded to realize the decree amount by execution. The plaintiff, as executor of the judgment-debtor thereafter instituted this suit claiming damages against the 1st and 2nd defandants to the extent of the amount, which the 2nd defendant has realized in execution. It has been well settled, and it can hardly be disputed, that so far as the 1st defendant, the original decree-holder, was concerned, the plaintiff had a good cause of action. This was so laid down as far back as Viraraghava Reddi v. Subbakka (1832) I.L.R. 5 Mad, 397 by a Full Bench of this Court and that is also the view of the other High Courts. In that case, it was held that such a suit would lie as for breach of a promise on the part of the decree-holder either not to execute the decree or to enter satisfaction. It was also held that the judgment- debtor could frame his claim against the decree-holder thus in default for damages on the basis of fraud or negligence in not certifying adjustment.

(3.) But the question whether there is a cause of action against the assignee of a decree which had been adjusted but the adjustment of which was not certified to the Court, is bare of authority. It cannot be said that there was any sort of contractual relation between the 2nd defendant the assignee in the case and the plaintiff and the mere fact that the 2nd defendant, as found, knew that the decree had been satisfied will not make him guilty in law, either of fraud or of negligence in as much as he was under no obligation to certify adjustment, the decree amount having been received b the original decree-holder before assignment. The executing Court was right in holding that it was bound to treat the decree as still subsisting and to allow it to be executed, by virtue of Order 21, Rule 2. Clause 3 which enacts that "a payment or adjustment, which has not been certified or recorded as aforesaid, shall not be recognized by any Court executing the decree. The decree, therefore, on the date of its assignment being one which according to law, the 2nd defendant could enforce, the only way in which the case of the plaintiff could be put is to base it on Section 49 which enacts that "every transferee of a decree shall hold the same subject to the equities, if any, which the judgment-debtor might have enforced against the original decree-holder." It is argued that we must hold that the decree was in this case subject to an equity which bound the assignee who had knowledge of the adjustment before he obtained the assignment. In the first place Section 49 relates to the stage of execution, that is to say, under it, it is the Court executing the decree that has to consider whether it was held subject to any equities which the judgment- debtor could enforce against the original decree-holder. Now the cause of action in a case like this as laid clown in Viraraghava Reddi v. Subbakka (1882) I.L.R. 5 Mad 397 is breach of a promise or contract and I am not aware of any general principles according to which the existence of such a contract or promise would create an equity which would be enforceable against the transferee. In the case of sales of immoveable property, no doubt, it is well established that the transferee is bound by a contract to convey the property in favour of another person of which he had knowledge. But that rule, so far as I am a ware has not been extended either to the disposition of moveable properties or of money decrees. We have been referred to a Full Bench decision of the Calcutta High Court in Goono Monee Dassia v. Pran Kishore Dosse (1869) 13 W.R. 69 where the cause of action against the original decree-holder who executed the decree in spite of adjustment out of Court is put on the ground that after such adjustment he held the decree in trust for the judgment-debtor. But I do not think that Section 49 of the Code of Civil Procedure or the corresponding provision of the old Code ever contemplated such an inferential trust. The Full Bench of this Court in Viraraghava Reddi v. Subbakka (1882) I.l.R. 5 Mad 397 does not base it on any such ground and if I may say so with respect the right way to regard the cause of action as laid down in that case is either breach of a promise or of a statutory duty to certify adjustment to Court. The 2nd defendant as 1 have pointed out could, not be said to have committed any breach of promise or having been guilty of violating any statutory duty. We have been also referred to another decision of the Calcutta High Court in Monmohan Karmokar v. Dwarak Nath Karmokar (1910) 12 Cal. L.J. 312. But I do not think that the point decided there throws much light on the principles applicable to this case. There the question arose in execution between the assignee of a decree who held it as benamidar of the judgment-debtor and other creditors of the judgment- debtor and having regard to the conclusion of the learned Judges that in those circumstances there was no executable decree, any observations regarding the liability of assignees of decree generally, cannot in my opinion be of much help in the present case. Here there was undoubtedly an executable and subsisting decree and that decree was executed according to law. I hold therefore that there was no cause of action against the 2nd defendant. I may mention that we had called for a finding as to whether the 2nd defendant at the time he obtained the assignment, had knowledge of the adjustment out of Court. The finding is that he had such knowledge, but as I have already stated, that fact cannot make any difference as to his liability in the present suit.