1914 JTR(SC) 68
1914 AIR(PC) 150 ; 1914 42 LawReportsInd.App. 88 ; 1915 19 CWN 561 ; 1915 2 LW 282 ; 1914 KHC 45
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD SHAW OF DUNFERMLINE, LORD PARKER OF WADDINGTON, LORD SUMNER, SIR JOHN EDGE, AND MR. AMEER ALI.
MUNNA LAL PARRUCK - Appellant
Versus
SARAT CHUNDER MUKERJI - Respondents
On Appeal from the High Court in Bengal.
Decided On : Nov. 5, 1914.
An application for an order to sell mortgaged property pursuant to a consent decree for payment is an application to enforce the decree and is therefore subject to the limitation period prescribed for the execution of decrees.
Act
Referred
:CIVIL PROCEDURE CODE
: O.34 R.5, O.34 R.4
LIMITATION ACT: Sch.i, Art.183
TRANSFER OF PROPERTY ACT: S.89, S.88
(A) Limitation Act, 1877 - Article 180, Schedule II; Limitation Act, 1908 - Article 181 and 183, Schedule I - Transfer of Property Act, 1882 - Section 89 - Code of Civil Procedure, 1908 - Order XXXIV, Rules 4 and 5 - Application to enforce a mortgage decree - Whether an application for an order of sale is barred by limitation - If the decree for payment is the real and substantial part of the judgment, an application to sell the mortgaged property is in substance one to enforce the decree and is consequently barred if not made within the prescribed limitation period.
(B) Mortgage Decree - Nature of application for sale - An application for an order to sell mortgaged property in pursuance of a consent decree for payment is a proceeding in execution or for judicial relief under a decree, and is subject to the limitation period prescribed for the enforcement of such decrees.
Facts of the case:
A mortgagor defaulted on a consent decree for payment of a specific sum, which provided that in default of payment, the mortgaged properties should be sold. Subsequently, the mortgagor sold an interest in one of the mortgaged properties to a third party. The mortgagee later applied to join this third party to the suit and for an order to sell the mortgaged property to satisfy the decree. The application was made after the expiration of the twelve-year limitation period for enforcing the decree.
Findings of Court:
The application was in substance one to enforce the decree, as the order for payment was the real and substantial part of the decree. Therefore, the application was barred by the limitation period provided under the relevant schedules of the Limitation Act.
Issues: Whether an application for an order to sell mortgaged property, following a consent decree for payment, constitutes an application to enforce a decree and is thus barred by the limitation period.
Ratio Decidendi: The court held that where a decree orders payment of a sum and provides for the sale of property in default, the order for payment is the substantial part of the decree. An application to sell the property is an application to enforce that decree and is subject to the limitation period for execution.
Result: Appeal dismissed with costs.
(B) Mortgage Decree - Nature of application for sale - An application for an order to sell mortgaged property in pursuance of a consent decree for payment is a proceeding in execution or for judicial relief under a decree, and is subject to the limitation period prescribed for the enforcement of such decrees.
Facts of the case:
A mortgagor defaulted on a consent decree for payment of a specific sum, which provided that in default of payment, the mortgaged properties should be sold. Subsequently, the mortgagor sold an interest in one of the mortgaged properties to a third party. The mortgagee later applied to join this third party to the suit and for an order to sell the mortgaged property to satisfy the decree. The application was made after the expiration of the twelve-year limitation period for enforcing the decree.
Findings of Court:
The application was in substance one to enforce the decree, as the order for payment was the real and substantial part of the decree. Therefore, the application was barred by the limitation period provided under the relevant schedules of the Limitation Act.
Issues: Whether an application for an order to sell mortgaged property, following a consent decree for payment, constitutes an application to enforce a decree and is thus barred by the limitation period.
Ratio Decidendi: The court held that where a decree orders payment of a sum and provides for the sale of property in default, the order for payment is the substantial part of the decree. An application to sell the property is an application to enforce that decree and is subject to the limitation period for execution.
Result: Appeal dismissed with costs.
Limitation - Cited by the respondents and conceded by the appellants as being fatal to their argument regarding the limitation period.
Limitation - Cited by the respondents and conceded by the appellants as being fatal to their argument regarding the limitation period.
Solicitor for appellants : G. C. Farr:Solicitors for respondents: J. E. Fox & Co.
Judgement
Appeal from an appellate order of the High Court (July 20, 1911) affirming an order of Fletcher J. (May 13, 1910).
The sole question for determination in the appeal was whether or not an application made on July 3, 1909, was barred by limitation.
By a registered mortgage dated January 25, 1886, the first respondent mortgaged to Amlook Chund Parruck (represented in the appeal by the appellants) his share in certain properties in Calcutta.
The mortgagor made default in repayment and the mortgagee instituted a suit upon the mortgage in the High Court. In that suit a decree was made by consent on December 16,
90 Law Rep. 42 Ind. App. 88 ( 1914- 1915) Munna Lal Parruck V. Sarat C hunder Mukerji 191
1886, for payment of Rs.25,832 in six months, with a provision that in default of payment the mortgaged properties should be sold and that the mortgagor should pay any deficiency which should arise upon the sale.
In 1903 the first respondent sold his interest in one of the mortgaged properties to a purchaser who resold it to the second respondent.
On July 3, 1909, the mortgagee filed an application to the High Court for an order joining the second respondent as a party to the suit, and for an order that he (the mortgagee) might be at liberty to sell the mortgaged property in pursuance of the decree of December 16, 1886.
The application was heard by Fletcher J. and dismissed. The learned judge was of opinion that the portion of the decree of December 16, 1886, which ordered the mortgagor to pay Rs.25,832 was the real and substantial part of it, that the application was in substance one to enforce the decree, and that it was- consequently barred by art. 180 of Sched. II. of the Limitation Act, 1877, since it was not made within twelve years from June 15, 1887. In his view the application was not one for an order for sale under the Transfer of Property Act, 1882, and the authorities relied upon by the plaintiff did not apply.
The Appellate Bench of the High Court (Sir L. Jenkins C.J. and Woodroffe J.) affirmed the order of Fletcher J. The learned Chief Justice said that, even assuming (as contended by the plaintiff) that the decree of December 16, 1886, was a decree under the Transfer of Property Act, 1882, it did not contemplate a further decree, but merely an order for sale under s. 89 of that Act. In his view the application was either a proceeding in execution or a proceeding for judicial relief under a decree, and art. 183 of Sched. I. of the Limitation Act, 1908) corresponding to art. 180 of Sched. II. of the Act of 1877), applied. The learned Chief Justice was also of opinion that if the decree had been an incomplete one, a further decree being required, then art. 181 of the Act of 1908 would have barred the applica tion, since the difficulties of applying the corresponding article of the Act of 1877 to an application for an order to sell had been removed in the case of art. 181 by the provisions of the Code of Civil Procedure, 1908.
Woodroffe J. agreed.
The proceedings upon the appeal to the High Court are reported at I. L. R. 38 Calc. 913.
Jenkins, K.C., and Sir W. Garth, for the appellants. The Courts below were wrong in holding that the application was one " to enforce a decree." The decree of December 16, 1888, was merely a preliminary mortgage decree which could not be enforced until an order absolute had been made. The application was really one for an order absolute for sale under s. 89 of the Transfer of Property Act, 1882. Decisions of the Calcutta High Court support the view that an application of that character is not barred by any limitation provision. The Transfer of Property Act, 1882, ss. 85,86,87, 88, and 89, and the Code of Civil Procedure, 1908, Order xxxiv., rr. 4 and 5, were referred to.
[_De Gruyther, K.C., who appeared with Homer Macklin for the respondents, drew attention to Batuk Nath v. Munni Dei (( 1914) L. R. 41 Ind. Ap. 104.) and Abdul Majid v. Jewahir Lal . (( 1914) I. L. R. 36 Allah. 350.) after some discussion, the appellants counsel conceded that these decisions were fatal to their argument.]
The judgment of their Lordships was delivered by
LORD SHAW OF DUNFERMLINE. Their Lordships see no reason for interfering with the decisions of the Courts below, and they will humbly advise His Majesty to dismiss the appeal with costs.
90 Law Rep. 42 Ind. App. 88 ( 1914- 1915) Munna Lal Parruck V. Sarat C hunder Mukerji