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1931 Supreme(SC) 68
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD MACMILLAN, SIR JOHN WALLIS, AND SIR DINSHAH MULLA.
H. V. LOW AND COMPANY, LIMITED - Appellant
Versus
JYOTI PRASAD SINGH DEO - Respondents
On Appeal from the High Court at Calcutta.
Decided On : July 24. 1931.
Solicitors for appellants:Oswald Hickson, Collier & Co. Solicitors for respondent: Downer & Lewis.
"Want of title" in a lease contract includes deficiency of title. The test is whether the title is free from reasonable doubt. Subsoil rights are presumed to remain with the proprietor unless the grantee proves their express inclusion in the grant.
Headnote:(A) Specific Relief Act, 1877 - Sections 18 and 25 - Transfer of Property Act, 1882 - Sections 55 and 108 - Contract for lease of underground mineral rights - Recovery of premium - "Want of title" - Meaning and scope - The expression "want of title" in a contract covers both deficiency and absence of title - The test for determining whether a lessee is justified in refusing a lease on the ground of defective title is whether an action for specific performance by the lessor could be successfully resisted on the ground that the title was not free from reasonable doubt or was imperfect. (Paras 18-20)
(B) Subsoil Rights - Presumption of ownership - Where a claimant holds land under a grant from a proprietor, the claimant must prove the express inclusion of subsoil rights in the grant - In the absence of evidence that grantees ever claimed or worked the minerals, and where no written grants exist, the possibility of a defect in the proprietor's title to minerals is considered practically negligible. (Paras 23-24)
(C) Transfer of Property Act, 1882 - Section 108 vs Section 55 - Rights and liabilities of lessor and lessee under Section 108 are distinct from those of buyer and seller under Section 55. (Para 25)
Facts of the case:
A company paid a premium for a long-term lease of underground coal rights. A formal agreement provided that the premium would be forfeited if the company failed to take the lease, unless such failure was due to a "want of the lessor's title." The company refused the lease, arguing that the lessor could not produce original grant documents for the land, creating doubt as to whether the subsoil rights had been transferred to previous grantees.
Findings of Court:
The court found that the company failed to establish a "want of title" that would create a reasonable doubt. Since the grantees had never asserted rights to the minerals and no written grants existed to prove such a transfer, the lessor's title was sufficiently established.
Issues: Whether the inability of the lessor to produce ancient grant documents constituted a "want of title" or "reasonable doubt" sufficient to justify the lessee's refusal to take the lease and recover the premium.
Ratio Decidendi: The court held that "want of title" includes deficiency of title. The applicable test is whether the lessor could provide a title free from reasonable doubt as required for specific performance under the Specific Relief Act. Furthermore, subsoil rights are presumed to remain with the proprietor unless expressly granted; the mere existence of surface grants without evidence of mineral rights transfer does not create a reasonable doubt regarding the proprietor's title.
Result: Appeal dismissed with costs.
Legal Category Hierarchy
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property law
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land tenure
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zamindari rights
- subsoil and mineral rights
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zamindari rights
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transfer of property act
- leases
- sale of property
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land tenure
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contract law
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specific performance
- defective title
-
specific performance
Judgement
Law Rep. 58 Ind. App. 392 ( 1930- 1931)
H. V. Low and C ompany, Limited V. Jyoti Prasad Singh Deo
185
Appeal (No. 8 of 1930) from a decree of the High Court in its appellate jurisdiction (December 13, 1929) reversing a decree of the Court in its original jurisdiction (February 12, 1929).
The appellants sued the respondent to recover a salami or premium paid by them in connection with a contract for the grant to them by the respondent of a lease of the underground coal rights in two mauzas within the respondents zamindari. The appellants contended that there was a “want of the lessors title," which under the contract entitled them to refuse the lease and recover the salami.
The facts are stated in the judgment of the Judicial Committee.
The trial judge (Page J.) decreed the suit. An appeal was allowed by a judgment delivered by Rankin
C. J. and concurred in by Buckland J. The appeal is reported at I. L. R. 57 C. 1189.
1931. June 22, 23, 25. E. B. Raikes K.C., M. B. Jardine and Harry Johnson for the appellants. A suit by the respondent for specific performance would have been dismissed under s. 25 (6) of the Specific Relief Act, 1877, upon it appearing that he could not give a title free from reasonable doubt, and thereupon the appellants would have recovered the salami under s. 18 (d) of that Act. Under the clause in the contract the right of the appellants to recover the salami is at least as wide as under the general law. Although under the authorities the brahmottar grants did not convey the subsoil rights unless there were express words, the grants may have been in language similar to that in Satya Niranjan Chakravarti v. Ram Lal Kaviraj (( 1924) L. R. 52 I. A. 109.), which the Board held was sufficient to carry the minerals. In the absence therefore of production of copies of the grants or information as to their terms there was a reasonable doubt as to the respondents right to deal with the subsoil rights. The respondent was bound to supply the appellants with information upon the matter. It should not be accepted that he could not do so ; his refusal to give an indemnity shows that he was not acting bona fide. Sect. 108 of the Transfer of Property Act, 1882, is not exhaustive of the obligations between a lessor and lessee. The Board has held that the Contract Act is not exhaustive as to the matters with which it deals Jwaladutt Pillani v. Bansilal Motilal . (( 1929) L.
R. 56 I. A. 174.) The relations of landlord and tenant in India are regulated by English law as it was before the Vendor and Purchasers Act, 1874, save so far as the Indian Legislature has provided otherwise Tarachand Biswas v. Ram Gobind Chowdhry . (( 1879) I. L. R. 4 C. 778, 781.) Under the law in England before the Vendor and Purchasers Act, 1874, there was in a contract to grant a lease an implied term that the lessor would make out his title to grant the lease Souter v. Drake ((1834) 5
B. & Ad. 992.) ; see also Jones v. Watts . (( 1890) 43 Ch. D. 574.) Further, the mining right contracted for was not a " lease " within s. 105 or s. 108 of the Act of 1882 ; it was really a sale of property out and out Gowan v. Christie (( 1873) L. R. 2 H. L. (Sc.) 273, 284.) ; Campbell v. Wardlaw . (( 1883) 8 App. Cas. 641, 649.) The respondent was therefore under the obligations laid down in s. 55 of the Transfer of Property Act, 1882 ; the appellants rely on s. 55, sub-s. 1 (a) (6), and sub-s. 2.
Upjohn K.C. and Parikh for the respondent. Under the clause in the contract the appellants could recover the salami only upon proof by them of a " want of title " in the respond ent, a cloud upon the title was insufficient. The Board has held in Raja of Pittapur v. Secretary of State for India (( 1929) L. R. 56 I. A. 223.) that the fact that persons are in possession of the surface rights of zamindari lands shows no want of title in the zamindar of the subsoil rights. Even if the suit was one by the respondent for specific performance, so that the tests of "
