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1929 Supreme(SC) 42
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD SHAW, LORD CARSON, AND SIR LANCELOT SANDERSON.
RAMJI - Appellant
Versus
RAO KISHORESINGH - Respondents
On Appeal from the Court of the Judicial Commissioner, Central Provinces.
Decided On : May 9. 1929.
Solicitors for appellant: T. L. Wilson & Co.
Solicitors for respondent: Valpy, Peckham & Chaplin.
Specific performance of a contract for immovable property is precluded under Section 21(a) of the Specific Relief Act if pecuniary compensation is found to be an adequate relief, as this rebuts the statutory presumption that money is insufficient for such transfers.
Headnote:(A) Specific Relief Act, 1877 - Sections 12, 19, 21(a), and 22 - Code of Civil Procedure, 1908 - Sections 100 and 101 - Specific performance of contract - Adequate relief - Compensation in money - The presumption that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money is rebuttable. Where it is found that pecuniary compensation is an adequate relief, a decree for specific performance cannot be granted under Section 21(a).
(B) Appeal - Scope of second appeal - A finding of fact by the first appellate court is final if the court had before it proper evidence in support of the finding. A second appellate court has no jurisdiction to entertain an appeal on the ground of an erroneous finding of fact, however gross the error may seem to be, provided there is no error or defect in procedure.
Facts of the case:
A party entered into an agreement to borrow a sum of money to fund legal proceedings, agreeing that upon winning the case, they would sell a specific village to the lender in lieu of the amount. The party won the case but refused to execute the sale deed. The lender sued for specific performance or, alternatively, a refund of the money with interest. The first appellate court found that the bargain was not extortionate and that the value of the property at the time of the agreement was not excessive, but it also found that compensation in money would be an adequate relief. Despite this finding, the first appellate court decreed specific performance.
Findings of Court:
The court found that the first appellate court's findings regarding the value of the property and the fairness of the bargain were binding on the second appellate court. It was further affirmed that compensation in money was an adequate relief to the plaintiff, thereby rebutting the presumption under the explanation to Section 12 of the Specific Relief Act.
Issues: (1) Whether the second appellate court could interfere with the first appellate court's findings of fact regarding the value of the property and the nature of the bargain. (2) Whether a decree for specific performance could be granted when the court had explicitly found that pecuniary compensation was an adequate relief.
Ratio Decidendi: Under the Code of Civil Procedure, findings of fact by the first appellate court are final in a second appeal if supported by evidence. Under the Specific Relief Act, Section 21(a) prohibits the specific enforcement of a contract for which compensation in money is an adequate relief. Since the court found that money was an adequate remedy, specific performance was precluded, and the plaintiff was entitled only to monetary compensation based on the value of the property at the date of the breach.
Result: Appeal allowed; decree for Rs. 20,000 with interest at 6% per annum until realization.
Legal Category Hierarchy
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civil law
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contracts
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specific performance
- adequacy of compensation
- unconscionable bargains
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specific performance
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contracts
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practice and procedure
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civil procedure
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appellate jurisdiction
- findings of fact
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appellate jurisdiction
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civil procedure
Judgement
Appeal (No. 82 of 1927) from a decree of the Court of the Judicial Commissioner, Central Provinces (August 22, 1925), setting aside a decree of the District Judge, Nimar, which reversed a decree of the Subordinate Judge of Khandwa.
The suit was brought by the appellant against the respondent for specific performance of an agreement; he claimed an order that the respondent should execute a sale deed of a certain village, and alternatively repayment with interest of Rs. 5000 advanced by him together with compensation.
The facts of the case and the decisions of the Courts in the Central Provinces appear from the judgment of the Judicial Committee.
April 16. Dunne K.C. and Parikh for the appellant. By the Code of Civil Procedure, ss. 100, 101, the finding of the District Judge that the agreement was not extortionate or even harsh was binding in the second appeal Durga Choudhrain v. Jawahir Singh Choudhri . (( 1890)
L. R. 17 I. A. 122, 127.) In any case, having regard to Raghunath Prasad v. Sarju Prasad (( 1923) L.
R. 51 I. A. 101.), there was no ground for holding that the bargain was unconscionable. The decree for specific performance should have been affirmed. Under the explanation to s. 12 of the Specific Relief Act, 1877, it is to be presumed that compensation would not be an adequate remedy. There was no ground for the District Judges view that it would be. In any case, s. 12 (d) gave him a discretion to decree specific performance if he was of opinion that pecuniary compensation could not be got. It is to be assumed that he so found. If a substantive decree for specific performance is precluded by s. 21 (a), the decree should provide that upon failure to pay the decreed sum within a limited period, the property should be transferred.
Kyffin for the respondent. It is conceded that the finding of the District Judge as to the value of the property was binding in the second appeal, but his finding that the bargain was not extortionate was wrong in law. In any case, as he found that pecuniary compensation would be an adequate remedy, ss. 12 and 21 of the Specific Relief Act preclude a decree for specific performance, "even as an alternative relief. It was not contended in India, nor is it by the appellants case in appeal, that pecuniary compensation could not be got.
Parikh in reply. Under s. 151 of the Code a decree in the alternative form suggested can be made if necessary for the ends of justice.
May 9. The judgment of their Lordships was delivered by
SIR LANCELOT SANDERSON. This is an appeal by the plaintiff in the suit from a decree of the Court of the Judicial Commissioner, Central Provinces, setting aside a decree of the District Judge, Nimar. The date of the first mentioned decree was August 22, 1925, and the date of the second mentioned—namely, that of the District Judge—was May 8, 1924.
In 1908 the defendant-respondent had instituted a suit against two widows to recover possession of an estate known as the Bhamgarh Zamindari, and after having obtained a decree in his favour, that decree was reversed by the Court of the Judicial Commissioner. He desired to prosecute an appeal to His Majesty in Council, and to enable him to do so he had to raise money. He entered into an agreement with the plaintiff on November 11, 1912, with regard to the advance of the sum of Rs. 5000 by the plaintiff on the terms therein mentioned. The agreement was as follows "I have brought from you Rs. 5000 in order to file my appeal to the Privy Council, and at this time I am very badly in need of this amount, because if you do not pay me the amount now, it will be extremely difficult for me to file the appeal. Therefore I lay down in writing and bind myself by this agreement that when I may win my case in the Privy Council in England and a decree may be passed in my favour, I shall at once sell, in lieu of this amount, the full sixteen anna proprietary rights of mauza Khedi out of my villages .... under a duly registered sale-deed and
