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1922 Supreme(SC) 57
Privy Council
Ameer Ali, Sir John Edge, Phillimore, Justice Dunedin, JJ.
Nur Mahomed Peerbhoy and another -Appellant
Versus
Dinshaw Hormasji Motiwalla and another -Resopndent
P.C.A. No. 36 of 1921
Decided On : 21-11-1922
Morris, Crisp and Co., Ashurst, T. L. Wilson and Co., Kenworthy Brown, De Gruyther, Raikes, Lowndes
A judicial sale's security cannot be invalidated by vague references to antecedent contracts; the purchaser must have unequivocal notice of such contracts for specific performance to be enforceable against them under the Transfer of Property Act.
Headnote:(A) Code of Civil Procedure, 1908 - Sections 64 and 73 - Transfer of Property Act - Section 40 - Specific Relief Act, 1877 - Specific performance of contract - Effect of attachment and subsequent judicial sale - Notice of antecedent contract - Where a contract for sale of land was executed and earnest money paid, and the property was subsequently attached and sold in a judicial sale, the question arose whether the contract was void under Section 64 of the Code of Civil Procedure or enforceable against the judicial purchaser under Section 40 of the Transfer of Property Act.
(B) Judicial sales - Security of title - Vague references to antecedent contracts cannot be held to invalidate the title of a buyer in a court-sale - Notice given to the purchaser must be unequivocal to override the security of a judicial sale. (Paras 15-16)
Facts of the case:
A contract was entered into for the sale of land and a bungalow for a specified price, with a portion paid as earnest money. The property was subsequently subject to attachment proceedings under different decrees. While one attachment was struck off, another led to a judicial sale where a third party purchased a portion of the property. The original intended purchaser sought a decree for specific performance against the judicial purchaser and the original seller.
Findings of Court:
The court found that the judicial sale only included a specific portion of the property (the bungalow and associated land) and did not extend to other plots mentioned in the contract. Regarding the property sold in court, the evidence regarding the notice of the antecedent contract provided to the purchaser was unsatisfactory and lacked the necessary unequivocality required in the context of a judicial sale.
Issues: Whether the contract to sell was rendered void by attachment under Section 64 of the Code of Civil Procedure, and whether the judicial purchaser had sufficient notice of the contract to make it enforceable under Section 40 of the Transfer of Property Act.
Ratio Decidendi: The court held that judicial sales would be robbed of their security if vague references to prior contracts could invalidate the buyer's title. General statements made by a pleader in the vernacular during the sale process do not constitute the unequivocal notice required to enforce specific performance against a judicial purchaser.
Result: Appeal partly allowed.
Legal Category Hierarchy
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practice and procedure
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execution of decrees
- attachment of property
- judicial sale
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execution of decrees
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property law
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transfer of property
- specific performance
- doctrine of notice
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transfer of property
Lord Dunedin :-
The suit in which these two consolidated appeals have arisen was brought in the Court of the First Class Subordinate Judge of Thana on the 11th August, 1913, by Dinshaw Hormasji Motiwalla against Adam Haji Jacob alias Adam Abdulla Patel, Nur Mahomed Purhai Damji, who is defendant 2, and Waman Ganesh Desai, the defendant 3, to obtain under the Specific Relief Act, 1877, a decree for the specific performance of a contract of sale of the 17th July, 1912, by which it was agreed that Adam Haji Jacob should sell and convey to Motiwalla, and Motiwalla should purchase :-
"All that piece or parcel of land with the bungalow, trees, plants, shrubs, etc., and a well standing thereon, situate lying and being at Hill Road, Bandra, in the Thana District, Sub-District Bandra, and measuring about 5,000 square yards, bearing Municipal No. 139 and City Survey No. 136, and bearing Collector's Survey No. 17, Pot Nos. 2, 3, 4 and 5 and measuring 25 Gunthas, and bounded on the East by property of Rustomji Muncherji Jasawala, on the West by property of Burjorji Ghamat, on the South by Government Hill Road, and on the North by the land of Mr. Dias, and which said premises are particularly described in the title-deed now in the possession of the mortgagees Sorabshah and Pirojsha Framji Bandrawala" for the price of Rs. 15,600, of which Rs. 1,000 were in compliance with the contract, paid as earnest-money by Motiwalla to Adam Haji Jacob on the execution of the contract. The purchase was to be completed within two months from the 17th July, 1912. The contract was registered by the Sub-Registrar of Bandra on the 22nd July, 1912.
The only relief prayed for, to which it is necessary to refer, may, in effect, be briefly stated as follows :-
That it should be decreed that Adam Haji Jacob, and the defendants 2 and 3, should execute a deed of sale in favour of Motiwalla, of the property described as bearing Municipal Number 139, and that Adam Haji Jacob should execute a deed of sale, in favour of Motiwalla, of the property described as bearing Collector's Survey Number 17, Pot Numbers 2, 3, 4, and 5. Adam Haji Jacob, by his written statement, admitted that the contract of the 17th July, 1912, was made and that he had received as earnest-money Rs. 1,000, and pleaded, in effect, that he was ready and willing to convey to Motiwalla the property bearing Collector's Number 17, Pot Numbers 2, 3, 4 and 5, but that he was unable to convey to Motiwalla the property bearing Municipal Number 139, as it had been sold on the 25th April, 1913, to the defendant 2, in execution of a decree against him (Adam Haji Jacob).
The defendants 2 and 3 who claimed title under the Court-sale of the 25th April, 1913, separately filed written statements, in which they pleaded that the contract of the 17th July, 1912, was void under Section 64 of the Code of Civil Procedure, 1908. They also pleaded that all the property in respect of which specific performance was claimed by Motiwalla, was purchased at the Court-sale of the 25th April, 1913, by the defendant 2, and they further pleaded several other matters, which, in the view that their Lordships take of the case, need not be considered by them.
To the allegation that the whole property was included in the Court-sale the plaintiff replied that on the face of the sale only property bearing Municipal Number 139 was included.
The history of the various executions as regards the lands in question is as given by the learned Judges of the Court of Appeal as follows :-
"On the 19th of August, 1911, an attachment was levied by a judgment-creditor under Darkhast No. 32 of 1911, and in June, 1912, the property was put up for sale after being attached. On the 29th of August, 1912, the judgment-debtor, that is, the first defendant, paid in the whole of the decretal amount and costs, and therefore the sale was not confirmed, and the Darkhast proceedings were struck off on the 1st of October, 1912. Before the payment of the decretal amount, name
