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1873 Supreme(Cal) 34

CALCUTTA HIGH COURT
The Bank of Hindustan, China and Japan - Appellant
Versus
Nundololl Sen & Ors. - Respondent
Decided On : 27-03-1873

Headnote:

Mortgage - Foreclosure - [Regulation XVII of 1806, Regulation VIII of 1812] - The court held that the suit would lie in the Calcutta Court despite some properties being situated in the mofussil. The court also held that the defendant should be given a year of grace to redeem the mortgage, as he would have had in a mofussil court. The court further held that the English law of mortgages applied to the case, and that the plaintiffs' right to recover their money was not barred by the foreclosures that had already been obtained. The court ordered an account of what was due on the mortgage, and directed the plaintiffs to take all necessary steps to complete their foreclosure by getting possession of the properties. The court also ordered an enquiry as to the value of the properties, and directed that the account be finally taken. If a balance was due from the defendant, the decree would direct foreclosure, allowing the ordinary period of six months for the Calcutta properties, and one year for those in the mofussil.

Fact of the Case:

The plaintiff filed a suit for foreclosure of mortgages of lands situated in both Calcutta and the mofussil. The defendant argued that the suit should be dismissed as the court had no jurisdiction over the subject matter and that the plaintiffs had lost their right to proceed under the covenants of the mortgages by proceeding against the property mortgaged. The defendant also argued that the principles applicable to mortgages of mofussil property by bye-bil-wafa were not applicable to the mortgages of the mofussil property in this case.

Finding of the Court:

The court found that the suit would lie in the Calcutta Court despite some properties being situated in the mofussil. The court also found that the defendant should be given a year of grace to redeem the mortgage, as he would have had in a mofussil court. The court further found that the English law of mortgages applied to the case, and that the plaintiffs' right to recover their money was not barred by the foreclosures that had already been obtained. The court ordered an account of what was due on the mortgage, and directed the plaintiffs to take all necessary steps to complete their foreclosure by getting possession of the properties. The court also ordered an enquiry as to the value of the properties, and directed that the account be finally taken. If a balance was due from the defendant, the decree would direct foreclosure, allowing the ordinary period of six months for the Calcutta properties, and one year for those in the mofussil.

Issues: The issues in the case were whether the court had jurisdiction to hear the suit, whether the English law of mortgages applied to the case, and whether the plaintiffs' right to recover their money was barred by the foreclosures that had already been obtained.

Ratio Decidendi: The court held that the suit would lie in the Calcutta Court despite some properties being situated in the mofussil. The court also held that the defendant should be given a year of grace to redeem the mortgage, as he would have had in a mofussil court. The court further held that the English law of mortgages applied to the case, and that the plaintiffs' right to recover their money was not barred by the foreclosures that had already been obtained.

Final Decision: The court ordered an account of what was due on the mortgage, and directed the plaintiffs to take all necessary steps to complete their foreclosure by getting possession of the properties. The court also ordered an enquiry as to the value of the properties, and directed that the account be finally taken. If a balance was due from the defendant, the decree would direct foreclosure, allowing the ordinary period of six months for the Calcutta properties, and one year for those in the mofussil.

JUDGMENT

Macpherson, J. - This suit having come on for settlement of issues, the matters in dispute between the parties have been argued, and it is agreed by Mr. Woodroffe and Mr. Evans, and is clear, that it is unnecessary to set the cause down for further hearing. I think that the suit will lie leave to sue in this Court was obtained when the plaint was filed, and therefore under the peculiar state of facts shown by the plaint, the suit will lie, though some of the properties which are the subject of it are situated in the mofussil.

2. But the suit being here, it is impossible that, in foreclosing the mortgages of the lands which lie out of Calcutta, I should follow the procedure prescribed by the Regulations for the foreclosure of mofussil mortgages. This Court has no means of carrying out a foreclosure under that procedure. At the same time (on the principles indicated in the case of Doed Chuttoo Sheick Jemadar v. Subbessur Sein 2 Boul., 151), I ought to see that the defendant is not by reason of the suit being brought in this Court deprived of any substantial advantage which he would have had if the suit had been instituted in a Court in the mofussil. For example, as the defendant, if sued in the mofussil, would have had what is called his year of grace within which he might redeem, so here he should have a full corresponding year allowed him before making the foreclosure absolute. The parties having contracted in the English form, there is no hardship or injustice to the defendant in dealing with the case in the manner in which I propose to treat it. It is true that, to a certain extent, mortgages of lands in the mofussil, drawn up in the English language and in the form of an ordinary English mortgage, have been treated as common bye-bil-wafas, or deeds of conditional-sale. But that has been merely with reference to the one question of the procedure to be gone through in order to obtain foreclosure. In an ordinary Bengali bye-bil-wafa it appears on the face of the document itself that the parties intend that, if the mortgagor does not pay the money due, the conditional sale shall become absolute, and the property shall remain finally with the mortgagee in lieu of the debt. Where such intention is apparent, the mofussil Courts have held, and with good reason, that the creditor must look to the land only, and has no remedy against the other property, or the person of the mortgagor. But the intention and contract are wholly different in a mortgage in the common English form, where personal and general liability is always contracted for, in addition to the security afforded by the mortgage of the land.

3. It seems to me there is nothing in the argument that, because some of the earlier mortgages have been foreclosed by reason of the non-payment of this same debt, therefore the debt is now to be deemed to be satisfied. Whether it is so or not, according to English law, in an ordinary and simple case, where there is but one debt and one security, to apply such a rule, in an exceptional case like the present, would be wholly inequitable and wrong, as being contrary to the express intention of the parties as testified in the several deeds executed by them.

4. The Regulations which lay down the law on the subject of mortgages to be applied in the Courts in the mofussil never contemplated a case like this now before me; and they make no provision for such a case. No mofussil Court in truth has any machinery with which to deal properly with such a matter as this.

5. In my opinion the English law does not indicate that the plaintiffs' right to recover their money in one way or other would be barred by the foreclosures which have been already obtained; although no doubt the institution of this suit would reopen the foreclosures, and let the defendant in to redeem. I quite think that, if the defendant now chooses to pay off the debt, the foreclosures should be set aside, and doubtless the plaintiffs will be well pleased to be paid off on

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