IN THE HIGH COURT OF MADRAS
Varadachariar, J.
Dubash D.K. Ahmad Ibrahim Sahib
Versus
A.K.R.M.K. Meyyappa Chettiar and Ors.
Decided On : 13.09.1938
Mortgage Bond - Recovery of Money - Contract Act, Section 16, Section 64 - The court discussed the liability of a minor for debts incurred in a family business, the application of undue influence, and the evidence of minority. The judgment highlighted the principles of undue influence, the burden of proof, and the impact of family business on the liability of a minor.
Fact of the Case:
The suit involved a mortgage bond for the recovery of money due, executed by defendants 1 to 3. Defendant 3, a minor at the time of execution, raised defenses of minority and undue influence.
Finding of the Court:
The court found in favor of defendant 3 on the plea of undue influence, holding that the mortgage bond was not binding on defendant 3. The court did not make a definite finding on the issue of minority due to the favorable decision on the plea of undue influence.
Issues: The issues involved the liability of a minor for debts incurred in a family business, the application of undue influence, and the evidence of minority.
Ratio Decidendi: The court emphasized the principles of undue influence, the burden of proof, and the impact of family business on the liability of a minor.
Final Decision: The appeal was allowed, and the decree of the lower court was modified to exonerate defendant 3 from the mortgage bond. The appellant was awarded costs to be paid by the plaintiffs-respondents.
Varadachariar, J.
1. This appeal arises out of a suit for the recovery of money due under a mortgage bond (Ex. A) executed in favour of the plaintiff by defendants 1 to 3 on 14th May 1923. Defendants 1 to 3 are the sons of one Khan Bahadur Dubash Khadir who died in November 1912. Defendant 4 was unnecessarily impleaded and his name was subsequently removed from the record. Defendant 5 is the Official Assignee of Rangoon in whom the estate of defendants 1 and 2 had vested during the pendency of the suit when they became insolvents in 1929. The mortgagees are certain Chettiars to each of whom defendants 1 and 2 had become indebted in the course of their business at Eangoon. It was stated that there was some inconvenience in executing separate mortgages in favour of each of them and that they accordingly agreed to take a single mortgage bond in their joint names for the aggregate amount due to them and for the cash advanced on the date of Ex. A. The document proceeds on the footing that defendant 3 was equally liable with defendants 1 and 2 for the amounts due to the mortgagees.
2. The mortgagors admitted execution of Ex. A but they raised various defences to the plaintiffs claim. It is unnecessary to refer to the defences pleaded by defendants 1 and 2 as they have acquiesced in the decree passed by the lower Court against them. Defendant 3 not merely adopted some of the defences raised by defendants X and 2 but raised two special pleas of his own which are covered by issues 1 and 4 framed in the case. These defences were to the effect that he was a minor when he, signed Ex. A and that the document had been obtained from him by undue influence. The lower Court decided these issues against defendant 3 and passed a decree against him as well. Defendant 3 has accordingly preferred this appeal. In the appeal, we are concerned only with the questions raised by issues 1 and 4, as no other point was pressed before us on behalf of the appellant. As we have come to a more definite conclusion in favour of the appellant on issue 4 than on the first, we propose to deal with issue 4 at the outset. The plea of undue influence was thus set forth in paras. 3 and 4 of defendant 3s written statement:
Defendant 3 was not interested in the partnership business of defendants 1 and 2 in Rangoon or the Lighterage Company referred to in the plaint nor was he liable for any of the debts of the said partnership or company...
The prior debts mentioned in the deed had no connexion with this defendant and the cash recited to have been paid was not for his benefit. The document was written up in India without the previous consent of this defendant including him as one of its executants and was sent over to defendant 2 in Rangoon. This defendant was then a student in a school in Rangoon and residing with defendant 2. The latter and another Muthuraman Chettiar, one of the agents of the plaintiff, requested this defendant to sign the document and assured him that the document would not be enforced against his share in the immovable properties first and that he was joining in the execution only as surety. Defendant 2 also stated at the time that unless he joined in the execution of the document, defendant 1 and himself would become in. volved in a terrible financial crisis and would be ruined irretrievably. Defendant 3 had then no knowledge of his rights under the deed of settlement executed by his father nor was he aware of his exact age. Unable to resist the importunities of the brother, defendant 2 and the agent of the plaintiffs, defendant 3 executed the document jointly with his brother, defendant 2, in Rangoon.
3. It seems to have been contended in the lower Court, that these allegations, even if true, would not invalidate the document as against defendant 3, nor amount to a plea of undue influence. This contention was embodied in issue 5. The learned Judge rightly found on issue 5 in the appellants favour. On issue 4, he held that defendant 2 was in a p
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