The main legal principle established is that a mortgagee can be estopped from enforcing the mortgage against a subsequent purchaser who was kept in ignorance of the mortgage, and that the estoppel also applies to the assignee of the mortgage.

Sundaram Chetty, J.

1. This is a Letters Patent Appeal against the judgment of our learned brother Jackson, J. The appeal arises out of a suit filed by the plaintiff who is the assignee of a mortgage held by defendant 4, for the recovery of a sum of money, by enforcing the mortgage. Defendant 1 was the mortgagor. Two items of properties are comprised in the mortgage. Defendant 3 happened to be a subsequent purchaser of item 2 for a sum of Rs. 725. It is clear from the findings of fact arrived at by the first appellate Court, that this transaction of sale by defendant 1 to defendant 3 was brought about with full knowledge and concurrence of the mortgagee (defendant 4) who was more or less instrumental in bringing about this purchase and who derived the benefit of this purchase, inasmuch as he credited the purchase money, viz., Rs. 725 towards the debt (between Rupees 800 and Rs. 900) due from defendant 1. This amount covers the debt due on the mortgage also. However, no endorsement of payment was made on the mortgage deed. It seems that, this-sort of arrangement was entered into for some purpose known to defendants 1 and 4 alone. Defendant 3 was kept in complete ignorance of the existence of the mortgage in favour of defendant 4 over the property (item 2), and it is also clear that he would not have paid the full consideration for Rs. 725 for item 2 if he had the least idea of its being subject to an encumbrance in favour of defendant 4.

2. The evidence shows that it was defendant 4 who advanced a sum of Rs. 25 to the vendor (defendant 1) to meet the expenses of stamp and registration for the sale deed. There is no doubt that defendant 4 took an active part in bringing about this sale. It may even be said, that by his silence or acquiescence he led defendant 3 to believe that he was purchasing an unencumbered property. It is argued that defendant 4 was not under a duty to disclose his mortgage, and therefore his silence in this respect should not be construed to be such as would create an estoppel under Section 115, Evidence Act. That section says that an estoppel can be created by declaration, act or omission, provided the effect thereof was to induce another person to believe a thing to be true and to act upon such belief. Defendant 3 was certainly led to go in for this bargain by reason of defendant 4s conduct, not to speak of defendant ls conduct also. It follows therefore that defendant 4 is estopped from setting up his mortgage on item 2, to the prejudice of the purchaser (defendant 3).

3. The next question is, whether the estoppel which could be pleaded by defendant 3 as against defendant 4 could also be operative as against the plaintiff, who is an assignee of the mortgage. We may even assume that he was a bona fide assignee for value. The question then is whether the plaintiff is a representative of defendant 4 within the meaning of Section 115, Evidence Act. If so, he is also estopped, fro as enforcing the mortgage against item 2. An attempt is made on behali of the appellant to limit the meaning of the word "representative" in the aforesaid section to a gratuitous transferee or volunteer and to a subsequent transferee for value with notice of the circumstances creating an estoppel. We find that there is no basis for such a restricted understanding of the word "representative." The plaintiffs position is nothing more than that of a derivative owner. He is certainly a person claiming under defendant 4. The fact that he was not aware of the circumstances creating an estoppel against defendant 4, would not avail him. There is the authority of the Privy Council in more decisions that one. In Poreshnath Mukerji v. Anathnath Deb (1883) 9 Cal. 265, the principle laid down is that a purchase by a mortgagee in execution of the mortgage-decree does not place him in a better position as regards the estoppel which could be asserted against the mortgagor himself. That is not the case of a mere volunteer or gratuitous transfer