MADRAS HIGH COURT
KUNHAMED KUTTI
A.Venkatasami Naidu
Versus
Annamalai Goundar
Second Appeal No. 414 of 1961
Decided On : 16 August, 1963
SPECIFIC PERFORMANCE - AGREEMENT FOR SALE OF LAND - MUTUALITY - WANT OF MUTUALITY AT THE DATE OF CONTRACT - SUBSEQUENT LOSS OF RIGHT TO ENFORCE CONTRACT BY OWN NEGLECT OR DEFAULT - NO BAR TO ENFORCEMENT AGAINST DEFAULTING PARTY - LIMITATION ACT (IX OF 1908), ART. 113.
Fact of the Case:
The respondent filed a suit for specific performance of an agreement dated 24-5-1948 (Ex. A.1) to sell 1.75 acres of punja land in Perimuthoor village, Krishnagiri taluk, which was in the possession of the respondent as lessee. The appellant, who had purchased the land for Rs. 500 in 1947, agreed to sell it to the respondent for Rs. 800 within seven years from 24-5-1948. On 23-5-1955, the respondent tendered Rs. 800 along with expenses for executing and registering the sale deed, but the appellant refused. The respondent sent the amount by telegraphic money order on 24-5-1955, which was also refused. The suit was filed on 26-5-1958.
Finding of the Court:
The lower courts found that there was an enforceable agreement between the parties and decreed the suit for specific performance. The appellant challenged the enforceability of the agreement on grounds of want of mutuality, lack of consideration, and limitation.
Issues: 1. Whether there was an enforceable agreement between the parties for specific performance. 2. Whether the agreement was unenforceable due to want of mutuality. 3. Whether the agreement was unenforceable due to lack of consideration. 4. Whether the suit was barred by limitation.
Ratio Decidendi: 1. The court held that there was an enforceable agreement between the parties as both the appellant and the respondent were parties to the agreement and the appellant had agreed to make over the property on the respondent paying the consideration of Rs. 800 to him within the stipulated time. 2. The court rejected the appellant's contention that the contract was bad for want of mutuality, as mutuality is essential for a suit for specific performance, but there are exceptions to this rule. In this case, both parties were parties to the agreement, and the appellant had agreed to sell the property to the respondent. 3. The court also rejected the appellant's contention that the agreement was unenforceable due to lack of consideration, as the respondent had tendered the consideration amount within the stipulated time, but the appellant had refused to accept it. 4. The court held that the suit was not barred by limitation as the respondent had filed the suit within three years from 24-5-1955, the date when the cause of action arose.
Final Decision: The appeal was dismissed with costs.
JUDGMENT :- The defendant who has been unsuccessful in the Courts below is the appellant before me. The matter arises out of a suit filed by the respondent (plaintiff) for specific performance of an agreement dated 24-5-1948 (Ex. A.1). The subject-matter of this agreement was 1.75 acres of punja land in Perimuthoor village, Krishnagiri taluk. This land which had been purchased by the appellant for Rs. 500 in 1947 was in the possession of the respondent as lessee. While so, the appellant and the respondent entered into the agreement in question to sell the land to the respondent for a sum of Rs. 800 within a period of seven years from 24-5-1948. On 23-5-1955, the respondent tendered Rs. 800 together with the expenses for executing and registering the sale deed. That was refused by the appellant. He then sent the amount by telegraphic money order on 24-5-1955. This was also refused by the appellant. The suit out of which this appeal arises was therefore filed by the respondent on 26-5-1958.
2. The contention of the appellant ranged from a denial of the agreement to its unenforceability even if it was found to be true and valid. The appellant also raised the question of limitation on the ground that the suit ought to have been filed prior to 24-5-1955. All these contentions were negatived by the learned District Munsif and he decreed the suit with costs giving 15 days time to deposit the sale amount and directing execution of the sale deed at the respondents costs within 15 days thereafter. This decree has been confirmed in appeal by the Additional District Judge.
3. The question is essentially one of fact whether there was an enforceable agreement between the parties which justified the respondents claim for specific performance. As this has been found in favour of the respondent by both the Courts below, there is little scope for interference in second appeal. Grounds have however been raised by the appellant that the suit ought to have been filed on 25-5-1955 when the appellant refused the respondents demand for specific performance, that a subsequent refusal would not give rise to a fresh cause of action and a fresh period of limitation and that the agreement in the case being a gratuitous one was not enforceable as a binding contract. But, the point urged before me is that, since the consideration for the sale as specified in the document had not been tendered within the stipulated time and the sale effected, the agreement itself had become unenforceable, the language used being (words in Tamil). The argument is that the agreement will remain and has to be treated as non est when they condition has not been fulfilled as undertaken by the respondent. Reliance was placed in this connection on the Privy Council ruling in Mir Sarwarjan v. Fakhruddin Md. Chowdhuri, ILR 39 Cal 232 (PC), and also on Halsburys Laws of England, Simonds Edn. Vol. 36, Section 367, at page 269, dealing with contracts lacking mutuality. The rule laid down by the Judicial Committee in the above case is that it was not within the competence, of either of the Manager of a minors, estate or of the guardian of the minor to bind the minor or his estate by a contract for the purchaser of immovable property and that as the minor was not bound by the contract there was no mutuality. Again as pointed out in S. 367 aforesaid, if a contract cannot be enforced against one party by reason of circumstances existing at the date of the contract, such as personal incapacity or the nature of the contract, that party will not be enabled to enforce the contract against the other party. But there are exceptions to such contracts and want of mutuality must be judged as at the date of the contract, and the fact that a defendant by his own neglect or default has, since the date of the contract, lost the right to enforce it will not prevent its being enforced against him.
4. I am, however, unable to appreciate the appellants contention that there was no mutuality in the pre
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