High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE E. PADMANABHAN
V.A.M. Mohammed Hanifa Sahib
Versus
Kanie, M.A. Anifa Sahib
S.A. Nos. 1726 & 1727 of 1982
Decided On :Decided on : 24-12-1996
BROKERAGE - LIMITATION - ARTICLE 18 OF THE LIMITATION ACT - WHEN DOES THE CAUSE OF ACTION ARISE? - AGENT'S RIGHT TO REMUNERATION - WHEN DOES IT ARISE? - INTEREST - WHETHER PAYABLE IN THE ABSENCE OF A CONTRACT.
Fact of the Case:
Plaintiff, a professional real estate broker, filed two suits against the defendants for recovery of commission for bringing forth a sale transaction between the defendants and a third party. The defendants denied the plaintiff's involvement in the transaction and pleaded limitation.
Finding of the Court:
The trial court and the first appellate court decreed the suits in favor of the plaintiff, holding that he was entitled to commission at the rate of 2% of the sale price. The defendants appealed to the High Court.
Issues: 1. Whether the suit claim is barred by limitation under Article 18 of the Limitation Act? 2. Whether the attestation of a person to a document imports any financial interest to the person attesting? 3. Whether the judgment of the lower court is illegal in granting interest to the claim of the respondent in the absence of a contract for payment of interest and hence contravening the provision of the Interest Act?
Ratio Decidendi: 1. Article 18 of the Limitation Act provides that a suit for the price of work done by the plaintiff for the defendant must be instituted within three years from the date the work is done. 2. In the absence of a written contract, brokerage or remuneration is payable to a broker on the completion of the deed of conveyance. 3. The plaintiff, being a professional real estate agent, is entitled to 2% remuneration on the completion of the deed of conveyance, unless a contract to the contrary is established. 4. Interest is payable from the date of demand, even in the absence of a contract for payment of interest.
Final Decision: The High Court dismissed the appeals, holding that the suit claim was not barred by limitation, that the plaintiff was entitled to commission at the rate of 2% of the sale price, and that the plaintiff was entitled to interest from the date of demand.
1. The two Second Appeals arise out of the common judgment rendered by the courts below.
2. The defendants in the two suits against whom the suits have been decreed are the appellants in both the second appeals.
3. The plaintiff is one and the same person who has instituted S. No. 895 of 1979 and 1125 of 1979 for recovery of Rs. 2,522.50 and Rs. 2,380/- respectively, against the defendant in each of the suits.
4. The common pleadings and the crux of the pleadings as well, are to the effect that the plaintiff brought forth a sale transaction between the defendant and a third party and that his remuneration has not been paid. According to the plaintiff he acted as a broker and that he is a professional broker who normally engages himself for the conclusion of contract between the seller and purchaser and for such conclusion of sale he receives the remuneration, in other words called as commission.
5. In this connection, it was the specific case of the plaintiff that the sale agreement entered between the defendant and third parties was brought forth by him, that the sale was concluded on 31.1.1979, that despite demands by letters dated 22.6.1979, 6.7.1979 and the registered notice dated 20.7.1979, his remuneration, has not been paid by the defendants.
6. The defence by the defendants in the two suits is common and it is one of total denial. The defendants pleaded that the plaintiff has nothing to do with the transaction, that the plaintiff has not brought forth the transaction that the plaintiff, a real estate broker by profession has not taken part in the negotiation as a broker and that the plaintiff is a total stranger.
7. The plaintiff has claimed his remuneration at 2 per cent of the total sale consideration, for which the sale was concluded. Though the plea of limitation has been allowed to be raised by the first Appellate Court, no such plea has been raised in the written statement. The defendants though specifically pleaded that they do not know the plaintiff as a broker, admitted the transaction of sale between themselves and the third party Ramalingam besides denying the plea of plaintiff that has negotiated with the said Ramalingam.
8. The plaintiff examined himself and two other witnesses, while one of the defendant examined himself and one Mohamed Ismail as P.W. 2. The plaintiff marked Exhibits A-1 to A-24 and the defendants marked agreement as Exhibit B-1. The two suits were tried together and a common judgment judgment was delivered on 21.2.1991.
9. The trial court decreed the suit, holding that the plaintiff has acted as a broker and he is entitled to commission at the rate of 2 per cent of the sale price. The suits were decreed.
10. The appellants herein preferred A.S. Nos. 48 and 49 1981 respectively on the file of the Subordinate Judge, Tiruppur. The first Appellate Court concurred with the findings rendered by the trial court and confirmed the decree passed by the trial court. The first Appellate Court allowed the defendants to raise the plea of limitation and after due consideration, the first Appellate Court held that the suit claim is not barred by limitation. As against the dismissal of the first appeal, the defendants in the two suits have preferred the above Second Appeals.
11. At the time of admission on 9.11.1982 the following three substantial questions of law have been framed:—
1. Whether the judgment of the lower appellate Court in decreing the claims of the respondent as in time, is illegal as the cause of action under both the claims arose as early as 1974 rendering both the suits barred by limitation under Article 18 of the Limitation Act?
2. What is the legal inference to be drawn on attestation of a person to a document? Does it import any financial interest to the person attesting?
3. Whether the judgment of the lower court is illegal in granting interest to the claim of the respondent in the absence of contract for payment of interest and hence contravening the provision of the Int
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