NELKA RUPASINGHE AND ANOTHER VS. NATIONAL DEVELOPMENT BANK

NELKA RUPASINGHE AND ANOTHER VS.
NATIONAL DEVELOPMENT BANK

SUPREME COURT
TILAKAWARDENE, J.
SRIPAVAN, J.
WANASUNDERA, J.
SC 39/2010
HC [CIVIL] 274/2007/MR
COMMERCIAL HIGH COURT
SEPTEMBER 27, 2013

Parate execution - Lands of debtor and guarantor sold Purchased by Bank - Parate executing guarantor's land - Valid? Who is the owner of the lands? Hypothecary action filed.

The 1st appellant mortgaged lot 6 and the 2nd appellant mortgaged her land securing a loan obtained from the bank. As the loan was not repaid, the bank auctioned both lands and the bank bought the lands and became the owner on a certificate of sale. The Supreme Court in another case held that the bank could parate execute only the land belonging to the debtor. The bank thereafter, on the basis that it cannot auction properties of the guarantor instituted hypothecary action to recover the balance due on the outstanding sum owed after the sale of the lands.

It was contended that the bank has become the owner of the lands in view of the certificate of sale, and that in view of the 5 Bench decision of the Supreme Court, it cannot auction the guaranto

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