VELLAIAPPA CHETTY v. PITCHA MAULA.

VELLAIAPPA CHETTY v. PITCHA MAULA.

(Alim, Special Mortgagee; Velliappa Chetty and others,
Simple Creditor).

D. C, Kurunegala, I,625.

Special mortgage of movables-Preference to proceeds of sale-Effect of section 352 of Civil Procedure Code.

Bonser, C.J.-A special mortgagee of movables is entitled to be preferred to all other creditors of the debtor in respect of the proceeds of the sale of such movables.

Since the price of the property Bold in execution takes the place of the property itself, the Court is bound to hand over to the special mortgagee so much of the money as Would cover his claim.

Section 352 of the Civil Procedure Code has not the effect of repealing the Roman-Dutch Law as to the right of a special mortgagee of movables to preference in the proceeds of the sale of those movables.

Konamalai v. Sivakolunthu (9 S. C. C. 203), commented upon.

PLAINTIFF having sued out writ of execution against the  defendant, certain goods were seized and sold by the Fiscal as belonging to the defendant, and the Fiscal brought into Court the sum of Rs. 1,160, stating at the same time that the goods sold under plaintiff's writ were also under seizure under five other writs, including writ No. 11,890 of the District Court of Colombo. The Fiscal further reported that the holder of 11,890 claimed preference over the proceeds of the sale as mortgagee of the goods, while the other writ-holders claimed concurrence.

Plaintiff in case No. 11,890 appeared in Court, alleging that the goods sold had been specially mortgaged to him, and claimed the proceeds of the sale. Notice of this claim was given to the other writ-holders.

The District Judge found that the identity of the goods mortgaged with the goods sold was not satisfactorily proved, rejected the mortgagee's claim to preference, and allowed him concurrence with the money decree-holders.

The mortgage-creditor appealed.

Bawa, for appellant.

Dornhorst, for respondent.

20th November, 1899, Bonser. C.J.-

In this case, the appellant was the mortgagee of certain movable property by a duly registered notarial deed. Me obtained judgment against the debtor, and various other simple creditors of tin-debtor also obtained judgments. The property of the debtor was

Bold, and amongst it the movable property mortgaged to the appellant and the proceeds of the sale are in the hands of the Court. The appellant claims to be paid his mortgage debt out of the proceeds of the sale of the mortgaged property in preference to the ordinary judgment-creditors. The District Judge refused to allow this to be done, on the ground that the identity of the goods was not established to his satisfaction.

Mr. Dornhorst, who appeared for the respondent, admitted that he could not support that finding of the District Judge; but he contended that even assuming that the identity of the goods was established, the result must be the same, and he relied on certain dicta of the judges who decided the case of Konamalai v. Siva-kolvnthu (9 S. C. C. 203) as establishing the proposition that the Roman-Dutch Law as to the right of a special mortgagee of movables to a preference in the proceeds of the sale of those movables was repealed by the provisions of the Civil Procedure Code.

It is difficult to believe that the Legislature can have intended to make so startling a revolution in the commercial law as would be effected by mortgagees of movables losing their right to the proceeds of the sale of the mortgaged goods. I should have expected that, if that was the intention of the Legislature, it would have expressed it in unmistakable terms and not left it to be inferred from the language of any obscure section in a Procedure Code. The section which is supposed to have effected this change is section 352 of the Civil Procedure Code, and I think I am not doing that section an injustice in saying that it is loosely drawn, for it speaks of the last preceding sectio

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