Somasunderam Chetty V. Todd Et Al.,

Present : The Hon. Sir Joseph T. Hutohinson, Chief Justice,
and Mr. Justice Wood Renton.  Oct. 19,1910

SOMASUNDERAM CHETTY v. TODD et al.

D. C, Jaffna, 6,868.

Evidence Ordinance, s. 92-Sale of land-Notarial agreement to re-convey the land if price is repaid within six months-May oral evidence be led to prove that sale was intended to be a usufructuary mortgage?

A deed of sale of land for value was accompanied by a deed of agreement between the parties for purchase back by the vendor of the land on payment by him of the money to the vendee within six months. The vendor did not exercise his right of re-purchase, but after many years entered into possession of the land. In an action by the vendee for declaration of title and ejectment the vendor pleaded that the conveyance to the vendee was not an absolute conveyance, but that it was intended to be only a usufructuary mortgage, and that anterior to its execution there was an oral agreement to the effect that the vendee should possess the lands until he had reimbursed himself with interest the amount of the advances made by him, and that thereafter he should re-convey the property to the vendor.

Held, that, as the parties had formally expressed in writing the terms on which the vendee was to re-transfer, it was contrary to the provisions of section 92 of the Evidence Ordinance to allow evidence of the oral agreement to be adduced.

ONE Todd, first defendant-appellant, who was the owner of the estate in dispute, which was burdened with three mortgages, sold it by deed No. 319 dated April 28, 1898, for the sum of Rs. 125,500 to one R. M. A. R. A. R. Supramaniam Chetty, who was to retain Rs. 93,930.97 and Rs. 13,000 to pay off the first two mortgages, and the balance Rs. 18,569.03 to pay off his own third mortgage.

By deed No. 320 of the same date Supramaniam Chetty covenanted to re-convey the land to Todd if he paid the sum of Rs. 125,500 to Supramaniam Chetty on or before October 1, 1898, and it was further agreed by the said deed that if the said sum of Rs. 125,500 was not paid on that date the deed No. 320 was to be no force or avail in law.

By deed No. 911 dated May 1, 1900, Supramaniam Chetty transferred the land to plaintiff-respondent (Somasundaram Chetty). Todd did not exercise his right of purchase under deed No. 320; but several years afterwards the third defendant, who held a power of attorney from Todd, entered into possession of land.

Plaintiff brought this action for declaration of title, ejectment, and damages .

The defendants pleaded, inter alia, that the transfer of April 28, 1898 (No. 319), was not an absolute conveyance, but was intended to be only a usufructuary mortgage, and that anterior to its execution there was an oral agreement to the effect that Supramaniam Chetty should possess the land until he had reimbursed himself, with interest the amount of the advances made for the discharge of the encumbrances on the property, and that thereafter he should re-convey the land to the first defendant-appellant. They claimed that either the action should be dismissed, or that plaintiff should render accounts of the income and expenditure in the working of the estate. The District Judge (E. N. Thaine, Esq.) held that deeds Nos. 319 and 320 did not operate as a mortgage, and he gave judgment for the plaintiff.

The first and second defendants appealed.

A. St. V. Jayewardene, for the appellants.

[The arguments of counsel are summarized in the judgment of Wood Renton J.]

Bawa, for the respondent (not called upon).

Cur. adv. vult.

October 19, 1910. HUTCHINSON C.J.-

The claim in this action is for declaration of the plaintiff's title to about 278 acres of land, and for recovery of possession, and damages. The plaint says that the first defandant, being the owner of the land, conveyed it by deed No. 319 of April 28,, 1898, to E. M. A. E. A. E. Supramaniam Chetty, who conveyed

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