Palaniappa Chetty V. Saminathan Chetty Et Al.

Present: Lascelles C.J. and Wood Renton J.

PALANIAPPA CHETTY v. SAMINATHAN CHETTY et al

38-D. C. Colombo, 30,719.

Payment of debt by a promissory note-Conditional payment-Action on notes dismissed for material alteration-Subsequent action for the recovery of the original consideration-Res judicata-Civil Procedure Code, ss. 34,207.

The defendants gave the plaintiff two promissory notes as a conditional discharge of their indebtedness. The plaintiff sued the defendants on the notes, but the action was dismissed on the ground that the notes were materially altered by the insertion of a rate of interest. The plaintiff thereupon brought the present action for the recovery of part of the original consideration in respect of which the notes were granted.

Held, that plaintiff's action was not barred by the dismissal of the previous action upon the notes.

Wood Renton J.-" Section 34 of the Civil Procedure Code does not require a plaintiff to exhaust in one suit all the causes of action that he may have at the date of the suit in respect of the property or the relief claimed by him, and of which he was then

Lascelles C.J.-" The crucial question in a case like this is not whether the subject-matter of the present action, that is to say, the moneys sought to be recovered, is the same as part of the subject-matter in the former action. The question is whether the cause of action,' that is, the question of right involved in the two actions, is identical. They appear to me to be essentially different. In the one case it is the failure of the defendants to meet their notes; in the other it is their failure to pay a balance claimed by the plaintiff on certain complicated loan transactions."

Where a bill or note is given by way payment there is a strong presumption that the payment is conditional, so that the original debt revives if the note or bill is not realized.

THE facts are set out as follows by Wood Renton J.: -

The plaintiff-appellant sues the defendants-respondents for the recovery (1) of Rs. 11,526.23, with interest thereon at 9 per cent-from August 30, 1909, till payment in full; (2) of a sum of Rs. 771, being the balance of principal and interest thereon at date of suit, together with further interest on the principal sum at 9 per cent, from August 30, 1909, till payment in full. The appellant, who is a money lender and trader carrying on business under the vilasam of S. S. P., alleged that the respondents were partners, and that the first defendant-respondent was also, between December 14, 1905,

6-J. N. A 99413 (8/50)

and June 15, 1909, his agent and the manager of his business in Ceylon during his absence in India. During that period the second defendant-respondent was a member of the firm of M. S. P. The appellant, on his return from India in 1909, examined the accounts of the first defendant-respondent, and found, as he alleged in his plaint, in the first place, that the first defendant-respondent had discounted a large number of promissory notes at the banks for the firms of M. S. P. and S. S. P., which had not been entered in his books, and the profits of which had not been credited to him; and in the next place, that the first defendant-respondent had had transactions with the firms of M. S. P., S. S. P., and M. K. P. B., with whom the appellant had forbidden him to have any business dealings as his agent. The appellant threatened to prosecute the respondents criminally. The respondents thereupon approached two leading members of the Chetty community, Ramanathan Chetty and Muttu Ramen Chetty, and induced them to arbitrate, and if possible to settle the disputes, between the parties. The appellant consented to their doing so. The arbitrators examined the parties and their accounts, and on August 30, 1909, a settlement was drawn up and signed by both respondents, whose signatures were attested by those of the arbitrators. The arbitrators found

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