1916 Present: De Sampayo J.

SIYATU v. BANDA.

113-C. R. Gampola, 2,144.

Lease executed for defrauding creditors-Action by lessor against lessee to obtain declaration that lease was void-May lessor bring an action to cancel deed if the illegal purpose is carried out fully or in part?-Prescription.

A executed, in 1901, a deed of lease of his land in favour of B for 99 years. B granted a sub-lease to C in 1912 for four years. A brought this action in 1915 for a declaration that both the leases were null and void, and alleged that he executed the lease without consideration in favour of B to defraud D, a creditor of his, who lent him (A) Rs. 500 on a mortgage of the land in 1903, and that he was all along in possession, in spite of the lease, till C disturbed his possession in 1913.

Held, that the action was not barred by the Prescription Ordinance, 1871.

" The cause of action in such cases as this is not the execution of the deed, but any act on the part of one party contravening the original intention, and interfering with the rights of the other."

Held, further, on the facts, that A had not executed the lease in favour of B for defrauding D, but that if there was any fraudulent intent the fraud was not carried out, as D had succeeded in  recovering his money.

THE facts are set out in the judgment.

Bawa, K.C., for plaintiff, appellant.

Bartholomeusz, for defendants, respondents.

June 13, 1916. DE SAMPAYO J.-

This is an action in which the plaintiff seeks to have two deeds declared null and void, and to be quieted in possession of certain lands. The first of these deeds is No. 5,951, dated March 25, 1901, by which the plaintiff leased his half share of the lands for 99 years to the first defendant and one Alweera Mudianselage Dingiri Banda and the second of them is No. 2,868, dated July 27, 1912, by which the first defendant granted a sub-lease of his interest in the lands to the second defendant for a term of four years. The consideration for the deed No. 5,951 is a sum of Rs. 500, acknowledged to have been received in advance as rent for the whole period. But the plaintiff's case is that there was, in fact, no consideration whatever, and that the deed was executed by him in order to defraud his

creditor, one Beale, conductor, who lent him Rs. 500 on a mortgage of the same lands on September 10, 1903. He says, and has called  witnesses to prove, that he has been in possession of the lands all  along, notwithstanding the lease; and he further refers, as showing the true character of the transaction, to the fact that the first defendant's co-lessee, Dingiri Banda, by deed No. 1,347, dated February 5, 1912, assigned his interest to the plaintiff's daughter Tikiri Menika, who in July following assigned the same to the plaintiff. One more fact that may be mentioned in this connection is, that the second defendant, on the strength of his sub-lease from the first defendant, attempted to disturb plaintiff's possession by cutting the crop of one of the fields in 1913, and was prosecuted for criminal trespass and convicted. The plaintiff says that he only then came to know of the sub-lease, and that it was the first intimation to him that the first defendant intended to set up any claim on the basis of the old lease. That incident is the proximate cause of the present action.

I may at once dispose of the plea raised by the defendants that the plaintiff's action is barred by limitation, inasmuch as more than three years have elapsed since the date of the lease. The action no doubt conies under section 11 of the Ordinance No. 22 of 1871, and the period of prescription is three years from the time of the accrual of the cause of action. But the cause of action in such cases as this is not the execution of the deed, but some act on the part of one party contravening the original intention and interfering with the rights of the other: Senaratne v. Jane Nona.1[(1