1933 Present: Drieberg J. and de Silva A.J.

HAYLEY et al. v. NUGAWELA.

160-D. C. (Inty.) Kandy, 40,294

Trustee-Action on contract entered into as trustee-Personal libability- Decree entered against defendant as trustee-Right of defendant to compel judgment-creditor to levy execution against trust property-Trustee under Buddhist Temporalities Ordinance not a corporation.

Where a trustee contracts as trustee and judgment is entered against him as such, he is not entitled to compel the judgment-creditor, who seeks to execute the judgment against him personally, to levy execution instead on the trust property.

The mere use of the words " as trustee " in a contract is not sufficient to execute personal liability.

A trustee appointed under the Buddhist Temporalities Ordinance is not a corporation.

THIS was an action to recover the value of cement delivered to the defendent on a contract entered into by him as the Diyawadana Nilame and Trustee of the Dalada Maligawa. The action was not defended and judgment was entered against the defendant on March 3,

1931. In the caption of the plaint the defendant was described as the Diyawadana Nilame, and Trustee of the Maligawa, and in the first paragraph of the plaint, it was expressly averred that he was sued in that capacity, and he was so described in the decree.

On March 26, 1931, the plaintiffs-appellants issued writ and the Fiscal reported that the defendant was possessed of no property. Thereafter the plaintiffs re-issued writ on serveral occasions and seized the defendant's allowance as member of the State Council.

On May 25, 1932, the defendant moved that the prohibitory notice or the seizure of his salary be recalled and the plaintiffs be directed not to proceed against the defendant in his personal capacity. The learned District Judge allowed the motion and the plaintiffs appealed from the order.

Choksy (with him D. W. Fernando), for plaintiffs, appellants.-In law a trustee cannot sue or be sued in his capacity as trustee. He has not a representative capacity like that of an executor or administrator. He is not an agent of the trust. He is personally liable, although he has a right of indeminity against the trust property, for expenses incurred in the bona fide execution of this trust. (Maraliya v. Gunasekera 1[ (1921) 23 N. L. R. 261.])

A creditor of a trustee has no direct right to claim payment out of the trust estate even though the debt was incurred in the execution of the trust. He has firstly the personal liability of the trustee that arises from the general principle of contract, and secondly the equitable right of being put in the place of trustee against the assets of the trust. (In re Johnson : Shearman v. Robinson 2[L. R. 15 Ch. Div. 548])

A trustee cannot contract so as to exclude personal liability. (Muir v. City of Glasgow Bank 3[(1879) 4 A. C. 337], Watliny v. Lewis 4[(1911) 1 Ch. 414. ], Williams v. Hathaway 5[ 6 Ch. Div. 544.], Farhall v. Farhall 6[(1877) L. R. 7 Ch App. 123.]) He may by contracting in adequate language limit his personal liability to the extent to which he has a right of recourse to the trust property. (Muir v. City of Glasgow Bank (supra), Gordon v. Campbell 7[1 Bell's App. 428.].

The trustee of a Buddhist temporality is not a corporation. Where the Legislature intends to make a trustee a corporation with power to contract as such, it makes express provision for it. In the Co-operative Societies Ordinance, 1921, section 17, and the Nuwara Eliya Board of Improvement Amendment Ordinance, 1921, section 4, the Legislature has expressly made the trustee a corporation.

H. V. Perera (with him Ranawake), for defendant, respondent.-The trustee of a Buddhist temporality is a corporation. It is a creature of statute with all the attributes of a corporation-perpetual succession, power to sue, and the liability to be sued in the name of trustee (8 Halsbury s. 164).