Kadappa Chettiar V. Ramanayake Et Al.,

1936 Present : Abrahams C.J. and Dalton S.P.J.

KADAPPA CHETTIAR v. RAMANAYAKE et al.

289-D. C. Colombo, 49,485.

Mortgage action-Action on mortgage bond against mortgagor-Failure to join secondary mortgagee and transferee-Subsequent action against them- Ordinance No. 21 of 1927, s. 16.

Where a mortgagee, in an action against the mortgagor on the mortgage bond, failed to make a secondary mortgagee and a subsequent transferee of the property parties thereto, he is not debarred from bringing another action to have the property bound and executable as against them.

THIS was an action brought against the three defendants on a mortgage bond No. 1,101 for Rs. 40,000 executed by first defendant in favour of the plaintiff. On February 24, 1931, the first defendant executed a secondary mortgage in favour of the second defendant and on March 10, 1931, executed a conveyance of the property to his wife, the third defendant. Plaintiff, who was unaware of the secondary mortgage and the conveyance, instituted action No. 46,335 in the District Court of Colombo on the bond against the first defendant. Judgment was entered in favour of the plaintiff and mortgage decree entered in the usual terms. Plaintiff took no further steps on the decree. He then instituted the present action making the mortgagor, the secondary mortgagee, and the transferee defendants to realize the mortgage and to have the property bound and executable against the second and third defendants.

The learned District Judge held that as the second and third defendants, who were necessary parties to the previous action under the provision of Ordinance No. 21 of 1927, were not made parties to that action, plaintiff could not maintain a second action against them.

H. V. Perera (with him F. A. Tisseverasinghe), for plaintiff, appellant. The object of the Mortgage Ordinance of 1927 was to re-introduce the Roman-Dutch law of mortgage. Section 16 gives the mortgagee the right to bring a separate action in respect of each of his remedies. Under the Koman-Dutch law the mortgagee was not limited to one hypothecary action Sinnaya Chittyar v. Babanis[1 (1882) Wendt 213. ] and Arumogam v. Velupillai [2   8 S. C. C. 97.]), The restriction was made by section 34 of the Civil Procedure Code which provided that a plaintiff should sue for all his remedies in one action. That section has been repealed by section 16 of the Mortgage Ordinance. Even under the Code there was a conflict of judicial opinion as to whether a second hypothecary action could be brought [3 16 N. L. R. 463.]. The matter was settled by a Full Bench (Supramaniam Chetty v. Weerasekere [4 20 N. L. R. 170.]), which held that only one action could be brought. That decision has been subsequently disapproved of in Moraes v. Nallan Chetty [ 5 24 N. L. R. 297 at 302.]. The new Mortgage Ordinance gave effect to the suggestion of Bertram C.J. in this case. See also Suppiah v. Sinniah [ 6 25 N. L. R. 383.] and Ramanathan v. Perera [7 31 N. L. R. 304.] .

The first action in this case was only in form a hypothecary action. It was not so in fact because the mortgagor had parted with his title. Second and third defendants were no parties to that action. No plea of res judicata is available to them. Necessary party in section 6 of the mortgage does not mean an essential party. The first action was maintainable without them.

E. B. Wikramanayake (with him M. T. de S. Amarasekera), for second and third defendants, respondents. It is true that a necessary party in section 6 is not an essential party. But he is a party necessary if the plaintiff wants a decree that binds him. If he is not made a party no further remedy is available against him. A mortgagee cannot bring more than one hypothecary action. The object of the Mortgage Ordinance is to achieve finality (Subasinghe v. Palaniappapillai[1 35 N. L. R. 289 at 291. ]). Under the Common law a pu

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