Ammal Et Al. V. Ibrahim Et Al.,

1937   Present: Moseley J. and Fernando A.J.

AMMAL et al. v. IBRAHIM et al.

 287-D. C. Nuwara Eliya, 1,589.

Partnership-Immovable property purchased by seven partners-Death of one Partner-Devolution of property-Assets of partnership-Beneficial interest-Ordinance No. 22 of 1866.

Where immovable property was purchased by seven persons, who were trading in partnership, the legal title to the property vested in the grantees and, on the death of one of them, the title to his share passed to his heirs.

Held further, that under the conveyance no beneficial title vested in the partnership as such so as to enable the surviving partners to deal with the entire property.

Madar Saibo v. Sirajudeen ( 17 N. L. R. 97) referred to,

THIS was an action for the partition of a land and buildings in the town of Nuwara Eliya. The land in question was purchased by seven persons, who were trading in partnership, one of whom was

P. Ibrahim Saibo. Ibrahim Saibo having died intestate, his interest in the property devolved on the first plaintiff his widow and his children the second and third plaintiffs. The defendants contended that the beneficial interest in the property vested in the various partnerships that from time to time carried on the business of K. Abraham Saibo & Co. The learned District Judge held that the property formed part of the assets of the partnership and, that, after the death of Ibrahim Saibo, the contesting defendants had acquired a good title from the ' surviving partners.

Rajapakse (with him M. J. Molligoda and M. Mahroof), for plaintiff, appellants.-Legal title is admittedly in the plaintiffs. The question is in whom was the beneficial title ? Contestants say it was in the partnership and it devolved on another partnership without any conveyance. But a partnership in our law, as in the English law, is not a legal persona, and has no legal existence outside the individual members constituting it, and therefore it cannot possess rights such as a beneficial title. See Letchemanan v. Sanmugam[18 N.L.R.121at. p. 124].; Suppiah v. Paliahpillai[2 14N.L.R. 392.]; Landley (1924 ed.), pp. 4, 5, 150, 151, 153, 165. Legal rights can be acquired only by a person who is known to the law.

Ordinance No. 22 of 1866 introduced the English law of partnership into Ceylon, but this is subject to the proviso that the English law of tenure or conveyance or succession to immovable property is not introduced. Under the English law if one partner buys property with partnership assets, it enures to the benefit of the other partners, but in Ceylon it can give rise to an implied trust only. In Ceylon Ordinance No. 7 of 1840 is applicable. See Madar Saibo v. Sirajudeen[317 N.L.R. 97]; Silva v. Silva [4 5 C W R 13] sections 20, 22, 38 of the Partnership Act; Lindley p. 973.

The conduct also of the parties indicates that the legal and equitable title vested in the grantees, e.g., administration of estates, shares inventoried and conveyances effected.

The asset, viz., the land cannot pass from one partnership to another without a conveyance. The second partnership was different from the first, and the third from the second, because the partners in each were not the same. Until the land was conveyed by a deed to the second partnership, it remained the property of the partners of the first partnership. Adamaly v. Asiya Umma[5 2Times of Ceylon L. R 223] relied on by the District Judge only decided that the death of a partner terminates the partnership. The other portion is obiter.

First plaintiff is an illiterate widow still in India, the other plaintiffs were minors, and prescription has not run against any of them. The premises were sold fraudulently by the last surviving partners to four of themselves.

In the earlier case the eighth defendant said there were no books of account. The present books should be rejected. They are fabricated ad hoc.

H. V. Perera (with him C

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