Avichchy Chettiar V. Perera

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

AVICHCHY CHETTIAR v. PERERA.

56-D. C. Negombo, 9,776.

Appeal-Failure to add necessary parties as respondents-Exercise of Supreme Court's discretion-Civil Procedure Code, s. 770.

The plaintiff sued the first defendant-respondent to recover a certain sum of money by way of principal and interest due on a mortgage bond and joined the second and third defendants as parties, who held subsequent incumbrances over the property mortgaged.

Judgment was entered in favour of the plaintiff for an amount less than that claimed by him and the plaintiff appealed, the first defendant alone being made respondent.

Held, that it could not have been obvious to the appellant that the second and third defendants were necessary parties to determine the amount payable to the first defendant, although their rights would have been affected if the appeal was allowed; and that the Supreme Court should exercise its discretion under section 770 of the Civil Procedure Code, and give leave to the appellant to add the second and third defendants as parties.

APPEAL from a judgment of the District Judge of Negombo.

L. A. Rajapakse, for plaintiff, appellant.

D. W. Fernando, for first defendant, respondent.

Cur. adv. vult.

December 15, 1937. FERNANDO A. J. -

Counsel for the respondent has taken the preliminary point that this appeal is not properly constituted, inasmuch as the second and third defendants who are also necessary parties to this appeal have not been made respondents. The plaintiff appellant claimed a sum of Rs. 622.30 as principal and interest due to him from the first defendant on a mortgage bond executed by him on April 26, 1929. In paragraph 3 of the plaint, he stated that the first defendant had paid a sum of Rs. 488.95 on the bond, and had thereafter failed to pay any sum to the plaintiff. The first defendant filed an affidavit in which he stated that he had paid Rs. 782.32 on account of the bond, and not Rs. 488.95 as mentioned by the plaintiff.

It will be noted that the bond provided for the payment of the principal sum of Rs. 80010 with a further sum of Rs. 480. 06 as interest for six years by 36 instalments, each of Rs. 35.56. The learned District Judge held that as the first defendant had paid 22 instalments up to June 22, 1933, the plaintiff was not entitled to anything more than the balance principal and interest due thereon from December 22, 1932, and entered judgment accordingly for Rs. 311.15 as balance principal and for interest up to December 22, 1932, on the rate stipulated in the bond, and thereafter interest at the rate of 9 per cent, on the aggregate amount till payment in full.

Now the second and third defendants were made parties to the action because they held subsequent encumbrances over the mortgaged property. The second and 3rd defendants filed no answer and did not appear at the trial. The decree that was entered ordered the first defendant to pay the sums fixed by the learned District Judge by certain instalments fixed by the Court, and that in default of payment of any instalments on the due date an order to sell do issue in respect of the mortgaged property.

There is no reference in the decree to the second and third defendants, but as they have been made parties to the action in the District Court, it cannot be doubted that the second and third defendants are themselves bound by the decree, and their rights on the encumbrances in their favour must be subject to that decree. In this appeal, the plaintiff appellant contends that he is entitled to have judgment entered for the sum prayed for by him, and the second and third defendants will no doubt be affected prejudicially if the appeal is allowed, inasmuch as their rights either to pay the amount decreed to the plaintiff-appellant or to claim any balance that may exist after the property is sold, and the plaintiff's claim

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