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IRAGUNATHER et al. v. AMMAL
NLR40V549
1937 Present:
Moseley J. and Fernando A. J.
IRAGUNATHER et. al. v. AMMAL.
110-D. C. Jaffna, 9518.
Executor-Power to incur debt
for purposes of administration-Liability of estate.
An executor has power to contract a debt for purposes of administration in such
a manner as to exclude personal liability; and when he has done so, the estate
is liable to pay the debt.
Fernando v. Muncherjee (5 S. C. C. 141) referred to.
APPEAL
from a judgment of the District Judge of Jaffna.
S. J. V. Chelvanayagam (with him Muthucumaru), for plaintiff,,
appellant.
S. Natesan for defendant, respondent.
Cur. adv. vult.
October 20, 1937. FERNANDO A.
J. -
The main question that arises on this appeal is whether the defendant who has
now been appointed administratrix of the estate of K. Ambalavanar is liable on
the promissory note signed by the executor of that estate in whose place she has
been substituted some time after the date of the note. This issue of law was
raised at the trial and is numbered 3, and the argument of Counsel for the
respondent was to the effect that the only person liable on the promissory note
was the executor Appasamy himself. The note P 1 has been signed by Appasamy ?as
executor of the estate of K. Ambalavanar for the purposes of the testamentary
expenses". There-are-some observations made by the learned District Judge with
regard to the words as ?executor, &c.?, which he thought had been added some
time after the note was signed, . but Counsel for the respondent frankly
admitted that he was not in a position to support the Learned District Judge's
opinion on this point, and on certain references made by him.
Appasamy himself gave evidence
and stated that he had to borrow money for the purpose of managing the estate of
the deceased and that in the course of his administration, he borrowed this
money for the purposes of supplying stamps in the testamentary proceedings, for
the expenses of Thudaiman estate and for the purposes of administration. There
was no evidence led for the respondent and I do not think there was any material
to support the observations of the learned Judge, some of which he admits are
based on mere surmises, or to enable him to hold that in fact the money had not
been borrowed for the purposes of administration.
It was not denied that under our law, ?an executor may raise money by a sale or
a mortgage of the property belonging to the estate or even by the pledge of
assets?. (See Fernando v. Muncherjee
1)
If an executor has that power, I do not think it is possible to deny that he
also has the power to borrow the money on a promissory note for the purposes of
administration and the only question is whether in such a case it is open to him
to borrow that money as executor, that is to say, in such manner as to make the
estate liable for the repayment of that money, or whether even in a case where,
as here, he executes a promissory note as executor of the estate, he
nevertheless remains personally liable for the money.
The question whether a trustee can incur a liability in such a manner as to
enable the creditor to claim payment out of the trust estate was considered in
Hayley v. Nugawela 2,
Drieberg J. in the course of his judgment cites a portion of the judgment of
Bertram C. J. in Maraliya v. Goonasekera 3,
where Bertram C. J. differentiates the position of a trustee from that of an
executor or administrator, and states that a trustee is personally liable on a
bond executed by him and adds, ?The law knows nothing of the idea of a trustee
suing or being sued in his capacity of trustee. He has not a representative
capacity like that of executor or administrator". Drieberg J. then refers to
certain English decisions on the question whether a trustee by describing
himself as such can exclude his personal liability. Referring to the case of
Muir v. Glasgow Bank
4
he refers to the observation of Lord
Cairns that t
