Wanigasuriya V. Hinduma Co-Operative Society Et Al.,

1949 Present . Jayetileke S. P. J. and Canekeratne J.

WANIGASURIYA, Appellant, and HINIDUMA CO-OPERATIVE SOCIETY et al., Respondents

S. C. 4-D. C. Galle X 412

Civil Procedure Code-Execution of mortgage bond by surety as security for manager of Co-operative store-Dispute-Arbitration-Award-Seizure of property hypothecated-Section 348-Not applicable.

The appellant executed a mortgage bond as security for the due performance by the 2nd respondent of his duties as manager of a Co-operative store. A dispute between the 1st and 2nd respondents ' was referred to arbitration under the Co-operative Societies Ordinance and an award was made against the 2nd respondent. Writ issued but was returned to Court. Thereafter the 1st respondent moved for a notice on the 2nd respondent in terms of section 348 of the Civil Procedure Code to show cause why the property hypothecated should not be sold.

Held, that section 348 of the Civil Procedure Code did not apply. That section applied only where a liability was incurred as surety for the performance of the decree after the institution of the action and before the entering of the decree.

APPEAL, from a judgment of the District Judge, Galle.

 H. W. Jayawardene, for the appellant.

Cyril E. S. Perera, with E. A. G. de Silva, for the respondents.

Cur. adv. vult.

June 3, 1949. JAYETILEKE S.P.J.-

The 1st respondent engaged the 2nd respondent to manage its business and the appellant executed a mortgage bond in favour of the 1st respondent for Rs. 1,000 by which he made himself liable as surety for the due performance by the 2nd respondent of his duties as manager. A dispute arose between the 1st respondent and the 2nd respondent in regard to a sum of Rs. 764.49 and the said dispute was referred to arbitration under rule 29 of the rules framed under the Co-operative Societies Ordinance, No. 34 of 1921. On January 23, 1945, the arbitrator made his award by which he awarded to the 1st respondent the amount claimed, to writ Rs. 764.49. The 2nd respondent failed to pay the said sum to the 1st respondent whereupon the latter filed the award in the District Court of Colombo on January 4, 1946, and applied for a writ against the 1st respondent in this action. The application was allowed and the fiscal seized certain property belonging to the 1st respondent. On August 24, 1946, the Fiscal returned the writ to Court on the ground that the 1st respondent failed to pay the charges necessary for advertising the sale in the Gazette. On May 19, 1947, the 1st respondent moved for a notice on the appellant to show cause why the property hypothecated by him should not be sold. The appellant opposed the application on the ground that section 348 of the Civil Procedure Code on which the 1st respondent relied did not apply to a case like the present. That section reads-

" Whenever a person has, before the passing of a decree in an original suit, become liable as surety for the performance of the same or of any part thereof, the decree may be executed against him to the extent to which he has rendered himself liable in the same manner as a decree may be executed against a defendant :

Provided that such notice in writing as the court in each case thinks sufficient has been given to the surety ".

The language of the section is very clear. It refers to a liability incurred by a person as surety for the performance of the decree after the institution of the action and before the entering of the decree. In the old Code of Civil Procedure of India [ Code of Civil Procedure of India. Act XIV of 1882 s. 253.] there is a section which corresponds with section 348 of our Code. It reads-

" Whenever a person has, before the passing of a decree in an original suit, become liable as surety for the performance of the same or of any part thereof, the decree may be executed against him to the extent to which he has rendered him

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