Valliappa Chettiar V. Visuvanathan

1961 Present: Weerasooriya, J., and H. N. G. Fernando, J.

VALLIAPPA CHETTIAR, Appellant, and VISUVANATHAN,
Respondent

S. C. 92 (Inty.) with S. C. 409 (F) D. C. Chavakachcheri, 1767

Liquid claim-Summary procedure-Prima facie defence, an regards a part only of claim-Appropriate order an to leave to appear and defend-Civil Procedure Code, s. 704 (2).

In an action by way of summary procedure for the recovery of Rs. 25,200 upon three cheques X, Y and Z, each for Rs. 8,400, the defendant applied for leave to appear and defend unconditionally. There was no admission of any liability by the defendant. The Court was of opinion that the defendant had no prima facie defence is respect of cheques X and Y but that the defence in respect of cheque Z was prima facie sustainable.

Held, that the defendant should be allowed to file answer unconditionally as against the claim on cheque Z only. In respect of the other two cheques, an order to give security as a condition of his being allowed to appear and defend was valid. As the defendant failed to furnish security in respect of the claims on cheques X and Y, the entering up of the judgment for those claims should be deferred until adjudication upon the claim on cheque Z.

                                   Issadeen & Co., Ltd. v. Wimalasuriya (62 N. L. R. 299) distinguished.

     APPEAL from a judgment of the District Court, Chavakachcheri.

                  C. Ranganathan, with S. C. Crossette-Thambiah, for defendant-appellant.

                   E. B. Wikramanayake, Q.C., with S. Sharvananda, for plaintiff-respondent.

Cur. adv. vult.

September 22,1961. WEERASOORIYA, J.-

This is an action by way of summary procedure for the recovery of Rs. 25,200 with legal interest and costs, on three causes of action based on three cheques issued by the defendant-appellant in favour of the plaintiff-respondent, each for Rs. 8,400, and filed with the plaint as X, Y and Z.

The appellant applied for leave to appear and defend the action unconditionally. After inquiry the District Judge made order on the 22nd June, 1959, permitting him to file answer only on his furnishing,

on or before the 21st July, 1959, security in Rs. 16,000 cash or Rs. 20,000 in immovable property. Appeal No. 92 is the interlocutory appeal filed by the appellant against this order. As he failed to furnish the required security, judgment was subsequently entered against him as prayed for. Appeal No. 409 is from this judgment and the decree entered in accordance therewith.

Section 704 (2) in Chapter L III of the Civil Procedure Code provides that the defendant " shall not be required, as a condition of his being allowed to appear and defend, to pay into court the sum mentioned in the summons, or to give security therefor, unless the court thinks his defence not to be prima facie sustainable, or feels reasonable doubt as to its good faith." The order of the learned District Judge dated the 22nd June, 1959, appears to have proceeded on the basis that the appellant had no prima facie sustainable defence on the first and second causes of action, which are based on cheques X and Y. In our opinion, too, no prima facie sustainable defence is disclosed on these causes of action.

Cheque Z has been specially indorsed by the plaintiff in favour of a company styled The United Tractor and Equipment, Ltd., which is not a party to this action. One of the defences taken to the claim on this cheque is that the United Tractor and Equipment, Ltd., as the indorsee to whom or whose order the cheque is payable, is the " holder " thereof as defined in section 2 of the Bills of Exchange Ordinance (Cap. 68) and, therefore, the proper party to sue on it, and not the plaintiff. As there is no averment in the plaint or in the supporting affidavit filed by the plaintiff that, subsequent to the indorsement, the United Tractor and Equipment, Ltd. had transferred back the cheq

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